Growing Successful Kiwi Businesses with Conduit Bookkeeping and Syft

Conduit Bookkeeping is a bookkeeping practice established 4 years ago by Rachel Paterson in the resort tourist town of Paihia. Located in the far north of New Zealand, Paihia is considered to be the birth place of New Zealand.

Initially, Conduit Bookkeeping was only a part-time job for Rachel. However, within 12 months of running the practice, she transitioned to full-time. Conduit Bookkeeping now has 2 staff members: Rachel and Sonja. They use Xero as their accounting software and offer bookkeeping and payroll services alongside customized Xero Training, and software consulting.

I sat down with Rachel last month to discuss how Conduit Bookkeeping has evolved over time, and how Syft has been able to help them provide crucial insights to their clients.

Growing Alongside Growing Clients

Rachel is an experienced administrator and Certified Bookkeeper. Although Conduit Bookkeeping only officially started 4 years ago, Rachel has been helping businesses with their bookkeeping for much longer. Her first client approached her 8 years ago when his trades business started, and she has been providing him with bookkeeping services ever since. During this time, Rachel's client’s business has grown from a one man business to a much larger operation with two teams in two different locations, on two different islands.

Just as this client’s business has grown a lot, so have a lot of Rachel’s other clients’ businesses. And as clients began to get more sophisticated, the basic reports available in Xero were no longer sufficient. As Rachel explained, Xero reports have got the nuts and bolts but people wanted to see something more visual, especially her primary clientele - trades people.

“As my clients grew, their needs grew and so I needed more graphical representations, and I didn’t have time to sit down and do 4 or 5 hours of graphing from Excel every time.” Rachel Paterson, founder of Conduit Bookkeeping

Rachel was already building reports in Xero and using it “to its nth degree” but her clients needed something less numeric-focused and more easy to understand. That’s when she heard about Syft from another Syft certified advisor, Haley Wilson of My Two Cents Accounting. Rachel and Haley belong to the same bookkeeping business coaching group and are joint Northland Regional Directors for the Institute of Certified NZ Bookkeepers. After Haley told Rachel about Syft, she decided to try out the free version and send some sample reports to clients for feedback.

All her clients loved what they saw. Rachel found she could generate a really solid annual report on the free version of Syft, and, after her clients' positive feedback, she tried out other features as well. Conduit Bookkeeping quickly moved from the free plan to a paid one as Rachel discovered more useful features on the app.

Pulling out the weeds and drilling down into the data

In New Zealand, setting up a business is not too difficult to do. As Rachel says, there aren't many major prerequisites. This means that sometimes bookkeepers find themselves in the position of having to fix up over 2 years of reconciliations and bank record keeping! Trying to figure out what income businesses have had over the past 2 years is difficult enough, let alone what their expenses might be, or any sales tax and so on. With thousands of transactions to be reconciled, a lot of businesses get stuck in the weeds. Conduit Bookkeeping goes into the weeds and makes everything neat and tidy.

The average person doesn’t remember all the little purchases they made a year ago, 2 years ago, sometimes even last month… It’s good to be able to drill down beneath the numbers.

“That’s why I like Syft. It takes that nice clean data. There’s no recoding. You just refresh, let it run in the background, carry on with something else, and then come back in.” Rachel Paterson, founder of Conduit Bookkeeping

This has saved Conduit Bookkeeping a lot of time and hassle.

The Impact of COVID-19

As a resort town, Paihia used to have 50 - 60,000 visitors coming in on cruise ships every year. But without that traffic, businesses have suffered greatly. Conduit Bookkeeping has done a lot of pro-bono work to help businesses during the pandemic.

“I’ve been doing a lot of pro-bono work with the business network and being able to model and give them society accounts and management reports and things like that was very helpful. They were also really impressed with the quality of the data, the fact that it comes up with commentary and in most cases, I don’t have to edit it. It’s already self-explanatory. And for the client, it looks like you’ve taken some time to look at their numbers and give them a one liner and that’s really all they want to know.” Rachel Paterson, founder of Conduit Bookkeeping

The first lockdown was 9 weeks long. The impact of Auckland, the nearest major city being under lockdown cannot be overstated. No one could come north of Auckland to get to Paihia.

“We are like a little island all by ourselves. Business is pretty tough in our region at the moment. Whether it’s because there’s nobody here to buy things at the shop or because you can’t get materials from Auckland.” Rachel Paterson, founder of Conduit Bookkeeping

However, the New Zealand government has been incredibly supportive of businesses during the pandemic, offering wage subsidies, rental assistance payments, and small business loans with no interest. This has meant that people have become a lot more aware of needing to have accurate information. For any funding application, you are required to be able to provide accurate tracking of your revenue, and you have to know what your financial position is.

Now that so many businesses are required to know their financial standing for funding purposes, many have turned to online accounting packages. But to derive further insights from their accounting software, businesses need the help of a bookkeeper or accountant.

Moving into an Advisory Space

As Conduit Bookkeeping has grown, Rachel has been able to transition into a more advisory role, generating customized reports with Syft.

“This year, I’ve been doing a lot more work, and I’m moving more into an advisory role myself and my contractors have been doing more of the day-to-day bookkeeping. Syft has allowed me to provide additional skills in the advisory space and to look at things like cash flow forecasting and budgets for my clients.” Rachel Paterson, founder of Conduit Bookkeeping

These additional services have proved invaluable in the turbulent times of the COVID-19 pandemic.

Feature Highlights

Financial Health, Income vs. Expenses, and Cash Flow

One way in which Rachel helps her clients to better understand their data is by providing them with the Syft financial health report.

“The financial health report is very visual and very colorful, and they like that. It has the little red heart and green heart and shows you what the percentage is and you can see all the little red and green ticks next to different metrics. It’s great for clients because it’s a one-pager and they can see immediately where they are.” Rachel Paterson, founder of Conduit Bookkeeping

Rachel also finds it useful to look at Income vs. Expenses in conjunction with Cash Flow and Balance Sheet to help explain to clients how they can have made a profit but still not have any money in the bank.

Audit

Now that Rachel is moving into more of an advisory role, she spends time checking the data coming out and being coded by her staff and finds Syft’s Audit features to be very useful. Audit Anomalies helps detect anomalous accounts and transactions and is a lot more visual than a general ledger report. She’s also used Audit: Data to help conduct an audit.

Budgeting, Forecasting, and Break-Even

Rachel also finds Syft’s Budget and Forecasting features to be immensely helpful. Syft's forecasts save Rachel a lot of time and come out looking very professional, with the client’s logo and branding. The first time she tried creating a cash flow forecast on Syft, Rachel realized that the process was quick and easy. What would’ve taken about 5 hours to do on Excel, took a few minutes while she sat with her client.

Rachel also likes using the Syft Break-Even graph to give clients a clear visual sense of their break-even point and what operating profits could be achieved at different revenues.

Customization

Syft also enables Rachel to customize reports and show clients the information that they want to see. She then generates different reports for different clients.

Divisional Reporting

Rachel loves all the new features coming out. As she says, "When I’ve got it all covered, there’s a new function.” One of the new features that Rachel appreciates is divisional reporting.

Recently, Rachel had a client with 4 different divisions, and being able to do a tracking category multi-period report  to assess how the different divisions were doing was very helpful. She could see where her client was increasing staff but not income, for instance, which enabled her client to make important decisions at a divisional level. While her client instinctively had a feeling about which divisions were not fairing well, having the data in front of her to back it up, empowered her to make the decisions she needed to.

Additional Services Turn Into Additional Revenue

When I asked Rachel if she charges extra for the use of Syft, she said yes. Cash flow, budgeting, and other advisory services are charged at an hourly rate as these are not standard bookkeeping services, and these are all enabled by Syft.

Moving Forward With Management Reports From Syft

Thanks to the pandemic, and pandemic related funding applications, financial organizations in New Zealand are now accepting management reports. Syft’s reports look professional and financial organizations can see that they are not just coming straight out of accounting software which adds a level of professionalism to them.

“Syft definitely adds to the presence of my practice. We are a reputable company.” Rachel Paterson, founder of Conduit Bookkeeping

Rachel has enjoyed using Syft to deliver clear visuals to her clients and using the software to improve Conduit Bookkeeping’s reputation, and save time to move into a more advisory space. In her own words: "I love Syft. It’s a really cool product.” And we, at Syft, are really happy to be able to help Rachel and Conduit Bookkeeping provide the most value to their clients and help grow successful Kiwi businesses alongside them.