Managing business expenses can be a tedious task, but it is essential if you want to achieve your business goals. Proper business expense management ensures that your company’s funds are used for the right purposes and helps prevent fraud and financial mismanagement. When you manage your expenses effectively, you can make informed decisions about investments and expansion, as well as identify areas where you may need to cut costs. Working with numerous small and medium-sized enterprises (SMEs) over the years, we at Validus give you tips on effective corporate expense management that will help your business maintain financial stability and growth.

1. Separate Personal and Corporate Finances

One of the most crucial steps in business expense management is to separate personal and corporate finances. Keeping your finances separate helps maintain accurate records and simplifies tax reporting. Additionally, separating your business and personal expenses avoids confusion and legal issues associated with co-mingling of funds.

You can start separating your company’s finances from your own by opening a separate SME business account and corporate card. This helps you track your business expenses and income easily and provides you with an accurate picture of your company’s financial health.

2. Establish a Clear Expenses Policy

A clear expense policy includes a detailed outline of allowable expenses and the reimbursement process to prevent confusion and ensure employees spend within company guidelines. The expense policy should have details about expense approval, reporting, and types that are reimbursable. Moreover, you must communicate the policies clearly to all employees and update them regularly to reflect any changes in business operations. An expense policy is crucial for proper expense management to control costs and avoid overspending.

3. Keep a Good Business Credit

When you have a corporate credit card, you must maintain a good business credit score to secure SME loans or other forms of financing in the future. An excellent credit score also helps you attain financing options at competitive rates and allows your SME to have good cash flow management. Furthermore, it gives your company a positive reputation in your industry. Your business can maintain an excellent business credit score by paying on time, managing expenses wisely by not maxing out your corporate card and monitoring your credit report regularly.

4. Monitor Your Expenses Regularly

Regularly monitoring the allocation of your funds is essential in effective business expense management as it helps you identify areas where you can save money and make informed choices about your company’s finances. You can track your expenses by keeping your financial records, like your receipts, and updating your books regularly. As such, you can avoid overspending and determine areas which are not cost-efficient and adjust your budget accordingly. Furthermore, tracking your expenses helps you spot unauthorised or duplicate charges, mitigating or preventing financial losses due to fraud or errors.

5. Take Advantage of Technology

Taking advantage of technology is an effective way for you to manage your small business’s expenses efficiently. There are many expense management software available for businesses today, where you can automate expense reporting, track receipts, and even get real-time insights into spending patterns. By using technology, you can save time, minimise errors, and simplify the expense management process.

Validus provides small businesses in Singapore with business expense management software that helps track and control company expenditures effortlessly. Our software comes with features, such as dashboard reporting and real-time transaction notifications, that help you and your team manage the company’s finances while limiting the hassle of manual administrative tasks.

Work with Validus for Your Business Financial Growth

At Validus, we strive to empower small businesses in Singapore to thrive in their industry and gain financial growth. Our professionals work closely with you in providing financial solutions that will help you boost your business and take it to new heights. Additionally, we help you integrate technology into your company’s financial management process so that you and your team can track your cash flows easily and make informed financial choices.

From SME loans to corporate expense management, partner with Validus today. If you’re also planning to get an SME loan from Validus, you can check out the four things to prepare when applying for our government-assisted SME loans. To know more about our services, you can reach out to our team.