In QuickBooks, reimbursed expenses refer to money that an employee has spent on behalf of the company, which the company then pays back to the employee. This can include things like business travel expenses, office supplies, and other business-related expenses.
Once the employee has submitted the expense report, an approver (such as a manager or accountant) can review the expenses and approve or deny the reimbursement. Once approved, the reimbursement can be recorded as a check or bank transfer, and the amount is then subtracted from the employee’s outstanding expenses.
It’s important to track reimbursed expenses in QuickBooks so that you can:
- Have accurate records of how much the company is spending on expenses
- Be able to reimburse employees in a timely manner
- Be able to identify which expenses are tax-deductible for the company and which ones aren’t
- Track employee expenses for Audit purposes
By tracking reimbursed expenses, you can ensure that your company is managing its expenses effectively and that employees are being fairly compensated for the expenses they incur on the company’s behalf.
How to Record Reimbursed Expenses in QuickBooks?
There are a few different ways to record reimbursed expenses in QuickBooks, depending on the specific details of the expense and the reimbursement. Below is the method you can use:
- Create a new expense transaction: Go to the “Expenses” menu, select “Vendor” and then choose “Expense” to create a new expense transaction.
- Assign the expense to the appropriate account: This will depend on the type of expense. For example, if the expense is for business travel, you would assign it to the “Travel Expenses” account.
- Enter the details of the expense: In the “Expense Information” section, enter the date of the expense, the amount, and any other relevant details, such as the vendor name or the purpose of the expense.
- Add any relevant documentation: QuickBooks allows you to attach receipts, invoices, or other documents to the expense transaction, which can be useful for keeping track of the expense details.
- Record the reimbursement: Once the expense report is approved and the employee has been reimbursed, you can create a check or bank transfer to pay the employee back. In the “Payee” field, select the employee, and in the “Account” field, select the account that the original expense was charged. And then fill in the amount.
- Record the reimbursement check and link it to the original expense transaction.
- Review the expenses: To view all the reimbursed expenses, you can go to the “Reports” menu and choose “Expenses” to see a summary of all expenses that have been recorded in QuickBooks, including reimbursed expenses.
It’s important to make sure that the expenses are properly recorded in QuickBooks to make sure that the company’s financial records are accurate, and also to make sure that employees are reimbursed in a timely manner.
The Benefits of Reimbursed Expenses in QuickBooks
Using QuickBooks to track reimbursed expenses can provide a number of benefits for your business, including:
- Accurate financial records: By recording reimbursed expenses in QuickBooks, you can ensure that your company’s financial records are accurate and up-to-date. This can make it easier to understand how much the company is spending on expenses, and can also be useful for tax purposes.
- Timely reimbursement: With QuickBooks, you can easily track which expenses have been incurred, which ones have been approved, and which ones still need to be reimbursed. This can help ensure that employees are reimbursed in a timely manner, which can help maintain good relationships with employees.
- Improved budgeting and forecasting: With accurate financial records, you can better understand your company’s expenses, and make more informed decisions about budgeting and forecasting. This can help you make more informed decisions about how to allocate resources and plan for future expenses.
- Easier compliance: Keeping accurate records of reimbursed expenses can also help with compliance with tax laws and other regulatory requirements. Depending on the country and area the business is situated, there are different laws around reimbursement, by keeping accurate records it can be easier to comply. QuickBooks wide range of software helps you to easily keep your accounting-related issues under control.
- Auditing: With accurate records, it can also make the audit process more straightforward as all the data will be in one place, allowing you to demonstrate to auditors that your company is adhering to all relevant financial regulations.
Overall, tracking reimbursed expenses in QuickBooks can provide a wide range of benefits that can help you better manage your company’s finances and improve the overall financial health of your business.