How to simplify your company expense report process
Company expense reporting is a tricky business. It can be time-consuming and error-prone. It can also take too long for employees to get reimbursed, which puts them under financial pressure, and managers can be blindsided by a deluge of claims at the end of the month, disrupting operational planning.
Some of these problems may be almost impossible to eliminate entirely, but a well-designed, simple, fair and clear expense report process can improve the situation significantly. We’ll outline how to achieve this below.
Automation can reduce time and improve accuracy
Automation is probably the most impactful change you can make to take the sting out of company expense reporting, and it will have bigger benefits the more claims your company processes. A 2023 survey showed that just over a third of large companies were still manually reporting expenses, using spreadsheets and paper forms, but the majority had switched to automated systems.
The most advanced of these are cloud-based expense management systems that offer a more streamlined, error-free and efficient process. Among the tools they might offer to reduce employee workload and improve accuracy are:
Receipt tracking: Users can simply snap a photo of receipts using a mobile app, and the system automatically extracts relevant information. It’s a better system than keeping receipts in a shoebox, hoping you don’t lose track of them.
Categorisation and coding: Rather than employees manually categorising data, machine learning can be used to automatically categorise expenses based on predefined rules. This speeds things up and minimises errors.
Approval workflow: With automated approval, managers receive instant notifications for approval requests, reducing processing times. The platform can also make it clear at a glance where a request is currently positioned in the approval workflow, so there is always transparency and clarity.
Reimbursement: An operational bottleneck can form when there’s one person who has to go through expense claims, manually verify all the details and activate reimbursements. An automated expense management system, on the other hand, can do all this instantly and effortlessly, without the same risk of human error.
The many benefits of automated expense reporting
There are many good reasons to automate your company expense reports. The fact that all managers can access real-time data about company spending allows them to make well-informed financial decisions rather than having to guess what’s going on until the end of the month. When it comes to compliance and regulatory standards, automation can also ensure that company expense policies are enforced consistently and in line with any relevant rules. The accelerated time-frame of automated processing saves resources and boosts efficiency, and the lack of errors is definitely an advantage.
Perhaps a company with few employees who rarely travel or need to purchase items can get away with manual expense reporting. However, expense management software is a smart step for growing businesses who are determined to grow their margins and get ahead.
Standardising templates is a must
Whether or not you are using expense management software, it’s important to create standardised templates to make the expense reporting process more efficient. That way you can avoid missing details or duplicated entries, find the information you need quickly, and ensure you are compliant with regulations. There are ready-made templates you can use if you have accounting software or an expense management platform, or you can create your own. Just make sure it’s clear, consistent, easy to fill out and has space for all the information you need.
Here’s a checklist of considerations when developing a standardised template for your company’s use:
Include all essential fields, for example, date, amount, vendor, expense category and purpose. You will need to customise the fields for the specific needs of your organisation, and ensure that all information needed for compliance is included.
Design the template in a user-friendly way, with clear headings, simple language, and intuitive layouts.
Consider creating both categories and subcategories if needed for expense tracking and financial analysis.
To promote adherence to guidelines, you could integrate reminders into the template to remind users of company policies related to expense reporting.
Upgrade your reporting with Airwallex
For seamless data entry and tracking, it’s best to integrate templates with expense management software. If you’re a company that has a Global Account with Airwallex, this will be a breeze. These powerful multi-currency business accounts empower you to issue Borderless Cards to employees that come with built-in expense management software.
Airwallex Expense Management tool also has a handful of integrations with accounting software. This means accounting data can be automatically imported to Airwallex’s platform, and expenses can sync back with accounting software. This integration ensures accurate categorisation, policy compliance, and efficient expense tracking, while taking the work out of balancing the books.
How to create an effective expense policy
You can have the world’s most well-organised expense reporting process in place, but if employees don’t know how to use it properly, you’re still going to run into problems. Set aside the time and resources needed to create a well-designed expense policy and train staff on any new processes that you decide to implement.
When designing an expense policy, you need to state clearly what expenses are allowable and align them with the organisation’s goals and values. Allowable expenses may include business travel, equipment and supplies, and client entertainment. Other work-related items such as business clothing and transport to the office are often not covered. It’s prudent to set spending limits for different categories of expense; and you may want to impose an overall monthly spending limit as well. Don’t forget to explain how the approval process works and the steps that must be followed to report expenses.
Training and communication are crucial
Once the policy is in place, consider strategies to ensure this information is absorbed fully, such as regular workshops, easy-to-understand guides, and accessible support for queries. Continuous communication is crucial in ensuring compliance and ease of use, and ensuring that expense reports are processed promptly and correctly. Some companies use communication tools or platforms that allow instant messaging, so that any problems can be quickly cleared up.
You should also make it clear what will happen if employees fail to comply with expense management policy. If employees are correctly using expense management software, you can build rules into the process, which leaves less room for error or violation. If employees are submitting reports to you manually, on the other hand, take some time to think about the process for identifying and dealing with any violations of policy.
Review and improve your process
Don’t just set your policy and then forget about it. The policy and expense reporting process may need updating as the needs of the company evolve, and in response to user feedback or analytics. To forge a culture of continuous improvement, use surveys, regular meetings or suggestion boxes to gather employee’s thoughts and suggestions. Analytics and reporting can also be assessed to evaluate the performance of your expense management system, and changes made accordingly.
With the right tools, expense reporting can be effortless
By automating processes, standardising templates, creating clear policies, training employees effectively and committing to improving, it’s possible to take the sting out of company expense reporting for good. The resulting system should be efficient, accurate and user-friendly.
Choosing the right expense management software can also be transformative. That’s where Airwallex can help. With an Airwallex Global Account, you can instantly issue virtual and physical Borderless Cards for employee spending. These multi-currency Visa cards allow you to set a variety of spend limits or restrict purchases to certain merchant types.
When you activate built-in expense management, you can empower employees to seamlessly submit expenses on the go. Meanwhile, you or your managers can track, review and approve all purchases from a single dashboard, in real time.
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