Companies that provide staff with expense accounts know they could potentially be opening themselves up to an administrative nightmare.
A recent survey found that more than 15 percent of UK workers admit to having exaggerated or falsified their expense claims. Not only is this incredibly costly to UK businesses, but it also bogs down bookkeepers and makes it more difficult for accountants to gauge corporate spend.
Expense management solutions allow firms to track how much their employees are spending on their expense accounts. With Making Tax Digital just round the corner, there’s a big push for these solutions to be integrated into cloud-based accounting software like QuickBooks and Xero. With integrated software, clients can upload their receipts and share real-time data with their accountants, optimising efficiency for both parties.
“When it comes to managing expenses the sharing of data is crucial,” explains Jon Martingale, product owner of Reckon One, an online accounting solution. “Accountants really fear finding issues right at the very end of the tax year. Expense management solutions mean that transactions can be added throughout the year as they happen. Now there’s no need to collate everything at the last minute.”
For accountants who juggle lots of clients, it can be challenging to adapt to different methods of expense submission. Traditionally there was only so much that accountants could do to mitigate this, but now adopting an expense management solution can act as a funnel and bring uniformity to clients.
“Expense management software brings consistency across an accountant’s workflow. There is a defined method of working that can be rolled out across all of the different clients,” says Martingale. “Once you’ve made that initial effort, everything else becomes easier because modern software systems are very good at talking to each other and exchanging data.”
Cloud computing has become the standard for 70 percent of British companies, with the proportion continuing to grow steadily. This, alongside the fact that 74 percent of the population have a smartphone, has meant the advent of app-based expense management packages.
Lost VAT receipts cost businesses money in tax relief every year, and the penalties for claiming on undocumented expenses can be harsh. Smartphone apps that permit mobile reporting are able to integrate seamlessly with a range of existing software options.
“It’s about one minute experiences,” says Brett Li, senior product marketing manager at Capriza, app developers for accounting software. “Being able to be on the road, take a picture of a receipt and upload it to the expense management system makes it easier to manage the whole expense process.”
By keeping data on a cloud platform, users have around-the-clock access, should they need it. By analysing the immediate impacts of expenses as they are incurred, accountants can offer keen insight to guide business plans. Such solutions can save hours of labour-intensive, low-reward work and enable accountants to focus on more high-value tasks.
Claiming back time
“It’s strategic for accounting firms to look at these processes for their customers and find places where they can improve,” says Li. “People are looking at real-time access to data when and where they need it. You can then make more educated decisions because the information is at your fingertips.”
Recommendations that are active rather than retrospective can help both accountants and their clients work more efficiently. Those collected hours of saved effort are a resource. They’re translatable into either the ability to take on more clients, or provide more profitable high-value services to existing ones.
Even when receipts are accurate and complete, sifting through mangled paper can be trying even for the most patient bookkeepers. Keeping track of corporate spend doesn’t have to be gruelling task. Instead, by providing clients with real-time control over their employee’s expenses, accountants can leverage more granular control over cash flow, increase productivity and ultimately make their lives much less stressful.
Lauren Razavi is an award-winning writer and content strategist, and managing director of communications consultancy Flibl. She has worked on projects for leading global brands such as NatWest, Google and Facebook, and her writing focuses on technology, finance, entrepreneurship and innovation. Follow her on Twitter @LaurenRazavi.