How to Keep Track of Business Expenses in a Spreadsheet (& Why Automation is Better)

If you’re a CFO, financial controller, or finance team member, you know how important it is to keep a close eye on your business expenses. You might even have searched for how to create a business expense spreadsheet or how to keep track of business expenses in a spreadsheet. 

Using a simple business expenses spreadsheet is a common starting point for tracking costs – it’s familiar, accessible, and doesn’t require special software beyond Excel or Google Sheets.

In fact, a survey found that about 35.9% of businesses still track their expenses using Excel spreadsheets​. 

It makes sense: spreadsheets are readily available and most people know the basics of how to use them. 

But is a manual business expense spreadsheet really the most efficient way to manage your company’s spending?

While setting up a spreadsheet can help you organise business expenses, it also comes with hidden challenges that might not be obvious at first. 

In this article, we’ll discuss how to keep track of business expenses with a spreadsheet, what a basic setup entails, and – importantly – why relying solely on manual spreadsheets can hold your business back.

Tracking Business Expenses with a Spreadsheet

Using a spreadsheet (like Microsoft Excel or Google Sheets) to record expenses is straightforward. 

Here’s how you can make a business expense spreadsheet work for your needs:

1. Set Up Columns for Key Details

Start by deciding what information you need to record for each expense. Common columns in a business expense spreadsheet include: 

• The date of the expense

• Vendor/payee (who you paid)

• Category of expense (e.g. travel, office supplies, utilities)

• A brief description or memo

• The amount paid. 

You might also have columns for: 

• Payment method

• Client/project (if expenses need to be billed or tracked by project)

• Tax-related details (like VAT)

By structuring your spreadsheet with clear headers, you ensure each expense entry captures all necessary info.

2. Record Expenses Regularly

Consistency is key. 

Each time your business spends money – whether it’s buying printer paper or taking a client to lunch – you (or your employees) would enter it as a new row in the spreadsheet. 

It’s a good practice to update your expense spreadsheet in real-time or at least weekly. The more promptly you log each expense, the less likely you are to forget details or lose expense receipts. 

Timely recording will help you keep track of business expenses in the spreadsheet and maintain an accurate running total.

3. Categorise and Sum Up Totals

One of the few benefits of spreadsheets is that you can use formulas to automate some calculations.

For example, you can use Excel’s SUM function to total all expenses in a given category or month. This helps you see how much you’re spending on, say, “Travel – June 2025” or “Office Supplies – Q1”. 

You can create summary tables or pivot tables to aggregate expenses by category or by time period. This way, your business expenses spreadsheet can double as a basic report – useful for budgeting and tax time. 

4. Save Receipts and Link Them (Optional)

If you want to be diligent, you can scan or photograph paper receipts and store them digitally. 

Some people attach receipt images or links in their spreadsheet so that each entry has proof if needed. For example, Excel allows you to hyperlink to an image of the receipt stored in a cloud drive. 

This can be handy during HMRC audits or when preparing taxes. However, doing this for every expense can become quite labour-intensive.

Disadvantages of Using Spreadsheets for Business Expenses

Using a spreadsheet for your expenses does give you a sense of control. It’s your custom ledger, and you can set it up exactly how you like. 

For a while, this manual method works fine – especially if your volume of monthly expenses is relatively low. A well-maintained business expense spreadsheet can help you budget, track deductible expenses, and understand where your money is going.

However, as your business grows (or simply as months go by), you’ll start to notice some problems.

Manually updating an Excel file for every little expense, making sure all the formulas are correct, and making sure everyone is using the same version of the file can become exponentially more tedious. 

What begins as a quick solution can turn into a time-consuming administrative task. Before long, you might be spending more time fiddling with cells and receipts than actually running your business.

Here are some of the major drawbacks of relying on spreadsheets for expense management:

Error-Prone Data Entry

Humans make mistakes, especially when doing repetitive data entry. Unfortunately, spreadsheets are highly susceptible to costly human errors. 

Did you know that up to 88% of spreadsheets contain errors? Small typos or formula mistakes can lead to incorrect totals or miscategorised expenses. 

In the context of expense tracking, an innocent slip-up (entering £400 instead of £40, or misplacing a decimal point) can throw off your financial reports. 

Even if you’re careful, errors can creep in over time – and there may be no easy way to catch them. It’s not just theoretical: about 1 in 5 expense reports submitted by employees contain mistakes​ that require correction. 

When your expense data is riddled with inaccuracies, it becomes a shaky foundation for making business decisions.

Time-Consuming Manual Process

Maintaining a business expenses spreadsheet can eat up a lot of your valuable time. Every receipt must be collected, then manually entered into the sheet.

If you have multiple team members filing expenses, someone has to consolidate all that information.

The process is tedious: 

1. Sorting receipts

2. Updating the file

3. Double-checking entries

4. Fixing mistakes

5. Emailing updated versions around

According to research by the Global Business Travel Association, the average expense report takes about 20 minutes to complete – plus 18 additional minutes to correct if there are errors. 

Now multiply that by dozens of expenses every month, and you can imagine the hours of administrative work manual tracking requires. 

Time spent on data entry and spreadsheet upkeep is time not spent on strategic tasks or growing your business.

Lack of Real-Time Visibility

A spreadsheet is essentially a static snapshot of your expenses at a given moment. It’s only as up-to-date as the last entry you made. This means you often operate with a delay in information. 

For example, if an employee forgets to enter a big purchase from last week, your current total is off until they update it. There’s no live feed of transactions – you have to manually input or import new data. 

This delay in visibility can hinder decision-making. 

If you don’t realise you went over budget in a category until weeks later when you update the spreadsheet, it’s too late to course-correct. 

In short, spreadsheets aren’t updated in real-time, so managers lack immediate insights into spending. In fast-paced business environments, that could mean missed opportunities or nasty surprises (like finding out about an overspend long after the fact).

Poor Collaboration & Version Control

If you’re a sole proprietor handling all expenses yourself, a single spreadsheet might be fine.

But for most businesses, multiple people are involved in the expense process (employees making purchases, finance teams reviewing them, managers approving budgets, etc.). 

Traditional spreadsheets don’t excel at multi-user collaboration. 

Emailing an Excel file around is a recipe for confusion – you’ll end up with filenames like "Expense_Report_final_FINAL2.xlsx" and no single source of truth. 

Even cloud-based sheets (like Google Sheets or Excel Online) can become messy when many hands are editing or if internet connectivity is spotty. There’s also the risk that someone accidentally deletes or alters data that others need. 

In a nutshell, manual spreadsheets offer no robust version control or user permissions. This makes it hard to enforce consistency and security. One person’s mistake in the file could ripple through the entire record. 

Also, if the spreadsheet lives on one person’s computer, others may not have timely access to update or view it – a serious drawback for team-based expense tracking.

Risk of Data Loss or Security Issues

Relying on a spreadsheet means your critical expense data is one accidental deletion or computer crash away from disappearing. 

Unless you have backups, a corrupted file or lost laptop could wipe out months of records. Even with backups, restoring data and verifying it’s all intact is no fun. 

Spreadsheets also lack advanced security features. 

They might be password-protected at best, but they don’t inherently track who changed what or guard against unauthorised access in a granular way. Sensitive financial data in a spreadsheet could be more vulnerable to prying eyes or misuse, especially if it’s being shared via email. 

In contrast, purpose-built expense management systems usually have audit trails and security measures to protect your data.

With a manual spreadsheet, you carry a higher potential to lose important data or expose it in ways you didn’t intend.

These drawbacks often become more pronounced as your business scales up. A system that worked for a handful of expenses can buckle under the weight of hundreds of transactions. 

What’s more, the inaccuracies and delays caused by spreadsheet-based reporting can lead to slow decisions and even financial losses.

For example, if errors go unnoticed, you might reimburse more money than you should, or you could miss out on reclaiming VAT because a formula was wrong. 

It’s clear that while spreadsheets are a familiar tool, they have serious limitations when it comes to efficient expense management.

So, what’s the alternative? 

The good news is that nowadays you don’t have to choose between staying on top of your expenses and saving time. Automation offers a better path forward.

Why Automation is Better for Tracking Business Expenses

Imagine if your business expenses could essentially track themselves, with minimal effort from you or your employees. This is the promise of automating your expense management. 

Instead of manually typing data into cells, you could snap a photo of a receipt and have the numbers magically appear in your expense report. 

Instead of cross-checking every line for mistakes, the expense software could flag anything that doesn’t add up or that violates your expense policy. 

Automation takes the grunt work (and guesswork) out of expense tracking.

Here are some key ways that an automated expense management solution outshines the old spreadsheet method:

Fewer Errors & Accurate Data

Automation dramatically reduces human error. 

Modern expense tools use features like OCR (Optical Character Recognition) to scan receipts and automatically extract data, so there’s no risk of typing the wrong amount. 

They also perform automatic calculations, tax conversions, and duplicate detection. 

The result? Far fewer mistakes compared to manual entry.

One study found that companies saw a 64% reduction in errors after switching to an expense management solution. 

When the software is doing the heavy lifting, your reports are more reliable – and you spend little to no time hunting down and fixing mistakes.

Time Savings & Efficiency

An automated system can save hours of work each month. 

Employees can record expenses on the go using a mobile app – for example, by taking a picture of a receipt as soon as they get it – rather than saving receipts and filling out a spreadsheet later. 

Submissions, approvals, and reimbursements all happen faster because the process is streamlined. 

Consider the earlier example: ~38 minutes to complete and fix one expense report in a spreadsheet. Some expense apps claim to cut that process to just a couple of minutes, by eliminating manual tasks. 

Even if your team isn’t dealing with large volumes of expenses, the cumulative time savings are significant. Automation frees you and your staff from tedious admin work so you can focus on more important business activities.

Real-Time Tracking & Insights

Most cloud-based expense software will update your expense data in real time. 

The moment an expense is submitted (or a company credit card transaction comes through), it’s visible to whoever needs to see it – finance teams, managers, etc. 

This means your finance dashboard is always up-to-date with the latest spending. You can monitor budgets live, catch overspending early, and make quick decisions with current information. Real-time reporting is a huge upgrade from waiting weeks for everyone to update a spreadsheet. 

Automated systems also often provide analytics tools: you can generate reports by category, department, project, and so on, with a few clicks. 

These insights can help you spot spending trends or savings opportunities that would be hard to see in a basic spreadsheet. In short, automation gives you better visibility into your finances at all times.

Improved Collaboration & Control

Expense management platforms are built for multiple users and typically live in the cloud. 

Each employee can have their own login to submit expenses, managers can have approval roles, and finance teams can oversee the process – all in one integrated system. 

There’s no confusion about versions or lost files; everyone is working off the same platform (often accessible via web and mobile app). 

You can usually set permissions and workflows: for example, an expense over a certain amount can automatically route to a senior manager for approval. This level of control and workflow management simply isn’t possible in a static spreadsheet. 

Also, with a proper system, every action leaves a digital audit trail. You know who added or approved each expense and when, which boosts accountability and security.

Enforces Policy & Reduces Fraud

Automated solutions can be configured to enforce your company’s expense policy rules. 

If an employee tries to claim something that’s not allowed (say, a lavish client dinner above the daily limit), the system can flag it or prevent it from being submitted in the first place. 

It can also catch duplicates (the same receipt submitted twice) or suspicious patterns. 

This built-in policing means you’re less likely to reimburse fraudulent or out-of-policy expenses, saving your company money. By automating checks and balances, you add a safeguard that a spreadsheet can’t provide.

Given these advantages, it’s easy to see why businesses are moving away from spreadsheets for expense tracking. 

But how do you make that transition? This is where a business expense tracker app like ExpenseIn comes into play.

ExpenseIn as a Smarter Alternative

ExpenseIn is an automated expense management solution designed to take over where spreadsheets leave off. 

It provides an all-in-one platform (accessible via a mobile app and web browser) that handles the entire expense process from submission to approval to reporting. 

Here are a few features of ExpenseIn that address the very pain points we discussed:

1. Receipt Scanning

Simply snap a picture of a receipt with your phone, and ExpenseIn’s OCR technology will extract the merchant, date, amount, VAT, etc., and create a digital expense entry for you.

No typing required. 

This drastically cuts down data entry errors and lost receipts. 

That taxi receipt crumpled in your wallet is no longer an issue – photograph it and toss the paper, because the digital copy is safely stored.

2. Automatic Policy Enforcement

You can configure ExpenseIn with your company’s expense rules (for example, daily meal allowance or required receipts for claims over £50). 

The system will automatically flag any expenses that don’t comply, alerting the submitter or approver. 

This means fewer awkward conversations and a consistent application of policy. It’s like having a built-in auditor that checks each claim instantly.

3. Fast Approval Workflows

ExpenseIn allows for multi-level approvals and notifications. 

When an employee submits an expense, the appropriate manager is notified to approve it online – no emails with spreadsheets attached, no physical signatures needed. 

Approvers can review expenses (with attached receipt images) and approve or query them with a click. 

The finance team gets a complete record of approved expenses in real time.

Reimbursements can then be processed faster, keeping employees happier. (No one likes waiting weeks to get paid back because paperwork is stuck in someone’s inbox.)

4. Real-Time Reporting and Integration

All your expense data in ExpenseIn aggregates into useful reports. 

Need to see how much was spent on travel this month, or how your actual spending compares to the budget? It’s readily available. 

You can also export data or integrate ExpenseIn with your accounting software (like AccountsIQ, Xero, QuickBooks, and more!) so that bookkeeping is automated too. 

No more manually re-keying totals from your spreadsheet into your accounting system – ExpenseIn can sync the data, reducing duplicate work and potential errors.

5. Secure, Centralised Data

With ExpenseIn, all your expense records are stored securely in one place. 

You don’t have to worry about a lost file or a former employee walking off with the only copy of the expense log. ExpenseIn uses cloud storage with encryption and other security measures to protect your information. 

Plus, you have an audit trail of every action. This level of security and reliability gives peace of mind that a basic spreadsheet cannot match.

By adopting an automated solution like ExpenseIn, you essentially outsource the mundane parts of expense tracking to technology. 

The software takes care of the details – capturing data, doing math, enforcing rules – far more efficiently and accurately than a person with a spreadsheet ever could.

And rather than spending your days doing admin cleanup, you get to focus on analysing the expenses and finding ways to optimise spending.

Conclusion: Ditch the Spreadsheet, Boost Your Productivity

Tracking business expenses is non-negotiable – you need accurate records to manage cash flow, claim tax deductions, and understand your financial health. 

Using a spreadsheet to get the job done is a natural step, especially in the early days of a business.

However, as we’ve seen, sticking with a manual Excel expense spreadsheet in the long run can become a drag on your time and a source of avoidable errors.

The rise of affordable, user-friendly expense management software means that you don’t have to grin and bear the limitations of spreadsheets anymore. 

Automation brings speed, accuracy, and convenience to a task that no one enjoys doing by hand. Instead of constantly updating cells and chasing receipts, you could have a system that updates itself and reminds you if something needs attention. 

By upgrading from a manual process to an automated one, you’ll ensure that your expense tracking is always accurate and up-to-date without consuming your workday.

So ask yourself: where is your time better spent – manually updating rows and columns, or strategising and growing your team and business? The answer is pretty clear. 

Say Goodbye to Spreadsheets – Book Your Demo Today!

Why spend hours manually tracking expenses when you can automate the entire process?

Book a free demo today to see how ExpenseIn can streamline approvals, eliminate errors, and give you real-time control over your company’s spending.