According to a JP Morgan study,
“Companies that use electronic expense reporting systems experience a 58% reduction in processing costs. On average, these companies spend $18 per report versus $43 through manual paper-based reporting.”
Based on this study, let’s do a simple calculation.
If a company processes 5000 expense reports every month using traditional expense management means, they will end up spending close to $2,15,000 in processing these expense reports.
Businesses can reduce these processing costs if they choose to use an automated expense reporting software. On calculating, companies would end up spending only $90,000 as compared to $2,15,000 if they use traditional means.
This is a whopping $15,00,000 in savings every year - by simply automating your expense reporting software!
Automating your expense report software comes with more than just monetary benefits. It not only helps finance teams with visibility into the expense reporting process but also allows employees to report expenses on the go. This offers a wholesome approach to streamlining and providing accountability to business expenses.
But the success of your expense reporting software will depend on the software you pick.
To help you pick the best expense reporting software, we’ve compiled a list of the ideal features of an expense reporting software. We hope this will help you better understand how this modern tool can help streamline your business processes. Let’s dive in!
What is an Expense Report Software?
An Expense Report Software is a cloud-based solution designed to streamline expense management for businesses. It does this by helping finance teams track and analyze business expenses, flag and detect policy violations or expense frauds, and decrease processing costs and reimbursement turnaround time.
This modern software is built to eliminate manual work, increase security and accessibility, and create ease of collaboration between employees and finance teams.
Key Features of a Modern Expense Reporting Software
Some of the must-have features in an expense report software are:
One of the biggest hassles when it comes to expense reporting is managing fragile paper-based receipts. Though managing bills and receipts can be a headache, we know they are crucial pieces of expense proof - both for tax and auditing purposes.
Thus, our Instafyle feature was created!
- Our receipt scanning feature works with Optical Character Recognition (OCR) technology, allowing employees to turn paper-based receipts into digital ones in just a few seconds!
- Additionally, the OCR technology extracts crucial expense report data like amount, date of expenses, and vendor’s name from a physical receipt and reduces manual efforts.
- Our auto-extraction feature takes care of human-prone data entry errors. This ensures that no manual errors get past the system.
- These expenses or expense reports can then safely be saved on the cloud either as submitted expense reports or draft expense reports. Since saved on the cloud, they can be accessed anywhere, anytime by either the employee or the finance team.
- Finance teams can also access expense reports faster with a searchable index. Fyle allows the team to search for reports based on categories such as departments, titles, employee names, etc.
Direct Report from Mailbox
Generally, an employee receives an invoice or email on making a business expense. For example, sales folks may receive an Uber or Lyft receipt in their inbox right after they finish a sales trip to a client meeting.
Employees may delay expense reporting if they have to report these expenses manually into an expense report form. This can lead to employees stashing away receipts in the mailbox for an extended period and forgetting about it. To curb last-minute receipt hunting and expense reporting, Fyle enables employees to submit expense reports directly from the mailbox:
- By forwarding receipts to an exclusive email
With Fyle, employees can fyle their expenses without having to log in to their account. Fyle provides users with a unique email address when they sign-up. Employees can use this email ID to forward all the business receipts he/she receives. Even if employees receive bills and invoices in their personal email id, Fyle gives an option to add it as a secondary email. By doing so, employees can forward receipts from their personal account as well.
On receiving the receipts, Fyle scans the attachment and creates an expense report. Employees can then either save the expense report as a draft or submit it for expense approval. Employees can also set up this special email to directly report invoices from vendor accounts.
- By using an email add-on
Whether your business uses Gmail or Outlook, Fyle provides the luxury of email add-ons that sit in the mailbox for seamless expense reporting. When an employee receives an invoice in his/her inbox, he/she can create an expense report within a minute by clicking on the plugin.
Our plugin scans the invoice, extracts all the necessary details, and auto-fills the expense report form. After all the work has been done by the email add-on, the user can simply review and save the expense report.
(P.s: The user does not have to worry about invasion of privacy. The plugin does not snoop around the mailbox or have access to emails.)
In travel and expense management, finance teams have to create policies around employees and business expenses. For example, most companies have policies for individuals based on their level, department, project, and other such categories.
These policies play a critical role in curbing expense fraud. Thus, the finance team has to clearly define and outline the outcome in case of any policy violations. Additionally, your finance team has to keep updating company policies as per the current business needs. For example, the COVID-19 crises have forced companies to work remotely. With the mandatory WFH, business expenses and policies have changed as well. With a robust policy engine like that of Fyle, the finance team can continuously update your travel and expense policies irrespective of the change.
Automated approval workflows
Fyle enables finance teams to integrate all their company expense policies, no matter how complex or extensive. Within the tool, finance teams can recreate policy checks and approval workflows based on how your organization works. The system also has a strong policy engine that can enable it to act as a control room for all your business expenses and process workflows.
Fyle also gives total flexibility to finance teams to configure complex business rules. For example, if you want to set a policy that prohibits any transactions after a specific date. But later, you decide that you want to make exceptions for employees with particular titles. In such a case, Fyle enables you to add or modify policy changes easily within the system itself.
Real-Time Policy Checks
Finance teams can spend a lot of time going back-and-forth with employees regarding a particular expense or policy violation. No matter how clear your business policies are, they can be hard to remember, and unintentional errors can occur. For example, employees forgetting to attach receipts to their expense reports or spending a little higher than what they should ideally have.
To help mitigate these problems, Fyle’s robust policy engine checks for violations in real-time even before the expense report is submitted. This helps solve for the employee-front of expense reporting problems. For example, an employee can resolve potential policy violations on-the-spot, even before submitting their report.
Admins can also set the flagging notification based on the severity of the violation, For example, if an employee reports an expense that is five times more than the allowable cost, the system can auto-flag the violation directly to his/her approver. In the case of a mild violation, the software can notify the employee to rectify the issue. This, in turn, can increase employee compliance and company audit readiness.
Automation of expense reporting
With a robust policy engine, all expense reports submitted will likely be compliant. Managers can also save their precious hours on expense report reviews when approval of reports that are compliant can be automated. With Fyle, you can automate routine manual tasks like submitting or approving of expense reports under certain conditions.
- The feature allows both employees and the approvers to set requirements for auto submissions or approvals.
- Employees can set up a workflow that automatically submits reports if the expenses do not violate any policy.
- For approvers, they can set up a process that will automatically approve reports assigned to them at regular intervals. For example, they can set reports submitted by the CEO or reports that satisfy all the policies to be approved automatically.
Accountable Per Diem Expense Reports
In the United States, per diem policies must conform to IRS guidelines. For this, in the per diem expense report, employees have to show the purpose of the trip, location & date, and receipts of lodging and meals. Also, employees have to be aware of the rates set up by the federal governments. They can vary based on the state, county, and country and are not as simple as they appear to be. For example, for international travel, the U.S. Department of State publishes the foreign per diem rates monthly.
Fyle enables finance teams to simplify expense reporting for per diem. You can upload company expense policies that are in perfect compliance with IRS regulations into the system. You can also set per diem allowances based on business units, departments, projects, and employee levels.
Fyle automatically computes per diem reimbursements according to the policies. If an employee tries to file an expense report which violates the set policy, the software can notify the employee. The employee can then review his/her expense report before submission and remain compliant with the company travel and expense policies. For international travels, the software also offers multi-currency set up based on locations. That means your finance team no longer has to convert and calculate foreign currencies manually!
From managing travel bookings to closing books on time, expense management is no easy job. But expense management can become extremely time-consuming and taxing when your finance team has to go from one source to another to gather data. You and your team can collate data and eradicate duplicate efforts by integrating your travel and accounting software with an expense report system like Fyle.
- With travel and expense report software integration, you can manage travel itineraries from a single platform.
- Prior to the trip, employees can provide all the required travel details like date, transportation mode, and the purpose of travel via the software application.
- Using these details, travel managers or finance teams can easily make arrangements.
- With the help of a centralized dashboard, travel arrangements can be made without a hitch and can also eliminate communication gaps.
- Even after the trip, you and your finance team can have access to all travel history of every employeel.
- Using the data, you can also identify frequent vendors for hotel or flight bookings and maybe strike up a partnership or a discount package.
Accounting and expense report software integration can ensure your finance team closes books on time. Additionally, with automation, all the mundane manual work in accounting can be taken care of within a matter of seconds. This removes the frustration from expense reporting.
Find the right expense reporting software for your business
Expense reporting has come a long way. Some years ago, employees had to return from their business trips, only to get stuck with a hoard of paper receipts. But now with expense reporting softwares such as Fyle, they can simply capture receipts and file business expenses on the go. With features like mileage tracking and policy regulations, employees can focus on the tasks rather than stressing over complex expense reporting processes.
Additionally, finance teams no longer have to be stuck with stacks of paper-based expense reports or multiple tabs of excel sheets. With cloud storage, they can access expense reports from anywhere and anytime by using any device of their choice.
Furthermore, they can get rid of manually crawling through hundred lines of bank statements and transactions looking for errors. With Fyle, tasks that take hours can be reduced to seconds, relieving all the stakeholders of mundane manual work.
To find the right expense management software, businesses need to evaluate themselves and their requirements. For example, if employees use a corporate credit card to pay for most of their business expenses, the business should look for software with strong credit card functionality.
To help you make the right choice, check out these comparison pages between popular expense management software:
Are you interested to learn more about how Fyle can streamline your expense reporting process? Schedule a demo with us today!