Helpful tips for filling out an expense report

Quick insights

• Expense reports document business credit card expenses and allow employees to claim reimbursements.
• Expense reports play an essential role in managing business finances.
• Some business owners integrate business credit cards into their business expense management system to streamline the process.

How to create a simple expense report

Expense reports are detailed documents that itemize business expenses and request reimbursement to employees who have incurred expenses on behalf of the business. These reports are essential as they ensure accountability and proper allocation of company funds. To create an expense report there are a few simple steps you could take:

Steps for completing an expense report

1. Determine your software

The first step in creating an expense report is deciding if your business will be using online expense reporting software. Digital expense reporting can be an essential tool for bigger businesses that accrue a lot of expenses.

Expense reporting can be a tedious process, but automating it can make things easier. It is important to choose the right expense management software for your business. When researching accounting software, take note of the available features and determine which one might work best for your business.

In some cases, using online accounting software may not be the best fit for your business. If you operate a smaller business, are a freelancer, or your business does not accumulate many expenses, investing in online software to complete expense reports may not be necessary for you. In these cases, it may be more cost efficient to utilize a simple spreadsheet to record your expenses. Many popular programs such as Excel and Word include expense report templates.

2. Choose a template

It may be helpful to choose a template or create your own to input your expenses. When choosing a template, remember expenses must be categorized and supporting documentation such as receipts may be required. Important things you may want to include in your template: vendor name, expense category, expense date and expense amount.

3. Calculate totals

Once expenses have been input into the template, it's time to calculate the subtotals and the grand total. For expense reports, you will need to include the sum of each business expense category in addition to the grand total of all expenses.

4. Include receipts

Receipts are generally a good idea to include in your record keeping, serving as proof of transaction, which is often necessary when filing your business taxes. Without a receipt you may need to go through extra steps to document proof, such as including a credit card statement.

5. Submit the report

The final step in creating an expense report is to double-check that all information is accurate then submit the report according to your business' expense management procedure. This may include the sign-off of a financial stakeholder within the company, such as the business owner, Chief Financial Officer or company accountant.

Key components of an effective expense report

A key component of expense management is maintaining a level of financial organization. Staying on top bookkeeping can play a big part in helping companies manage their finances. Part of this includes having a detailed expense report which makes it easier to manage budgets and maintain financial accuracy and accountability. Here are a few things that may be helpful when creating expense reports for your business:

Tips for completing an expense report

• Include details: Always include important information like dates and totals for each purchase. In addition, including information like descriptions for why a purchase was made can provide additional context and may help speed up the approval process. Having a detailed report can help ensure compliance with company policies.
• Categorize each expense: Categorizing each expense provides better insight and visibility on your business's cash flow, which can be helpful when trying to build a budget and analyze spending trends. Common categories include travel and client-related expenses.
• Submit reports on time: Employees who submit expense reports on or before the designated day they're due may find they receive their reimbursement in a timely manner.
• Maintain a schedule: As a business owner, it may be helpful to implement a schedule of when expense reports should be received and approved. Having a schedule can create a more efficient bookkeeping process and relieve some of the administrative burden. The expense report policy should clearly identify the due dates and cadence that an employee can expect their reimbursement.
• Identify spending habits: Expense reports are great for monitoring cash flow and determining how much your business is spending. Use this information to compare spending amounts to predicted budget amounts. Expense reports can provide helpful information that can positively influence future business decisions.

Maximizing business credit card benefits for expense management

To better manage expenses, it may be easier to issue employees their own employee credit cards. Business credit cards allow employees to directly charge expenses to the company account. This makes it easier to view cash flow, enforce spending policies, and streamline expense reporting by removing the need to issue reimbursements.

To find a business credit card that works for your business, it may be helpful to review the Ink suite of business credit cards. The Chase Ink business credit cards come with expense management features such as allowing the primary cardmember account to set spending limits. Issuing employee credit cards is available at no extra charge.

In summary

Expense reports are essential tools that ensure financial accountability and help properly allocate company funds. Take the time to research what expense reporting software is best for your business. Having an effective expense report may benefit your employees by streamlining reimbursements. In addition to expense reports, using a business credit card may be another resource to help manage business expenses.