This article refers to the sync status for Xero found under the Xero sync settings. We'll look at each status and what it does for a bill/expense and invoice/income. In short it changes the area in Xero that the item lands in and what the next steps are.
NOTE: The settings here control both bill/expenses and invoices/income together you cannot select different settings for each.
The item will land in the draft folder in Xero and the next step is approving the draft.
The item will land in the awaiting approval section in Xero and the next step is to approve.
The item will land pre-approved in the awaiting payment area, the next step is payment or reconciliation.