Expense claims

Using cloud accounting to simplify expense claims

Dealing with expense claims is a task despised by managers and employees alike. With the advent of cloud accounting and the plethora of online expense claim tools available to tackle this specific problem, you don’t have to spend hours dealing with expenses. Less time on expense claims = happier staff. We’ve made it our mission to research every option to improve this process so that we can help you alleviate the hassle as much as possible.

Going through and evaluating all of these tools can be a painstaking task in itself. Not to worry, we’ve got your back. At Cumulative, we make it our mission to review notable cloud-based tools in detail. Here we’ve selected the best expense claim tools and provided an overview of each.

 

Expensify

Expensify offers one of the most comprehensive expense claim management solutions.

Using the Expensify mobile app and its SmartScan feature, users simply snap a picture of a receipt, from which relevant data (date, total amount, sales tax) is extracted to create a record of the expense. SmartScan is quick, but it comes at a cost – we’ve found that data isn’t always extracted accurately, so the user may need to review and correct the information before submitting it. You can also add in expenses manually, which is required for mileage reimbursements. To make things even easier, Expensify lets you connect to your personal bank/credit card and import the relevant business-related transactions that you need to be reimbursed for. We loved this feature – just a few clicks and virtually no typing! If you’ve already scanned in the corresponding receipt, they will automatically be matched to the imported transaction and merged into one expense.

Expensify Screenshots

You can also set up some advanced rules such as requiring receipt images only for expenses over a certain amount (unless you enjoy reviewing receipts from Tim Hortons for $1.85). You can also limit the maximum expense amount that can be submitted, or set the maximum expense age to avoid receipts from say 2006. These rules help ensure users are always complying with your company’s expense policies (try enforcing that in Excel).

Expensify’s focus is only on expense claims, and it shows. They keep pushing the boundaries in terms of innovation and new features in the expense claim space. Their mobile apps are designed to have all the features that the website has (including some handy ones like GPS based mileage tracking), so it is entirely possible for employees to create and submit expense claims without ever having to use a browser. This functionality is unique to the this platform.

Expensify addresses key pain points associated with expenses claims. Chasing after employees to submit their claims can be very frustrating, and Expensify has solved this problem quite well. It has an ‘auto-submit’ feature that automatically combines all of their receipts entered so far, and submits the claim on their behalf on a periodic basis.

Expensify also offers a couple of different approval workflows: claims can be approved by managers within Expensify (and then synced to your cloud accounting platform as a payable) or the claim can be forwarded directly to QuickBooks Online or Xero for approval.

All in all, Expensify is a solid choice; hard to go wrong here.

 

Xpenditure

Xpenditure has recently undergone a complete overhaul, and we’re really digging this new version. It’s a remarkably full-featured expense claim management solution, including all the must-haves: mobile apps, lightning-fast receipt OCR, mileage claims, credit card transaction import and integration with all your favourite cloud accounting platforms like QuickBooks Online and Xero.

Xpenditure Screenshot

You can upload receipts from your computer, snap a picture using your webcam or smartphone app, or forward receipts via email. The OCR works very well, and we’ve found the processing generally takes no more than a few minutes. However, it’s not very good at guessing the expense category (i.e. expense account) or separating the sales tax amount, so some review work is required (hey, we never said it was perfect).

Xpenditure also lets you log your mileage from business trips for reimbursement. It can automatically calculate the distance between addresses (using Google Maps), or you can log distance in the mobile app using GPS tracking. Additionally, Xpenditure allows you to connect to your bank so you can easily import credit card transactions.

Once employees scan all their receipts, they will have to group all their expenses together to create a claim. You have the option to enable the approvals module, so managers can login and approve expenses directly within Xpenditure. Alternatively, you can just forward the claims to Xero or QBO and then review and approve directly within in your accounting software. It really depends on your preference; some of our clients don’t like having to deal with multiple systems, so having this option is great. Another plus, Xpenditure also generates beautiful PDF reports of your expense claims, these include a listing of all claimed expenditures, along with images of all your receipts arranged on one page.

 

Receipt Bank

Although Receipt Bank has additional functionality beyond expense claims, it can be adapted to handle employee expense claims pretty well. Make sure you sign up for the multi-user plan, so that all your employees can submit expense claims.

Just like all the others, Receipt Bank offers a smartphone app, including a nifty ‘multiple mode’, so you can line up & take pictures of all your receipts without missing a beat. It has top notch OCR (possibly the best we’ve seen) that does a phenomenal job of extracting all the relevant data from your receipts, so a lot of the data entry work can be avoided. It takes a few hours to process the receipt, and you also have a chance to review/change information before submitting. All of your scanned receipts are stored until you’re ready to create an expense claim and submit it.

Receipt Bank screenshot

There’s no approval workflow in Receipt Bank – the claim gets forwarded to your accounting system (QBO or Xero) as a bill pending approval, along with a summary of the expense claim.

As we mentioned, since Receipt Bank wasn’t designed specifically for expense claims, unfortunately there is no way for employees to import transactions from their personal credit cards. However, if your company policy requires a receipt for each claimed expense, you will be scanning each individually regardless so this won’t be an issue. Receipt Bank integrates very well with both Xero and QuickBooks Online, and works very well as a ‘hands-off’ system. However, it’s very important to have it configured properly.

The one shortfall of Receipt Bank is that the mobile app doesn’t allow you to track mileage. For businesses where employees claim a lot of travel and mileage expenses, this may not be a great fit.

 

Xeroxero-expenses

That’s right – if you’re already using Xero for your bookkeeping needs, you can use it to handle your expense claims without signing up (and paying) for any additional software. Xero comes with some basic built-in expense claim functionality, so your users might end up having to do a lot of manual data entry.

To get started, invite all your employees as users into Xero (remember, there’s no limit to the number of users you can have in Xero). Make sure you set the user type to ‘Invoice Only – Sales Only’, so that they cannot access any data other than their own expense claims; you don’t want to accidentally give them access to all your accounting data.

Since Xero doesn’t offer any receipt OCR, in terms of work required by users, Xero would be very similar to submitting Excel claims. They will need to enter expense details manually (date, vendor, amount, tax, description) and then snap a picture of their receipt using the Xero mobile app.

The benefits, however, include paperless expense claims and excellent integration with your day-to-day bookkeeping process. You can also look up all of your past expense claims and receipts without digging through a ton of paper receipts. Once users submit an expense claim, you can approve it right within Xero, and it will show up as a bill payable to that employee, similar to all your other bills.

If you’re on a budget or your employees submit expense claims very rarely, Xero is a bare-bones yet cost-effective expense claim system.

 

Wrap-Up

We also tested some other tools that we considered, however they were missing some key features.  For example, Tallie doesn’t handle sales tax at all, while others we reviewed just weren’t quite there yet.

It’s great to have options to choose from, however, cloud accounting brings a specific set of challenges that require a different expertise. Too much choice is not always a good thing. There are new tools being introduced every few weeks that can help you with expense claims. What might be the best option today may not be true a few months from now. In the spirit of cloud accounting, the existing expense management tools undergo such rapid changes and are continually introducing new features, so keeping track can be daunting.  Isn’t that what you were trying to avoid in the first place?

As part of Cumulative’s ongoing systems research, we make it our mission to stay on task with the ever evolving nature of the cloud accounting landscape  As such we review existing and newly introduced tools and services continuously.  If you require a specific workflow or a custom solution (i.e. integration with Google Drive or Dropbox, automatic scanner-to-claim workflow), get in touch with us. We’ll sit down and discuss how your company uses expense claims, and figure out the best solution for you.

If you’re interested in cloud accounting beyond expense claims, and would like to learn more about how it can help your business, contact us for a free consultation.

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