Managing expenses and keeping a handle on what is being spent can be a nightmare for business owners, employees and finance teams. In addition to the repetitive and time-consuming data entry, receipt organisation alone is sufficient to make anyone crazy. As a business grows from small to medium-sized, the task gets more difficult – and you’re going to need some help.
This is where expense management software comes in handy.
What is Expense Management Software?
An expense management software allows businesses to “process, pay, and audit employee-initiated expenses. The software includes capabilities for employees to input expenses for approval through a browser or mobile application. Expense management software simplifies and automates a business’ expense entry, streamlines review, eliminates paper trail, and reduces administrative effort. Expense management software allows administrators to have full visibility of and track employee use of business financial resources. Expense management software analyses overall expenses, identifies cost-saving opportunities, and controls excessive spending.” (Source: g2)
Here are 8 ways an expense management software can enable your business to grow:
1. Ease management and tracking of paper receipts
Most expense management software is cloud-based, accessible via any device.
For employees, this means that you can file your expense claims on-the-go, the instant you spend the money. With machine learning technology like optical character recognition (OCR) built into expense management software, tracking your expenses is as easy as taking a photo of your receipts and having your expense data automatically captured and populated for you. No more shoebox full of paper receipts, or dealing with faded receipts or misplacement of critical receipts.
For finance teams/accounting professionals, no more countless hours of unproductive data entry, receipt chasing, and murky, outdated views of client spending records.
2. Reduce data errors that lead to a mismatch of payments
Ever heard of the “Telephone Game”? For those of you who haven’t, the gameplay goes like this: A message is given to the first person in a line of people and then they are instructed to pass the message on by whispering it in the ear of the next person in line. The message goes from person to person until it reaches the end of the line, and that person announces the message to the group. In most cases, the message that is announced to the group is significantly different from the message that was originally given to the first person in the line.
Just like the “Telephone Game”, businesses run the risk of data errors when employees manually enter data and it is being transferred and communicated across departments. As your business grows and the volume of expenses increases, the risk of data errors increases as more information gets keyed into the systems every day.
By using expense management software, you can automate expense claims and filing of expense reports such that you can reduce data errors and prevent your business from overpaying or underpaying employees.
3. Compliance with company spend policies
In a study, it is found that at least 20 percent of expenses are in violation of corporate policy. By using an expense management software, you can preset spending policies and restrictions within the software to ensure that employees will adhere to every expense policy set by the company and that even new employees can stay compliant as well.
This will reduce the amount of work that finance and accounting departments will have to do and increase work efficiency in the company.
4. Shorten approval workflow
By using expense management software, information is updated in real-time and employees across the entire organisation can work efficiently to manage expenses within the company together.
For example, managers can have visibility on the expenses claims submitted in real-time, receive notifications and approve them immediately once they see that it does not violate any company policies. This removes the need for employees to attach files, write approval emails, send them over to approving managers and then wait for an approval reply. The whole process is streamlined throughout different departments and management levels and you can save up to days or weeks of going back-and-forth within your company.
With the time saved, employees can then focus their time and efforts on other essential tasks to boost productivity and business growth.
5. Boost employee satisfaction
According to a study by economists at the University of Warwick, it is found that employees who are satisfied and happy were 12% more productive, while those who are dissatisfied were 10% less productive.
With less hassle and effort to get reimbursed via an expense management software, it will lead to an increase in employees' satisfaction which will then boost their morale and productivity as well.
6. Foster data-driven decision making
Using data to drive decision making is important as it helps you to better understand the impact that any decision you make will have on your business, and therefore drive business growth.
With a complete view of employee-initiated expenses, finance teams and company management to make data-driven decisions for forecasting, predictions and better allocate resources.
7. Compliance with tax regulations
The filing of tax returns is compulsory for every business, no matter which country you are operating in. To ensure that you can submit records when asked for and that they are compliant with accounting standards, good record-keeping practices should be adopted and expense management software can be a tool to help you with that.
8. Synchronise data across functions
When an expense management software can synchronise data across multiple systems, it reduces the amount of time and manual effort required to complete different tasks.
Most expense management software will have an integration with at least one accounting or HR software but some companies provide their standalone accounting and HR modules and do not provide external software integration capabilities as well.
Growing your business
Navisteps is a cloud-based expense management solution for businesses to control, track and manage spend efficiently. Automated receipt tracking, smart spending policies, multi-level criteria based approvals, complete spend analytics and accounting integrations — we take care of your pre accounting processes so you can focus on business.
The solution also integrates business travel management so that you can book, manage and control your travel with ease while having your expense reports automatically created for you.