When employees go on business-related trips, their organizations reimburse them on their return. In theory, this is simple – the employee travels, comes back, files an expense report, and gets reimbursed. But in practice, it is not quite so. The process of reimbursement faces several challenges, making it complicated. If the organization does not employ a process automation tool like online expense reimbursement software, these challenges can become insurmountable. Let us see some of those challenges:
Fraud: A major challenge that can plague any organization, reimbursement fraud committed by employees can take many shapes. From falsifying the numbers on expense reports to submitting fraudulent bills in collusion with vendors, employees find many avenues to commit fraud. It is up to the organization to have a robust system in place to detect fraud; otherwise, they can potentially lose hundreds of thousands of dollars.
Strict enforcement of policy: Every organization has some kind of expense reimbursement policy in place. It covers everything from reimbursable and non-reimbursable expenses to the format of the expense report to be submitted. However, ad hoc requests and unyielding employees sometimes hinder the effective implementation of policy. Apart from educating employees about the nuances of the policy, organizations also have to take strict action against offenders in order to discourage others from doing the same.
Reimbursement cycles: Some organizations follow a long-winded reimbursement procedure that delays reimbursements. In such cases, reimbursement cycles run into several weeks, and sometimes even months. This suits neither party as the organization is obligated to reimburse the amount as soon as it can and the employee expects his reimbursement as soon as possible.
There is, however, an effective way to surmount these challenges. By automating the process using expense reimbursement software, organizations can shorten their reimbursement cycles considerably, ensure strict implementation of policy, and take steps to prevent reimbursement fraud.