Expert: Arthur Naman - 11/6/2009

Question
Hi Mike,
I have recently set up a solo pediatric therapy business (LLC, s-corp designation). I am using Quickbooks, which I find easy and organized. My question is concerning logging of expenses. In my previous jobs, the companies had expense forms for the employees to complete and attach to any documentation (mileage logs, store receipts, etc). If I am just a one person company, and I am already logging these expenses into quickbooks, is there any reason (legal, accounting, auditing) why I would need to complete and retain expense forms?  I realize that I need to keep my receipts and mileage logs - just don't know if I should be completing an expense form or if this is primarily used to streamline accounting in a larger company.

Thanks for your help.

Alison DeLorme

Answer
Generally an expense form is used for expenses paid out of a personal account -- checking or credit card. If the expenses are paid out of the corporate checking account then this is not necessary.

If the expenses are paid out of a personal account, then the expense form is the "receipt" for the payment from the corporate account back to your personal account to reimburse yourself for those expenses.

Make sense?