Upgrading Expense Policy – 3 Things to Keep in Mind

If your expense policy hasn’t been updated for years, perhaps you are doing something wrong. The way employees are spending money has changed over time and now you are more likely to see a digital receipt than a paper. Having an outdated expense policy will create frustration in employees, which adds workload to your finance team. A bad expense policy will encourage your employees to submit fraudulent expenses and out-of-policy expense claims. So, updating expense policy frequently is the best way to stay in line with the industry trends. Here are a key ways to go:

Business expense policy helps you set what you can and cannot claim for reimbursement. Making your employees familiar with expense rules will help you reduce out-of-policy claims. Updating your policy on a regular basis would benefit your company, especially your finance department. The following are a few things you should consider while updating your policy:

Speak with stakeholders first

Consulting only the CEO and finance team may not be good; you have to speak with department heads and managers responsible for signing employee reimbursement requests. Taking inputs from all those involved will let you create a document that works right.

Review your employee expenses

Your expense policy should cover every expense your employee might claim. You should include some questions such as what happens if employees extend their business trip, and what would happen if your employee accompanies any family member on the trip. Including all these in your expense report policy will ease your job.

Reasonable limits

Find out how much food, travel, drink and accommodation will cost where your employees work from or travel. Set reasonable limits based on the areas and provide a detailed explanation of payback periods so that employees will have an idea about reimbursement periods.

Expense policy is important, but just keeping it updated won’t solve any problem. Using manual processes such as paper or excel would leave you with an increased risk. Fully automated expense report solutions are the better choices for organizations to be more efficient.