The start of a new year is the perfect opportunity to streamline current day-to-day processes and create cost-saving efficiencies. It’s a chance to take a fresh approach and train staff on new ways of doing things, setting yourself up for a successful year ahead.
Lodging expense claims is one of these essential processes, which needs to be managed to maintain productivity and keep costs down.
Expense claim processes are typically time-consuming and frustratingly manual, requiring a lot of time and attention. Many organisations are still managing their records using Excel, the same way they did in the 90s, with 37% of businesses identifying manual data entry and inefficient processes as a core challenge. Of course, keeping accurate records is a necessary burden to keep on top of business expenses and tax requirements — but with the right tools at your disposal, it can become far more streamlined and intuitive.
Here are just a few ways successful businesses are evolving their expense processes.
Digitising expense claims
Integrating digital tools into your business to manage expenses is an effective way to reduce paperwork and free up employee time.
These applications centralise the expense claim procedure and reduce unnecessary paperwork within a business. The latest applications also provide integration with commonly expensed items, such as Uber for Business trips, to reduce duplicate processes, or allow tracking data to record transport claims accurately.
Expenses are changing constantly. Recent research reveals Uber is now the most frequently expensed claim. With digital integration, managing expenses from these different systems and apps can become a simple, hands-off process.
Essentially, these tools function as digital bookkeepers, with the ability to record data from employee’s receipts, including the date, expense amount and any essential tax information. This digital copy can then be used as proof of purchase to verify any expenses during an audit.
Integrating automated systems also reduces the risk of employee fraud, intentional or otherwise. With 42% of Australians admitting to fraudulent mileage claims and 22% saying they’ve claimed drinks with friends as a work-related expense, the need to stay on top of staff expenses is clear.
Digitisation reduces the opportunity to exploit the system and makes it easier to keep track of where your dollars are going.
Managing employee behaviour
Managing individual behaviour is difficult when it comes to claiming expenses, particularly in larger businesses, so it’s important to teach best practice to all employees. Having clear and visible expense claim processes is an essential step in reducing risk, along with regular, ongoing training.
It’s easy for staff to make a mistake on their expense claim, whether it’s because they’re rushing or don’t understand the requirements — but it could result in hundreds or thousands of dollars down the drain. Having clear rules reduces the temptation to ‘beat the system’ by exaggerating or inventing expense claims while also providing a source of information for people to return to. Open communication channels in the workplace are equally important, so you can provide guidance and support when needed.
Of course, making it clear to staff there’s a potential mistake on their expense claim immediately, before it gets to their manager for approval, is also a great way to coach behaviour. Automated alerts for out-of-policy or duplicate claims can nip potential issues in the bud.
“Always on” audits
While employees are ultimately responsible for their own expenses, it’s essential claims are monitored and audited. A formal system for submission and sighting of original expense documents prevents errors and reduces fraud.
But large-scale audits can be fairly costly and time-consuming to carry out, so schedule regular, sample-size monitoring to reveal inconsistencies. Comparing this information against corporate-card spending also provides useful data.
Automation of expense claims makes this process even easier. By using accurate, tracked data, a smart digital-expense app will ensure claims are accurate and reimbursed correctly.
Integrating new business tools often falls in the ‘too-hard’ pile or drops off the to-do list, but in the long run, it will allow you to regain control of your expense claims.
After a chaotic holiday period of Christmas parties, client drinks and other celebrations, the start of the new year is the best time to ‘trim the fat’ and make sure your expense processes are foolproof. These steps also free up essential employee time and enable new productivity gains to set your business up for a profitable 2019.