Are you paying attention to your corporate travel and expense management?
You should. Because according to GBTA (Global Business Travel Association), annual corporate travel spending will reach $1.4 trillion by 2024.
If you are struggling with your travel and expense management due to your manual setup, it’s time to take a step towards digitization. This is because if you leave your expense management woes unattended, it can significantly impact the growth and scale of your business in the long run.
This article highlights some of the top corporate T&E challenges and how businesses can embrace corporate T&E software to make expense management less frustrating.
Top corporate travel and expense management challenges and their solution
Challenge no.1: Tracking and managing receipts
As a necessary means of staying compliant, businesses should always ensure employees submit their expense reports with corresponding receipts. This is because expense receipts serve as proof of spending and are crucial during audits. Receipts may either be paper receipts or e-receipts, and a single expense report can often come with multiple receipts. In these cases, the onus of collating, verifying, and documenting these receipts and reports would fall entirely on the Finance teams.
While some businesses believe using expense report templates may solve the problem, the truth may vary. With templates, employees are to manually enter expense details and attach photocopies of receipts as proof of spending. This may result in receipts all over the place and in varying formats. For example, with a car rental for work, you have receipts from the rental agency, gas stations, and parking validation - that’s already three different types of receipts for just one corporate travel expense.
To add to the confusion, these templatized expense reports make it easy for missing, incorrect, and exaggerated entries to slip by. In these cases, Finance teams are to manually identify and address issues with multiple employees over multiple expenses. Further, all clarifications and justifications for these business expenses go unrecorded as they happen over emails, calls, or word of mouth. This translates to zero clarity and a highly ineffective means of managing business expenses and receipts.
How can a travel and expense management software help manage receipts?
- Business travel and expense software comes with unlimited cloud storage that can store all your employees' trip reports and expense receipts in one place.
- You and your Finance team can access the trip reports for review or reference from anywhere, using any device and at any time.
- The T&E software eliminates the frustration behind paper receipts as employees no longer need to hold on to them to file later. They can simply use an expense reporting app to take a picture, and the software will automatically extract all the crucial information to the trip report form and store it in the system.
- Employees can submit expenses through everyday apps like text message, Gmail, Outlook, and more. The software will collate all information under one platform no matter how your employees submit their expense reports.
- Before your traveling employees submit their trip reports and expense receipts, the software can also run an automated audit check, so no errors or potential fraud pass through.
Challenge no.2 : Frustration with unclear travel and expense policies
Is your travel and expense policy clear and comprehensive? Is it easy to understand and document every step of your travel reimbursement process in detail? If not, then the chances are that it may be contributing to employee expense reporting frustration and poor reimbursement turnaround time.
Unclear T&E guidelines can lead to policy violations, out-of-policy expense claims, and finance teams spending more time going back and forth with confused and frustrated employees. This translates into productive time wasted over something that could have been curbed from the beginning.
Your travel and expense policies work as your one source of truth when it comes to employee reimbursements. Unfortunately, most companies pay no heed to their policies, and as a result, so do their employees. This results in out-of-policy expenses and other policy violations, which cause unnecessary financial leaks in the system.
How can a travel and expense management software help enforce policies?
- Businesses can pre-set policies based on designation, business goals, nature of business expenses, and other such parameters.
- Once you’ve set up your approval workflow and integrated your T&E policies into the software, it automates your entire expense management process.
- With the policy set-up, you can spot expenses incurred on alcohol bills, holidays or weekends, and any other expenses outside your T&E policy guidelines.
- This feature simplifies the entire expense approval workflow and increases employee compliance and productivity.
Challenge no.3: Reviewing and approving expense reports takes too much time
Expense management tasks can be frustrating for both employees and Finance teams. For example, employees need to keep a tab of their travel expenses and correctly enter all the information into an expense report template to be reimbursed on time.
After employees submit their T&E reports, Finance teams need to collate all the trip reports from managers and manually identify claims that are not supported by your travel and expense guidelines. Then, in case of a policy violation, the Finance team needs to send back the travel report to the employee in whole or in part for necessary changes or clarification.
This can translate into a costly and time-consuming process. Additionally, due to stringent timelines, they may not thoroughly verify the submitted expense reports and may end up missing claims that might be fraudulent in nature. This behavior over prolonged periods can prove detrimental to the financial health of your business.
How can a travel and expense management software help review and approve expense reports?
- Modern expense software comes with OCR technology that scans receipts, extracts crucial data, and auto-fills a digital expense report in just a few clicks. This cuts down manual data entry tasks for traveling employees and also eliminates human-prone errors.
- The robust policy engine also comes with real-time policy checks to ensure no policy violations slip by.
- If the software detects any out-of-policy expenses, the software flags the errors and notifies the employee immediately to make corrections. In case of a serious violation, the approver gets informed as well.
- The software also provides a detailed digital audit trail that documents all activities related to an expense report. This comes in particularly handy during quick reviews, approvals, and audits.
Challenge no.4 : Lack of visibility into spending patterns and trends
Insight into expense trends occurs when Finance teams have historical and real-time data in hand. But, businesses who use traditional expense management means gain little to no insight as they have no data to refer back to. As a result, you can end up making ill-informed business decisions.
Expense analytics and real-time insight into expense data play an important role in cost optimizations and preventing financial leaks in the system. But, this can happen only when businesses have the numbers to speak for them.
How can a travel and expense management software help with spend insight?
- Since all travel expense data, such as flight bookings, accommodations, transportation costs, and more, are stored under one platform, Finance teams don't need to gather expense data from discrete sources.
- Finance teams can identify frequent spenders, top policy violators, and other recurring or abnormal patterns and address them.
- With real-time insight into the business's financial health, Finance teams can tweak and improve the organization's travel and expense policies to drive compliance.
Challenge no.5 : Delay in closing the reimbursements cycle on-time
Delayed reimbursements in a manual travel and expense management setup can be due to a number of reasons. It can be because of:
- Employees dread the time-consuming and tedious expense reporting and tracking tasks and keep it for the last minute. This can lead to late expense report submissions from the beginning.
- Working on their expense report at the eleventh hour can also cause multiple manual data errors, incorrect expense entries, missing receipts, and ignoring policy guidelines while filling in the expense report form. This may result in numerous back and forths between the approver and employee before it reaches the Finance team for a final audit.
- Furthermore, since Finance teams receive all the expense reports in bulk just before the deadline, fraudulent expense claims can pass unnoticed.
How can a travel and expense management software improve reimbursement cycles?
- The expense reporting app makes it really easy for business travelers to keep track of their expense receipts and submit their expense reports on the go from anywhere, ensuring they never miss a deadline.
- With features like data extraction and receipt scanning, an expense software drastically reduces errors in an expense report.
- The real-time policy check engine also flags any out-of-policy expenses, duplicate bills, and policy violations when an employee uploads their receipts. This helps curb delays right at the source of expense creation.
Streamline your corporate travel and expense management process today
The business world is continuously evolving to become highly receptive to the needs of employees. While the choice to automate your travel and expense management software may benefit you as a business, it also is a boon for your employees. Addressing employee challenges has a direct impact on employee morale and productivity. Thus, also impacting the overall financial productivity of your business.
All this and more without your Finance team slogging it out.
Do you want to hop onto the bandwagon of digital change? Fyle does more than just expense reporting. Schedule a demo today to witness how Fyle helps you put an end to your expense management woes.