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Employee Advance / Expense Claim - same as "Reimbursement" isn't it?

expense-claim

#1

As per the manual entry The “employee advance” is a tool for providing an Employee with cash before and expense is being made.

As far as I understand the internal mechanics of this (also connected to Expanse Claim) thus far the exact same Employee Advance/Expense Claim workflow can be used for Expenses being made by an Employee from his/her own money an being reimbursed to him/her afterwards.

Am I missing anything in this regards, or is that correct?


Cost to company in payroll
Employee Advance
Employee advance and repayment
#2

As far as I know, expense claim workflow has only one use case, i.e. to pay employees for any expense he/she makes on behalf of the company. This is done after the employee has made the payment using his/her money.

Perhaps @Reema_Mehta can share the correct answer to your question.


#3

Another observation. Commonly in my country, the term Employee Advance means Salary Advance. This was quite confusing at first.


#4

@adam26d Your right, in generic terms Employee advance is against salary and then it is deducted from your salary on pro-rata / full amount depending from company to company whereas the term ‘Expense Claim’ means claiming an expense that you have already incurred.


#5

Hello @nabinhait

Do you have any input towards this observation?


#6

do you mean (in the ERPNext context) the Employee advance has nothing to do with Expenses done by Employees or the “Expanse Claim”


#7

It does, but I think it shouldn’t. In erpnext Employee Advance provides for an employee’s expected expenses (hence advance). But all the businesses I’ve dealt with treat an employee advance as a part salary payment made sometime before pay day.

To achieve the second type of advance we had to use zero interest loans as a workaround in one setup.


#8

it’s a terminology matter then in your case.

That being said I’d say this does not really touch the matter of this Topic here and may need a separate feature request


#9

so, what (as per you understanding) does the “employee advance” do? I think “Employee Advance” / “Expense Claim” come as a pair (Claim, creates a liability, advance balances the liability (same logic as PINV/Payment)


#10

You’re right. Though I think we need to be unambiguous whenever we can. Especially for the sake of end users.


#11

As per my limited knowledge, ERPNext Employee Advance is built towards tackling the use case of business travel an employee may have to undertake or any other expense that an employee may undertake on behalf of the company and needs advance payment for it. The company provides cash advance / advance payment for them. It is not linked to salary processing currently.


#12

I agree, but I know it is very unlikely to get an existing term changed (because, afaik, has implication in many parts of the code). What you practically can do to make this less ambiguous is to add some info on this to the manual entry


#13

why would you say the sequence (expense done by employee/reimbursement paid to employee) would matter here? My point is that it looks like the term (“Advance”) implies a sequence that practically does not matter. And I am looking for confirmation or correction on this thesis


#14

This link maybe helpful.


#15

thanks, that’s exactly the manual entry I am looking to improve (if I am right).

In order to do so I (with this Topic) am trying to get confirmation of the actual mechanics of this.


#16

I was looking for the same subject, and I found this thread.

I believe salary advance is a separate topic than employee advance.

Salary advance :
Given to employee as per his request then deducted from salary nothing to do with expenses etc…, I saw a suggested workaround as loan with zero interest need confirmation for the last point who tried once? is it implemented ?

Employee advance:
Is for expense claim and so on and no relation with salary and deduction. Currently fully implemented.

Yes agree that manual guide need to be updated.


#17

this Topic is about expenses reimbursement/pre-payment of such, not about Salary whatsoever. I am not intending to discuss anything else then that here in order to not get side tracked.

If anyone (and it seems there are several ppl) want to go there (where I do not want to go in the context of this Topic) please kindly create a separate Topic.


#18

Quite right. I’d be happier though if we renamed that to Expense Advance.

We tested this on v11 and it’s working. Just haven’t rolled it out yet in a real payroll month.


#19

I would not pursue this. It will not happen I think.


#20

Yes your right it is a terminology matter. In generic terms, such kind of advance is called “Imprest” money i.e. some money given in advance for a particular expense that an employee will incur in future.