When thinking about an expense management system, the first thing that comes to mind is the harried business travelers. They keep hundreds of receipts, manually entering all the trip details in the excel spreadsheet.
With a modern expense management system, your employees can snap a picture of the receipt, upload them to the digital vault, and then get the expense instantly approved for reimbursement by either the finance team or the manager.
According to a survey by Levvel research, organizations that adopted Travel and expense management systems improved expense report accuracy by 30%, reduced paper volume by 20%, and saved time for creating and processing expense reports by 25%.
This level of effectiveness shown by automated expense management solutions is hardly surprising.
Why is managing expenses using excel not a good idea?
Travel and expense reports are handled manually at the end of each month, especially in many small organizations. Employees gather receipts and enter all the details, such as category, vendor, dates, etc., in the spreadsheets. They then submit their receipts to the finance team or the management for approval. While this process appears to work fine, it is inefficient. There is a lot of manual handling that takes time, which costs money. Also, the process is error-prone, and it cannot prevent fraud, such as duplicate receipts.
Why is an expense management solution beneficial?
An expense management solution is beneficial for every business, no matter what the size is. It is cost-effective, reduces error frequency, and provides better insights to keep track of an organization’s financial health. Below are some reasons why expense management software is better than excel spreadsheets.
Manually entering every trip detail in the expense reports is time-consuming for your employees. Subsequently, the finance team spends much time acting on the expense data. The expense management automation becomes the savior and lets your employees submit all the expense receipts as and when they pay. The process is much easier using OCR-based receipt management. With this software, your finance team can keep track of all the expense reports, as everything is stored in the cloud and can be accessed with a few clicks.
• Automated approval workflow
In a typical expense approval process, each employee sends the expense spreadsheet to the finance team, accompanied by a folder full of expense receipts. The finance team manually reconciles all the receipts, approves, or denies the claim, processes the payment, and records all the claims for future auditing purposes. It takes a lot of time and effort, particularly when employees attempt to claim reimbursements for expenses against company policy.
Meanwhile, an expense management solution automates the process of expense policy compliance. The system uses AI to check and weed out fraudulent or non-compliant claims and instantly approves legit reimbursement claims.
• Fast-track reimbursements
Manual reporting and reimbursement generally take over seven days, leading to massive employee dissatisfaction. An automated reporting system can expedite the reimbursement process, ensuring claims are approved in seconds.
• Improves policy compliance
Once various expenses start coming in, it is hard for the finance team to validate all the details in the spreadsheets manually. Manually processing expenses also leads to the approval of claims that don’t adhere to company policy. For instance, employees may have claimed reimbursement for personal travel expenses, citing them as clients’ visits.
Employers can ensure almost 100% policy compliance using an automated expense management solution. Employees and the management are instantly notified when non-compliant claims are made. There is also an option for employees to either remove the claim or modify it based on company policy.
• Real-time visibility and spend control
One of the best benefits of automated expense reporting is integrating with accounting software quickly. The seamless integration with the finance software allows the automated expense system to generate custom reports. These reports help the finance team analyze employee spending and cut down the costs of any expenses that go out of budget.
Excel spreadsheets for expense reporting are annoying for business travelers, and they are also a source of pain for the finance team and managers. Switching to an automated expense management system is a win-win situation for everyone. Using automated solutions will only help scale the business, make it easier for employees to get reimbursed, and even allow the managers to make optimal decisions while ensuring policy compliance.
ExpenseOut is here to help you get rid of spreadsheets for managing expenses to leverage the power of automation.
Schedule a demo to learn how our automated expense management software can benefit your business.