XBert finds GST errors and bookkeeping mistakes early to save you money

by XBert Team ~ 7 min read

Bookkeeping mistakes like typos, incorrect GST payments or transactions with a cancelled business can lead to big money losses. XBert analyses your Xero accounting data to find mistake money and keep it in your pocket.

Small businesses thrive on positive cash flow and knowing the financial numbers are right. Mistakes in your books, even a typo or incorrect GST payment, can lead to big money losses. Paying GST when you shouldn't or trading with cancelled companies are mistakes that can put your business at risk. XBert analyses your accounting data to find mistake money before it's gone for good.

It's just a little mistake, no biggie, right?

Wrong.

A typo may mean paying $360 rather than $340 or paying $12,000 and not the $1,200 you were charged! Even small bookkeeping mistakes have a flow-on effect and are a pain to fix. Sometimes it takes a long time to get any extra money paid back, or you may not get it back at all!

Typos and entry errors are one type of mistake money, i.e. money that is lost or could be lost, due to avoidable bookkeeping mistakes.

Inaccurate books create inaccurate reports; then you're making important decisions based on the wrong Income, Sales and Expense numbers.

There's also mistake money associated with GST claims and payments, Australian Business Number (ABN) discrepancies and trading with unregistered or cancelled businesses. Your supplier could be adding GST when they're not registered to charge it, the ABN provided may be invalid or you could be trading with unregistered businesses.

Mistakes like this cost your business, but there are also tax compliance implications. You could pay more money to the tax office than needed, or not pay enough and get hit with tax debt and fines.

If you submit an incorrect BAS or make incorrect GST claims, the ATO will chase you for the money, regardless of whether it was due to your mistake or your supplier's.

Bookkeeping and accounting are highly specialised fields. Tax compliance is complicated. You most likely work with a range of subcontractors and suppliers. Some are registered for GST, and others aren't. Some products and services attract GST, and some don't.

As the business owner, you are ultimately responsible for tax and legal compliance.

Whether you do the books yourself, have someone like a spouse or employee do them, or you hire a bookkeeper, XBert will help you spot the mistakes early.

XBert analyses your Xero accounting software and contact records and monitors the Australian Business Register to alert you to any cancelled businesses or issues with a business' GST staus and ABN.

ABR, GST, ABN, URGH!

Businesses can change their GST status or cancel their registration at any time. Without a valid ABN, you can't check if a supplier is registered to charge GST, know whether you're trading with a legitimate entity or if you need to pay withholding tax.

It's near impossible to keep track of all these changes to the ABR records. Nobody has the time or the staff to check your Xero contact records against the ABR for every bill raised or invoice sent.

Generally, ABN and GST checks are done when contacts are first entered into your accounting system and only updated when you or your bookkeeper get told something has changed. If you're not told, you may not find out until it's too late.

GST payments You could pay GST when you shouldn't then won't be able to claim that money back, or you don't pay GST when you should, and may end up with a tax debt or fine.

Imagine you've been working a supplier for several years. Behind-the-scenes your supplier's in trouble, and their revenue has dropped below the GST threshold. The supplier could forget to instruct their staff or bookkeeper to remove the GST from invoices, or they may be ripping you off.

The supplier's invoices continue to include GST even though they're not registered to charge it, but you're unaware of the change. The supplier's latest invoice to you is for $50,000 + GST. You pay, expecting to claim the $5,000 GST.

GST mistakes could be devastating to your cash flow and your business, especially when repeated. Tens of thousands of dollars of incorrectly claimed GST accrues. Then, the ATO demands you pay back two years' worth of GST credits you should never have claimed. You're left chasing the supplier to refund the overpayments.

Incorrect or invalid ABNs If you don't have the right ABN for your trading partner, you don't know if a company is registered and can't check their GST status. The ABN and business name should match the record on the ABR. Otherwise, you could be trading with someone who is not who they claim to be.

As an example, say your sales are going well and have been increasing for the last eight months. Now is an excellent time to purchase new equipment for your factory. You've done your research, know the model you want, have carefully calculated the return on investment and found the best purchase price of $28,000. Top stuff!

After just one month, the machine stops working. What a hassle, but luckily faults are covered by the warranty. You call the supplier but they don't answer. Your salesperson and the company have disappeared.

You discover the supplier wasn't registered and the ABN was trading with an ABN that belonged to another, unrelated company. Now you have a hefty repair bill as well as a red face!

If you do trade with someone that doesn't have a valid ABN you're exposing your business to increased risk or fraud and potentially damaging financial loss. There are also tax compliance implications. If an Australian supplier doesn't provide their ABN, you may need to withhold an amount (currently 47%) from their payment and send it to the ATO.

Unregistered and cancelled businesses Businesses can cancel their business registration at any time. So many things can go wrong when trading with unregistered businesses. Warranties may become worthless, and the business could vanish with jobs half-finished, shoddy work, or products not supplied. You're left out-of-pocket, and your reputation could get damaged.

You may think to confirm the ABNs and business registrations of new trading partners, but not existing ones. You could have previously dealt with a supplier whose now cancelled their business and are continuing to trade illegally, but you're not aware.

Perhaps you're owed money and after four weeks decide to chase the payment. You find out your customer went bankrupt and if you'd known earlier, you would have made that overdue invoice a priority and possibly been paid in full.

How can I minimise mistake money?

You can't run a business well without devoting the time, or money if you hire a professional, to keep your books and contact records updated and accurate. Poor bookkeeping leads to money loss, time loss to fix up messes, outdated and inaccurate reports, poor decision making, a greater chance of non-compliance and possibly business collapse. Depending on the size of your business and supplier and customer base, manually checking the ABR for changes could be a full-time job!

You expect your supplier or customer will do the right thing, but that is not always the case, and honest slips like typos and errors do get made often.

Discovering business risks early is how you can prevent losing mistake money, and ideally, those manual ABR, ABN and GST checks would be automated.

That's where XBert steps up.

XBert in action

XBert is a low-cost and easy to use Xero connected app powered by AI (artificial intelligence) and the latest advancements in data science to detect anomalies, human error and potential fraud in your accounting data.

XBert analyses Xero data hourly, automating many of the manual checks and audits for you, including monitoring the ABR for business registration, GST status and ABN changes.

Stay a step ahead as XBert alerts you to risks before you know the risks exist!

XBert is a tool built for collaboration. Business owners, business managers, finance teams, bookkeepers and accountants can work together and resolve risks early.

Bookkeepers, accountants and advisors can use XBert CONNECT to manage their process flows their way, streamline workflow and track clients easily and efficiently from the one dashboard. Invite your clients and assign them anything that requires their attention.

XBert Blog InPost Images MistakeMoney Alerts GST ABR

For example, you receive a risk alert (called XBerts) about a Payment to a supplier not registered for GST. Using a direct link to the relevant ABR record, you can confirm their GST staus, update your contact details in Xero and take action to correct any bills, invoices or outstanding transactions.

You can resolve the XBert alert yourself or assign a staff member, your bookkeeper or accountant to manage. You can also create and assign tasks to stay organised.

The types of mistake money related to GST, ABNs and business registrations that XBert finds are: Bill raised with a cancelled supplier

  • Expenses with a cancelled supplier
  • Payment to a cancelled supplier
  • Bill raised with a supplier not registered for GST
  • Payment to a supplier not registered for GST
  • Business has incorrect GST status
  • Large GST activity for a contact without an ABN
  • Incorrect ABN for business
  • Incorrect business name for ABN
  • Unpaid income with a cancelled business
  • Invoice raised with a cancelled customer

But wait, there's still more. XBert also detects potential duplicate bills, invoices and contact records, plus errors in account coding and transaction allocations.

Peace of mind and reducing business risks

Manage your cash flow and minimise money lost due to bookkeeping mistakes with XBert. You'll get alerts when a trading partner deregisters, or the GST status, ABN or company name doesn't match the ABR record.

XBert helps you turn mistakes into money, reduce financial risks to your business, save time and improves compliance. Our automated checks and audits mean you can spend more time on the things that matter most.

Your books and reports will be more accurate, and you can make more informed business decisions.

GST, ABN and business registration discrepancies are just some of the many risks XBert will find analysing your accounting data hourly. Using sophisticated algorithms, predictive analytics, and machine learning, XBert is there to detect business risks, saving you time and money.

If you're serious about business success, sync your accounting data with XBert. In minutes, you'll discover the amount of money at risk and how to prevent losing it. Book a demo or start your FREE 14-day trial now!

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