Hidden Costs of Paper Approvals

Inefficiency is a high-dollar expense, especially when it comes to expense management and mileage reimbursement. When organizations choose to manage these activities with traditional methods, they may be saving on the cost of proper business tools, but they pay even more in other, more insidious ways. In this article, we discuss the hidden costs associated with paper approvals.

Delivery

How do your employees submit expense reports to supervisors? If you do not use an automated system, the answer is likely a number of ways, including fax, email, or mail. This requires your accounting department to create multiple processes and procedures for one kind of task. This problem is compounded when there are multiple offices and employees that must intake these documents.

Storage

With the intake of these documents piling up, storage becomes no small concern. In the event of an audit, your accounting department must be ready to present documentation for the organization’s expenses. If those expenses are kept in paper records, then the accounting department faces a very real, real estate issue. Those volumes of paper must be stored somewhere and, overtime, the amount of space to store paper receipts will shrink.

Timing

As storage shrinks, organization becomes much more important. You won’t be surprised to learn that employees often tend to wait until the last minute to do administrative tasks. This is especially true if they’re expected to collect receipts, organize expenses, and submit reports themselves. Without fail, those expense reports — which cover entire periods of time — flood in at the same time, overwhelming even the best accounting department.The pressure increases even more now that the timeframe for providing reimbursement is now short.

Verification

An overwhelmed accounting department knows all too well the meaning of “end-of-month madness”. Without a system to automatically track and verify expenses, supervisors must retrace the steps of each employee, verify each claim, and do their best to catch mistakes and fraud attempts. Combing through expense sheets to verify claims takes time, and accounting departments scramble to meet their own deadlines.

Mileage reimbursement is an easy target for fraud. Without an automated system to create accountability, employees may be submitting reimbursement claims for personal trips, or even their own commutes from home. If you’re using traditional methods of mileage reimbursement, such as odometer readings, you’re likely a victim already.

Delays

When you take into account the limitations of paper approvals and manual verification, the inability of accounting departments to meet deadlines is to be expected. Delays in reimbursement are often the result of a supervisor discovering questionable expenses. When supervisors find errors that must be reconciled, both employees and supervisors must spend time managing each questionable transaction. Delayed reimbursement also has an effect on employee engagement, which impacts employee productivity and performance. A common struggle for many US employees is their cost of living outstripping their take-home pay. One survey finds 3/5 of business travelers had problems paying personal bills due to these sorts of expense reimbursement delays.

Eliminate hidden costs with automation

There is an easier way that not only saves approval time, but lowers your mileage expenses. SureMileage by CompanyMileage addresses the shortcomings of processes typically associated with paper-based expense tracking because it automates travel expense management with an entirely new approach. Employees report their starting points and destinations and the system calculates the driving distance between them. So, rather than verifying the miles that were driven, it calculates the expenses to be reimbursed. Once travel data goes into SureMileage, it becomes a travel and expense reimbursement solution. Supervisors can review and approve expenses and send them to Accounting for reimbursement. It’s an end-to-end solution that solves a business problem – and eliminates the hidden costs of paper approval.