Small amounts cause large arguments. A taxi, a client lunch, parking, a courier, a last-minute supply from a shop: each is easy to approve and hard to remember. Left informal, expenses become a pile of photographed receipts in a manager's chat and a month-end guess about who is owed what. A short policy and a simple digital flow remove most of the friction and most of the risk.
Write a one-page policy
- What is allowed: travel, meals with clients, supplies, subscriptions and fuel, each with a sensible limit.
- What needs prior approval: anything above a stated amount, gifts and any spending with a government body.
- What is not allowed: personal items, fines and cash advances without a form.
- Time limit: claims submitted within a set number of days, or they are reviewed as exceptions.
Receipts and VAT
Ask for a clear photo of the receipt and the supplier name. For a purchase to support input VAT recovery, the document normally has to meet tax invoice requirements, including the supplier's tax registration number, so staff should ask for a tax invoice rather than a plain till slip when VAT matters. The rules are explained in the VAT return checklist; confirm details with your adviser.
The digital flow
| Step | What the system does |
|---|---|
| Submit | Employee uploads the receipt from a phone, picks the category, project or cost centre, and enters the amount and VAT |
| Check | The system flags duplicates, missing receipts and amounts above a limit |
| Approve | The line manager approves or returns with a comment; higher amounts go to a second approver |
| Pay | Approved claims are added to the next payroll or a transfer batch, with a reference |
| Post | Journal entries and VAT lines are created without re-typing |
Petty cash done properly
Keep a fixed float under one custodian, use numbered vouchers, and reimburse the float against vouchers so it returns to its set amount. Count the cash weekly with a second person present. Never lend from petty cash or hold personal cheques in it. A dedicated petty cash account in the ledger makes the balance visible and reconciles in minutes.
Reports that expose problems
Look at spending by employee, category and supplier each month. Repeat round numbers, many claims just under an approval limit, weekend meals and the same receipt twice are common signals. Connect expenses to payroll in HR and payroll software so reimbursements and deductions stay together. Ask us to add an expense module to your system.