Once DEAR Inventory and Xero are connected, DEAR Inventory becomes the central point of all inventory management within your business. This means that all inventory-related purchases, sales, and manufacturing will be performed in DEAR Inventory and then synchronized over to Xero.


NOTE: If necessary, you can easily switch between accounting apps, such as changing from Xero to QuickBooks Online. For more information, refer to the following topic:  http://support.dearsystems.com/support/solutions/articles/11000056864-switching-accounting-integrations

 

video tutorial is also available.


Proceed to the following sections below for more details:


Creating Accounts in Xero

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Before commencing the integration process, a number of accounts must be created in Xero. You need to verify that you have, at a minimum, the following accounts:

  • Accounts Receivable

  • Accounts Payable

  • Inventory

  • Supplies and Materials - COGS

  • Revenue Account 

  • Sales Tax Payable

Setting Up Your Chart of Accounts 

  1. Access your installation of Xero.
  2. Navigate to Settings, and click Chart of Accounts

The Chart of Accounts is loaded based on the industry that you specified when initially setting up Xero.


NOTE: You will need to add an Inventory and a COGS account to the ones already loaded into Xero if your existing accounts are not compatible with DEAR Inventory. This process is described below.


Setting Up Your Inventory Account 

  1. Click Add Account.

  2. Choose Current Asset from the Account Type drop-down menu.

  3. Type a code for the account into the Code field. 

  4. Type Inventory into the Name field.
  5. (optional) Type a description of the account in the Description field.

  6. Verify that the Tax setting for the account is correct.

    Your screen should appear similar to the one below.


  7. Click Save.

Setting Up Your COGs Account 

  1. Click Add Account

  2. Choose Direct Costs from the Account Type drop-down menu.

  3. Type a code for the account into the Code field.

  4. Type Cost of Goods Sold into the Name field.

  5. (optional) Type a description of the account in the Description field.

  6. Verify that the Tax setting for the account is correct.
  7. Click Save.


Completing the Signup Process 

Once you have added all the relevant accounts, access DEAR and complete the signup process, as described in the next section.


Connecting DEAR Inventory and Xero

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To connect DEAR Inventory and Xero: 

  1. When creating your DEAR Inventory account, select Xero as your accounting system.

  2. Once you receive an activation email from DEAR, click the link in the email. 

    You are redirected back to DEAR Inventory and asked to choose a password.

  3. From the Welcome screen, click the I don't need help option. 

    NOTE: The other options on this screen are described in other topics within this help system.

  4. From the left menu, click Integrations, then click the Xero option.




  5. From the Integration Settings screen, set the following options:
    • Xero Invoice Status. When credit notes and invoices (purchase invoices, sale invoices, and consolidated sales) are exported, this option determines what status will be set for new Xero invoices/credit notes. This status is then used when the item is exported as a DEAR document.

    • Xero Payments are. Set the direction for payment synchronization between DEAR and Xero. Payments can be synced both ways (from Xero to DEAR, and from DEAR to Xero) or only in one direction, as desired.

    • Export COGS. Allows you to enable or disable the exporting of cost of goods sold transactions.

    • Show journals on cash basis reports. When DEAR exports COGS and Manual Journals, this value is added to Xero’s Manual Journal record (ShowOnCashBasisReports property). 

    • Treat all Xero Contacts as Customers. If this option is enabled, customer and suppliers from Xero will be created as Customer in DEAR.

    • Category 1 and 2. These are tracking categories. When transactions are exported to Xero, additional tracking information can be included with these transactions (for example, you could add information about Sale Reps, Product Brand or Categories, Customer or Product attributes, etc.). For more details, see: https://central.xero.com/s/article/Set-up-tracking-categories. 
       
    • Load items from Xero. If this option is enabled, items (products) are loaded from Xero to DEAR. 

    • Load Invoices from Xero. Allows you to load purchase and sale invoices from Xero. Invoices are only loaded if they have not been loaded before. Sale invoice numbers must be unique in DEAR. Purchase invoice numbers must be unique for a particular supplier.

    • Auto-receive stock when loading purchase invoices from Xero. Determines if stock receiving is created when a purchase is imported from Xero, or if the purchase will be created without stock receiving, with the stock receiving being done manually.

    • Location to be used for purchases and sales loaded from Xero. The default location for sales and purchases imported from Xero.

    • Fulfilment mode when loading sales invoices from Xero. Determines the fulfillment status for imported sales. The following options are available: No Picking, Auto Pick, Auto Pick + Pack, and Auto Pick + Pack + Ship.

    • Export attachments to Xero. Allows you to export sale and purchase attachments (attached documents) to Xero.

    • Auto-synchronisation. Allows you to enable or disable auto-synchronisation with Xero. Auto-synchronisation automatically starts a sync process. You specify the start date and start time for the first sync, the sync frequency (2,  4, 8, 12, or 24 hours), and how any errors will be reported (email or internal messages).

  6. Click Save Changes.

  7. Click Sync Now.

  8. Log in to Xero, and click Allow access to let DEAR Inventory access your data.



    You are redirected back to the Xero Synchronisation screen.

     

  9. Follow the link to Account Mapping, and check that all your Xero accounts have been correctly mapped.

  10. If you receive a synchronisation error, check that all the accounts have been set up correctly in Xero. 


Now your accounts are synchronized between DEAR and Xero. You can continue to set up your ProductsSuppliers, and Customers


Using Xero Integration Settings

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Once your DEAR Inventory account is set up, you'll be able to locate the Xero Integration page by navigating to the Integration module and selecting Xero.


The Xero Integration page will contain the details of the integration in the page header and it explains the flow of data between DEAR Inventory and Xero.


Created in Xero, Sent to DEAR 

  • Chart of Accounts, Tax Rules, Payment Terms, and Addresses


Created in DEAR, Sent to Xero 

  • Bills or Purchase Invoices

  • Purchase Credit Notes

  • Sale Quotes/Estimates

  • Sale Invoices

  • Credit Memos and Sale Credit Notes

 

Can be created in both, Synced both ways

  • Bill/Sale/Purchase Payments or Refunds

  • Vendors/Suppliers

  • Customers

  • Products/Items  


Within the Xero Integration page, you are able to control whether your integration is enabled or disabled, and you can authorize your Xero connection. You can also choose whether payments are pushed to Xero or pulled from Xero (see more).


Configuring Consolidated Sales

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This setting turns on a condition for all consolidated sales invoices and credit notes to be exported into XERO. These consolidated documents are then exported to XERO during a manual or automatic synchronization process.


To configure consolidated sales in DEAR:

  1. From the left menu, click Integrations, then click the Xero option.
  2. On the Xero Integrations page, scroll down to the Consolidated Sales section, and turn on Consolidate Sales on Export.
  3. Click the View consolidated invoices and credit notes link to open the Consolidated Sales page.
  4. On the Consolidated Sales page, all consolidated sales and credit notes are listed.
  5. Look for a specific sales record using typing either of the following items in the Search bar at the top right of the page:
    • The record's document number in DEAR 
    • The consolidated number in Xero

TIP: You can click any of the column names on the page to automatically sort the sales records in ascending or descending number. If applicable, click the navigation buttons at the bottom to navigate between pages.


NOTES:  

  • The period for consolidation is always one day. Payments, Refunds and Customer Credits should be consolidated and added.

  • Void or Undo cannot be performed on consolidated invoices in DEAR since these operations will cause discrepancies in the exported data. You need to create a credit note or invoice to offset the sales you need to void or undo.


Performing Cost of Goods Sold Maintenance

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You can manually export COGS transactions, or void (recall) previous exports, for a specific time period using the options in the Cost of Goods Sold Maintenance section. Simply specify the time period you want to adjust (the selected dates are included in the time period), then click either the Export COGS to Xero or Void COGS in Xero button, depending on the action you're taking.

IMPORTANT: These features are for maintenance purposes only. Exporting is automatically performed daily.



Connecting to Another Xero Organisation

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If you decide to connect DEAR to a different Xero organisation, click the Change Organisation button.



To connect to another organisation:

  1. After you click the Change Organisation button and confirm the action, the Xero Connect Wizard appears, and the Welcome screen asks you if you want to keep your data in DEAR.


      
  2. Make a selection, and click the Continue button. The Xero connection screen appears.

  3. Use your credentials to establish a temporary connection with your new Xero account. 

  4. Once you connect to Xero, you need to map your current DEAR chart of accounts to the new Xero chart of accounts using the Mapping screen. This step is necessary because the chart of accounts and tax rules are going to be imported from your new Xero account to DEAR, and to use them they must be remapped.



  5. Click Continue. The Tax Mapping screen appears.



  6. Map your current DEAR tax rules to your new Xero account's tax rules.

  7. Click ContinueThe Confirmation screen appears.


      
  8. Review the information, and click Confirm.

    If the DEAR organisation does not have a connection to Xero, the following message appears.


      
  9. Click Connect

    NOTE: If the DEAR organization is connected to Quickbooks, you will need to disable the Quickbooks connection before enabling the Xero connection using the Connect to Xero button.



Disabling Your Xero Integration

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If you decide that you want to permanently remove the integration between DEAR and Xero, click the Disable Integration button, as shown below.



Exporting Data from DEAR to Xero

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You can export historical data from DEAR to Xero, which registers all documents and related items (products, vendors, customers, etc.). You might use this feature if you want to export all data to Xero for a particular date range. Simply select a start date and when click the Export Historical Data button, as shown below.