Learning how to properly and effectively manage your business expenses can seem intimidating at first and get you into all sorts of trouble if they are not managed correctly. Fortunately, we have many years of experience and can teach you some ways! Here’s how to ensure effective management of your business expenses.
Research Before Commitment
For some, spending business money makes it feel less real and that can get you into some complications. We recommend shopping around for quotes before committing and regularly review which vendors are saving you money or costing you money. It’s also worth remembering that in some cases bulk buying or larger orders can lower the cost, so don’t be afraid to renegotiate as you grow.
Keep Records and Receipts
In order for you, your business and your accountant to stay on top of your business spending, your whole team needs to keep receipts and records of expenses. We recommend giving everyone a regular deadline to hand these in by so nothing gets lost. Keeping up to date regularly whether it’s daily, weekly or monthly will make it easier for you to ensure no records are misplaced.
Business records should be kept for several years, even after you no longer revisit these records. Tax audits and investigations can ask for multiple years of your records, files and calculations, to ensure you are coming to the right calculations and conclusions. If you don’t want to box everything up and hide it in a storage locker (or worse, taking up half your office), consider keeping digital copies of your invoices and receipts. HMRC will usually accept digital receipts as evidence, but make sure you keep a backup of your data files!
We understand that the best businesses hire the right people for the right task regardless of where they are, but that can lead to high travel expenses. It’s always worth investigating where you can better manage expenses. Consider having conference meetings remotely instead of making people travel in. Regularly cap tickets or ensure ticket prices and bookings are vetted by a member of staff so that your team don’t miss discounts or cheaper options of travel.
There are a lot of elements to managing your finances and business expenses which can become overwhelming for the best of us! Consider researching and using software as a way to effectively see and manage all the different expenses going out of the business, and to track receipts and records. With the abundance of apps on the market to manage your expense process, you can have everything from integrated apps into your accounting software (Xero expenses, Expensify, Datamolino, Receipt Bank) to smart company cards backed up by intuitive software (available with apps such as Pleo and Soldo) to keep you on track with spending.
Not sure your business is doing all it can to effectively manage expenses? Don’t hesitate to get in touch with us today and see how we can optimise and advise on your processes!