How much time does your team spend on expense reports each month? For most startups, the answer is "too much." Between collecting receipts, filling out spreadsheets, getting approvals, and reconciling with accounting, expenses eat up hours that could be spent on actually building your business.
The good news: this is a solved problem. Modern expense management tools can reduce manual work by 80% while actually improving compliance. Here's how to set it up.
The Receipt Chaos Problem
We've seen startups at all stages struggling with the same issues:
- Lost receipts: That RM200 client dinner? Can't find the receipt. That's RM200 you can't claim as a business expense.
- Month-end scrambles: Everyone submits expenses on the last day, creating a bottleneck.
- Policy confusion: Did we approve Grab rides? Is that meal within policy? Nobody's sure.
- Accounting delays: Your accountant spends hours re-categorizing expenses that were miscoded.
- Audit nightmares: LHDN asks for supporting documents and you're digging through email for PDFs.
If your expense process involves emailing receipts, manual spreadsheets, or physical paper, you're wasting time and risking compliance issues.
Recommended Expense Management Tools
Here are the tools we recommend for Malaysian startups, ranked by company size and needs:
The gold standard for startups. Snap a photo of your receipt, and Expensify uses OCR to extract vendor, amount, and date. Integrates with most accounting software including Xero and QuickBooks.
Popular with accountants for its powerful data extraction. You can forward receipts via email, WhatsApp, or the mobile app. Particularly good for high-volume receipt processing.
Singapore-based, built for Southeast Asian companies. Combines expense management with corporate cards and bill payments. Good if you want an all-in-one spending solution.
Another Southeast Asian player. Strong on corporate cards with good spending controls. Useful if you want to issue cards to team members with built-in limits.
Our Recommendation
For most Malaysian startups under 50 employees, we recommend Expensify + Xero. It's the best balance of functionality, cost, and integration quality.
Step-by-Step Setup Guide
Here's how to go from receipt chaos to automated bliss:
Define Your Expense Policy
Before implementing any tool, document your expense policy. What's reimbursable? What requires approval? What are the limits for meals, travel, and software? Write it down. Most expense tools let you encode these rules for automatic enforcement.
Set Up Your Chart of Accounts
Create expense categories that match your accounting software. Common categories: Travel, Meals & Entertainment, Software Subscriptions, Office Supplies, Professional Development. The more specific, the better your reporting.
Connect Your Accounting Software
Set up the integration between your expense tool and accounting software. For Xero: Settings → Connected Apps → Expensify. Test the sync with a few transactions before rolling out.
Configure Approval Workflows
Set up who approves what. Typical setup: expenses under RM500 auto-approve, RM500-2000 needs manager approval, above RM2000 needs finance review. Keep it simple—too many approval layers slow everything down.
Train Your Team
Do a 15-minute demo showing how to snap receipts and submit expenses. Emphasize the "do it immediately" rule—capture receipts the moment you get them. Set expectations for submission timing.
Set Up Weekly Sync
Schedule approved expenses to sync to your accounting software weekly. Review the sync log monthly for any errors or uncategorized items.
Integration with Accounting Software
The magic of expense automation is the accounting integration. Here's what a good setup looks like:
- Automatic categorization: The tool learns from your past categorizations. After a few weeks, most expenses auto-categorize correctly.
- Tax code assignment: SST-registered? Set up tax codes so expenses flow into your books with correct tax treatment.
- Supplier mapping: Common vendors (Grab, Petron, Starbucks) get mapped to accounting suppliers automatically.
- Receipt attachment: The original receipt image stays attached to the transaction—crucial for audits.
Don't Double-Enter
A common mistake: manually entering expenses in accounting software AND using an expense tool. Pick one source of truth for expenses. Usually that's the expense tool syncing to accounting software.
Tips for Long-term Success
- Enforce the "same day" rule: Receipts should be captured within 24 hours. After a week, memory fades and receipts get lost.
- Use corporate cards where possible: Card transactions import automatically—no receipt capture needed for most small transactions.
- Review monthly reports: Look at spending by category, by person, by vendor. Spot unusual patterns early.
- Keep physical receipts for large items: For capital expenditure above RM500, keep the physical receipt too. LHDN may ask during audits.
- Set up policy reminders: Most tools can flag out-of-policy expenses. Use this feature rather than manual review.
The goal is to make expense submission so easy that people actually do it. Every minute saved on expense admin is a minute you can spend building your business.