Employee expense reports: How to track and manage business expenses

An employee expense report is a document employees use to record business-related expenses such as travel, meals, lodging, or supplies so companies can track spending and reimburse employees accurately.

Manual expense reimbursement processing can be time-consuming and error-prone, causing delays and frustrations. Plus, businesses that don't have a standardized reporting system may lack visibility into their spending patterns.

Employee expense reports can help alleviate these issues by giving you a structured and effective way to manage employee-related expenses. They also help you ensure workers are only using company funds for legitimate business expenses.

In this article, we go in-depth about what an employee expense report is, its importance, and how to create and fill one out. We also give you a bonus template to help you craft an employee expense form quickly.

What is an employee expense report?

An employee expense report is a document used to track business expenses incurred by employees while performing work-related tasks. Employers use it to review spending and reimburse employees for approved expenses.

Business expenses include airfare, car rentals, meals, travel , lodging, professional license fees, and much more.

Having workers submit thorough expense reports means you can better monitor spending, set spending limits, and keep finances transparent. An expense management platform guides your employees through the process of filling out the report and submitting it for your accounts payable department to review.

What should you include in an employee expense report?

An employee expense report typically includes employee information, expense details, receipts, approval signatures, and the total reimbursement amount.

Employee expense reports can differ in structure based on your company's policies and the reporting tool or template you use. Here are some common variables you can expect to find in most employee expense reports.

• Employee details: The employee’s name, ID, department, and contact information
• Expense details: The date, type, purpose, and description of the expense
• Amount: The amount spent on each expense item, including any taxes or tips
• Receipts: Fields for attaching copies of receipts or invoices for each expense item
• Approval: A field for the signature or approval from a manager or supervisor, if required by company policy
• Reimbursement request: The total reimbursement amount

Why are employee expense reports important for businesses?

Employee expense reports help businesses track spending, enforce expense policies, streamline reimbursements, and maintain accurate financial records.

Employee expense reports have many benefits. Here are just a few of them:

Track business expenses accurately

Expense reports allow companies to monitor employee spending and identify opportunities to reduce unnecessary costs.

On top of that, it's easy to analyze your employees’ spending patterns and generate reports for management or accounting purposes.

Automate reimbursement approvals

Automated expense reporting systems route employee submissions for approval and speed up the reimbursement process.

Integrating your expense management capabilities into your accounting software makes processing each employee's expense report for reimbursement easy. An automated expense management system helps you route scanned reports to the appropriate personnel, helping you stay compliant with the set time limit for approvals.

Ensure compliance with company expense policies

Expense reports help organizations ensure employees follow company expense policies and submit legitimate receipts.

If you have an automated approval workflow, ‌assigned personnel can double-check each expense report as it’s uploaded to confirm policy compliance. You can also automatically configure expense management software to check expenses against company policies.

Improve budgeting and financial planning

Expense reports allow finance teams to compare actual spending with budgets and forecast future costs more accurately.

They provide clear visibility into where employees are spending money, making it easier to identify discrepancies, control costs, and reallocate resources as needed. Enforcing expense policies alongside reporting can also help prevent overspending.

Over time, analyzing expense data improves forecasting accuracy and supports better planning for upcoming projects.

Support tax reporting and deductions

Accurate expense reports document business costs and help companies identify eligible tax deductions. Clearly documented reports help minimize audit risks.

Receipts included in expense reports provide proof of actual expenditure that may substantiate any deductions claimed on tax returns.

Further, expense reports often categorize expenses, making it easy to identify tax-deductible expenses and file correct tax returns. With an aggregated report of all expenses, it's easier to transfer this information to tax forms.

How do you create an employee expense report?

You can create an employee expense report using spreadsheets like Excel or Google Sheets, or automate the process with an HR or expense management platform.

Create an expense report in Microsoft Excel

Excel templates allow companies to track expenses manually using predefined fields for dates, categories, and totals.

Here’s how to create an expense report in Microsoft Excel: 

1. In Excel, select “new” from the left menu. Alternatively, select “view more templates” if templates are displayed close to the top of the initial screen.
2. Search for “expense report”
3. Select and click on your preferred template
4. Click on the “create” icon
5. Use the template or save it for later use

Create an expense report in Google Sheets

Google Sheets offers customizable expense report templates that teams can access and update collaboratively online.

Now for the steps to generate an expense report using Google Sheets:

1. Select “file,” then “new,” then “from template gallery”
2. Search for the “expense report” template and select it
3. Use the template or save it for later use

Create expense reports using Remote

Remote’s HR platform allows companies to generate and export employee expense reports quickly while tracking reimbursement requests.

If you want to quickly create an appealing template that you can reuse for different purposes, then Remote is your answer. Remote makes it easy to manage your business expenses through our HR management platform.

Many businesses use Remote to keep track of their costs. For example, Gusto customers reimburse their employees directly in Gusto, powered by Remote. 

Remote also helps you generate individual expense reports with just a few clicks. Here are the required steps:

1. Go to the “expenses” tab
2. Select “all requests”
3. Use the search function to filter out specific employees
4. Click on “export data” to download a CSV file of the report

Employee expense report template: how to fill one out

An expense report template helps employees record expense details, attach receipts, calculate totals, and submit reimbursement requests for approval.

We’ve included an overview that you can use to guide your staff on how to fill out an expense report.

1. Download the expense report form

Most companies provide a standard expense report form. If not, you can create one using a spreadsheet program, like Excel or Google Sheets, or download the template we’ve made for you below.

A template should contain sections for:

• Employee details, like their name, employee ID, department, and contact information
• A field for adding the current date and purpose of the form
• Expense details, such as the date, type, purpose, and description of each expense
• The amount spent on each expense item, including any taxes or tips
• A space for attaching copies of receipts or invoices for each expense item
• A space for a signature or approval from a manager or supervisor
• The sum of all expenses

2. Enter your personal information

Once you’ve downloaded the template, you can start keying in your personal details. At the top of the form, fill in your name, employee ID, department, and other required personal information.

3. Indicate the date and the purpose of the expense

Next, add the date and the purpose of the expense report. For instance, you could state that the expenses are for a business trip to a technology conference.

4. Fill in the expense details

Enter the relevant details of each expense, including the amount, category (such as meals or travel), and any necessary notes.

5. Calculate the total cost

Proceed to calculate the total amount for each category and the total for all expenses. Ensure that your calculations are correct to avoid having to go back and forth with the accounting team during the approval process.

6. Attach receipts

Collect all receipts for each expense incurred and scan them. Upload the images and double-check them to make sure there are no missing receipts.

7. Submit the report

Review your expense report one last time to check for any mistakes. Once you’re done, submit the completed report to your supervisor or the appropriate department for approval.

Take care of employee expense reports with Remote

An expense reporting system prevents unauthorized purchases and fraudulent receipts for reimbursement. It’s a simple but efficient way that helps you track employee spending and ensure your staff spends what you budget for.

Remote helps you reduce the cost of expense management for employees, no matter their location. With Remote , you can track and approve employee reimbursement requests with just a click. 

For more information on how to simplify your expense management process, chat with one of our experts today.