March 11th, 2019 • Expense Management
One bad cell is all that’s required to ruin an entire spreadsheet–in 2003, Fannie May overstated their gains by $1.3 billion due to a spreadsheet error.
When spreadsheets were first introduced, they became the go-to tool for several finance business processes including accounting, payroll, and expense management. And, for good reason. Spreadsheets are easy to use, cost-effective, and responsive to business needs.
Expense management requirements evolved with the business, but spreadsheets remained the same. Their limitations exposed businesses to security issues, human errors, and inconsistent data. All these risks boiled down to one thing–spreadsheets were not built for expense management.
When multiple people use the same spreadsheet, errors are inevitable. Studies reveal that 88 percent of all spreadsheets have significant errors. Manual errors are costly and difficult to track.
Formula errors have a cascading effect and can affect several sheets, making it impossible to find and fix the errors.
Using spreadsheets for expense management is an open invitation for fraud. There’s every chance that data can be overwritten or altered after expense approval since there are no security measures in place. The inability to attach receipts makes audits extremely hard.
Automatic data validation ensures that employees stick to their spending guidelines. While spreadsheets offer some kind of validation, they aren’t flexible enough to handle ad-hoc cases.
A few business cases like taking a high-value client for an expensive dinner demand some leeway. It is frustrating when the system throws an error that food expenses are capped at $30!
Storage, backup, and data protection are major concerns for businesses that use spreadsheets for managing expenses. Though sheets can be password-protected, it doesn’t match the granular permissions that most dedicated expense management software provides. Further, you can be locked out of your spreadsheets in case you forget the password.
Spreadsheets don’t talk to each other. Your expense data is shared between multiple teams–accounting, sales, payroll, and more. When you use spreadsheets, the same information is entered over and over into multiple systems eating away a lot of time and effort.
As new entries and modifications to an existing expense are not reflected in the other spreadsheets, the information is never up to date.
When you use spreadsheets, you spend hours poring over rows of expense and creating charts that offer little insight. They tell you how much you spent and on what. While this is key information, it’s incomplete without the “why”.
To improve the efficiency of your expense reimbursement processes and cut down unnecessary costs, you need insightful reports that can be customized to the smallest detail.
A lot of small businesses and startups tend to use spreadsheets for expense management. This may work for a very small team, but not without costing efficiency and productivity. Today’s businesses need to digitize and automate their manual processes to stay ahead of the competition.
Dedicated expense management tools help your business save time and costs, eliminate errors, avoid fraud, and offer actionable insights. Options like Kissflow help you with just that.
If you’re looking for an expense approval app, take Kissflow for a spin. It’s free for 14-days.