documentation/content/applications/finance/expenses.rst

:show-content:

========
Expenses
========

Odoo **Expenses** streamlines the management of expenses. After an employee submits their expenses
in Odoo, they are reviewed by management and accounting teams. Once approved, payments can then be
processed, and disbursed back to the employee for reimbursement.

.. seealso::
   `Odoo Expenses: product page <https://www.odoo.com/app/expenses>`_

Set expense categories
======================

The first step to track expenses is to configure the different types of expenses for the company
(managed as *expense categories* in Odoo). Each category can be as specific or generalized as
needed. Go to :menuselection:`Expenses app --> Configuration --> Expense Categories` to view the
current expensable categories in a default list view.

.. image:: expenses/categories.png
   :align: center
   :alt: Set expense costs on products.

To create a new expense category, click :guilabel:`New`. A product form will appear, with the
description field labeled :guilabel:`Product Name`.

.. note::
   Expense categories are managed like products in Odoo. The expense category form follows the
   standard product form in Odoo, and the information entered is similar. Expense products will be
   referred to as expense categories throughout this document since the main menu refers to these as
   :guilabel:`Expense Categories`.

Only two fields are required, the :guilabel:`Product Name` and the :guilabel:`Unit of Measure`.
Enter the :guilabel:`Product Name` in the field, and select the :guilabel:`Unit of Measure` from the
drop-down menu (most products will be set to :guilabel:`Units`).

.. tip::
   The *Sales* app is where specification on the units of measure are created and edited (e.g.
   units, miles, nights, etc.). Go to :menuselection:`Sales app --> Configuration --> Settings` and
   ensure `Units of Measure` is enabled in the `Product Catalog` section. Click on the
   :guilabel:`Units of Measure` internal link to :doc:`view, create, and edit the units of measure
   <../inventory_and_mrp/inventory/product_management/product_replenishment/uom>`.

.. image:: expenses/new-expense-product.png
   :align: center
   :alt: Set expense costs on products.

The :guilabel:`Cost` field on the product form is populated with a value of `0.00` by default. When
a specific expense should always be reimbursed for a particular price, enter that amount in the
:guilabel:`Cost` field. Otherwise, leave the :guilabel:`Cost` set to `0.00`, and employees will
report the actual cost when submitting an expense report.

.. note::
   The :guilabel:`Cost` field is always visible on the expense category form, but the
   :guilabel:`Sales Price` field is *only* visible if the :guilabel:`Sales Price` is selected under
   the :guilabel:`Re-Invoice Expenses` section. Otherwise, the :guilabel:`Sales Price` field is
   hidden.

.. example::
   Here are some examples for when to set a specific :guilabel:`Cost` on a product vs. leaving the
   :guilabel:`Cost` at `0.00`:

   - **Meals**: set the :guilabel:`Cost` to `0.00`. When an employee logs an expense for a meal,
     they enter the actual amount of the bill and will be reimbursed for that amount. An expense for
     a meal costing $95.23 would equal a reimbursement for $95.23.
   - **Mileage**: set the :guilabel:`Cost` to `0.30`. When an employee logs an expense for
     "mileage", they enter the number of miles driven in the :guilabel:`Quantity` field, and are
     reimbursed 0.30 per mile they entered. An expense for 100 miles would equal a reimbursement for
     $30.00.
   - **Monthly Parking**: set the :guilabel:`Cost` to `75.00`. When an employee logs an expense for
     "monthly parking", the reimbursement would be for $75.00.
   - **Expenses**: set the :guilabel:`Cost` to `0.00`. When an employee logs an expense that is not
     a meal, mileage, or monthly parking, they use the generic :guilabel:`Expenses` product. An
     expense for a laptop costing $350.00 would be logged as an :guilabel:`Expenses` product, and
     the reimbursement would be for $350.00.

Select an :guilabel:`Expense Account` if using the Odoo *Accounting* app. It is recommended to check
with the accounting department to determine the correct account to reference in this field as it
will affect reports.

Set a tax on each product in the :guilabel:`Vendor Taxes` and :guilabel:`Customer Taxes` fields, if
applicable. It is considered good practice to use a tax that is configured with :ref:`Tax Included
in Price <taxes/included-in-price>`. Taxes will be automatically configured if this is set.

Re-invoice expenses to customers
================================

If expenses are tracked on customer projects, expenses can be automatically charged back to the
customer. This is done by creating an expense, referencing the :abbr:`SO (Sales Order)` the expense
should be added to, and then creating the expense report. Next, managers approve the expense report,
and the accounting department posts the journal entries. Finally, once the expense report is posted
to a journal, the expenses appear on the :abbr:`SO (Sales Order)` that was referenced. The sales
order can then be invoiced, thus invoicing the customer for the expense.

Setup
-----

First, specify the invoicing policy for each expense category. Go to :menuselection:`Expenses app
--> Configuration --> Expense Categories`. Click on the expense category to open the expense
category form. Under the :guilabel:`Invoicing` section, click the radio button next to the desired
selection for :guilabel:`Re-Invoicing Expenses`. Options are :guilabel:`None`, :guilabel:`At cost`,
and :guilabel:`Sales price`.

:guilabel:`Re-Invoicing Expenses`:

- :guilabel:`None`: Expense category will not be re-invoiced.
- :guilabel:`At cost`: Expense category will invoice expenses at their real cost.
- :guilabel:`At sales price`: Expense category will invoice the price set on the sale order.

Create an expense
-----------------

First, when :doc:`creating a new expense <expenses/log_expenses>`, the correct information needs to
be entered in order to re-invoice a customer. Select the *sales order* the expense will appear on in
the :guilabel:`Customer to Reinvoice` section, from the drop-down menu. Next, select the
:guilabel:`Analytic Account` the expense will be posted to. After the expense(s) are created, the
expense report needs to be :doc:`created <expenses/expense_reports>` and :ref:`submitted
<expenses/submit>` as usual.

.. image:: expenses/reinvoice-expense.png
   :align: center
   :alt: Ensure the customer to be invoiced is called out on the expense.

.. important::
   Selecting a :guilabel:`Customer to Reinvoice` when creating an expense is critical, since this is
   what causes the expenses to be automatically invoiced after an expense report is approved.

   The :guilabel:`Customer to Reinvoice` field can be modified *until an expense report is*
   **approved**, then the field is no longer able to be modified.

Validate and post expenses
--------------------------

Only employees with permissions (typically, managers or supervisors) can :doc:`approve expenses
<expenses/approve_expenses>`. Before approving an expense report, ensure the :guilabel:`Analytic
Distribution` is set on every expense line of a report. If an :guilabel:`Analytic Distribution` is
missing, assign the correct accounts from the drop-down menu, and click :guilabel:`Approve` or
:guilabel:`Refuse`.

The accounting department is typically responsible for :doc:`posting journal entries
<expenses/post_expenses>`. Once an expense report is approved, it can then be posted. The :abbr:`SO
(Sales Order)` is **only** updated *after* the journal entries are posted. Once the journal entries
are posted, the expenses now appear on the referenced :abbr:`SO (Sales Order)`.

Invoice expenses
----------------

Once the :abbr:`SO (Sales Order)` has been updated, it is time to invoice the customer. After the
expense report has been approved and the journal entries have been posted, click the
:guilabel:`Sales Orders` smart button to open the :abbr:`SO (Sales Order)`. The expenses to be
re-invoiced are now on the :abbr:`SO (Sales Order)`.

.. image:: expenses/sales-order.png
   :align: center
   :alt: After the expense report is posted to the journal entry, the sales order can be called up
         by clicking on the sales order number.

.. note::
   More than one :abbr:`SO (Sales Order)` can be referenced on an expense report. If more than one
   :abbr:`SO (Sales Order)` is referenced, the :guilabel:`Sales Orders` smart button will list the
   number of :abbr:`SO (Sales Order)`'s. If multiple :abbr:`SO (Sales Order)`'s are listed, the
   :guilabel:`Sales Orders` smart button opens a list view of all the :abbr:`SO (Sales Order)`'s on
   the expense report. Click on a :abbr:`SO (Sales Order)` to open the individual :abbr:`SO (Sales
   Order)`.

The expenses are listed in the :abbr:`SO (Sales Order)` :guilabel:`Order Lines` tab.

.. image:: expenses/so-details.png
   :align: center
   :alt: See the expenses listed on the sales order after clicking into it.

Next, click :guilabel:`Create Invoice`, and select if the invoice is for a :guilabel:`Regular
invoice`, a :guilabel:`Down payment (percentage)`, or a :guilabel:`Down payment (fixed amount)` by
clicking the radio button next to it. Then, click :guilabel:`Create Invoice`. The customer has now
been invoiced for the expenses.


.. seealso::
   - :doc:`expenses/log_expenses`
   - :doc:`expenses/expense_reports`
   - :doc:`expenses/approve_expenses`
   - :doc:`expenses/post_expenses`
   - :doc:`expenses/reimburse`

.. toctree::
   :titlesonly:

   expenses/log_expenses
   expenses/expense_reports
   expenses/approve_expenses
   expenses/post_expenses
   expenses/reimburse