Benefits of digitised expense management for the finance team and end user
According to research, only 12 of companies prioritised the digitisation of expense management over other functions. Those functions perceived to have greater reach within an organisation or those connected to revenue were usually prioritised. However, even if companies are not prioritising expense management, digitising this process can provide an ‘easy win’ and lay the foundations for more complex, costly and time-consuming projects to come.
CFOs often believe they can benefit from being a ‘late mover’. In other words, they only act when other companies have already gained experience with innovations. While it makes sense to hold out when it comes to some solutions, expense digitisation does not fall into this category, and has many advantages.
Benefits for the Finance Team
The top benefits of having a digitised expense management system for finance teams can vary. This includes fast results through balancing the books and saving precious working hours, integrations with ERP systems, to systems for the beginning, middle or end of your roadmap that will streamline working processes.
We know the benefits of wider digitisation – rather than processing historic data, the team can forecast results, conduct in-depth analysis and provide recommendations. But what do companies see as the benefits of a cloud-based expense management platform? Accurate forecasting was the top cited reason according to a recent survey, as to why companies digitise expense management. This was closely followed by compliance with the rules and employee satisfaction.
A more accurate system with higher levels of compliance will save resources and time. These are legacy issues that many thought could never be resolved – sorting through piles of receipts and reports, challenging requests and chasing up managers for sign off. As workforces become more fragmented and businesses open new offices in different jurisdictions, the pressure put on the finance team by an increasing number of expense reports is only going to take more time away from other tasks.
It’s issues such as these that encourage managers to think about automating their business’ expense management process. Expense management may not be as important to an organisation as accountancy, but a company cannot operate to its full capacity without an efficient expense management system in place.
An efficient and accurate expense management process is also an effective way of saving money spent on expenses. For example, a line-by-line app can alert end users when they have made a mistake. This mistake could be outside of their agreed per diem rate, not allowed in their current jurisdiction or potential fraud, such as a duplicate expense. Even with the most diligent finance team cross-checking potential instances of fraud, some will be missed. In fact, because genuine expense claims that follow the company’s expense policy and the jurisdiction of the traveller’s trip are automatically approved, the finance team can focus on those expenses that are irregular.
Benefits for the End-User
For end users, an automated line-by-line expense management tool can save time spent going through receipts, dealing with mistakes and filling in forms. With line-by-line expenses, the user leaves the restaurant, takes a picture of the receipt, fills in a few lines of a form and throws the receipt away.
The cloud-based system will then alert the user if the expense has been accepted, rejected or whether further investigation is required. The intuitive nature of such an app can help employees save time and increase productivity. And although employees need to use a new piece of software, these solutions are often easily adopted and do not require much training.
Proactive Steps for Long Term Improvement
As more of us work away from the office and businesses become increasingly global in nature, more employees are working in jurisdictions with different rules. Unsurprisingly, recent expense management research discovered that 42% of respondents identified connecting data points across the business as the top challenge for expense management in the future. The next two most popular issues were the challenges of long-term forecasting and control of costs. The beauty of expense report apps is that they are developed to keep track of each jurisdiction’s regulations, and change accordingly.
The pandemic alone will not change the way expenses work - the encroachment of technology will also play a significant part. As we travel less and connect more over technology such as Teams and Zoom, these expenses may never reach their previous levels. Yet businesses must look at this as an opportunity to make changes where they can due to less travel activity. Lockdowns around the world gave businesses breathing room. Expenses weren’t being made around the world - making it the perfect time to take stock of what isn’t working and put in place solutions for the future.
The pandemic may have helped accelerate the move to a digitised expense management system. By being proactive now and making changes when businesses can, teams are setting themselves up for easier onboarding with automated expense management systems that will help to improve business long term as travel returns.
