Essential features of an automated expense management system
Managing employee expenses is not easy, and the more you travel, the more difficult it can be. That’s why using expense management software is so important it can have a huge impact on your bottom line.
But not all software options are created equal. In fact, it’s common for some to stand out from the rest. How they do so depends on the features. While almost all the right options are available online, you need to go further.
It is safe to say that cost management is one of the most feared functions of business management!
A common sight during the reimbursement cycle is employees drowning in paper invoices and spreadsheets, while approvers and finance teams run around like headless chickens to complete the reimbursement process with strict deadlines.
Traditional ways of managing costs have their price. A quantitative and qualitative effort that can slow down the pace of your business!
This article will help you understand the need to move from traditional to automated means of expense management. It will also give you an overview of the ideal features you should have in your automated expense management software.
Do traditional means of expense management affect the health of your business?
Using traditional means to manage your expenses may seem convenient for small organizations. With a handful of employees, auditing and managing your expenses doesn’t necessarily become a major challenge.
The problem arises when companies are in a growth phase. Whether it’s for networking, marketing or sales purposes, your employees need to travel and help your business grow. Here, your employees can sometimes use their own money for business purposes. So it becomes critical that you put in place a new retirement system that helps you manage costs seamlessly for your employees and financial teams.
To help you understand how traditional means could harm your business, we have compiled a list of plausible drawbacks to using traditional methods to manage your expenses:
Here are some reasons why companies like you are considering automation?
Can automated expense management software reduce manual work?
Managing your expenses, sorting physical documents and receipts, scanning multiple dashboards, handling policy violations, and more are ways for organizations to waste productive time.
Manual work, whether entering data or reviewing reported expenses, can be a daunting task. It requires patience, manpower, effort, and hours of assembly time. Reviewing multiple expense reports, comparing and validating claims, and traveling back and forth when policies are violated are just some of the things administrators and finance teams routinely face.
But what if we told you that automation can solve all these challenges?
With automated expense management software, administrative and financial teams would spend less than half the time they spend with traditional methods. Employees can directly download images of receipts from which the expense management software can automatically extract details.
In addition, once all receipts have been submitted, employees can create an expense report in minutes. What would normally take hours to compile and submit can now be processed with just a few clicks.
If an inconsistency or breach of policy is detected, both employer and employee are notified. Once this has been done, employees can provide detailed explanations for violations, and administrators now have the right to approve or reject the expenses in question.
In addition, the directors now have the right to approve or disapprove of the expenses concerned.
Employers do not have to go through many emails to receive these statements. They are all documented and can be viewed at any time. This further reduces the amount of time spent on managing expenses.
We know it can be difficult to choose the right one with the multitude of options available on the market today. To make it easier for you, we’ve listed the key features that are essential to your expense management software.
Here are some key features to consider when choosing your expense management software.
This feature allows employees to record their expenses on the road from a device of their choice. It also allows approvers to access and accept or decline deposited expenses from their preferred device and location. This significantly reduces the time required to process reimbursements and drastically eliminates the risk of fraud.
The problem this feature solves: A major challenge for most employees is that they often simply misplace invoices. This is an obvious problem that needs to be addressed given the number of invoices your employees have to juggle at any given time. It is strongly recommended that you choose device-independent software. This also means that your employees, approvers and management teams can submit, approve and access expense reports anywhere, anytime.
This is an essential requirement for any automated expense management software. This feature allows employees to click on receipts and download receipt images directly. Once this is done, most software also provides an automatic data extraction feature that further simplifies the process. Similarly, administrators or approvers can view expense reports from a single dashboard to manage expenses.
The problem this feature solves: Traditional expense management tools include manual data entry for employees and manual data review for expenses. Not only does this eat up their productive hours, but it is also very labor-intensive and time-consuming. This feature helps combat fraudulent behavior by automatically extracting data, eliminating the possibility of duplicate invoices, excessive claims, manual data entry errors and more.
easy-to-integrate software helps you further simplify and streamline your expense management. It is essential that you review the potential integrations of a particular expense management software to understand the issues it can solve.
The problem the feature solves: Your expense management software comes with a defined set of challenges that it can address. However, there are still many issues that can go unresolved. These challenges can be overcome by integrating your preferred ERP, accounting and other software to solve specific problems.
This functionality is essential for any expense management software. It enables real-time verification of policies on reported expense reports. If a claim violates a policy, the expense is reported immediately and the approver and employee are notified. This feature saves time and adds transparency and credibility to your cost management.
The problem solved with this function With most traditional expense management tools, the approver must manually validate each expense to eliminate the risk of manual input errors. Once this step is complete, the approver must then check for policy violations. This automation feature gives your finance team enough room to focus on other urgent tasks.
In the event of a policy violation, employees can explain possible reasons for the violation. The responsibility for accepting or rejecting the expense report then lies with the employer or administration. In addition, the documented proof of all these aspects helps companies to remain audit-proof.
The problem the feature solves: It can be difficult to track every detail of every employee who submitted an expense report. The software documents all communication. This provides you with a complete digital audit trail that enables you to remain audit-proof at all times.
This function helps you to understand what the numbers say. It gives administrators and financial teams a sense of “how much is too much” and helps to limit unnecessary spending to optimize business functions. With this information, companies can make informed decisions based on the numbers, rather than just limping along. This feature ensures that your decisions are always supported by reliable numbers.
The problem this feature solves: The databased analysis enables companies to gain a deep understanding of the nuances of managing and running a successful business. Adding numerical values to test your business assumptions is critical for growth and scaling. Data analysis is a critical component in understanding employee behavior, spending trends, common spending categories, and more.
This feature enables one-click approval of submitted expenses. Here you can view, approve and reject expense reports. All under one dashboard. Some expense management software also provides the ability to customize approval hierarchies with multi-level approvers where appropriate.
The problem this feature solves: The whole premise for wanting automated Expense management software is to automate and streamline certain aspects of Expense management. With this functionality, combined with real-time policy controls, approvers can easily approve or reject spend without wasting time validating individual spend items.
This goes beyond simply connecting online. Expense management software that gives your team access via their mobile devices means they are better able to stay connected, adds extra functionality and also make it easier to track your team’s expenses. It’s a must for any business.
Receipt imaging: It’s the natural evolution of mobile access. It allows your employees to take pictures of their receipts with their mobile device and then upload them directly into the system. This means there is much less effort to keep track of receipts and paperwork on the road.
Used properly, data reports can give you a very clear view of your business and your employees’ expenses. This allows you to change strategies, adjust policies and even detect fraud.
The more people you have to upload expenses or monitor tracked expenses, the more obvious it is that you need expense management software that has multiple levels of authorization. Each employee can access what they are supposed to do and nothing more.
It’s often overlooked, but it’s important. The ability to integrate a corporate credit card or credit account directly into the system means that the entire process is greatly simplified. It reduces potential errors and makes the work even easier.
IceHrm is a Human resource management system for small and medium-sized organizations. This HRM software centralizes employee data and allows only one authorized person to access it, providing a high level of security. The presence module monitors employee time based on information about insertion and perforation. It covers all the basic HRM needs of a company such as Time Management, Training, and Development, Attendance Management, Expense management, leave management, Recruitment management and handling employee information.