Expense management and control is an important aspect of any organization. When you’re starting a new business or growing your business in some way, it’s critical to make sure you have processes and controls in place to manage your expenses. Whether you’re starting a new business or looking to optimize existing processes, it’s important to understand how different methods can impact your business. Implementing the right expense management systems can help cut costs, reduce unplanned expenses, and streamline the entire process. Use this comprehensive guide to learn the different ways to streamline your organization’s expense management process, as well as other helpful tips.
Understand expense management
Expense management is one of the most important aspects of business accounting. It is the process by which businesses record, track and categorize all of their expenses. This data can then be used for different purposes, such as creating budgets or forecasting future revenue streams.
Automate expense approvals
One of the most effective ways to streamline your organization’s expense management process is to automate your expense approval process. This can work especially well if your business has remote employees or if you have employees who travel frequently. Implementing an automated expense approval process is a great way to save time and money by reducing the time spent manually approving expenses. With an automated approval process, employees can submit their expenses and have them automatically approved. This can simplify the process and make it easier for everyone involved.
Consider a virtual credit card
Another way to automate certain aspects of your expense process is to implement a virtual card solution, such as that provided by Payhawk. A virtual credit card can be useful in situations where you or your employees need to make purchases but don’t want to carry a lot of cards with them. A virtual Visa card is connected in-app with Payhawk, which means your accounting department can track expenses and set limits so employees don’t have to spend time filling out expense reports. It can also be especially useful when working with vendors and need to pay fees up front, as well as for business trips.
A virtual credit card can streamline the shopping process. You can make purchases directly through your account and the accounting department will have all the information instantly. It can save you time when processing payments, and it can also help you better track what you’ve spent.
Another aspect of expense management you may want to consider is eliminating unnecessary paperwork. While it is important to have a paper trail, some aspects of the process may not need to be documented. By eliminating paperwork where it is unnecessary, you can save time. You can also help eliminate errors by ensuring that all data is entered correctly and that there are no discrepancies between paper and digital records. By eliminating paperwork, you can also help speed up the approval process. If you use paper receipts, entering data, reviewing it, and then approving it can take a long time. By switching to digital receipts, you can speed up this process and save your entire team time.
Integrate your expense reports with other departments
Another way to streamline your expense management process is to integrate your expense reports with other services. For example, you might want to integrate your expense management system with your HR system. This will allow employees to report their expenses and submit their receipts through the same system. This will allow employees to submit their expenses faster and easier and provide management with a more complete view of all expenses incurred.
Develop a digital reimbursement process
If you currently use a paper-based system to reimburse your employees’ business expenses, you may want to consider switching to a digital system. A digital reimbursement system can help simplify the process and can also help reduce the administrative burden of reimbursing employee expenses. With a digital reimbursement system, employees can submit their expenses online and employees can also view their expense reports online.
Save expense data
Additionally, it is important to record all relevant data for each type of expense you incur. This can include details such as type of expense, vendor, amount spent, and reason for purchase. When you manually record your expenses, it can be easy to forget to include certain information. If you use a digital tool, however, it may be easier to ensure that you record all relevant information. This can help you identify problems and make it easier to identify the source of any problems if you notice problems with your finances.