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The first time I watched someone do an expense report, I genuinely felt bad for them.
A sales rep at a company I was working with had a shoebox. An actual shoebox, stuffed with crumpled receipts from three trips back, and he was sitting there trying to remember which dinner went with which client. Half the receipts were faded thermal paper, gone completely blank. An hour of his life on it, two line items rejected, and he had to redo part of it.
For most people, that’s the expense report process. A chore nobody wants, a black box of approvals, and a finance team chasing missing receipts at month-end. And it costs more than people realize: a GBTA Foundation study found that processing a single expense report takes an average of 20 minutes and costs $58 in staff time - and one in five expense reports contains errors or missing information, adding another $52 and 18 minutes to correct each one. It really doesn’t have to work like that.
I’m Yuval, CEO of Glitter AI. I’ve spent a lot of time sitting with finance and ops teams, documenting the workflows that keep a company running, and the expense report process is one of the messiest ones I keep running into. What follows is a straight walkthrough of how it actually works, end to end, plus how to document it so you’re not re-explaining the whole thing every time someone new joins.
Teach your co-workers or customers how to get stuff done – in seconds.
What Is the Expense Report Process?
The expense report process is the end-to-end workflow for how an employee spends company money, reports it, gets it approved, gets paid back, and how finance ends up recording it in the books. Five stages: capture, submit, approve, reimburse, and reconcile.
It lives inside the broader finance function, next to accounts payable and the monthly close. For the wider picture, the glossary entry on standard operating procedures covers the documentation background, and the finance SOP overview explains where expense reporting fits among the other finance procedures.
A good expense report process answers four questions at every stage:
- Who owns this step (employee, manager, finance)?
- What evidence is required (receipt, policy reference, GL code)?
- When does it need to happen (the deadline)?
- What can go wrong, and what’s the rule when it does?
Get those four right and the shoebox problem mostly disappears.
Step 1: Capture Receipts
Everything downstream rides on this step. If the receipt isn’t captured cleanly at the point of spend, you’ll be fighting it forever.
The rule I push every team toward is simple: capture at the moment of purchase, not at month-end. Thermal receipts fade. Memories fade faster. The person who paid for that client dinner is the only one who will ever know what it was for, so the context has to get recorded while it’s still fresh.
A good capture step records:
- A photo or PDF of the receipt
- The amount and currency
- The date
- The business purpose (one sentence: who, what, why)
- The expense category (travel, meals, software, etc.)
The business purpose line is the one people skip, and it’s the one auditors always come back to. Make it required. “Dinner” is not a business purpose. “Client dinner with Acme during Q2 renewal discussion” is.
This is also where a clear policy earns its keep. Employees should know before they spend whether something is reimbursable, what the per-diem limits are, and what needs pre-approval. Fewer surprises at approval time means the whole thing moves faster.
Teach your co-workers or customers how to get stuff done – in seconds.
Step 2: Submit the Expense Report
Submission is where the individual captured expenses get bundled into a report and sent off for review.
A clean submission step has the employee:
- Group receipts into a single report (by trip, by project, or by month)
- Confirm each line has a category and business purpose
- Attach any required documentation (event agenda, approval email for large items)
- Certify the report is accurate and policy-compliant
- Submit before the deadline
That last point is worth digging in on. Set a submission deadline and enforce it. Month-end close slips most often because finance is waiting on stragglers. And fraud is a real factor here - the ACFE’s 2024 Report to the Nations found that expense reimbursement schemes appear in 13% of occupational fraud cases, with a median loss of $50,000 per incident. Clear submission rules and controls narrow that window. A rule like “expenses must be submitted within 30 days of being incurred, and by the 3rd business day of month-end” takes the ambiguity off the table.
The submission step is also where a documented process pays off right away. Most submission errors aren’t laziness. They’re people not knowing the rules. A short visual guide showing exactly which fields to fill and what a good business purpose looks like cuts rejected reports way down.
Step 3: Approve
Approval is the control step. Someone with authority confirms the spend was legitimate, within policy, and coded correctly before any money moves.
Most teams run a two-layer approval:
- Manager approval confirms the business need (“yes, this person was on this trip for this reason”)
- Finance review confirms policy compliance, receipt completeness, and correct GL coding
The single biggest speed killer here is unclear routing. If nobody knows whose approval a $4,000 expense needs versus a $40 one, reports just sit. Spell out the approval thresholds: who can approve what dollar amount, what triggers a second sign-off, and what happens when the approver is out.
This is a workflow worth documenting precisely. A defined approval workflow with thresholds, backups, and escalation rules is the difference between a report clearing in a day and one rotting in someone’s inbox for two weeks.
Common rejection reasons to bake into the process:
- Missing or illegible receipt
- No business purpose
- Over policy limit without pre-approval
- Wrong or missing expense category
- Personal expense mixed into a business report
When you reject something, say why and say what’s needed to fix it. A rejection with no explanation just buys you a second slow round trip.
Step 4: Reimburse
Once a report is fully approved, the employee gets paid back. This should be the most boring step in the whole thing, and if your process is good, it is.
Reimbursement typically runs through one of:
- Payroll (added to the next paycheck)
- A dedicated AP/expense payment run (separate ACH batch)
- Corporate card settlement (no employee reimbursement needed because the company already paid)
What employees care about most here is predictability. “Approved expenses are paid on the 15th and the last day of the month” beats “whenever finance gets to it” by a mile. Publish the schedule and actually stick to it. Predictable reimbursement is one of the cheapest ways to get employees to stop dreading expense reports.
For corporate card spend, the “reimbursement” is really a reconciliation. The employee still has to report and code the expense even though no cash goes back to them, because the company is the one on the hook for the card balance. Don’t let card spend skip the reporting step just because nobody’s getting a payout.
Teach your co-workers or customers how to get stuff done – in seconds.
Step 5: Reconcile
Reconciliation is where the expense report process connects back to the books. Employees never see it, and it’s the step that keeps finance honest.
In this step, finance:
- Confirms every reimbursement that was approved actually got paid
- Matches corporate card statements to submitted reports (every charge should map to a report)
- Posts expenses to the correct GL accounts and cost centers
- Flags unreported card charges and chases the owners
- Files receipts and approvals so they’re retrievable for audit
That last point matters more than people give it credit for. When an auditor asks for support on a $2,300 travel expense from eight months ago, you need the receipt, the business purpose, and the approval in minutes, not days. A clean trail of supporting evidence, with receipt, justification, approver, and date all linked to the transaction, is the whole payoff of doing the previous four steps properly.
Reconciliation is also where process problems show up. A pile of unreported card charges every single month means the capture and submission steps are broken upstream. Fix the cause, not the symptom.
Why You Should Document This Process Once
Here’s the pattern I see over and over: the whole expense report process lives in the finance team’s heads. One person knows the GL codes. Another knows which managers approve what. New employees learn by submitting a report wrong and getting yelled at.
That’s expensive. Every new hire reinvents the same mistakes. Every finance person who leaves walks out with a chunk of the process. And every audit turns into an archaeology dig.
The fix isn’t a 40-page policy PDF nobody reads. It’s a clear, visual, step-by-step guide for each role: one for employees on capturing and submitting, one for managers on approving, one for finance on reconciling. When someone asks “how do I do an expense report?” you send a link instead of scheduling a meeting.
This is the exact reason I built Glitter AI. You walk through the process once, clicking through your expense tool while talking out loud, and it turns that into a clean step-by-step guide with screenshots automatically. No writing it up by hand, no re-explaining it every quarter. For the bigger picture on documenting finance workflows, the accounting SOP glossary entry is a good place to start.
The expense report process will never be anyone’s favorite part of the month. But it can be a five-minute task with predictable outcomes instead of a shoebox of regret. That difference comes down almost entirely to documentation.
Teach your co-workers or customers how to get stuff done – in seconds.
Frequently Asked Questions
What is the expense report process?
The expense report process is the end-to-end workflow for how an employee spends company money and gets reimbursed. It runs in five stages: capturing receipts, submitting a report, getting it approved, receiving reimbursement, and finance reconciling the expense to the books.
What are the steps in the expense report process?
There are five core steps: capture receipts at the point of spend, submit a grouped expense report, route it through manager and finance approval, reimburse the employee, and reconcile the expenses against corporate card statements and the general ledger.
How do you submit an expense report correctly?
Group your receipts into one report, give every line an expense category and a one-sentence business purpose, attach any required documentation, certify it is accurate, and submit before the deadline. Missing business purposes and illegible receipts are the most common reasons reports get rejected.
Who approves expense reports?
Most companies use two approval layers. The employee's manager confirms the business need, and finance confirms policy compliance, receipt completeness, and correct GL coding. Approval thresholds should be defined so larger expenses get a second sign-off.
How long should expense reimbursement take?
It depends on your payment method, but predictability matters more than speed. Publish a fixed reimbursement schedule, such as twice a month, so employees know exactly when approved expenses will be paid rather than waiting indefinitely.
What is expense reconciliation?
Reconciliation is the finance step where approved reimbursements are confirmed paid, corporate card statements are matched to submitted reports, expenses are posted to the correct GL accounts, and receipts and approvals are filed for audit. It connects the expense report process back to the books.
Why do expense reports get rejected?
The most common reasons are missing or illegible receipts, no stated business purpose, expenses over policy limits without pre-approval, wrong or missing expense categories, and personal expenses mixed into a business report. Clear upfront rules prevent most rejections.
What is a business purpose on an expense report?
A business purpose is a short statement of who, what, and why for an expense. "Dinner" is not a business purpose; "Client dinner with Acme during Q2 renewal discussion" is. Auditors consistently ask for it, so it should be a required field at capture.
Do corporate card expenses still need an expense report?
Yes. Even though no cash is reimbursed to the employee, the company is liable for the card balance, so each charge still needs a receipt, business purpose, and correct coding. Card spend should never skip the reporting step.
How do you document the expense report process for a team?
Create a clear, role-specific visual guide: one for employees on capturing and submitting, one for managers on approving, and one for finance on reconciling. Tools like Glitter AI let you record the process once and generate a step-by-step guide with screenshots so you stop re-explaining it.
