How to keep track of employee expenses?

Employee expenses are charges incurred on behalf of the company. The company then reimburses these expenses to the employee. The receipts encountered most frequently are:

• car travel, reimbursed per unit of distance (mile or kilometer),
• subsistence expenses, reimbursed based on the bill,
• other purchases, such as stationery and books, destined for the company but carried out by the employee.

The expenses workflow

 

 * Record a new expense

Every employee of the company can register their expenses from Expenses application ‣ My Expenses. The workflow for personal expenses work that way:

1. an employee record his expense, and submit it to the manager
2. the manager approve or refuse the expense
3. the accountant post journal entries
4. the company reimburse the employee expense (the employee is like a vendor, with a payable account)
5. if the expense is linked to an analytic account, the company can reinvoice the customer

For every expense, the employee should record at least:

• a description: that should include the reference of the ticket / bill
• a product: the expense type
• a price (e.g. hotel) or a quantity (e.g. reimburse km if travel with his own car)

Depending of the policy of the company, he might have to attach a scan or a photo of the expense. To do that, just a write a message in the bottom of the expense with the scan of the bill/ticket in attachment.

If the expense is linked to a customer project, you should not forget to set an analytic account, related to the customer project or sale order (you might have to activate analytic accounts in the accounting settings to get this feature).
Once the expense is fully recorded, the employee has to click the button Submit to Manager.

In some companies, employees should submit their expenses grouped at the end of the month, or at the end of a business trip.

An employee can submit all his expenses in batch, using the Submit Expenses action from the list view of expenses, or the small icons in the list view.

* Validation by the manager

Managers should receive an email for every expense to be approved (the manager of an employee is defined on the employee form). They can use the menu To Approve to check all expenses that are waiting for validation.
The manager can:

• discuss on an expense to ask for more information (e.g., if a scan of the bill is missing);
• reject an expense;
• approve an expense.

 

* Control by the accountant

Then, all expenses that have been validated by the manager should be posted by the accountant. When an expense is posted, the related journal entry is created and posted in your accounting.
If the accountant wants to create only one journal entry for a batch of expenses, he can post expenses in batch from the list view of all expenses.

 

* Reinvoice expenses to customers

If the expense was linked to an analytic account related to a sale order, the sale order has a new line related to the expense. This line is not invoiced to the customer yet and will be included in the next invoice that will be send to the customer (charge travel and accommodations on a customer project)
To invoice the customer, just click on the invoice button on his sale order. (or it will be done automatically at the end of the week/month if you invoice all your orders in batch)

 

* Reimburse the employee

If the expense was paid with the employee's own money, the company should reimburse the employee. In such a case, the employee will appear in the aged payable balance until the company reimburse him his expenses.
All you have to do is to create a payment to this employee for the amount due.

 

Youtube video 

 

Reference link