The pandemic has brought about an incredible number of changes in the way businesses function. As a result, companies need to reevaluate their core processes if they are going to survive and adapt to this new normal of doing things.
While businesses may have trouble with a starting point, expense management automation is a good start. Automating expense management helps track and manage business expenses and costs and ensures no financial leaks persist in the system. This provides financial stability and allows businesses to streamline core business processes that won’t survive without automation.
This post works as a quick guide to expense management automation and how your company, employees, and finances can benefit from an expense management software. Let’s get started!
How can expense management automation enable remote businesses?
With companies moving remote, Finance teams and employees can no longer meet each other in person for report submissions, corrections, clarifications, and reimbursements. Finance teams also have zero control and visibility into expenses. This means tons of back and forths, incomplete records, broken financials, possible expense fraud, and inefficient processes.
Business owners need to understand that broken processes lead to a broken system that will hurt their business. Thus, all companies must find new ways to carry forward operations that still abide by the IRS’s rules and regulations.
Finance leaders across the world have started to see the importance of automating the expense management process. This is evident with the drastic increase in businesses adopting an expense software to automate their pre-accounting.
But how can your business find a business use case for expense management automation? Listed below are some of the essential benefits that an expense software brings to remote teams:
Make expense management easy for your employees
Remote and traveling employees incur considerable expenses whose receipts could be physical or digital. Having a separate box just for physical receipts or a folder in one’s gallery filled with screenshots of e-receipts doesn’t sound too exciting, does it? Automation tools can help you better track mileage and travel spending for commercial auto insurance purposes
Business owners and Finance teams must understand that these are low-impact tasks but garner extra attention as it involves your employees’ money invested in business needs. Thus, it is only fair that businesses also make this process easy for the employees.
An AI-powered expense management software enables easy tracking of receipts from employees’ applications every day like Outlook, Slack, G-Suite, or even Whatsapp. In addition, it comes with OCR (Optical Character Recognition) capabilities which let employees directly capture the receipts and store them in the cloud. This makes it easier for employees to balance their work and personal lives while also dedicating time for high-impact tasks.
Automate processes that are error-prone and time-consuming
In the traditional setup, your employees and Finance teams need to go back and forth to get work done. Additionally, if employees are unaware or want to take advantage of expense policies, this may lead to out-of-policy expense submissions, expense fraud, or even duplicate expense submissions.
In such cases, the onus of identifying and correcting these reports depends on your Finance teams. While this could have been possible in a centralized location, your Finance teams are literally expected to do the unexpected with distributed teams.
This is where expense software comes in handy. This software helps Finance teams feed in custom business rules and enforce them on all employees based on set parameters by the Finance teams. The software also comes with a real-time policy engine that checks all expenses against set business rules to ensure no fraud or out-of-policy expenses get through. Thus, given the current scenario, teams should look into an expensive software to do the work for them while also adding a layer of security and accuracy to the whole process.
Achieve enhanced compliance with expense policy enforcement
Imagine announcing every expense policy through emails or one-on-one meetings each time employees submit reports; whew! It shouldn’t be a surprise if a policy or two are going to slip off your employee’s minds, leading them to submit non-compliant expense reports.
An expense report software effortlessly automates real-time policy enforcement across the organization. Its policy engine checks and flags all non-compliant expenses at the source of expense creation. On flagging the report, it also provides employees reasons as to why the expense was flagged. The employees can then either make corrections or provide justifications as to why their policy violation is well within the company’s limits. All this while also providing digital receipts as proof of spend.
Once the employee provides these justifications, only then can they submit the expense report. Once the Finance teams get the report, they can go through the detailed digital audit trail that documents all actions taken by the employee and approvers. They can also see the violations and justifications if any. This reduces the time and effort Finance teams put on expense management drastically. It also gives Finance teams enough visibility and control to even start thinking of optimizing for costs.
Comes with advanced analytics to drive data-driven business decisions
With traditional pen and paper expense management, it is safe to say your Finance teams may not have the insight they must to ensure efficient expense management. This may lead to bad business decisions, financial leaks, and no optimization for costs.
An expense software comes with advanced data analytics that does the math and heavy lifting for you. The software provides data with just a few clicks regarding the department, category, or even employee-wise breakdowns. It also gives information about top policy violators, top spenders, and more.
This data is crucial for your Finance teams to make the right choices. It provides Finance teams with an opportunity to optimize for cost-cutting and cost-saving opportunities with frequented hotel and airline chains and more. In short, the software empowers your Finance teams with data to make correct and informed business decisions.
Faster turnaround times for reimbursements
Approvals can be a difficult process for managers having to ensure that the submitted reports stay within department-wise budgets and company policies. Having to go through both every time an expense is verified can be stressful and irritating. Additionally, it leads to:
- Zero insight, visibility, and control into the company-wide spends
- Time wasted on verifying and approving expenses manually
- Employees having zero awareness of their reimbursement status
An expense software enables approvers to review expense reports with a single click, even from mobile phones. As a result, this enhances the remote working experience for employees and Finance teams regarding expense reporting and tracking.
The software also integrates seamlessly with multiple bank portals; thus, giving Finance teams the capability to process multiple transactions to different employee accounts simultaneously. It also enables employees to track their reimbursement status in real-time, drastically reducing unnecessary communication between employees and the Finance department.
Having shorter TATs for reimbursements boosts employee morale, productivity, and satisfaction. It also motivates them enough to work better and stay accountable for the expenses they submit.
Eliminates expense fraud and protects the company’s financial bottom line
The pandemic has shown a tremendous increase in the risk for expense fraud in companies across the U.S. With Finance teams facing an increased workload, there is a greater risk for non-compliant expenses slipping through and accidentally getting paid. This would pose further problems with the IRS during audits. If ignored, it would also cost your company severely in the long run.
An expense software comes with real-time policy checks that let employees know of violations right at the source of expense creation. This results in the submission of compliant expense reports. Additionally, due to its centralized cloud storage, employees can no longer submit the same receipt twice. This ensures no duplicate submissions.
Coupled with OCR technology eliminating data entry and a real-time policy engine that checks for violations, businesses can rest assured that expense fraud is at bay.
Having a robust expense management system is crucial in ensuring that businesses stay afloat during uncertain economic times. In addition, companies looking for rapid scale need to fix broken processes and take on a more adaptive mindset.
A reliable expense management process ensures that your company’s financial health is stable irrespective of the times ahead. It also is a boon to all the stakeholders involved. Most successful businesses have started switching to automated expense management; it’s time yours does too!