We’ve been covering invoicing pretty thoroughly. But there’s another side to managing your business accounts. One that is crucial for maintaining solid records and an understanding of your financial situation. Expenses.
Expenses used to be an additional tedious task in double-entry bookkeeping. But with accounting & invoicing software it has become substantially more manageable (and we must say - fast!).
Accounting software and expenses
First let’s address what exactly an expense _is_. In the context of a business, an expense is any amount of cash or assets that are given in exchange for the purchase of goods or services.
To be clear, expenses that are added to your business records are only those that pertain directly to the running of your company or your daily work. In other words, your trip to the hairdresser’s or your holiday weekend in Bristol likely wouldn’t fall into business expenses.
But that new plant for the office? The bulk pack of pens you ordered? Those are examples of things that could be registered as expenses in your company financial records.
Simply upload receipts to your accounting software
When you record an expense using your accounting & invoicing software, you should also include any related documents. For example, you can snap a photo of a receipt for that plant when you add the expense. Or upload the invoice from your supplier for raw materials.
Out and about? Mobile apps with built-in OCR (Optical Character Recognition) make it simple to add new business expenses directly from your iPhone or Android.
It’s then automatically synced to your account so you can easily access it from your web app on your computer. You can also use the classic way - scanning documents and attaching them from your desktop. Whichever you prefer!
You can also create an email alias so that you can email them directly to your account and they will be added automatically. No matter the method you choose, it’s as easy and fast as possible.
Expenses with OCR - increased automation
If you’re not familiar with OCR, it’s a good term to know as it’s certainly a trending topic in the mobile and online app community. What OCR does is essentially read the information in a receipt, for example, and automatically fill in the correct fields for you. Making it even less work to add a new expense.
It will read the date, the amount and automatically give your expense a chronological number in your expenses sequence, making it even more time-saving and also upping the organisation of your account, all without you needing to lift a finger.
Recording payments for expenses
Once you’ve added your expense, you can easily mark it as paid by entering a payment. With Debitoor, on one of our larger plans, you can simply upload a bank statement and the payments will be matched automatically to the corresponding expense, marking it as ‘Paid’.
You can also manually enter payments from a cash account, so that you can keep track of your outgoing cash flow and whether you still have any accounts payable.
