{"id":173024,"date":"2025-04-06T05:22:06","date_gmt":"2025-04-06T05:22:06","guid":{"rendered":"https:\/\/peraltafinancing.com\/accounting\/what-is-expense-management-iris-kashflow\/"},"modified":"2025-04-06T05:22:06","modified_gmt":"2025-04-06T05:22:06","slug":"what-is-expense-management-iris-kashflow","status":"publish","type":"post","link":"https:\/\/fivemor.com\/?p=173024","title":{"rendered":"What is Expense Management? – IRIS KashFlow"},"content":{"rendered":"


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We\u2019ve partnered with Cashplus to help KashFlow customers manage their expenses using a prepaid card solution.<\/p>\n

We\u2019ve already given expense management a brief introduction<\/a>, but we wanted to delve deeper in what expense management actually is and how it can help your business. If you\u2019ve any questions, or insights into how you manage expenses in a small business then leave us a line in the comments below \u2013 we\u2019d love to hear from you!<\/p>\n

Expense management is the system a business uses to process, pay and audit their business spend. These costs normally include employee travel and entertainment. Expense management systems can also be used for sole traders to manage and monitor their business spending.<\/p>\n

Expense management has two key elements: how a business pays for their items and how they track that spend.<\/p>\n

Managing expenses can be a difficult task, especially if you\u2019re processing expenses from multiple employees. Without a proper system in place, you will quickly find yourself becoming confused with the number of receipts. It can be hard to establish an audit trail if expenses aren\u2019t processed immediately, and finding the time to process expenses as they come through can be equally difficult when you\u2019re a small business.<\/p>\n

Delaying the processing and payment of personal expenses could produce problems in both your personal and business cash flow. If you delay in paying employee expenses, then you may also face problems with reduced morale.<\/p>\n

Unfortunately, delays can be common when you use a manual system \u2013 which is why it\u2019s worth looking at expense management tools like those available in KashFlow. Our bookkeeping software<\/a><\/strong> will allow you to enter and track your expenses from one place.<\/p>\n

We\u2019ve also recently introduced a \u201cQuick Add\u201d feature that means you can add out-of-pocket expenses like coffee, food or transport tickets with just one click. Systems like this mean that you\u2019re no longer stacking receipts up until you have a chance to sort through them, you\u2019re simply logging them and paying them as you go! Take a look.<\/a><\/p>\n

One of the most effective ways to manage employee expenses through your business is to create a company expenses policy. A company expenses policy should outline what you will and won\u2019t pay for.<\/p>\n

You should make sure that your expenses policy is clear and concise; too much small print will lead to confusion. If it isn\u2019t clear whether or not an expense is permitted, employees will likely try to apply for it. This creates a lot of paperwork \u2013 so taking the time to clarify and pare down your policy in the beginning will save you admin time in the long run.<\/p>\n

Once you\u2019ve created your policy, you should make it easily visible to your employees. This will help cut down on invalid expense applications, which will reduce your admin and free up more of your important time.<\/p>\n

As the ultimate owner of the business and of the expenses policy, it\u2019s your duty to ensure it remains up-to-date and evolves in line with your business. You may find the policy needs updating as employee numbers increase or the business expands to incorporate new and different types of expense.<\/p>\n

Your expense management policy should set out what is and isn\u2019t classed as a work-related expense.<\/p>\n

There are two main types of employee expense: ones that paid directly by the company on an employee\u2019s behalf, and ones that the employees pay and then claim back (reimbursement).<\/p>\n

Many expenses are related to business travel, so make sure your policy includes trains, taxis, petrol (if employees are using their own car) etc. If the travel is international, include sections covering legal document expenses like Visas and any vaccination or medical expenses needed.<\/p>\n

You may also include an allowance for business materials or meals purchased on the trip.<\/p>\n

It makes sense to include an expense cap so that you can effectively budget. You may, for example, agree to reimburse a meal up to \u00a315 \u2013 with the employee covering the rest of the cost themselves.<\/p>\n

For further clarity, you could also include a list of non-reimbursable expenses like:<\/p>\n