Expense management explained

Learn what expense management is, how it works, and why many companies move away from spreadsheets and manual expense tracking to use AI-driven software.

What is expense management and how is the process evolving?

Expense management is how a business tracks, reviews, and reimburses employee expenses like travel, meals, and office purchases.

While some companies still rely on spreadsheets, email, or paper receipts to manage this process, many companies have adopted automation software that’s backed by AI to manage company spending.

The essential guide to expense management

How AI transforms spend management

Why is expense control important?

If you currently use manual processes, you may see:

Slow reimbursements that frustrate employees
Expense tracking in spreadsheets or email that wastes time
Little visibility into where company money is being spent
Frequent out-of-policy purchases
Errors, duplicate expense claims, or fraud

Tips to strengthen compliance

With effective expense management, businesses can:

Track exactly where money is being spent across teams
Automatically enforce expense policies
Reimburse employees faster and with fewer errors
Reduce manual work for finance teams
See spending in real time and make faster decisions

Expense automation and growth

How does expense reporting work?

Most companies follow these steps to manage spending. Expense management software can automate many of these steps to reduce manual work and improve accuracy.

Fast track the expense process

Step 1: Expense submission

Employees submit expense reports and upload receipts.

Step 2: Approval workflow

Managers review expenses to confirm they follow company policies.

Step 3: Finance review

Finance teams check for errors, match receipts to transactions, and approve expenses for reimbursement.

Step 4: Reimbursement

Employees are reimbursed for approved expenses.

Step 5: Reporting and tracking

The business tracks and analyzes expense data to monitor spending, control costs, and improve budgeting.

Signs you may need a better expense management system

Frequent policy violations

Employees regularly submit expenses that don’t follow company spending policies.

Employee frustration

Employees find expense reporting confusing or time-consuming, which leads to delays and errors.

Manual expense tracking

You’re tracking expenses in spreadsheets, email, or paper instead of using a dedicated system.

Low spending visibility

You don’t have a clear, real-time view of how and where your company is spending money.

Frequent budget overruns

Departments often exceed budgets without clear explanations or tracking.

Slow expense reimbursements

It’s common for employees to wait several weeks to be paid back for expenses.

Missing or poor-quality receipts

Receipts from employee expenses are often lost, incomplete, or difficult to manage.

You see duplicate expenses

The same expense appears more than once, or unusual claims go unnoticed.

Key expense management terms

Travel and expense (T&E)

Travel and expense (T&E) refers to business expenses employees incur while traveling, such as flights, hotels, meals, and transportation.

Expense report

An expense report (or expense claim) is a document employees submit to list business expenses and request reimbursement, usually with receipts attached.

Expense reconciliation

Expense reconciliation is the process of matching submitted expenses with financial transactions to make sure everything is accurate.

Receipt capture

Receipt capture is the process of uploading, scanning, or automatically capturing receipts so expenses can be recorded and verified.

Approval workflow

An approval workflow is the set of steps an expense follows as managers review and approve it based on company policy.

Reimbursement

Reimbursement is the payment made to employees after their expense reports are approved.

Expense policy

An expense policy defines what employees can spend, how much they can spend, and how expenses must be submitted.

Duty of care

Duty of care refers to a company’s responsibility to keep employees safe and supported while traveling for work.

Best practices for good expense control

Set a clear expense policy

Define simple rules so employees know what they can spend and how to submit expenses.

Automate and add AI to the process

Use automation software that is backed by AI to reduce manual data entry, speed up approvals, and prevent errors.

Enforce policies in real time

Check expenses as they are submitted to catch out-of-policy spending early.

Get more spending visibility

Having current spending data helps leaders control costs and make smarter financial decisions.

Make expense reporting easy for employees

A simple, mobile-friendly process helps employees submit accurate expense reports on time.

Learn more with these additional resources

Compare expense management solutions

Use a checklist to evaluate tools and choose the right expense management solution for your business.

Get the checklist

Expense automation buyer’s guide

Get insights that will help you make the best automated expense management solution for your business.

Read the buyer’s guide

Concur customer case study: Uber

Hear how Uber reduced manual work and saved thousands of hours by improving expense management.

Listen to Uber’s story

Fraud detection in spend management

Learn how automated checks can catch duplicate and suspicious expenses early.

Learn about fraud detection

Integrating finance and expenses

Understand how connecting expense management with finance systems improves reporting and control.

Learn about integrating teams

Tips for creating an expense policy

Get practical guidance for how to best create or improve upon your company’s expense policy.

Read the tips

Ready to go deeper?

Now that you understand how expense management works, explore real-world examples and tools that can help your business track expenses, control spending, and reduce manual work.

Case study

See how Brother UK used expense management software to standardize and track spending across teams.

Watch Brother UK’s story

Concur Expense

Visit our product page and explore our market-leading expense management solution.

Learn about Concur Expense