Big idea: Dont lose out in the corporate race; Be the winner by applying these expense management solutions
Corporate world has become like the legend of hare and tortoise race. No one wishes to be the disadvantaged hare but the medallist and diligent tortoise. Its not about becoming a workhorse to reach to the top but reaching it by doing smart work. Managing ones companys travel & expense management is a key. Expense management refers to the system of processing and paying employee initiated expenses. Such expenses include the costs of business travel and entertainment. Apart from processing such paying, it also governs and creates policies for such payment.
For big enterprises, they have their own in-house accounts departments to choose the best expense management solutions. For small and medium level enterprises, they have to depend on other service providers. The service providers manages such expense management system through manual paper based system, excel spreadsheet, in-house automated software or the traditional legacy system.
At present, companies have shifted to automated software for its flexibility, ease of use and efficiency. Such software manages filing of expense incurred by the employees, authorization and repayment. Approval by relevant authorities is done electronically. They provide the in-house software along with support services or third party service, which develops a web, based application. Employees have to submit relevant documents such as hotel receipts or mobile phone records for claiming payment. In the manual based system, an employee will complete the process by writing it on paper, spreadsheet or graphs. The file is then transferred to the manager for approval. After he approves it, it is then forwarded to the accounts department who keys in each expense item to the companies finance system and then payment is made.
Tips for companies while searching for best expense management solutions
While searching for a perfect expense management solution suitable for their company, they should look into the following points:
- Fraud prevention: It is important to ensure that the system has fraud detection capabilities. Accuracy of data is the key element for smooth functioning of the system. If fair and consistent policy is applied across the company, then employees won't have the opportunity to enter incorrect data. Automated solutions ensure that data is automatically keyed into expense claim from hotel authorities or travel agents, thus reducing the chances of fraud such as duplicate identity.
- Keeping the process simple and cost effective: Having a robust and quick system ensures that precious man-hours will be saved by company's employees. Integrating the account system with expense system means data can flow directly there without the need for another manual entry and also less employee needed in that department for managing expense system. With less complexities in the system, employees can fill the relevant data appropriately without committing any mistakes and the it can be easily adopted by them.
- Integrating company policies: The software should be able to evaluate expenses by complying with the company's polices and other complex tax policies. It should be flexible enough such that policies can be updated with time and also to ensure that different departments can have different policies for completing a successful claim. If the software is unable to comply with the policies then it will result in a loss for the company financially and also its reputation. It should help in providing relevant data for income tax purposes.
- Keeping it up to date: Cloud based and mobile app based software ensure that expense claim can be filed from the comfort of Smartphone while on the road. Then employees won't have to visit office for entering relevant details. Relevant authority can also approve the claim easily thus making the process faster. The Software should have advanced facilities like optical character reorganization such that relevant receipts can be scanned and uploaded to the system without the complexity of manual entry. For cloud-based system, it is flexible and easier to add or delete employees and policies. In addition, it will automatically invoke local laws as the company increases its base and welcomes new employees.