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Filing expense reports aren’t just dreadful for employees. They could be costing businesses a pretty hefty figure. Fraud and expense abuse by employees can cost companies up to 5% of their annual revenue – or $4 trillion in global losses each year. To conceal these fraudulent claims, more than half of the employees use physical documents.
The pains are felt on both sides. Manual entry and routing of expense reports was the top problem for 62% of workers. Employees expect the technology that they use in their personal lives to carry over into their professional but traditional processes don’t offer that. Spreadsheets and disjointed systems do very little to ease these pains that both parties face.
With automation, expense management becomes faster, more efficient, and less prone to fraud. The benefits are realized on both sides.
Here’s how to solve the five expense management challenges with automation.
1. 85% employees admit to sometimes lying about expense claims
85% of employees have admitted to falsifying expense reports, and 82 percent of employees who lied have never been caught by the company. What’s more, 5% of these employees add that they falsify information on every one of their expense reports.
When managed through an automated solution, expense filing and reporting becomes a completely transparent process. For example, approvers can verify expense claims in real-time and flag claims that are outside of the company policy.
2. One in five expense reports contain inaccuracies
19% of expense reports contain errors- and rectifying those mistakes takes about 18 minutes per report. And this doesn’t even include the time to actually file a reimbursement.
With automation, you can set up customized expense receipt categories that map to your GL codes. This takes away the pain of going back and forth with employees over inaccurate or incomplete submissions. Instead, coding is completed automatically, giving more time and increased accuracy to finance teams.
3. It takes eight days or more to submit, approve, and reimburse an expense
This common challenge shows up in all AP workflows – delays. Delays in employees filing the expense in time; delays in managers and finance teams approving the expense; delays in employees getting reimbursed; and, delays in following up with approvers.
When managed with an automated system, approvers are notified online about reports. From here they can dig into the what, where, when and why of the expense online, and then approve or reject the report even through their phone.
4. Two-thirds of employees have not read their company’s expense policy
One in ten employees pay for their own expenses, despite having a company expense policy. Enforcing an expense management policy can be a challenge when processes are manual. Or you might have non-compliance issues later causing a tormenting audit.
An integrated expense software solution manages the entire AP process in one platform, making audits and compliance real time. The process is much simpler to use making employees more engaged in the whole process.
5. Lack of visibility into spend/travel data
You can’t manage what you can’t see. Added to that the pressure to control and operate expense-related data when visibility is low means finance teams have minimal resources to help identify trends and areas of concern in employee spend.
Automation tools make the entire expense management process digital. This gives finance teams better opportunities to run reports on spend, analyze data, and find opportunities to reduce costs.
Make the most out of your expense management system:
- Integrate digital payments into the workflow. A comprehensive automated expense solution integrates with the payments workflow to reimburse employees online rather than cutting paper checks.
- Do not find a band-aid solution. Manual processes cannot scale. Organizations should choose a central system that makes AP entirely paperless (from PO’s to payments), not just one part of the workflow.
- Implement customized approval routing. Not all automated solutions offer customized approvals. A solution like Beanworks gives you the flexibility to get as specific as you like with your approval routing customization. Approvers can access reports from anywhere and approve/inquire instantly.
- Easy to use and implement. A fully automated solution gives you flexibility to scale as you grow. It is easy to implement, use and access across the breadth of the organization.
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