5 best expense tracking software for SMEs

Efficient expense tracking helps identify tax deductions and improve financial performance. It not only facilitates strategic planning, but also ensures compliance with financial regulations. Hence, expense tracking is crucial to businesses of all shapes and sizes.

In this article, we'll explore 5 expense tracking software options for SMEs and guide you in selecting the one that best fits your needs.

What is expense tracking software?

Expense tracking software enables businesses to accurately record their expenditures, making it easier to organise and understand cash flow. Some advanced expense tracking software automates expense recording and streamlines the reimbursement process to enhance overall financial efficiency. 

What information is recorded by expense tracking software?

For financial reporting and analysis purposes, expense tracking software captures the following crucial information:

1. Date of the expense

2. Total amount and the currency used

3. Recipient of the payment

4. Expense category

5. Purpose of the expense

How often should my business perform expense tracking?

Think of expense tracking like monitoring sales performance – you wouldn’t wait until the year-end to check your earnings; and similarly, you shouldn’t delay understanding your expenditures.

That being said, the ideal frequency for tracking expenses depends on the nature of your business. Some small businesses owners record expenses as they occur; while professional service providers may track expenses per project or when invoicing clients. 

Be it daily, weekly, monthly, or per-project, you should establish an expense tracking routine that works best for you and your business operations.

How can expense tracking software help and benefit my business?

With automated procedures and streamlined operations, expense tracking software can help SMEs to:

• Save time and boost productivity: According to a 2024 whitepaper by Rydoo, switching from manual methods like Excel to automated expense tracking software can save companies over 30,000 hours a year and increase productivity by more than 70%.

• Maintain accurate and reliable financial records: Automation of expense entry significantly reduces the chances of human errors.

• Gain clarity on cash flow: Business owners can access real-time data through expense tracking software for clear cash flow visibility, enabling better financial forecasting and budget management.

• Optimise budgeting: By identifying duplicate and unnecessary expenses, businesses can ensure funds are allocated more effectively to critical areas.

• Better tax planning and compliance: Expense tracking software facilitates accurate record-keeping and categorisation, helping businesses quickly identify tax-deductible expenses and avoid penalties for non-compliance.

What are the types of business expenses?

Understanding the various categories of business expenses can help you better manage and track your finances. Here's a commonly adopted approach to categorising expenses:

• Fixed expenses: consistent month-to-month expenses, e.g. office rent, employee salaries, Shopify subscriptions

• Variable expenses: expenses that fluctuate based on activity, e.g. utility bills, payments to suppliers, delivery costs, advertising

• Direct expenses: costs that are directly linked to the production of a specific product or service, e.g. cost of raw materials, rates for freelancers dedicated to a specific project

• Indirect expenses: costs that cannot be directly tied to a specific product or service, but are necessary for business operations, e.g. office supplies, legal fees, accounting services

Through this approach, you will have a better understanding of your business spending pattern and identify better ways to track, monitor, optimise, and reduce costs. If you are still not sure where to start, expense tracking software usually offers a default template for you to kickstart. 

How does an expense tracker create reports?

Once a business expense tracker is in place, every expenditure of your company will be recorded, categorised, and properly documented. 

The software can then generate expense reports to provide insights into where and how your money is spent, highlighting opportunities for cost reduction, and supporting tax filing and compliance. 

In a nutshell, the implementation of expense tracking software bridges the gap between simple expense documentation and actionable financial planning, further boosting your company’s financial health. 

The best practices to utilise expense tracking

Implementing expense tracking for business is just the beginning. Here are 5 key actions to maximise the impact of your expense tracking. 

• Clearly define your expense policy: Establish a comprehensive policy that clearly defines approval workflows and designated persons in charge to ensure accountability and consistency.

• Utilise company cards and employee cards: Assign employee cards for easier tracking of individual or departmental expenses. Airwallex Borderless Card offers built-in budget control functionalities to monitor and control expenditure effectively.

• Adopt a centralised approach: Streamline your financial operation by processing company card expenses and out-of-pocket expense reimbursement on the same platform.

• Foster a culture of transparency and timeliness: Encourage timely submissions and open communication about expenses to prevent discrepancies and unexpected costs.

• Conduct regular reviews and evaluations: Assess your expense tracking system and reports to identify areas for improvement, potential savings, and ensure compliance with budgeting goals.

5 most popular expense tracking software in Hong Kong

To assist you in making an informed decision, we’ve compiled a list of the 5 most popular expense tracking software in Hong Kong. 

**T&Cs apply.

When you choose an expense tracking tool for business, it’s crucial to assess your specific needs, budget, and team’s readiness, while keeping an eye in the future - the ideal expense tracking software should meet your current requirements, but also be able to accommodate your ever-changing needs as your business grows, ensuring continued effectiveness and efficiency.

Benefits of tracking expenses with Airwallex

More than just a simple expense tracking tool for businesses, Airwallex offers an all-in-one platform that streamlines the entire financial management, including comprehensive expense management solutions with the following competitive features:

1. Track and control employee expenditure in real time

With Airwallex Borderless Cards, you can issue employee cards at no cost and within minutes. Coming with built-in expense management features, these cards allow you to set spending limits, restrict purchases to specific merchants, and track usage in real-time.

2. Automate expense submission with minimal effort  

Employees can upload receipts and submit expenses on the go; your finance team can track, review, and approve these business expenses in real-time, all within the Airwallex platform. You can also build multi-layer approval workflows and define expense submission criteria.

3. Seamless integration with other business tools

Airwallex’s user-friendly plugins integrate seamlessly with your accounting software such as Xero and QuickBooks. This powerful merge not only enables automatic reconciliation, but also simplifies all aspects of your financial management.

4. Full visibility and clarity on multiple business entities

Airwallex allows the creation of separate expense accounts and additional users at no extra cost. This means that you have clarity and complete control over employee expenses across different offices or branches. 

5. Comprehensive suite of financial tools

Airwallex is designed for scalability, offering high-value tools including company cards, international transfers, online payment solutions and more. An Airwallex Business Account is an all-in-one financial and payment platform for businesses with global ambitions.

As your business grows, Airwallex can grow with you, offering an extensive range of solutions that help you stay ahead of the competition.

Limited time offer: 6-month free trial of expense management 

For a limited time only, sign up for an Airwallex account to enjoy 6 months free trial of expense management.

Issue employee cards online for free to empower your team, and enjoy free expense tracking, reimbursement, cash flow insights and more for the first 20 Airwallex Borderless Cardholders for 6 months. 

Sign up today and experience the smart approach to expense tracking. Take control of your business finances and simplify your expense management with Airwallex.

Frequently asked questions

What is expense tracking software?

Expense tracking software facilitates the accurate recording and documentation of business expenses, making it easier to organize expenditures and understand cash flow. Some tools can help automate expense submission and streamlines the reimbursement process, enhancing overall financial management efficiency. 

Does Airwallex offer expense tracking solutions?

Yes, Airwallex offers a comprehensive expense management solution, with expense tracking being one of the high-value features. 

With Airwallex, you can customise multi-layer approval workflows, streamline global expense reimbursement and reconciliation, gain clarity into cash flow and other insights, and more. 

What is the difference between Airwallex and other expense tracking tools?

While Airwallex provides all the essential features of expense tracking software, it is an all-in-one platform that streamlines the entire financial management. Designed for scalability and global expansion, Airwallex enables business owners to issue company and employee cards at not cost, use its market-beating rate to conduct FX and international transfers, accept payments online with 160+ local payment methods, and transact in 60+ currencies across 150+ countries and regions with an Airwallex Business Account.

Sources: Information on Xero, QuickBooks Online, ABSS and Info-tech was retrieved as of August 2024. Information provided is for reference only. Please refer to the official websites for the most up-to-date details

Disclaimer: The information was based on our own online research and we were not able to manually test each tool or provider. The information is provided for educational purposes only and a reader should consider the specific requirements of their business when evaluating providers. This research is reviewed every 6 months. If you would like to request an update, feel free to contact us at [email protected].