What is an Expense Policy, and do I need one?

An expense policy is a document created to outline the rules laid down by the company on types of expenses employees can claim back on, and how to submit such an expense. Every company is different, so every policy reflects this in being unique, however they largely contain two parts, travel and expenses and how to claim.

Travel and Expenses

T&E outlines what expenses can be claimed back on when your employees travel for business, as well as recommended suppliers and methods of transport. It’s important to have a document which highlights this so that you can effectively control and manage expenditure, and ensure everyone in the company is on the same page.

Why should I create a business expense policy?

It can sometimes be a little unclear on what people can make an expense claim on, and an expense policy clears this up. A concise clear policy not only increases accurate claims but reduces confusion which can often lead to frustration and mistakes. It can even limit expense fraud. Not only will your employees be happier, but it means your finance department can gain better control and insight over expense forecasts.

First things first

It may seem daunting to start, but there’s plenty of help and support out there on where to begin. There are plenty of free to use templates online, or you can chat with us to create a totally unique policy just for you. Once you have this down, it can be easily implemented into Capture Expense so that you don’t even need to remind employees of what they can and can’t do, it will automatically show up in the app when it is relevant.

Create multiple policies

Different departments and even different branches will require different policies, so with Capture Expense you can assign different policies to these sections. You can also add policies for travel, card payments, etc. Whatever you want to add a note or caveat to, you can.

Set maximum spend

You can also set maximum expense amount limits, allowing for greater control over company expenditure. You can set overall rules or more defined specific rules, depending on your unique needs.

Automate the process

Using a smart expense management product is the key in ensuring expense policies are successful. When using Capture Expense the whole process becomes integrated and fluid, meaning errors, duplication and out of policy expenses are reduced. This not only speeds up the expense process but saves you money and time in the long run.

Get started today

It’s never to late to join the future. Technology has made it so we have super computers in our pockets, so why are you still using old documents and excel templates to process your expenses? Get in contact today to see what we can do for you and the future of your company.

What actually is a smart expense management system?

Expenses. Everyone has to do them. It is simply spending that is required to make the business run, and encompasses everything from business travel to corporate card spending to stationary. Be it SME or enterprise, every business has to keep track of where it’s money is going, otherwise costs are waylaid or even fraud can happen.

The problem

All spending is different, as every company is different. A construction company will outsource a lot of its labour, so ensuring contractors are paid the correct amounts based on policy is key. Even hospitality will be completely different – there’s a lot more physical purchases made on a card as the business needs to be well stocked. And as every company is so different, so is their ways of conducting expense management systems.

It can often be an arduous time intensive process, especially if you are using an outdated method such as physically on paper, or even in an excel template. Often digital spreadsheets are mixed with copies of receipts and invoices. This is a pain to keep track of and document as it’s a confusing and intense paper trail.

It can also be made harder by the size of the company and employees location. Overseas spending will have different exchange rates, different requirements, different norms, so how on earth do you accurately keep track? If you are truly looking for your business to grow and develop, you need a smart automated expense management system that can grow and adapt with you.

Change is scary

Whilst it is good and all to talk about the pros of an automated expense management system, you may still be apprehensive about switching to a smart digital solution. This is because you may have old fixed business practises that you can’t imagine changing, or the idea of transferring old information online to create a comprehensive archive to be almost impossible, but that is not the case. Capture Expense can work with you to import all historical data making your life as easy as possible.

We also work with your current systems, not against them, having integrated Capture Expense with more then 50 different back-office systems and provided additional support for many others. So whilst you may be worried your current accounting system won’t integrate, have no fear. Capture Expense works with your accounting, payroll or other back office system, replacing any manual and repetitive tasks. Data integration is quick and accurate whether recording expenses within accounts or reimbursing staff via BACS or payroll.

Bank feeds generate card expenses automatically each month as we integrate with all major banks, alerting cardholders to review their expenses.

Just a few of the companies we work with are Tripcatcher, Azure, Oracle, Travelport, Financial Force, Quickbooks, Unit 4, Sage, Salesforce, Sap and Xero.

No need to import/export CSV files every month

No need to manually update spreadsheets every month. Capture Expense works directly using the Application Program Interface (API), meaning records and transactions are moved seamlessly without any manual intervention. Let technology work for you in the way it was designed.

Creating a single source

We can aggregate data from multiple sources and update multiple systems. For example retrieving Project and Costcentre records from Costing and Staff records from HR. Once an expense is fully approved we can generate a BACS payment as well update Accounting to record the receipt.

Mobile Expenses

You can even keep track of your expenses on the go with our mobile app. Simply use the mobile expense login (which you can even use SSO for an even speedier expense log) and snap a picture of your receipt. It will then be automatically processed and all the data can be used to automatically fill expense forms for easy submission and archiving of receipts.

Corporate credit card expense reporting

Easily keep a feed of both online transactions with company credit card and cash transactions using receipts. Cards can be added to your Capture Expense account so that any transaction is automatically added to your expense feed, meaning you just need to add an invoice.

Ever company is unique

It really is as easy as that. If you have any other doubts, feel free to send us a question. We will be happy to help, and we know that no one solution will fit all, so we can work with you to create a unique custom solution which works for you. You can add whatever tags you need, whatever categories you want, and unique company policies to ensure compliance.

Book a free trial today to see how easy it is.

Need an Excel Income and Expense Template?

It’s that time of month again where you need to sort your expenses out. It’s a bit of a pain having to put the data in, but you’ve got an excel business travel expense template so it’s not too bad. You just have to go through and dig for all your receipts, manually put in the data and hope you’ve not forgotten anything. There are loads of free download excel templates you can use, and it works just fine, so why would you change? It’s certainly cheaper than using an automated expense management system.

But what if you’re wrong? It turns out you’re actually spending more doing it this way, and it’s all in the time it takes to input this data.

Manual data processing

Say you hire someone to do your accounting, 20 hours a week at £12 per hour. They have to manually enter, check and produce reports on employee expenses. If they are working 50 weeks a year, that’s £12,000 you’re paying for your expenses to be input. Think of where else 12k could be invested in your company. You’re losing revenue on sales through missed marketing opportunities.

Receipt storage hassle and lost invoices

And not only that, but manual data input using something like a free download income and expense spreadsheet creates mistakes. What if someone is late in sending over their receipts and invoices? What if they’ve lost a receipt? You can’t reclaim Tax on lost receipts, so you’re losing money in other areas too.

Poor visibility of spend and lack of expenditure control

Using a simple travel sheet format leads to a lack of visibility of your overall spending. It takes extra time to visualise this data and analyse spending. It may seem like an extra add on to use a service which supplies this analysis, but an automated expense management system like Capture Expense integrates it automatically in the software so that you can easily view your expenses and understand what they mean. This means better control of expenditure as well.

Overestimated mileage

Working out fuel expenses using a template is a pretty rudimentary way of calculating mileage and VAT on fuel rates. Mileage Allowance Payments (MAPs) are what you pay your employee for using their own vehicle for business journeys.

You’re allowed to pay your employee a certain amount of MAPs each year without having to report them to HMRC, this is called an ‘approved amount’. If you reimburse employees above the approved amount, the benefit-in-kind will need to be reported to HMRC to deduct any further tax due.

Capture Expense stores the approved rates and you can generate a reports which shows how much you’ve paid to staff above or below the approved rates. This determines by simply multiplying the employee’s travel miles for the year by the rate per mile for the vehicle. The total includes any type of vehicle they’ve used. The rates below were correct in 2020.

Anything below the ‘approved amount’ then you won’t have to report to HMRC or pay tax, but your employee will be able to get tax relief (called Mileage Allowance Relief, or MAR) on the unused balance of the approved amount. You can make separate optional reports to HMRC of any such unused balances under a scheme called the Mileage Allowance Relief Optional Reporting Scheme (MARORS).

Chasing staff to submit claims and backlogged reimbursement

I’m sure we’ve all been on at least one side of this problem. It can take an age to get your reports approved and reimbursed because it’s such a time intensive operation. Want to speed up expense reimbursement? Use an automated system! Because it is so much easier to input data as most of it is done automatically using receipts and OCR, it means you can submit more accurate reports more quickly. This is easier to check and approve, meaning you get your money back in a timely manner. On the flipside, if you’re in charge or approving expenses it can be a real burden to chase claims. It takes time and effort to check up on people, send emails, check data, so switching to an automated system largely eliminates this problem by allowing a much more consistent and accurate flow of claim data which you can approve at a better rate.

Out-of-policy bottlenecks

Sometimes it’s easy to forget what policy is, and what applies to you. With an expense excel sheet you can’t dynamically show policy and make sure all claims are according to policy. With a smart system custom policies can be easily displayed to stop the problem before it’s even submitted.

Duplication and errors

File management is also a real struggle when you have very similar sheets sent from multiple people at different times. Is this the most up to date version? Have I already been sent this? It’s a tedious process of checking that can often lead to errors. Eliminate this entire problem with a smart dynamic system such as Capture Expense.

To summarise, just a few of the drawbacks to manual expense management using excel template are:

• Receipt storage hassle
• Lost receipts ( so no Tax reclaim)
• Poor visibility of spend
• Tax inaccuracies
• Lack of audit trail
• Out-of-policy bottle necks
• Lack of expenditure control
• Overestimated mileage
• Manual data processing
• Backlogged reimbursement
• Duplication and errors
• Chasing staff to submit claims
• Reiterating policy to employees
• Accrual unaccounted expenses
• Difficultly with Remote Workers
• Staff personalise expense forms

And just some benefits to automated expense management:

• Digital Receipts
• Combined Mileage, Cash and Card
• Smart Approval workflow
• HMRC Fuel Rates (Private, Business)
• Personal Milage Refund
• VAT Reclaim & Management
• Built-in Compliance
• Easy to use and maintain
• Available 24/7 on any device
• Only pay what you use
• Minimal training and setup

If you’ve got any questions or want to know more, drop us a message. You can also book a free demo to see what we can do for you and your company.