Overall, manual expense management is time-consuming, frustrating, and leaves lots of room for human error – both accidental and intentional. Do not leave your company at risk of these possible occurrences. Instead, take the time to learn about automated expense reporting systems available to your company. Then decide how you can begin to implement them. It is one of the simplest ways to make everybody’s lives a bit easier.
Managing expenses is a necessary and crucial responsibility for organizations of all types. Manually maintaining costs and essential reporting affects multiple departments and hierarchies within the organization. This includes the front-line employee, the finance and accounting departments, and even the CFO. The latter has to ensure that thousands of dollars are properly accounted for and are within the stated budget. One thing that each department and role can agree upon is that nobody enjoys expense reporting or any of its associated functions. They are a hassle and require an exponential amount of time.
Here are the topics we cover in this guide:
Expense reports are used to manage costs incurred by employees for professional use. Typically, this is through the use of a company card or some form of compensation. However, some organizations require employees to use their own money to cover the expense and then report the costs to get reimbursed.
Even employees who have access to a company card experience hiccups here and there that require them to use their own for tender. These include situations such as:
No matter the circumstances, there will always be instances in which you or your employees are required to foot the bill before receiving reimbursement. When this occurs, that is when it is time to file an expense report. Some companies have automatic reporting systems, while others still process their expense management manually. Those who handle the process without the assistance or use of expense automation software are more susceptible to errors. They find themselves spending an immeasurable amount of precious time handling and processing paperwork.
Expense automation utilizes the convenience of a spend management application or software to guide employees through their expense claims quickly. These systems are usually straightforward and do not typically require any data entry from either the finance or accounting department.
Expense automation is beneficial for organizations that require a fair amount of external expenses on both the employee and management levels. Companies can significantly benefit from expense automation software if their employees travel, take clients our for meals, or stay in hotels.
You should not rely on multiple people to handle and manage the expense reporting of the occurrences. Expense management software has the capability to record, track and approve the necessary reimbursement to each individual employee. Aside from tracking, this software also ensures that the company isn’t overspending on either approved or unapproved expenses.
Recommended reading: Keep Calm And Let Finance Automation Kick Out Chaos
There are many ways in which expense management automation can benefit organizations across many industries. The labor and processing costs behind managing expenses can quickly add up and become costly. Automated management systems remove the potential of human error and streamline the process while making it more cost-efficient.
Automation translates to elimination of paperwork and enormous spreadsheets. These would require more administrative employees who can only process so many requests at one time. Automation also eliminates a great deal of potential fraud and non-compliance.
The appropriate software helps to eliminate paperwork and errors from reporting. Manual expense reporting requires countless pieces of paperwork in the form of receipts, spreadsheets, and documents. Employees have to remember to save receipts while the finance department has to sift through mounds of paperwork. Not only is this process costly regarding time and money, but it is also susceptible to errors during processing. The use of automation software allows companies to remove unnecessary paperwork and eliminate the majority of possible errors.
Recommended reading: How to Future-proof Your Organisation Through Your Expense Management Software
Expense management automation allows companies to maintain compliance easily. Without the use of a proper system, compliance becomes a daunting task as receipts and paperwork begin to pour in. Customizing an automated system to account for your company’s compliance policies significantly simplifies the process and ensures that you do not violate any guidelines.
Another significant way that expense management automation protects your company is by preventing expense fraud. More manual inputs in your expense accounting systems translate to more opportunities for employees to submit falsified information to receive extra reimbursement. This is usually done by using the same receipt multiple times or rounding up traveling expenses such as mileage. Automation protects your company by identifying duplicate entries, customizing transparency through workflows, and creating more opportunities for review.
The ultimate benefit experienced by using an expense management automation system is the time and energy it saves. It does so by speeding up the approval process and how quickly your employees are reimbursed. The efficiency created by an automated system is unmatched by any manual processing system. Rather than passing on envelopes and stacks of forms, the employee files the claim with the necessary info electronically. It ends up in the finance manager’s hands, who sees a concise report and chooses whether to make the final approval.
Recommended reading: Company Expense Policy Best Practices
Expense management automation offers benefits to many departments. Manual expense management causes frustration for both employees and managers. It also affects departments outside those directly affected by expense reporting.
Finance teams benefit from the simplification and streamlining of their processes. Finance teams can use automation to accurately keep track of all necessary data regarding expenses. This means that the risk of error and fraud is eliminated. Data is entirely transparent.
Employees benefit from using an automation system because it keeps their role in the process as convenient and straightforward as possible. Providing employees with direct tools to submit their expense information keeps them happy. It helps them to stay productive, and lets them focus on what is essential – completing their job.
IT managers also benefit from the use of an expense management automation system. When the IT and finance departments cooperate, automating expense and invoice management is much easier, leading to better compliance and greater employee satisfaction.
Executives and business leaders may benefit the most from an automation system. Automated expense management empowers them to run their businesses in the best possible way while maximizing profit and optimizing labor. Automated expense management helps to keep profits high, costs low, and employees productive – what more could an executive as for?
Expense management automation is an excellent choice for any company, but not all automation systems are created equal, or well for that matter. After establishing an effective and quality expense management automation system in place, it is crucial to develop expense policies that work with the system.
A few factors that any company should consider while choosing a system include:
Once you have chosen the right system, adopting good expense policies will improve the overall expense reporting process. Some things to keep in mind while reconsidering your policies include:
Recommended reading: 10 Features to Look for in Expense Management Software
Expense management automation is the easiest way to ensure that your expense reporting is being completed effectively, accurately, and without unnecessary time and effort. Using an automation system not only helps to streamline your processes but it also keeps your company protected from fraud and possible non-compliance. As many departments within your company greatly benefit from the use of expense management automation software, employee satisfaction and productivity will continue to increase.
Let Volve help you focus on your small business strategy. From sales to human resources to finance operations, management can look forward to shifting resources from repetitive manual practices to realizing strategic goals that create more value and deliver higher returns.
Volve’s corporate card comes with an automated expense management solution and reporting tool. This enables all functions of business to capture productivity growth potential from time-cost reductions, greater accuracy, increased visibility and control.
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