Expense management is not at the top of the mind while running a business. However, it is an essential part of the business that all startup founders and business owners cannot ignore.
As a startup founder or small business owner, your financial capabilities are limited and you will want to save up on any additional cost - even if it means doing things manually.
So at which point do you decide that having an expense management software is necessary for your company? We have broken down some key questions that you can answer to determine whether or not you would need an expense management software.
Analysing my business expense management process
1. Do my employees send in expense claims frequently?
How often do your employees send in expense claims? Does it take up a lot of time during their work hours and reduce productivity?
Time is precious, and it is important to ensure that your employees spend it wisely.
2. Do my employees spend a lot of time keying in expense claims?
What is your company’s current expense management process like? Does it involve the storage of physical receipts and manual entry of data? Does it take days for any expense claim to get approved and additional time to have it reimbursed?
Decide whether having a long and/or manual process worth it for your company if it takes up too much of your resources and employees’ time!
3. Does my finance and accounting team spend a lot of time reconsolidating all the expenses claims?
Many companies are still using traditional methods of managing expenses and doing everything manually. Without digital systems, finance and accounting teams may have to go back and forth to tie in expense data and ensure that all finances are kept in check.
Accounting and auditing seasons will be a bother as employees struggle to find receipts and proof of purchase to file for taxes, tax-deductible expenses and etc.
4. Is my current expense management segregated from my accounting management?
Is the expense data automatically imported into my accounting system or does my finance team have to reenter all the data themselves?
Without integration capabilities, many companies use traditional accounting approaches and face the problem of having to do double work.
5. Is my company vulnerable to fraudulent claims and expenditure?
Is there a possibility where your money goes missing or unaccounted for? Do you see recurring transactions but don’t even know what it is for?
Your company may be spending on unnecessary expenses which may harm the cash flow of the company!
6. Do I lack accurate insights on where my expenses are flowing to?
While planning for the company’s budget and doing financial analysis and forecasting, how accurate are my financial data and can I make impactful decisions based on the given expense data?
Imagine thinking that you spend $1,000 per month when you are spending $5,000 per month on office supplies. You might have wanted to increase your office supplies budget while referring to a much lower and inaccurate expense data! Having accurate insights is vital when making business decisions!
7. Is the cost of managing my expenses higher than using an affordable automated software?
How many staff are being allocated to performing expense management related tasks? How much does it cost the company to manage expenses at the present moment? Are there alternatives that can be cheaper, faster and more efficient than the current process?
It is quite straightforward to say that if the current cost of managing your business expenses is higher than using digital automated solutions, there is definitely a need for your company to use an expense management software.
So what’s next?
After going through the list of questions, you should have a better understanding of your company’s business expense management process. If you have answered yes to any of the questions above, you should definitely consider having an expense management software for your business!
Many startups and small businesses overlook and ignore the hidden costs of expense management, which can create obstacles and impact the efficiencies of your business later on as your business scales and grows.
Expense management does not have to be complicated and can even be simplified through email submissions. If you are interested in automating your company’s expense management, sign up for an account here or speak to us to find out more.
It’s time to manage your business expenses efficiently!