Expense Categories are officially classified according to the way in which a business spends its money. From day-to-day operations, to large purchases or investments, everything should be recorded accurately and categorized unambiguously. These categories define the line items of a budget and help businesses to track their spending more effectively. Accurately categorizing your expenses will not only help you stay organized and keep your books balanced, it can also help you identify potential areas of waste – allowing you to make smarter decisions about where your valuable resources should be allocated.