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Set up expense management

[This article is prerelease documentation and is subject to change.]

Before employees can record expenses and submit reports, an administrator must configure expense management features in Business Central. This article explains the key setup tasks.

Important

Choose your setup path

You can configure Expense Agent in two ways:

  • Assisted setup (recommended): Use Configure Expense Agent to get started quickly with guided steps and validation checks. Learn more in Use Expense Agent (recommended).
  • Manual setup (advanced): Use the Expense Agent Setup page to configure each setting directly and fine-tune behavior after initial setup. Learn more in Access expense management setup.

For most organizations, start with assisted setup, and then use this article for detailed settings and ongoing management.

To learn more about the differences of using the agent or not, go to With and without Expense Agent.

It's optional, but we recommend that you start with the default configuration that we provide, and then adjust the settings to match your organization's needs. The default settings create a baseline setup with default categories, rules, and other master data.

To apply the default configuration, on the Expense Agent Setup page, choose More options, and then Apply default settings.

Expense Agent is an AI‑powered capability that automates the most time‑intensive parts of expense management. For example, receipt intake, data extraction, categorization, and expense line creation. It accepts receipts from multiple channels, including uploaded images and email submissions, while maintaining a human‑in‑the‑loop review process to ensure accuracy, compliance, and full user oversight. Learn more at Expense Agent overview.

If you haven't configured Expense Agent yet, we recommend that you use assisted setup first. Learn more in Set up the Expense Agent.

Access expense management setup

The Expense Agent Setup page organizes all configuration settings on FastTabs. Except for the settings that are related to Expense Agent, the settings apply to expense management. The following sections describe the settings that are available on each FastTab.

To get started, select Search (Alt+Q) in the upper-right corner, enter Expense Agent Setup, and then choose the related link.

Configure general settings

The following table describes the settings on the General FastTab.

Field Description
Enable agent Specifies whether Expense Agent can process expense submissions from email and the Expense Agent web app.
Mailbox Account Specifies the shared mailbox that the agent monitors. You need permission to the mailbox to activate the agent.
Process incoming emails with receipts Specifies whether the agent reads its mailbox and processes incoming emails containing expense receipts. Receipts are only processed when a mailbox is configured.
Exchange Rate for Expenses Controls whether foreign currency expenses use the rate from the expense date or the posting date.
Allow Grouping of Transactions in Report Determines whether similar transactions are grouped together in expense reports automatically by the agent.
Expense Report Grouping Defines how expenses are grouped into expense reports, for example by period.
Expense Report Rounding Precision Sets rounding precision for report amounts.
Expense Report Rounding Type Rounding behavior: Nearest, Up, or Down.
Receipt No. Mandatory Requires entry of a receipt number for every expense.
Merchant Name Mandatory Requires entry of a merchant name for every expense.
Create Employees for Expense Users Specifies whether Employees should be automatically created from Expense Users when no matching Employee exists. Employees and their connection with Expense Users are critical for correct processing and posting in Expense Agent, but this setting may impact your HR data.

Configure rules and controls

The following table describes the settings on the Rule & Controls FastTab. These settings define expense policies.

Field Description
Apply Rules Turn on to enforce expense management rules during submission.
Do Not Allow Expenses Older Than Restricts how far back expenses can be dated (for example, -90D for 90 days).
If Expense Is Older Than Allowed Choose what happens when an expense falls outside the allowed range: Warn, Require Justification, or Block Submission.
Check Category/Subcategory Usage Turn on to require that expenses use valid category and subcategory combinations during entry.
Display Anti-Corruption Attestation Turn on if your organization requires an attestation message that users must confirm before submitting expenses.
Enable Approval Workflow Turn on to require manager approval before expense reports can be posted. This setting applies only when the agent is not enabled, as the agent provides its own approval process.

To learn more about categories and rules, go to Set up expense categories and rules.

Assign number series

Number series automatically generate unique identification codes for things such as new general ledger accounts, customer and vendor accounts, invoices, and so on. To learn more about number series, go to Create number series.

On the Number Series FastTab, assign number series in the fields described in the following table.

Field Description
Expense User Nos. Automatic numbering for expense users.
Expense Reports Nos. Automatic numbering for expense reports.
Posted Expense Reports Nos. Automatic numbering for posted reports.
Expense Nos. Automatic numbering for individual expenses.

Configure notification settings

When the agent is enabled, you can configure reminders about open expense reports on the Communication FastTab.

Field Description
Enable Open Report Notification Let Business Central notify you about open expense reports that might need attention.
Open Report Notification Frequency Specify whether to be notified on a weekly, monthly, or custom basis:

For weekly notifications, choose the day of the week in the Notification Day of Week field.
For monthly notifications, specify the number of the month in the Notification Day in a Month field.
For custom schedules, enter a date formula in the Custom Notification Formula field. To learn more about date formulas, go to Use date formulas.
Notification Day of Week Specifies the day of the week for weekly open report notifications.
Notification Day of Week Specifies the day of the week for weekly open report notifications.
Custom Notification Formula Specifies a custom date formula to control when open report notifications are sent. For example, use CM for the last day of the current month or 1M‑CM for the first day of the next month.
Noreply Email Account Specifies the email account used for outgoing messages. If empty, the main mailbox account is used for sending.

Manage agent access control

The Agent Access Control FastTab lets you specify which users can configure the agent and which users the agent can work on behalf of. When you enable the agent, the current user is automatically added to the access control list.

Set up posting groups

Posting groups map entities to general ledger accounts. Examples of entities are customers, vendors, items, resources, and sales and purchase documents. Posting groups save time and help avoid mistakes when you post transactions. The transaction values go to the accounts specified in the posting group for that particular entity. To learn more about posting groups in general, go to Set up posting groups.

Expense management uses two types of posting groups to control how to post entries for expenses to the general ledger.

Employee posting groups

Employee posting groups control how amounts related to the expense report header (reimbursements, prepayments) are posted.

In addition to the standard fields, on the Employee Posting Group page, fill in fields described in the following table.

Field Description
Expense Payable Cash Account The G/L account for expenses paid personally by the employee and due for reimbursement.
Expense Payable Bank Paid Account The G/L account for expenses paid directly by the company through its bank accounts.
Expense Payable Card Paid Account The G/L account for company credit card transactions that aren't reimbursed to the employee.
Expense Prepayment Account The G/L account for cash advances or prepayments issued to the employee.

The next step is to assign the group to employees who submit expenses. On the Employees page, fill in the Employee Posting Group field.

Expense posting groups

Expense posting groups control how to post individual expense lines. In addition to standard fields, on the Expense Posting Group page, fill in the fields described in the following table.

Field Description
Refundable Debit Account The G/L account for posting refundable expense amounts.
Prepayment Credit Account The G/L account for crediting prepayments when applied to expenses.
Expense Debit Rounding Account The G/L account for debit rounding adjustments.
Expense Credit Rounding Account The G/L account for credit rounding adjustments.

The next step is to assign the group to expense categories. On the Expense Categories page, fill in the Posting group field.

Set up approval workflows

Note

You only need to set up a workflow if you aren't using Expense Agent. The agent automatically uses a newer way to handle workflows, so you can skip this step.

Administrators configure approval workflows on the Expense Agent Setup page.

  1. Select Search (Alt+Q) in the upper-right corner, enter Expense Agent Setup, and then choose the related link.
  2. Turn on Enable Approval Workflow.
  3. To configure approver assignments, select Search (Alt+Q) in the upper-right corner, enter Expense Approvals Setup, and then choose the related line.
  4. On the Expense Approval Setup page, fill in the fields as necessary. Hover over a field to read a short description.

Note

When the approval workflow is enabled, managers can only view reports where they're assigned as the approver, unless they have Unlimited Expense Approval permission.

Next steps

Manage employee expenses

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