The Ultimate Guide to Streamlining Expense Management
Expense management is one of the key areas where businesses have to tread a fine line between cutting back on expenses and spending effectively. This job usually falls to the finance department. They are responsible to make the expense management process better, control costs, and reduce mistakes that can prove costly.
Outdated expense management processes result in ineffective expense management and an incredible waste of time. Paper forms, spreadsheets, and emails are not equipped to handle the expense management needs of modern businesses. A streamlined, automated expense management process can help you identify unnecessary expenditure and cut back on costs.
What Is Expense Management?
Expense management is a systematic set of processes businesses use to record expenses, execute payments, and track their spend. This includes keeping tabs on purchases businesses make, like assets and inventory, as well as the expenses incurred by traveling employees. It also involves defining a spend policy, enforcing it, and finding ways to cut down spending.
Why Manual Methods Don’t Work Anymore
Outdated expense management methods result in ineffective expense control and can lead to unnecessary expenses.
The problem with a conventional pen-and-paper system is that it’s prone to human errors, expense frauds, an exhaustive paper trail, and reimbursements that take weeks to get to the employee's bank account.
Implementing expense automation with Kissflow
A workflow automation tool like Kissflow can help you implement expense management with ease. With no coding involved, anyone can create a smooth process. You can use drag-and-drop tools to create workflows that streamline expense processes. Here’s how you do it in Kissflow:
Step 1: Install the expense management app
Kissflow has a collection of pre-built apps from which you can install the expense reporting app. Or, you can easily create your own from scratch with an easy-to-use visual editor.
Step 2: Customize the forms
This is where you customize the app to suit your exact needs. Create forms to capture all the necessary details. You can add additional fields, dates, users with drag-and-drop functionalities. There are also options to attach receipts. You can auto-fetch data like employee name and id from master databases or compute certain fields.
Step 3: Define the approval hierarchy
Design the sequential path of tasks and assign the roles and responsibilities of the different individuals in the workflow. Include all the stakeholders, hide sensitive information, and provide role-based access to your team. This is the stage where you can automate approvals based on predefined criteria.
Step 4: Track the progress
You can view the status of expense reimbursement requests and identify bottlenecks in a glance. If your requirements change, you can easily make alterations to the app to improve the efficiency of your expense approval process.
Streamline expense reimbursement process with
Create a Custom Solution. No Coding Required.
Challenges of NOT having a expense management software:
Waste of Time, Money, and Resources
Manual expense solution means time-consuming tasks for you and your employees. According to the Aberdeen Group, the cost of creating and approving one expense report manually is $41.12, while an automated report costs only $7.17.
Difficulty Enforcing Policies
Auditing reports and processing payments manually can easily become a full-time job for your finance team. It becomes difficult to enforce corporate spending policies when they have to go through rows of data.
No Control Over Spending
It’s difficult to monitor all your spending, especially when it is spread across multiple spreadsheets. This leads to bad business decisions as you don’t have the complete picture.
Best Practices to Streamline Your Expense Management
Record Expenses Data Promptly
It’s really important to record spending as and when it happens so as to account for all expenses. A travel expense tracker with a mobile app comes in handy so employees can submit expenses even when they’re on the move for a business travel.
Automate Whenever Possible
Whether it is automated expense approvals for a particular amount, or creating journal entries immediately, you can find many ways to introduce more smooth functioning. Also, applying automation to approve expense reports saves up a lot of time.
While exhaustive paper trails are important, you don’t want to go down a rabbit hole during audits. Paper receipts not only fade and become illegible with time, but they’re also easy to lose. It’s always better to scan the receipts and back them up on the cloud.
Integrate With Other Software
Connect your expense reporting process with your other systems like accounting software to avoid manually entering the same data twice. This not only saves you time but also eliminates human errors.
Set Up Online Reimbursements
When the finance team reviews and approves an employee expense claim, you can expedite the reimbursement process by setting up an ACH payment or a direct bank transfer, and sending the money directly to the employee’s bank account.
Types of Expenses Inside SMB's
Businesses incur different kinds of expenses over the course of their daily operations. Some of them are directed toward purchasing capital assets while others are required on a day-to-day basis. Here are some common expense types:
Wages and Salaries
The fixed pay a business offers its employees or the variable pay such as incentives and bonuses, or payments to contractors form the major chunk of any business’s expense.
Businesses reimburse employees for the expenses they incur on behalf of the company when they travel for business. This is the second highest controllable expense.
All the infrastructure and the software tools a business use are considered technology expenses.
Cost of Goods Sold
Whenever a business procures goods with an intent to sell, there are recorded as assets in the balance sheet. When the business makes a sale, the value of the purchase is expensed as Cost of Goods Sold.
Build Your Own Expense Management System With Kissflow
Kissflow is an expense management system, that lets you build a custom expense management app that is tailored to suit your exact requirements. With Kissflow, you can build powerful forms with simple drag-and-drop functionalities to capture all the necessary information.
Once someone submits a request in Kissflow, it moves automatically to the next person in the approval chain through simple notifications. There’s also an option to accommodate your expense policies so the system throws up a red flag in case of policy violations.
This makes it easier for the finance teams to approve or reject a claim. You can also set up automated approvals up to the desired limit. Further, you can generate powerful reports that identify unnecessary expenses and offer 360-degree visibility on your spend.
If you’re looking for expense approval app, take KiSSFLOW for a whirl. See how it can give you insights on cutting down expenses–start your free 14-day trial today.
Manage All Your Business Expenses in One Place
Try KiSSFLOW and Create a Paperless Environment.
3 Signs Your Travel Expense Policy Needs an Upgrade
Expense management is risky business. Every business has to establish and enforce their unique expense...
Exploring the Future Trends of Expense Management Software
Expense management software solutions have come a long way from being mere reporting tools. They...
Top 5 Myths About Expense Management Software
While you hear a lot about ignoring negative narratives in your personal life, they aren’t...
Fight the top 5 expense management challenges with automation
Wouldn’t it be wonderful if you could handle your corporate expense management like you managed...
A-Z of Petty Cash Management for Your Small Business
For something called petty cash, it’s management is no trivial feat. Petty cash refers to...
Make Reimbursements Easy With Expense Approval Software
Reviewing and approving expense reports manually can feel like heavy labor. Finance teams are usually...
How to Implement an Expense Management System in 15 Minutes
The financial landscape is plagued by roller coaster economic conditions and volatile markets. At any...
Best Expense Management Softwares to Look Out For in 2019
For most businesses, expense management has always been an area of concern. Good expense management tools...
Sorry, Spreadsheets Aren’t the Right Tool for Expense Management!
One bad cell is all that’s required to ruin an entire spreadsheet–in 2003, Fannie May...
Speed Up Your Reimbursement Processes With Dedicated Expense Reimbursement Software
Manual expense reimbursement processes involving paper forms, spreadsheets, and emails can bog you down. They...
Expense Reimbursements: 5 Step Solution to Handle Business Expenses
Expense Reimbursement is one of those financial processes that every company has to handle but...
6 Salient Features to Look For in an Expense Report Software
Manual expense report tools involve paper receipts, tedious processing cycle, and costly errors. But over...
5 Reasons Why Your Current Expense Procedures Are Impacting Your Company’s Productivity
Dealing with the expense reimbursement process of a business can quite often be a time-consuming...
Expense Management Process: Steps involved in Streamlining Business Expenses
What is Expense Management Process An expense management process is a set of procedures that...
7 Reasons to Look Out for an Expense Management Tool in 2019
Expense management is a two-pronged approach: how a business spends money and how it keeps...
How to Implement an Automated Expense Approval Workflow in 15 Minutes
Manual process management methods involving paper forms, spreadsheets, and emails can bog you and your...
Automating Business Expense Approvals Augments Business Efficiency. Here’s How
Expense approvals seem pretty straightforward, except when they aren’t. What could be easier than approving...
The Ultimate Guide to Choosing the Best Expense Management Software
Expense management is a two-pronged approach: how a business spends money and how it keeps...