September 6, 2012 | 4-minute read (624 words)
If you’re running a small business, you likely have a lot of different kinds of expenses that you need to keep track of efficiently and effectively. From travel expenses to trainings and seminars to a company vehicle and mileage, keeping track of business expenses is necessary for:
- Tax reporting purposes
- Identifying strategies for reducing your burn rate (in other words, pinpointing where you can make cuts to save money)
- Making operational adjustments in response to market or economic changes
All of your expenses should be properly accounted for to prevent future potential financial problems. And by “properly accounted for,” I don’t mean that you should have a massive receipt pile that you only excavate come tax time. You need a simple, inexpensive, and painless way to closely track your company expenses and to create and monitor expense reports. For small business expense tracking, online options are the clear winner.
For expense reporting for startups, I highly suggest using Expensify. I love it because it is simple to use and integrates with QuickBooks (online, desktop, and hosted versions) fairly easily. If you have ever used a spreadsheet for tracking small business startup expenses, this is even easier. Also, it's relatively inexpensive.
Whichever online expense management software you choose, make sure that it offers these essential features to help you to streamline your expenses for a lean startup (and make your tax accountant’s job a whole lot easier!):
Take pictures of your receipts You should be able to snap a picture of your receipts and save them as expense entries. This is a key task in expense management for startups. These photo records are invaluable for capturing your receipts in real-time, before they become paper-fluff in your wallet. And once the receipts have been captured, you’re just steps away from recording them and creating reports. Plus, there’s no need to develop a contingency,- plan for lost documentation, if all receipts are captured and electronically stored.
Import credit/debit cards and banking information Never forget to log another expense, including credit and debit card transactions. With expenses automatically imported, the necessity for manual entry work is eliminated, saving you time and mental energy. This is a fantastic way to free up time and mental energy while minimizing human error when doing expense reporting for startups.
Auto-create expense reports Attach receipts and add and edit expenses with ease. The ability to enter expenses without attaching them to an expense report is valuable for staying on top of expense entry. Once your expenses are entered, you can automatically create your expense reports.
Expense mileage tracking You can enter in date and distance of a trip or even just click on a map and your mileage will be automatically calculated.
Expense tracking Track your expenses, including those of employees, and see spending breakdowns by individual, expense type, or another custom filter. Monitoring the details of your company’s expense can help you to keep costs down and spending under control.
Expense reporting for startups is a valuable exercise for the health of any company. Once you find the right system that works for you, you can spend less time burdened with the manual task of entering expenses and more time monitoring these expenses, and using this data to better manage your business.
How do you keep track of your expenses? Got any tips for expense reporting for startups? Tell us about it in the comments below or contact Early Growth Financial Services for solutions to help track and monitor your expenses?