Expense reports include expenditures incurred by a worker on behalf of the organization- whether during the daily course of work or towards corporate travel. Such expenses comprise of business supplies, hotel stays, meals, and travel like local transportation or flights. The traveler should provide proof of their receipt that goes into the expense report. After submitting, these expense reports will be assessed and either accepted or rejected by the accounting team.
Usually, an expense report includes:
a) Time and date of purchase
b) The amount spent
c) Rationale of purchase
d) To which team it must be charged
e) Total sum
f) Subtotal of every kind of expenditure
g) How much a worker has been paid in advance that is deducted from the grand total
Key Challenges Faced by a Business
- Many organizations still follow an outdated, manual, and labor-intensive approach to manage business spending.
- The physical movement of receipts and vouchers takes a lot of time that can be otherwise used in productive ways by everyone involved- the worker as well as approvers.
- A huge build-up in heavy paperwork, specifically for organizations with a lot of workers. The paperwork occupies space in your office cabinets. Plus, it is challenging to search for an expense report when it needs to be revisited and checked.
Automate Your Outdated Methods
The expense management workflow of expense recording to disbursing them is slow-moving and error-prone. Corporate expenses are still made in cash. Your workers tend to waste long hours creating these expense reports manually. What is more? The senior management has no holistic insight or control regarding how the money is being spent. Accounts and the HR departments can spend copious amounts of time bringing together and reviewing piles of Excel sheets and receipts.
It may seem quite intimidating to scrap an outdated, suboptimal method in favor of a modern one that workers will have to adjust with. Earlier, this transformation might have been cumbersome and more susceptible to failure. But today, the availability of multiple expense management solutions makes this shift from pen and paper-based expense management to digital much simple.
Organizations find that employing a travel and expense automation system can cut down on wastage and results in saving significantly. When a company adopts expense automation software, it has been observed that it minimizes the cost of processing a report by more than 65%. Additionally, above 30% redirected their employees to other valuable tasks. Cloud-based expense management solutions save money and time while providing the management and other stakeholders complete visibility into spending through holistic reports and analytics.
Reasons to Automate Your Expense Management
Digitized expense management has multiple advantages. Some of them include.
- Eliminates Fraudulent Activities
Given that you gave granular insight over all the expenses that take place at your organization, the risk of fraudulent transactions can be eliminated. Balances and checks are put in place, and new expense filings can be compared to the previous ones with great ease, giving approvers a barometer to judge variance without the need to delve into the details.
2. Quick Employee Reimbursement
It becomes discouraging for staff to handle a long delay between submitting expenses and reimbursements. Robust expense solutions can help minimize the time by perking up accessibility for quicker submission, sanction, and prompt reimbursement. Data gets shared instantly; thus, the employees can set off the method by submitting their expenses while still traveling, and the accounting team can access and grant expenses.
3. Rule-based Policy Enforcement
Organizations have their own rules and regulations, along with frameworks related to individual clients and projects. Expense reporting systems help companies control their spending by making sure policy implementation without the burden of manually comparing the expenses and rules.The non-compliant expenditures will be flagged immediately to staff when they are submitted, and these expenses that need extra attention can be emphasized for instant consideration. The expense solution can be programmed to flag and deny expenses that are not valid. Plus, limits and checks can also be set for expenses.
4. Enhance Transparency to Search Trends and Negotiate Volume-based Discounts
Data-driven decision-making puts the leadership team in the driver’s seat. Expense management solutions make it easy for organizations to review spending, find trends, and apply it to negotiate the volume-based discounts on products/services. Whether your employer wants to review expense spending quickly against a budget for their team, or your forecasting planners wish to dive deeper into business-wide trends, detailed analytics allow them to do so with configurable reports, handy export features, and an integrated dashboard.
5. Eliminate Delays and Ineffectiveness Caused by Paper
Manual approaches to managing expenses are tedious and paper-intensive. Excel sheets need to be reviewed, handled properly, and monitored. Effective expense management solutions eliminate paper overload, policy compliance slip-ups, and lengthy delays. Online submissions offer staff flexibility to file their expenses through any smart device effortlessly. The accounting department can promptly assess submissions and forward them to the next stage in the procedure from wherever they are present.
As your business grows, more staff is hired, thus resulting in increased expenses. Old expense reporting methods may not be able to cope up with the surge. Traditional systems are error-prone and costly to maintain. Online expense software offers numerous advantages that can save businesses from unnecessary spending. So, what you need is a solution that is scalable, quick, and convenient to use.