What finance leaders need to consider about expense management
Expense management can be the bane of finance team members’ lives. But there are lots of reasons why expenses need to be well-managed: from saved time to the reduced risk of fraud, staying on top of the many expense claims that come flowing in and out of a finance team has lots of benefits.
As a finance leader, it's important to consider the impact of your expenses process on your team and on your organisation on a regular basis. Failure to do so can lead to creeping problems, from a rising workload for your team and a bloated headcount, to problems with fraud and increased costs.
As seen in our recent UK finance survey, more than one in ten finance professionals still consider expenses to be the most inefficient function of their finance department, highlighting the need for further focus on modernisation.
How much time and resource is expense management taking?
With a traditional paper-based system of expenses, you not only have to account for the cost of the manual labour to process a claim by the finance team but also the teams around your business that submit claims.
The time taken to process a manual paper-based claim can be significant. From the collating of receipts, posting to a central location (even more difficult if staff are working from home!), to filling out forms and entering details by hand, the work can be lengthy and time consuming compared to an automated system. Using expense management software that allows staff to take images of receipts and to enter claims real-time on their mobile device can give staff the freedom to do more. On the finance team automation can mean more time for your staff to focus on value-added tasks.
Freeing up your team's time by automating expenses can allow you to scale without adding headcount, and improve the reputation of the finance department with an organisation that no longer has to go through an outdated and slow manual expense claim process.
Controlling the cost of expense claims
While utilising expense management software can free up significant time and resource within your team, it also has a secondary but no less important benefit. With claims now logged online in a centralised system, access to valuable reporting and insight becomes a lot more accessible.
While the world of expense claims is not one that many finance leaders find themselves voluntarily dipping into, it’s actually a fertile ground for data analytics. It’s simple to look at overarching data, such as total expense claims, and make a judgement about whether or not that’s too much. But with software on your side, you’ll be able to assess metrics which are more insightful, such as value for money or areas of particularly high spend. Without data analytics tools which automate the process, this sort of deep-dive would take up staffing and time resources which may not even be available.
You’d be forgiven for thinking of data analytics as fashionable, but for many finance leaders it already represents a world of opportunity to better understand your business. Going beyond Microsoft Excel and discovering the power of sophisticated data tools is essential, especially in an age where insights on efficiency and profitability are needed perhaps more than ever.
How to prevent expense fraud
While it’s not a pleasant subject to discuss, the risk of fraud is always there – no matter how minuscule it might seem. According to one study, 38% of British employees have owned up to submitting expenses for things that they were well aware were against the permitted expense rules! It may seem like there’s little chance of expense fraud happening in your particular organisation, especially if you work in a trusting environment, but expense fraud can take place anywhere, and everyone should work to prevent it. With expense management software that is able to identify trends, confirm receipts and more, it’s simple to notice any suspicious patterns and have them flagged.
Expense management has long been a challenge for finance leaders and team members, and with the potential for lost receipts and loophole exploitation ever-present, it’s always been a fraught area of financial management. However, with expense management software now available for finance team members to use, it’s easier than ever to keep on top of the many different claims that staff members send in.
Improving your expenses system
It's clear that expense management still presents a good opportunity for improvement in many organisations, and the technology exists to help finance leaders drive this change. However, not all expense systems are created equal. It's important to note that while many solutions on the market will help automate manual processes and give time back to your team, to get the full benefits of the analytics and insights, your solution needs to be able to integrate with your other business solutions and offer the analysis in a single place.
Access Expense is a modern expense management solution that is delivered via Access Workspace allowing integration with other Access software, giving you integrated analytics from across your business. To find out more, download the Access Expense product brochure, or watch our short online product tour.