While certain skills will always be helpful in managing expenses, certain actions can be done to make expense management simpler and more convenient.
Education Orgs and Finances: How Expense Management Can Help
Expense management software allows education organisations to easily track and categorise their finances. Learn more.
The need for budgeting, spend management and financial operations is industry-agnostic. However, each industry has its own set of challenges and needs when it comes to getting the most from proper expense management practices and tools. For educational organisations, unique challenges like staff spending and stationery expenses can be a lot for their admin and finance departments. This calls for a streamlined expense management process that can help education orgs manage their finances and, in turn, achieve financial efficiency.
What Is Expense Management for Educational Organisations?
Expense management, in the general context, is the process of planning, tracking, analysing, streamlining and reporting an organisation’s expenses. In the context of education orgs, expense management makes it easier for the organisation to distribute the education institution’s budget, work with vendors and track staff spending on work-related expenses.
For example, educational events such as academic conferences and inter-school competitions come with expenses such as transportation and meal expenses, which, if not managed properly, can complicate the school’s budget management. Staff also spends on items like stationery and school supplies which amount to a lot of money. With proper expense management, the organisation can keep track of these expenses so nothing gets missed and everything is accounted for.
Expense-Related Challenges for Educational Organisations
The success of education orgs doesn’t only come from efficient operations and programs. Effective finance management, from budgeting to expense claims, is also a big factor for the organisation to function well. However, some challenges can make the finance process a little too hard to deal with.
1. Paper-intensive processes
The manual process of managing education finances is one of the causes of inefficient expense management. Imagine the tedious process of collecting receipts and creating spreadsheets that consist of vendor, item and transaction data.
And it doesn’t stop there! You also have to attach the receipts to a printed copy of the spreadsheet and send these to your organisation’s administrator. The administrator will then have to enter and verify the data manually. After all these steps is the only time they can process and reimburse the expenses. Moving from spreadsheets to expense management software can not only help save time but also minimise human errors.
When an organisation is still using manual processes, it’s prone to fraud and scams. This is because paper-based expense management makes it difficult (sometimes nearly impossible) to prevent fraudulent expense claims from being input into the system. Administrators will also find it hard to identify and reject these fraudulent claims.
3. Errors in data entry
Even with extreme attention to detail, admin and finance personnel can commit data entry errors. The simple mistake of pressing the wrong key on the keyboard or misplacing a decimal point could have major implications on the organisation’s expenses.
4. Use of various systems and/or cards
When there’s no streamlined process in place, different departments end up using different systems or credit cards to manage their spending. Not only is that a huge mess but there’s also the lack of visibility on the purchases. This can lead to duplicate claims or overspending.
5. Lack of visibility
The lack of visibility in expense claims circles us back to the possibility of fraud. The admin and finance team must have complete visibility over where the education finances go and why they’re being spent.
Benefits of a Streamlined Expense Management Process for Your Education Organisation
Getting rid of the manual process and streamlining expense management through automation is not just easier for everyone. It also has a positive impact on your organisation in the long run—cost savings, better productivity and so much more!
1. Better cost management
A streamlined expense management process makes it more efficient for you to manage costs. When you closely monitor your organisation’s expenses, you’ll be able to identify costs that need your attention—whether they need to be reduced or eliminated. Having an easy view of your expenses makes it easier to implement proactive measures to avoid unnecessary costs, delays and overspending.
2. Enhanced productivity
An automated process saves the staff’s time and, therefore, enhances employee productivity. This is because the software can automate managing the education finances so the staff won’t have to. Instead of spending hours collecting, processing and managing files, the employees can focus on more important tasks that need their attention.
3. Reduced processing time
Back in the day, schools and education orgs had to manually maintain organisation records. The admin department had to maintain paper files and keep them in the filing cabinet, causing a plethora of folders and printed records. Digitally transforming the process using software can get rid of the excessive amount of time they used to spend in expense management.
4. Better visibility
An expense management platform allows authorities and decision-makers easy access to critical data. This promotes transparency of the school’s or organisation’s finances and shows the specific details of expenses. This also eliminates the chances of under or overestimates, discrepancies and misunderstandings.
5. More effective process
An expense management software can sort and store data on every transaction that it contains. This will help its users seamlessly search for any past transaction details.
How to Start an Effective Expense Management Policy for Your Educational Organisation
1. Modernise the processes
You may have already modernised some processes in your organisation, such as sending announcements via SMS and setting meetings via video call. Kick it up a notch by modernising work processes—introduce expense management software to your entire staff.
2. Spell out the purpose and extent
No employee wants to participate in a process change where they don’t understand what it’s all about. Define and clarify the purpose and extent to your employees. This includes explaining the change, its benefits and the reason behind it. Detail the benefits to the finance and admin teams and staff members explicitly.
3. Have a well-communicated expense policy
An expense policy helps control costs and reduce fraud, but only when it’s properly communicated. Communicate and implement the expense policy to help your employees understand matters like which expenses are eligible for reimbursement, who’s qualified to claim them and how they should be reported.
4. Implement a user-friendly system for all departments
The act of streamlining a process includes making sure that all users understand it. Make sure you implement a straightforward, intuitive and user-friendly system for all employees.
5. Issue virtual cards
Having just one system in place when paying for org purchases makes the expense management process a lot easier. Issue virtual cards to employees so you can better track work-related expenses and have the ease of instant-issue.
Automated expense management can do more than just tracking expenses. Its features and abilities allow further benefits such as visibility and fraud detection. When your education org automates expense management, you’ll notice the difference in your organisation’s efficiency and employee productivity.