Business expense management can be a headache for SMEs, but it doesn’t have to be. Keeping track of business expenses and ensuring employees correctly record company credit card expenses is a fundamental element to ensure you remain compliant.
Our bookkeeping experts have provided some practical tips to streamline your expense management, keep your finances in check, and ensure you have employee-friendly processes in place.
Set Clear Policies and Guidelines
You need a formal expense policy that is straightforward and unambiguous. Make sure everyone in your team knows what’s covered and what’s not. Having clear rules in place ensures everyone is on the same page and helps avoid unnecessary spending and potential conflicts over expense claims.
Expense Management Tip 1:
Keep it simple. The simpler your policy, the easier it’ll be for your team to follow.
Use Expense Management Software
Holding onto old receipts in a shoe box is a thing of the past. There are plenty of software options out there to help you manage your expenses more efficiently. Tools like Dext, HubDoc or Expensify can automate the process, saving you time and reducing errors.
Expense Management Tip 2:
Automation makes the process faster and more accurate, freeing up your time for more important things.
Monitor Employee Spending
Keep an eye on your employee’s expense claims. This helps you spot any unusual activity or overspending quickly, so you can have a discussion or reiterate your company’s guidelines.
Real-time reports and analytics from your expense management software will make it easier to stay on top of your finances.
Expense Management Tip 3:
Set up alerts for any transactions above a certain amount. This can be a great way to keep tabs on significant expenses.
Implementing a Company Credit Card System
Company credit cards can simplify the tracking of business-related expenses. But they do come with their own set of advantages and challenges. Check out our article on managing company credit cards to learn more.
Expense Management Tip 4:
Store receipts digitally. Most expense software allows you to capture and store receipts easily, making audits a breeze.
Teach Your Team About Expense Management
Make sure your team knows how to use the expense management tools and are informed of any changes to policies or processes. Training sessions can go a long way in ensuring everyone is comfortable with the system and understands how to make your finance team’s lives easier.
Expense Management Tip 5:
Educated employees are more likely to follow the rules, reducing the risk of errors or misuse.
Regularly Review and Update Policies
The business environment changes rapidly, and your expense policies should too. Regularly review and update your policies to ensure they remain relevant and effective.
Expense Management Tip 6:
Get feedback from your team. They’re the ones using the system daily and can provide valuable insights into what’s working and what needs improvement.
Explore Outsourced Bookkeeping Services for Small Business
Managing expenses can be a tedious task, but with the right software and policies, you can simplify and automate the process and keep employee expense claims under control.
No matter what stage your business is at, it could be worth exploring outsourced bookkeeping so they can manage your expenses efficiently and effectively, giving you more time to focus on the things you do best.
Need help with expense management? Reach out to our Melbourne-based bookkeepers or explore our monthly bookkeeping services today.
