Businesses of any size and industry must keep their finances in order and accurately register income and expenses. How much money you earn and spend is important for tax purposes, proving to your stakeholders that the business is profitable, knowing how much money you can invest in development and marketing strategies, and planning upcoming projects and activities.
However, small businesses and entrepreneurs must often manage income and expense tracking without relying on a dedicated department. They simply can't afford it. Therefore, they use business income and expense spreadsheets to monitor their money flow. Instead of starting from scratch, check out our free business income and expense tracker templates and choose the one that fits your requirements. But first…
A business expense report is a table, usually a spreadsheet, in which you record every expense made on behalf of your business. Most business expense trackers register who made the purchase, what they bought, when, and how much money they spent.
However, small businesses may choose to use the same spreadsheet for both income and expenses, compute sums, filter expenses based on categories, and add custom details and information, such as whether the payment was made in cash or via an online payment method if it is a recurrent payment, and so on. When the expense list gets too long, you may want to use a separate spreadsheet for each category. For example, travel expenses, payroll, and administrative expenses may have their own spreadsheet.
Many employers have tested and trusted a template. They've already gone through the trouble of adding all the important information, checking the spreadsheet's formulas, and developing the best structure. Of course, you will customize the expense tracker template of your choice. But it will take you less time and energy to do so.
Another reason you need an income and expense tracker template is that it helps you keep all finances in a similar order. You will use the same model for all types of expenses, avoiding mistakes and wasting time on repetitive tasks. Over time, your staff will get used to the structure of expense spreadsheets and fill them out instantly. You'll end up with fewer errors in your financial documents and happier employees.
There are many reasons why you should consider using expense spreadsheets, but if you need something convincing, here are five benefits you can't ignore:
In addition, you can share expense spreadsheets with your team members, allow collaborative work, and quickly send them to your accountant. Store your expense tracking documents using a cloud-based service, and they will be available on any device or location.
Bonus tip: Create a procedure for gathering justificative expense documents, such as invoices and receipts, when filling out the expense tracker spreadsheet. For example, employees can use the same cloud-based service to store digital justificative documents or pictures of receipts.
Depending on your business requirements, you may need a more straightforward or complex expense tracker template. Furthermore, although a template is a good starting point, make sure you customize it. You want your business expense Excel template to fit your team like a glove: no confusion, frustrations, and minimum time spent filling out the form. Check out the following five completely free business expense templates and choose your favorite.
A basic business expense Excel spreadsheet is the best starting point if you've never used an expense tracker. It has just the columns and rows you need, is easy to use, and is ideal for small businesses and entrepreneurs. This minimalist option will help you track your money flow without errors or headaches.
As a small business, you only have a short and diverse list of expenses and sources of income. Therefore, you can use the same template to monitor both and save time switching between spreadsheets. Having them side by side allows you to see how much you earn and spend and instantly keep an eye on the cash flow. It's also helpful for computing statistics and spotting patterns.
Having a dedicated travel expenses spreadsheet makes sense if you or your employees travel a lot. You can keep it online and allow your employees to add entries while still in the field. Other expenses may be safely kept in an offline spreadsheet with limited access (e.g., only department managers). You need to detail travel expenses as much as possible to understand your employees' requirements clearly. You can use the report to adjust future travel budgets, look for deals for expensive purchases, and manage how much time your employees spend traveling.
A monthly business expense spreadsheet helps plan and monitor budgets, tasks, and projects. It also allows you to manage payroll, monitor month-to-month spending, watch over recurrent bills, and spot trends (e.g., some months may require a little extra cash flow). You can use the same Excel spreadsheet for the entire year and dedicate a monthly sheet. At the end of the year, you have all expenses in one place, ready for your annual finance report.
Like the basic expense tracker template, you are free to add sources of income in the same table and use formulas to reveal in real-time how much you earned and how much you spent.
A business expense template covering an entire year is helpful for tax purposes and for generating financial reports for stakeholders. Like previous templates, small businesses often use the same spreadsheet for income and expenses. The annual business expense spreadsheet summarizes monthly expense reports. Only the supervisor has access to this document.
You can use income and expense categories or group everything under the same umbrella. You decide how granular you want the annual review to be.
Conclusion
Keeping your finances in order is essential for a successful business. For small businesses especially, income and expense trackers must be straightforward and error-free. Just use easy formulas and simple tables. Complexity will come in time. Initially, you want basic tables customized for your team and business profile. And starting from a free business expense template is the best way to do it.
How do I create an expense tracker in Excel?
Download a free expense tracker template that fits most of your requirements—for example, a dedicated travel expense spreadsheet. Then, personalize it with your company's data, such as the supervisor's name and report period. Customize the expense categories, including legends with lists and definitions, so your team can know exactly what they need to do.
How do I track daily expenses in Excel?
Classify your daily expenses, such as accommodation (e.g., rent, electric bills, cleaning supplies, etc.), groceries, transport, clothing, etc. Then, create a table in an Excel spreadsheet that includes a column for date and columns for each expense category. Each row will represent a day. You can compute sums per row to see how much you spend in a day or per column to see how much you spend over some time for items in a particular category.
How do I create a monthly expense sheet in Excel?
You can either download a free monthly expense spreadsheet or start from scratch. If you want to start from scratch, create a table with columns for date, amount spent, expense category, and, if necessary, the name of the person who made the purchase. Include sums for each category and a total for the entire month.
What are expense tracking best practices
Best practices for expense tracking involve being aware of your expenses and categorizing them appropriately without creating too many or too few categories. You should also maintain accuracy regarding dates, amounts, currency, and invoices. Compute the total expenses correctly using your country's reference currency. Exchange costs and bank transfer fees, if applicable, should also be included. Adding a brief description to each purchase is recommended, which will help you recall the purchase in the future, such as for recurring bills, budget planning, and so on.
Please pay attention to tax regulations, such as VAT, and include them in your expense tracking spreadsheet. You may also integrate your expense tracking with accounting and payroll software. However, expense data should not only be used for tax and payroll purposes but also for analyzing costs, estimating income, and managing budgets.