Reviewing and approving expense reports manually are quite challenging. The finance department is swamped with expense reimbursement requests when employees return after their client meetings, sales conventions, and more. Expense reports done manually are error-prone and inaccurate.
It is extremely difficult to gather, review, authenticate, and approve reimbursement claims manually without slipping down somewhere in the middle. There are a lot of things when it comes to expense approvals and a small error can cost you greatly.
Expense approval system helps organizations replace heavy administrative tasks associated with expense approvals such as validating, examining, and approving expense reimbursement claims with rule-based logic. Expense reports have a sequential path to follow and can reach the right person at the correct time so employees can get reimbursement quickly.
All businesses has unique needs when it comes to managing expenses. There are some features that you cannot do without. Here we present a few of them.
- Expense Reporting
When employees return from their business trip, they compile all corporate expenses into reports and submit them to the managers or the finance department. The expense report software must allow them to submit their expenses on the move with the help of a mobile app.
- Validating Data
At the time of submitting expenses, the expense management system must validate employee expenses and throw red flags if they do not stick to the spending guidelines.
- Approving Expenses
When there are expenses in the report that do not comply with your company’s policy, the expense management software must notify the approver. This will make it easier for the finance department and managers to approve or reject claims.
- Integrated System
When expense claims get approved, the software must post journal entries to accounts payable and add an entry to the payroll system to help employees to get reimbursed.
Importance of Leveraging Expense Approval Software
At times, the finance department finds themselves busy with paperwork when employees return from their business trips. Manual processes are prone to miscommunication and errors. They need to rely on the managers to validate and approve expense claims fast.
While using cloud-based expense management software, it does all the heavy lifting for you and helps to expedite the approval process. Here, we present some advantages of using an effective expense management tool.
- Complete Visibility into Financial Health
When you track the money, you get a clear picture of the cash flow. It becomes easier to identify the areas where you are making unnecessary spends, and make insightful decisions that will help you to cut down on the costs and plan an efficient budget for the business trips in the long run.
- Compliance with Corporate Travel Policies
The expense approval system identifies policy violations and throws red flags when a request violates them thus making sure that the business’s travel policies are adhered to which takes off a huge burden from the finance team’s shoulders. It will help to minimize expense fraud and enforce compliance.
- Audits and Tax Deductions
Travel expenses should be ‘qualified’ for a company to mark them as legitimate expenses. So, without tight control over the process, you might miss out on the tax benefits. Additionally, you need audit trails and records for showing that you have managed corporate travel expenses properly, and have not opened yourself up to claims of mishandling funds.
- Satisfied Employees
Submitting expenses and waiting for the claims to get approved can be time-consuming and take a toll on productivity. With an easy to use expense management solution, employees can submit their reports and claim expense reimbursements easily.
The Bottom Line
With automated expense approval software, businesses can cut down unnecessary costs involved in the manual expense process, and also eliminates unintentional human errors and inaccuracy. This will prove to be beneficial for your organization.