Expense Tracking Strategies?

[gundog48]

For context, I am a sole trader, I work a full time job in addition to running my business, so my requirements for keeping things streamlined are as high as my tolerance for repetitive, automatable work is low!

I do my own books in Xero with very little trouble, I have automations set up for invoicing sales from Ebay, Etsy and my website. On the expense side, however, it's a different story! The big orders are easy to account for come reconciliation time, bank transfers and B2B invoices, straightfoward. The issue comes with the sheer number of sundries and small orders, and the relative difficulties of obtaining a receipt. I often buy on a budget or in a hurry, this means lots of orders from various sellers on eBay, through Amazon or various other websites. I put all these sales through a dedicated Amex card, that way I can't miss any expenses as they show up on the reconciliation report.

The problem is, I end up with an overwhelming quantity of '£7.95 Ebay Order', '£14.50 to 1268SHOPIFY54', '£19.99 to TOOLPARTSDIRECT'. Tool Parts Direct will invariably end up being the listed parent company for a 'subdivision' trading by a totally different name in an unrelated industry. So going through these becomes this exercise of:

1. Find the line to be reconciled
2. Try to identify company from line name
3. Check for emails from that company, or look through order history on platforms like eBay
4. Identify the order
5. Hopefully they have a simple option to download an invoice, otherwise;
   • contact them to obtain invoices,
   • create a screenshot of an email that technically doesn't include all the required information
6. Create expense for that invoice
7. Rinse and repeat

There's a few obvious solutions:

1. Simplify suppliers- I've been trying to do this, and have to a large extent, but being a manufacturer, we go through a lot of sundries, consumables and weird one-off tools
2. Scan receipts on delivery/store for scanning later: in a beautiful world where others care as much as you, sure, but very rarely do suppliers enclose sufficient documentation for an expense claim, even B2B suppliers
3. Get an Accountant- I've seriously considered it, but the real work being done here is in actually retrieving the receipts, not the bookkeeping element, and I doubt a bookkeeper would be able to help with that work
4. Lower my standards- for example, don't worry about having copies of receipts for orders under £25. Record the details, but don't worry about filing the receipt. It seems generally considered acceptable, but I'd be worried that the large number of these sub-£25 orders would still draw some scrutiny by an auditor
5. Stop moaning and get on with it- I suspect this is the real solution

My system is rather chaotic, and is a symptom of ordering things on-the-fly while in the workshop and busy with other tasks. If anyone has some strategies for tracking this stuff, I'd love to hear it. I do basic things like routing order emails to a specific email address, but the email rarely contain an easily digestible receipt!

 

[MyAccountantOnline]

For context, I am a sole trader, I work a full time job in addition to running my business, so my requirements for keeping things streamlined are as high as my tolerance for repetitive, automatable work is low!

I do my own books in Xero with very little trouble, I have automations set up for invoicing sales from Ebay, Etsy and my website. On the expense side, however, it's a different story! The big orders are easy to account for come reconciliation time, bank transfers and B2B invoices, straightfoward. The issue comes with the sheer number of sundries and small orders, and the relative difficulties of obtaining a receipt. I often buy on a budget or in a hurry, this means lots of orders from various sellers on eBay, through Amazon or various other websites. I put all these sales through a dedicated Amex card, that way I can't miss any expenses as they show up on the reconciliation report.

The problem is, I end up with an overwhelming quantity of '£7.95 Ebay Order', '£14.50 to 1268SHOPIFY54', '£19.99 to TOOLPARTSDIRECT'. Tool Parts Direct will invariably end up being the listed parent company for a 'subdivision' trading by a totally different name in an unrelated industry. So going through these becomes this exercise of:

1. Find the line to be reconciled
2. Try to identify company from line name
3. Check for emails from that company, or look through order history on platforms like eBay
4. Identify the order
5. Hopefully they have a simple option to download an invoice, otherwise;
   • contact them to obtain invoices,
   • create a screenshot of an email that technically doesn't include all the required information
6. Create expense for that invoice
7. Rinse and repeat

There's a few obvious solutions:

1. Simplify suppliers- I've been trying to do this, and have to a large extent, but being a manufacturer, we go through a lot of sundries, consumables and weird one-off tools
2. Scan receipts on delivery/store for scanning later: in a beautiful world where others care as much as you, sure, but very rarely do suppliers enclose sufficient documentation for an expense claim, even B2B suppliers
3. Get an Accountant- I've seriously considered it, but the real work being done here is in actually retrieving the receipts, not the bookkeeping element, and I doubt a bookkeeper would be able to help with that work
4. Lower my standards- for example, don't worry about having copies of receipts for orders under £25. Record the details, but don't worry about filing the receipt. It seems generally considered acceptable, but I'd be worried that the large number of these sub-£25 orders would still draw some scrutiny by an auditor
5. Stop moaning and get on with it- I suspect this is the real solution

My system is rather chaotic, and is a symptom of ordering things on-the-fly while in the workshop and busy with other tasks. If anyone has some strategies for tracking this stuff, I'd love to hear it. I do basic things like routing order emails to a specific email address, but the email rarely contain an easily digestible receipt!

The solution is option 5.

When you order items why not download and save documentation as a PDF at the same time - save it in a windows folder with a name which makes it easy to recall - you could use the date, supplier name and amount.