Prior to a business trip, your finance team has to sort out all the travel requirements like transportation, accommodation, etc. This can become time-consuming and can take up precious hours especially when they have to collect data from disparate sources.
To help tackle out travel expense management challenges, most businesses take the help of travel managers. Travel managers help streamline business travel for your employees. They help with hotels, flights, and sometimes even local travel while on a business trip. A travel manager needs to consider numerous aspects of travel expense management for global business travelers. This makes the process complicated. This confusion further leads to inefficient processes and delays in reimbursements, among other things.
To help you through the process, we have compiled a guide on how to create a reliable expense management process. Let’s dive in!
Factors to consider while creating a reliable expense management process for travel managers
Expense Reporting: Manual Vs. Mobile Vs. Automatic Entry
How do employees across the globe submit their expense reports? And which one is best out of them all?
As we can see, implementing an automated expense management solution through the use of mobile apps and integrated software can drastically reduce the rate of errors. It also speeds up the reimbursement process for employees. It also comes with added benefits such as advanced analytics for greater insight into travel expenses. This helps boost employee and financial productivity.
Integrate policy checks in travel bookings
At various points in corporate travel booking, there might be situations where the travel and expense policy has not adhered. Usually, employees either do not know the full extent of the travel policy or purposely don't follow the guidelines.
Sometimes the company may not even have a travel policy set. And rarely, they ignore the policies in favor of employee satisfaction. Companies have various ways of resolving this issue; let's take a look at some of the main ones:
- Written acknowledgement
The company sends out its full policy document to each employee and asks them for a sign-off. Sign-offs are indicators that the employee has read the material. Although this is an excellent way to keep track of employees who frequently travel on business, it is not a sure-fire way of preventing non-compliant expenses as you have no clear idea of tracking each payment.
- Policy handbook
Here the main policy guidelines around corporate travel are sent to the employees in the form of a handbook or mobile e-book. Travelers can keep this throughout the trip, and it provides some clarity on peculiar expenses. Again, this is just a guideline that has no way of actually tracking each payment. Non-compliant expenditures can still slide past.
- Real-time policy checks
Many companies are now starting to use integrated expense management solutions that either track each expense digitally or allow managers to approve expenses in real-time. Travelers can send expense reports via a mobile app to approvers. The approvers can then accept or reject them accordingly. This is arguably the best solution to prevent non-compliant expenses in corporate travel. It also greatly enhances the traveler's experience, as well.
Stay audit-ready at all times
Having a business that is tax compliant means fewer worries for the overall growth of the company. Comprehensive audits cannot occur if you don't have a good expense reporting processes in place. Policy compliance and travel expenditure analytics are other factors that play a crucial role in keeping you audits spotless. Hence, businesses must pay attention to their expenses to not run into trouble with the IRS.
Making sure the entire team is aware of these audits will ensure they follow the best practices.
Audits become challenging when businesses use the traditional methods to conduct them. Auditors have to comb through numerous physical receipts and cross-reference them with reports and company policies. On the other hand, an expense management solution helps eliminate the hassle of human interference and gives crystal clear insight into every expense made during corporate travel.
Choose an appropriate TEM software
As we have mentioned above, the most reliable expense management only comes from using a TEM software. Travel expense management software comes equipped with features that dramatically speeds up and declutter the entire expense reporting process. TEM software comes as a cloud-based service rather than a packaged software. Cloud-based services are easier to deploy as it can be accessed virtually. They also have cheaper subscription costs based on usage rather than a fixed amount.
Automated expense management is the forefront of this vertical, coming with advanced features not available elsewhere.
However, your business needs to choose the correct TEM software that suits your business needs.
The five main steps to consider when selecting an expense management solution:
- What are your business requirements?
- What is the current expense management process?
- What are your expectations of this new TEM solution?
- Compare the features and pricing of different vendors.
- Consult the team on what they want.
These are some of the main steps when selecting a TEM software. But there are more specific criteria you should look at when selecting one for your corporate travel expenses:
- Travel booking / Travel programs
- Receipt scanning
- Pre-approving trips
- IRS compliance
- Mobile reporting/Workflows
- Expense reporting/approval workflow
- Corporate card integrations
- Expense analytics
- Cash advances
- User-friendly dashboard for real-time insight
That's not all; there are some other advanced features that you should consider. Note that not all vendors may provide these features:
- Trip reports
- Automated travel booking
- Automated policy checks on travel requests
- API integration with online travel aggregators
- Travel-centric system roles
And there you have it! This was everything you need to know before creating a reliable expense management process for your travel managers. This guide will give you an edge when it comes to managing travel expenses for your business. The advanced features mentioned above are exclusive to our Travel Expense Management system, Fyle.
Fyle utilizes advanced machine learning to provide a definitive expense management solution to businesses and enterprises. Turbocharge your entire travel expense management process and take your business to the next level with Fyle. Schedule a demo today to find out how!