While certain skills will always be helpful in managing expenses, 10 key features can be done to make expense management simpler and more convenient.
5 Ways to Simplify Business Expense Management
While certain skills will always be helpful in managing expenses, certain actions can be done to make expense management simpler and more convenient.
Managing your company’s expenses requires having organisation skills, attention to detail and knowledge of how finances work. While these skills will always be helpful in expense management, certain actions can be done to make business spend management simpler and more convenient.
What Is Expense Management?
Expense management is an essential practice to properly track employee spending and determine how the company will reimburse the expenses made. Part of expense management is implementing policies to control company spending.
Any company, regardless of industry, must practise expense management to stay on top of their expenses and spot any frauds or errors.
5 Ways to Simplify Expense Management
1. Have an expense management policy
One way to make expense management more efficient is by implementing an expense management policy. You can do this by creating a list of which expenses will be reimbursed or paid for by the company, as well as a list of expenses that the company will not cover.
We recommend using simple and concise language in your lists to avoid misunderstandings and make them easy for everyone to understand. Make sure that your policy follows not only government regulations but also your company’s budget and culture.
2. Orient your employees on best practices
Creating policies and processes is great, but what’s more important is clear communication with your employees about the same. Use proper and different channels to educate your employees on best practices. Here are some tips to get started:
a. Build a budget-conscious culture — This doesn’t mean being stingy in purchasing what the company needs. Simply educate your employees about the concepts of frugality, practicality and investment.
b. Encourage transparency and accountability — Transparency leads to accountability, which helps prevent fraud and promote profitability. Start encouraging transparency by asking leaders to give feedback on expense policies. Be transparent about the finances of each department and reward those who practise company best practices.
c. Promote a culture of timeliness — Being in the field of finance, you must know all too well how late submissions affect your day-to-day work. Promote a culture of timeliness wherein employees must submit their expense reports on a certain day of the month (e.g., the 15th day of the month, the first Friday of the month, etc.) with complete documentation.
When they follow this deadline, they’ll be able to receive the reimbursement by a certain day of the month too. Make it known that managers must also approve reported expenses promptly. To put it simply, regardless of one’s role in the finance process, one must always be on time.
3. Audit your processes and review expenses regularly
Processing a company’s finances is not a one-off task. Make sure an accounting expert conducts regular audits to track spending and spot any potential problems like counterfeit receipts or overspending. Regularly auditing your records and expenses can spot small issues before they snowball into big ones.
We also recommend doing regular expense reviews instead of reviewing only at the end of the year. You want to spot issues early. The last thing you want to happen is to discover that your company has an ongoing subscription that is not needed only at the end of the year.
4. Implement security
Any finance professional knows that expense management can’t run smoothly without security. After all, security is the best way to prevent scams and fraudulent expenses.
Aside from making sure that your expense tracker is safe and secure, you can also make your finances secure by promoting transparency and laying the ground rules. Go for more secure practices like issuing virtual cards to prevent theft and avoid card transfers.
5. Go digital
With highly advanced technology today, it’s unusual for a company not to have an online expense tracker—especially since going digital means having access to convenient automation features. Here are more tips to simplify expense management in digital ways:
a. Issue virtual cards — Virtual cards function the same way as physical cards, except they live in your mobile banking app. Having virtual cards for business allows easier tracking as they promote accountability, transparency and controlled spending—especially when compared to physical cards.
b. Make transactions easier to track — The easiest way to have prompt and complete reporting is to make your company transaction tracker digital—and we don’t just mean any digital file. Use an online expense tracker to make tracking simpler and automated. No one wants to wrestle with a plethora of cells in spreadsheets.
c. Make processes faster and more efficient — Gone are the days when employees had to collect receipts, submit them to the finance department and wait for their managers to approve each receipt. Find an expense approval software that comes with the convenience of a mobile app to record expenses on the go. This will make your processes faster and more efficient for everyone. An expense management app is not only convenient—it also has less room for inaccuracy and human error.
With so many things to do in the finance industry, we need all the solutions we can get to make our work easier while still keeping it accurate. An expense management system can help with that. After all, in a world where digital platforms are constantly rising, expense management automation plays an essential role in digital transformation.
Want to see how an expense management software can make a difference? Book a demo with us and see for yourself!