Friday, May 29, 2015
Expense Software and Expense Policy Enforcement
One of the most important components of an organization's travel and expense management is the travel and expense policy. Whether in a rudimentary form that only gives a few guidelines or in an advanced form that governs every aspect of management, it is necessary to have an expense policy. There are multiple uses of one:
Standardize the reporting and reimbursement processes Prevent expense management fraud Control spend
Detailing a sound travel and expense policy only makes up half the job; enforcing it is strictly is just as important. In this article, we'll discuss a few aspects of expense policy and how online expense tracking software helps with its enforcement.
Instead of waiting till the employee submits an expense report is submitted after a trip, it is a good practice to require pre-approvals as part of the policy. Granted, the employee will not be able to give an exact accounting of the expenses incurred, but there could at least be a tentative report that gives an idea of the kind of expenses that the employee is liable to incur and the amount of spend.
If the organization uses expense software, pre-approvals can be simplified and can be edited to be used as the basis for the final expense reports that will be prepared and submitted after the trip.
As mentioned earlier, enforcement of policy cannot be done without the adequate number of checks and balances. There has to be a mechanism to weed out out-of-policy expense reports. It is up to the organization to have a single or a double verification phase where the different expense items are verified and the accompanying receipts are audited. This is a very important step in preventing fraud. It is advisable that the organization verifies every expense report instead of randomly sampling a few to ensure that there is no scope for fraud. It is also advisable to detail the kind of penalty the employee has to pay for stepping out of bounds of the policy or the employees won't take it seriously.
With online expense software, organizations can include adequate checks and balances. Line item verification and receipt audit can be automated to reduce the burden on the supervisor. As the software does the work, all the reports can be verified instead of a few random ones.
A chaotic and complex workflow probably does as much, if not more, damage as not having a well-defined workflow. Without standardization, the routing becomes chaotic and employees will not be sure about their roles. There will be scope for bottlenecks and obstacles in the process. With expense tracking software, standardizing and streamlining the expense management process is a breeze. It allows for the implementation of a well-defined workflow. Every individual stakeholder's role and responsibility is defined to ensure that there is no confusion or ambiguity.