MYOB vs Xero – Choose Carefully
The choice of financial accounting software is never more important than it is today, with varied options marketed that often have misleading information to get you hooked, yet will cost you more going forward once established in that software. MYOB and Xero are the biggest, and one can cost you much more than the other in your near future.
MYOB is the industry leader for accounting software, and their cloud software is now equal to Xero for performance, functionality and ease of use. Xero performs for the individual / small business that doesn’t engage in professional bookkeeping. In our opinion, MYOB surpasses Xero as it contains no limitations for use or compliance.
So if both are feature rich and easy to use, why do NJM&Co recommend MYOB?
There are several reasons that impact a business, usually unbeknownst to the Xero licensee. Whilst we readily use Xero for some clients who took themselves in that direction, those same licensees did not know or understand the hidden, important, problems.
There is nothing wrong with cloud computing. Whether MYOB or Xero, all online services have issues, they have scheduled maintenance and unscheduled issues. Take a look for yourself, Xero’s status history page.
The problem is that with Xero, all data recording and access stops during their down times. There is no scope to work with your file offline as Xero maintain control of your data file and never relinquish that right.
You own the data (providing you’re the subscriber), but you do not own the file your data is stored within. Perplexing, ha?
Whilst this isn’t a huge issue (we’re all used to Internet and website issues nowadays), this leads us into a bigger problem – backup.
Xero control your file, in totality, with no scope for external backup. You can download record by record, individually, but that’s it. File corruption occurs, that corruption goes into backup files, and files become unusable or partially corrupt, requiring weeks / months / years of data re-entry. It happens with all software.
You must maintain copies of all Data inputted into the Service. Xero adheres to its best practice policies and procedures to prevent data loss, including a daily system data back-up regime, but does not make any guarantees that there will be no loss of Data. Xero expressly excludes liability for any loss of Data no matter how caused.
There is nothing wrong with those terms, they’re covering their backside. Just good business. Again… software does weird and wonderful things at times, outside of human control. The difference is that with MYOB you can backup your online file to your local computer after each use, or any time you choose. You own the data and file.
This means that if, or when, corruption occurs, you have a healthy version of your file. More important, you only lose the data between your last days backup and the corruption, not your entire data history.
Imagine losing months or years of your business data? Xero make that scenario a likely reality.
Even if you could backup your file, what if Xero closed their doors and went into receivership?
Xero legal terms basically say that if they close their doors, shut down their service, then so be it. Tough for you and your data. If you had a backup, you can’t do anything with it, as there is no software to put it within, nor subsequent service to import the data file.
Xero do not promote redundancy for their services use. MYOB, Intuit, so forth, they have redundancy in the event of failures, so you, the business owner, do not unduely suffer consequences of their business actions.
Xero allow other accounting data files to be imported into their service, but once there, they own you for the duration you want access to that data.
Whilst professional partners for both MYOB and Xero have a level of ownership to their license allocations, and must use professional discretion to ensure the right thing is always done by their clients, Xero add an additional level of disturbance to who owns what. MYOB and other main players, do not legally do this with their involvement.
Whilst there are always companies who may abuse ownership rights, Xero make it legally impossible to get your file back, refusing to bypass the subscriber ownership rights. This means that if your accountant or bookkeeper setup your file under their professional license, they can use your file hostage as they deem fit, if needed. An interesting case study.
Now don’t get me wrong, professional partners for both MYOB and Xero have rights to the license, but Xero legally refuse to change the subscriber rights IAW their legal terms.
if there is any dispute between a Subscriber and an Invited User regarding access to any organisation or Service, the Subscriber shall decide what access or level of access to the relevant Data or Service that Invited User shall have, if any.
It’s one thing to hold a file until payment is made, it’s another to have the right to keep that file forever and refuse to give the business owners data to them.
Xero introduce complexities that NJM&Co are not willing to endorse. If Xero change their stance in the future, then our recommendation will change accordingly.
It would be nice if they started with an entire file backup. This would allow a user to move companies if they chose as others would create import structures, whilst allowing the user to ensure their data integrity via offsite backup.