Does it take your employees an eternity to submit a travel expense report?
Our best guess is, they hate the process just as much as you. But, in today's employee-centric ecosystem, businesses are actively moving towards automation. An automated solution like an expense reporting software helps eliminate the mundane tasks associated with work. It is also known to help boost financial and employee productivity.
But how can automation help with a T&E report, you ask? Let's delve in.
Business travel is hectic enough. Your traveling employees need to hop across cities, and sometimes even countries to close business deals. They need to manage clients, presentations, and timelines. They also need to constantly save business expense receipts to make expense reports.
All these to get reimbursed for the money that they put into for accomplishing business goals. But if your expense reporting process is broken, it can be the perfect ingredient to create the worst sauce for employee morale and productivity.
Collecting and maintaining receipts is tedious
Every traveling employee dreads the idea of collecting physical receipts at every point of expenditure. The dread continues when these employees are also expected to manage multiple receipts throughout their business travel. These fragile paper receipts often get lost, stolen, or damaged. Due to this, employees are likely to not collect receipts in the first place.
Once your employees are back from a business trip, they need to create and submit an expense report for every business expense incurred on the trip. Employees are often overwhelmed by the task of cataloging each receipt and reporting them separately. The manual effort required to organize, arrange, and update each entry causes many employees not to report them at all.
Employees may not know of their rights and responsibilities, as stated by the company’s travel and expense policy. The policy guidelines could also be too complicated for them to understand. Such a lack of information can lead to a lack of execution. This is very common among new employees who are not well-versed with the company’s policies.
SUGGESTED READ: Five ways to make expense reporting easier for employees
A recent survey states,
“Only 72% of organizations have a formal travel and expense policy in place, of which 58% report that their employees’ understanding of the policy is “decent but in need of improvement.”
If a company does not have a proper travel and expense policy in place, travel expense reporting is at stake. Without a standardized expense reporting framework and template, there would be no straightforward way for employees to create and submit travel expense reports on time. This further discourages employees from staying compliant.
With most companies catering to a broad consumer base, business travel has become very common. An increase in business travel has naturally led to higher business travel expenses for companies. These travel expenses are necessary for any company to meet its business goals.
However, when employees do not report these business expenses on time, it becomes a blocker for various other functions. Finance and accounting teams find it challenging to process and accurately account for these expenses within the appropriate time-frame. Additionally, they end up relying upon provisions based on estimates & assumptions. This further leads to businesses making ill-informed business decisions.
While many companies are actively upgrading to expense management software, some companies still employ manual expense management methods. Do you fall under this category? If so, here are some steps you can employ to encourage your employees to submit their travel expense report on time:
An expense report template is usually a spreadsheet or a form that can be filled out by employees to report their business expenses. If you don't have the budget and size for an expense management software, expense report templates can help streamline expense reporting and accounting to an extent.
Here's a free-to-use template for your employees to help submit travel expense reports. The ease of reporting cuts short the time and confusion around it. Additionally, reconciling expenses of multiple employees would become simpler for accountants.
There are many receipt-scanning apps in the market for converting all physical receipts to e-receipts. Such apps are ideal for employees as they eliminate the need to collect and store physical receipts. With these apps, employees would no longer have to follow the tedious manual receipt submission process. This works as a critical motivator for employees to report travel expenses on time. Additionally, processing expense reports would also become quicker for finance teams.
Travel and Expense policy revision and explanation
Employees should be informed of the policy guidelines to ensure they are aware of what to report and how to report. New employees should be thoroughly instructed during their on-boarding and training to contain future delays. A well-defined and clear travel and expense policy will reduce the turnaround time at every stage of travel expense reporting.
You can make the policy available on your intranet with the expense report template/ forms for easy reference.
Even though the means mentioned above may help decrease the time and effort involved, it does not address the whole problem. Expense reporting is a far more devious problem. If not tended to, it may cost you the health of your business.
Most businesses are actively moving towards automated expense management software to help address the more significant challenges around expense reporting. Let's look at how an expense management software can help resolve your expense reporting needs and more.
Expense management software automates the expense report creation and submission processes. It also shortens the reporting time tremendously. This plays a crucial role in encouraging employees to submit their travel expense reports on time. Here are some other benefits of using an expense management software to streamline expense reporting in your organization.
It is usual for employees to forget to report their travel expenses on time. It is therefore essential to remind them about any pending expense reports. Expense management software offers the option to set up reminders to automatically notify employees about their pending and unreported expenses. This helps keep employees on their toes and reduces unnecessary delays.
If you use an expense management software, you can gain insights into employee spending habits. You can also gauge whether your employees are staying compliant or not. Appreciate your complaint employees via newsletters, emails, and other means of communication. This helps them feel rewarded and works as an ideal way of social proofing.
Few expense management software also tracks the spending patterns and trends of employees and present expense analytics based on them. You can analyze the turnaround time of the reporting phase to track the time spent on reporting. You can track and question the defaulters to investigate the source of delay and the impact of policy guidelines. The travel and expense policy should be regularly updated and modified to address employees’ concerns regarding travel expense report creation and submission.
You need to pick an expense reporting software that matches your business needs. Most software provides a basic framework that barely supports your needs. It is likely the software is also not user-friendly or efficient enough for employees. Check the possible areas of improvement and if a different expense management software can address your needs.
To avail expense reimbursements, employees need to submit their travel expense reports on time. But, various factors contribute to the delay in submissions. This delay further creates frustration for all stakeholders involved. It is thus essential to take measures to make the process of reporting travel expenses as effortless and manageable as possible.
Fyle does much more than just streamlining your expense reporting. Schedule a demo today!