The Ins and Outs of An Efficient Expense Process in Modern Businesses

The financial health of a company is a great litmus test to ensure that the company itself is…well, healthy. Expense management stands as a linchpin to that financial health, securing stability and operational smoothness in modern businesses. The necessity of a prudent expense process is doubled when it comes to businesses that reimburse mobile employees for work travel in their personal vehicles, in the form of expense claims and approval. 

An effective expense process should strike a balance between granting employees the autonomy they require to do their jobs while ensuring company-wide compliance and oversight. In this article, we’ll examine the mechanism and strategies of the approval process, and the role technology can play in keeping everything on track.

Understanding The Expense Process 

The expense process goes far beyond that of mere rubber-stamping stacks of papers. It’s a systemized process ensuring that all expenditures are both legitimate and compliant with laws, regulations, and company policy. The purpose of a secure expense process is to prevent financial leaks, maintain the organization’s budgetary discipline, and foster transparency in organizational spending within the company. Regular audits and reviews of expense approvals can offer insights into spending patterns, revealing areas in which the business can potentially save money, or highlighting instances of noncompliance.

The Role of Streamlined Workflow in Expense Approval

A well-defined workflow is pivotal to the expense process! A streamlined workflow minimizes employee and manager/supervisor confusion, expedites approval times, and ensures consistent application and consistency with company policies. Setting clear parameters on who can approve what, and up to what amounts, eliminates the chance for ambiguity or confusion. 

Whatever workflow your organization ends up employing, clear and consistent training is also vital to ensure efficiency. Period training sessions can help make sure that all employees, from claimants to the members of management approving the claims, are aligned with the organization’s expense approval protocols.

Embracing Technology for Enhanced Efficiency

Leave Manual Workflows in the Past

As outlined above, efficiency and streamlining can make or break the expense process when it comes to mileage reimbursement. And while manual expense approval methods – like emails, spreadsheets, and paper – are time-honored methods of documentation, it might be time to leave them in the past. Manually, the average expense claim takes about 20 minutes to process. Multiply that by the tens or hundreds of mobile employees within your organization who need to submit reimbursement claims for mileage traveled and that’s…an awful lot of minutes that probably could be more productively spent elsewhere.

Besides the time sink that manual workflows can create, there’s also a greater margin for mishaps. A process relying solely on human brain power could fall victim to the inevitably of human error. Filing, processing and approving reimbursement claims using only pen and paper, or manual data entry leaves your process open to lost or missing data and documents, as well as errors in data entry or just incorrect filing. And all of these mistakes will take – you guessed it – even more time to catch and correct, if they’re even caught at all. 

Reap the Benefits of Automation

Consider instead automating the process of expense approval, using software created specifically to streamline everything about the expense process. By digitizing the approval process, organizations can increase both efficiency and accuracy. Expense approval software can automatically process approvals and move them through a customizable, structured workflow, making approvals faster and systematic. This reduces the chance of reports getting misplaced or lost, creating frustrating paperwork bottlenecks and delays, while lessening the workload of management and supervisors. 

Additionally, using digital software solutions for the approval process gives managers and supervisors incredible oversight. Using automation for expense approval means that all documents and information are stored in one centralized location, so that everyone is on the same page and has access to the same information if needed. Integrated systems can also pull data from various sources, offering a holistic view of expenses incurred, aiding in more informed decision-making.

Automating the approval process can also create greater accountability within the company; because an automated workflow lessens the chance for human error, those approving claims will be more likely to catch noncompliant behavior, such as employees duplicating claims or trying to fudge mileage numbers. In turn, once employees know that this kind of behavior is unlikely to go unnoticed, they’ll be more likely to submit claims honestly.

Pitfalls in Expense Approval and Their Solutions

Once you’ve made the decision to automate the expense process, your work is not done. Even with the best systems and workflows in place, challenges can still make themselves known within the process. Common pitfalls include employees misinterpreting policies, approval delays, and lack of clarity in documentation requirements. 

To meet these challenges, remember that communication and clarity are key! Utilizing clear communication and regular training will help employees learn the ins and outs of the process, and how to follow all organizational rules to the letter. Setting up multi-level approvals for larger expenses and integrating real-time query resolution mechanisms into approval software can also add another level of security to expense approval.

CompanyMileage Has You Covered

As businesses grow and evolve, the importance of perfecting expense approval workflows becomes increasingly evident. By fostering clear communication and leveraging technology, modern businesses can foster a seamless, efficient and compliant expense approval process. CompanyMileage and its suite of expense approval software is just the tool you need to facilitate that process.

We use a unique point-to-point method to calculate travel distance based on starting and ending points, so employees can report their business mileage without having to record, calculate and submit odometer readings. Once submitted, reports and claims move through our automated workflow, which can be customized to best suit the needs of your business. Once approved, CompanyMileage software integrates with all major accounting and payroll systems, securing efficient reimbursement. 

To learn more about how CompanyMileage can perfect expense approval for your organization, contact us today for a free demo!