# How bills and expenses fit together

The two ways money leaves the firm, the states of a bill and of an expense, who approves an expense, where each one lands in the books, and what this app does not do.

Money leaves a firm in two ways. A supplier sends a bill and the firm pays it: a **vendor bill**. An employee pays for the firm, a taxi, a hotel, a court fee, and the firm pays the employee back or settles the company card: an **expense**. This app holds both, and both end the same way: a document in a purchase journal, closed by a payment.

## The documents {#documents}

| Document | On screen | Comes from | Menu |
|---|---|---|---|
| Vendor bill | **Vendor Bill** | Typed, or uploaded from a file | Vendors, **Bills** |
| Refund | **Vendor Credit Note** | **Credit Note** on a bill, or typed | Vendors, **Refunds** |
| Receipt | **Purchase Receipt** | Posting an expense paid by an employee | Vendors, **Bills** (with **Receipt**) |
| Payment | **Payments** | **Pay** on any of the above | Vendors, **Payments** |

All three documents are entries of a purchase journal, numbered in it; the payment is an entry of a bank or cash journal. Journals and accounts belong to the accounting setup: see [Accounting: start here](/docs/accounting-start-here).

## The life of a bill {#bill-life}

A bill has two statuses. The first says whether it is in the books: **Draft** while it is being typed, **Posted** once confirmed, **Cancelled** for a draft dropped. The second, shown as a ribbon and in the list, says whether it is paid:

- **Partial**: a payment or a refund covers part of it.
- **Paid**: settled by payments, whether or not they are matched with the bank statement yet ([Banks, cash and currencies](/docs/banks-and-cash)).
- **Reversed**: settled by a refund rather than money.
- **Blocked**: set by hand with **(Un)Block Payment** in **Actions**, for a bill in dispute; it cannot be blocked once paid.

What a vendor owes back, an open refund or a payment not tied to a bill, waits on the vendor's next bills under **Outstanding debits**, where **Add** deducts it. A draft bill with **Auto-post** set, in its **Other Info** tab, is posted by a daily job on its date; that job is described with the fixed assets, in [Fixed assets automations](/docs/fixed-assets/fixed-assets-automations#auto-post). Bills imported from electronic invoice files can be posted by themselves for a vendor whose **Auto-post bills** is **Always**; the company-wide switch is **Auto-validate bills**, in the **Vendor Bills** section of the accounting settings.

## The life of an expense {#expense-life}

| Status | Who acts | What exists |
|---|---|---|
| **Draft** | The employee records it | The expense only |
| **Submitted** | The approver approves or refuses it | An **Expense Approval** activity |
| **Approved** | The accountant posts it | Nothing in the books yet |
| **Posted** | The accountant pays the employee | A posted **Purchase Receipt** |
| **Paid** | Nobody: the receipt is paid | The payment, matched later with the bank statement |
| **Refused** | An approver may reset it to draft | The reason, on the expense |

The expense the company paid skips a step: posting it creates and posts its payment at once, and its status goes straight to **Paid**.

## Who approves an expense {#approver}

On **Submit**, the **Manager** of the expense is the first one found of:

1. the **Expense** approver of the employee, set on the employee form under **Approvers**;
2. the manager of the employee's department, when that user has an approver right on **Expenses**;
3. the user of the employee's own **Manager**.

When none is found, or when it is the employee themselves, **Submit** approves the expense at once. Anyone with **Team Approver** can then approve the expenses of the people they manage, **All Approver** those of everyone, and **Administrator** their own as well. A weekly e-mail reminds approvers of what waits for them: see [Vendor bills and expenses automations](vendor-bills-automations).

## Expense categories {#categories}

A category is a product that can be expensed, kept in **Expenses/Configuration/Expense Categories**. It carries the **Expense Account** and the **Purchase Taxes** the expense takes, a **Reference** used in e-mailed receipts, a **Guideline** shown on the expense, and a **Cost** when the price per unit is fixed, as for **Mileage**. **Re-Invoice Costs** decides whether the expense can be charged to a client: **No**, **At cost** or **Sales price**; when it can, the expense shows **Customer to Reinvoice**, to choose the sales order it is added to.

## Checks along the way {#checks}

- An expense with the same employee, category, date and amount as another one asks for a confirmation on **Submit**, and its approval opens a duplicate check.
- An expense whose receipt is already attached to another expense shows a warning.
- **Split Expense** divides one draft into several, each with its own category and amount.

## What this app does not do {#not-done}

- There is no expense report gathering several expenses: each one is submitted, approved and posted alone. The **Expenses Report** in **Actions** prints one expense with its receipts.
- It does not match payments with the bank statement: [Banks, cash and currencies](/docs/banks-and-cash) does.
- It does not reimburse through payslips, read receipts by OCR or issue expense cards: see [Expenses settings](expenses-settings).
- The distributors' own expenses follow their own flow, in [Distributors](/docs/distributors).

## Who may do what {#access}

| Access right | Can |
|---|---|
| None on **Expenses** | Record, submit and reset their own expenses |
| **Team Approver** on **Expenses** | Approve and refuse the expenses of the people they manage |
| **All Approver** on **Expenses** | Approve and refuse every expense, except their own |
| **Administrator** on **Expenses** | All of that, their own expenses, the categories and the settings |
| **Invoicing** on **Accounting** | Bills, refunds, payments, and posting approved expenses |

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- Source: https://jaah.app/docs/vendor-bills/how-bills-and-expenses-fit-together
- Updated: 2026-10-23
- Version: Vendor bills and expenses 19.0.2.1