Expense management software & reporting for businesses: Key features and benefits
- Debit card
Efficient expense management software and reporting systems can significantly save time for the accounting department, streamline processes, and reduce human error. However, many organizations still rely on manual entry of invoices into Excel sheets, which lack customization and efficiency. In this article, we will explore the benefits of modern expense management software and provide insights on how to enhance your current systems.
What is expense management software?
Expense management refers to software solutions designed to process, pay, and report employee-initiated expenses. These solutions enable employees to log their expenses according to company guidelines, allowing the accounting department to efficiently process transactions.
Advanced expense management software solutions can be directly linked to employee credit cards, providing managers with a real-time overview of all incurred costs. Additionally, these solutions can automate processes, eliminating the need for manual entry or modifications.
Expense reporting software reduces expense-related risks for the company and minimizes the workload for accounting and purchasing staff involved in the process.
Conventional vs automated expense management
Conventional expense management typically involves manual processes such as collecting receipts, filling out expense reports, and manually entering data into spreadsheets or accounting software. This process can be time-consuming, prone to errors, and often requires a significant amount of administrative effort.
In contrast, automated expense management software leverages advanced technologies to streamline and simplify the expense reporting process. These solutions reduce the need for manual data entry, minimize errors, and significantly cut down on administrative workload.
| Conventional Expense Management | Automated Expense Management |
|
|---|---|---|
| Receipt Capture | Manual collection of receipts through filling out forms and submitting receipts. | Automatic receipt capture (e.g. through scanning receipts). |
| Integration with Cards or Bank Accounts | Manual entry of transaction data from cards and bank accounts. | Integration/Automatic synchronisation of transaction data from cards and bank accounts. |
| Policy Compliance | Manual review of expenses for compliance with company policies. | Automatic review of expenses and notification of policy violations. |
| Approval Workflow | Manual forwarding of expense reports for approval. | Automated routing of expense reports to managers for approval. |
| Real-Time Reporting & Budget Control | Limited or no real-time reporting on expenses. | Real-time reporting on expenses and budgets. |
| Integration with Accounting Software | Manual transfer of data from expense management to accounting software. | Automatic integration of expense data into accounting software. |
| Audit and Compliance | Paper-based | Digital records |
Why expense management software is essential for your business
Efficient expense management software can streamline and automate your company’s accounting processes. By linking employee credit card transactions directly to your system, you eliminate the need for manual entries, reducing the risk of errors and inefficiencies.
Expense reporting software solutions enable businesses to record and track various types of expenses, from employee reimbursements and travel expenses to office supplies and vendor payments.
By implementing expense management software, businesses can establish and enforce their own expense policies and guidelines. Modern software solutions can flag expenses that violate these policies, ensuring compliance and preventing unauthorized spending (maverick buying).
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Expense Tracking and Reporting
Expense management software lets you track expenses in real-time, from when they happen to when employees get reimbursed. It also generates clear reports that show spending patterns, helping businesses manage their finances more effectively.
Automation
Automated processes eliminate manual data entry, reducing errors and streamlining the entire expense management workflow, from submission to approval and reimbursement. This increases efficiency and accuracy in managing expenses.
Fraud Detection
Certain expense management solutions are equipped with fraud detection systems that alert administrators to any suspicious activity, such as duplicate entries or out-of-policy expenses. This helps prevent expense fraud and ensures compliance with company policies.
Efficient Reimbursement
Expense management software simplifies and accelerates the reimbursement process for employees. It allows for quick submission of expense reports and ensures timely reimbursements without delays or errors, enhancing employee satisfaction.
Benefits of tracking expenses for small businesses and how to do it efficiently
Efficient expense tracking is more than just an accounting task: businesses can optimize their cash flow and improve forecasting – for improved budgeting and tax readiness. Startups and SMEs should make use of scalable SaaS expense software solutions to keep the costs down, while maintaining flexibility. Further, create clear categories for your business expenses and set limits to your employee debit/credit cards. As such, you can easily set the first building block of secure and cost-efficient financial management.
Types of expense management systems
- Cloud-based: Cloud-based expense management software usually refers to an expense management platform hosted on remote servers, allowing users to track, manage, and analyse their expenses online.
- Integrated: This expense management software refers to a comprehensive digital solution that combines various functionalities and expense management tools into a single platform.
- PC Terminal: Expense management software, which is directly installed on a PC or laptop.
- Mobile Terminal: Expense management application, which are specially developed for iOS and Android.
- Company-specific software: Some expense management solutions are specifically tailored for different businesses or sizes, such as SME or corporate expense management, to better meet the company needs.
How to choose the right expense management system
The following steps help you choose the right expense management for your specific needs:
- Assess your business needs: Determine the size and complexity of your organization and identify the specific types of expenses you need to manage (travel, office supplies, etc.)
- Ease of use: Ensure the system is user-friendly and has a flat learning curve for both employees and finance teams
- Automation features: Look for systems that automate expense tracking, approval workflows, and reporting as well as features like receipt scanning to reduce manual data entry and errors
- Integration with existing tools: Check compatibility with your current accounting software and ERP systems to ensure smooth data transfer between systems
- Security and compliance: Make sure that the system complies with industry regulations (GDPR, tax regulations, etc.). Strong data encryption and secure access controls protect sensitive financial data
- Scalability: Look for flexible options to add more users, departments, or regions as needed
The pitfalls of expense reporting software
When selecting the best expense management software for your business, it is crucial to ensure that the solution delivers the benefits mentioned in the previous section. Unfortunately, many expense reporting software solutions are fraught with pitfalls and often rely heavily on manual data entry.
Manual data entry prevents you from receiving a real-time transaction overview, as you lack control over how and when employees enter their expenses. This issue is exacerbated as your business scales and you issue more employee credit or debit cards. Additionally, employees may enter incorrect expenses into Excel sheets, making errors difficult to track. Inability to transfer data to your accounting software complicates the workload for your accounting department, especially during end-of-month peaks.
Insufficient customization options further complicate the process, as you may need to tag specific expenses while excluding others in your overview. Therefore, choosing the appropriate expense management software can save you and your team from unnecessary headaches and inefficiencies.
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How to avoid the pitfalls of expense management software?
How can you ensure that your expense management software provides all the desirable advantages without the pitfalls? Here are some non-negotiables to look for:
- Real-time transactions: Your software should display transactions immediately after they are made by employees in one unified dashboard. This is essential, as manual checks and data entry must be avoided to ensure accuracy and efficiency.
- Budget control: Administrators should be able to set budgets and limits for each individual credit/debit card to mitigate risks and manage spending effectively.
- Auto-accounting: Options like tagging and pre-categorization facilitate reporting and expedite accounting processes through automation.
- Compatibility with accounting systems: Ensure that your expense management software can seamlessly transfer data to your accounting system, typically through file import/export functionality, API or direct real-time synchronization.
- High customization: In addition to tagging options, your software interface should be highly customizable, allowing you to display different views and filters according to your preferred settings.
- Mobile app: A mobile app is invaluable, enabling employees to submit expense receipts directly from their phones and allowing administrators to perform critical tasks on the go.
amnis’ multi-currency business debit card: lower costs and more transparency
amnis’ multi-currency card combines industry-leading fee structures with advanced expense management software features.
All transactions are displayed in real-time on a single dashboard, ensuring you never miss any transaction and always have a complete overview. With amnis’ auto-accounting functionality, expense information such as accounting category, cost center, tags to assign expenses to projects, and VAT rate can be saved and pre-filled automatically, making it particularly convenient for recurring expenses like public transport or subscriptions.
Receipts can be easily uploaded via the mobile app – just as effortlessly, transaction data can be exported and seamlessly integrated into accounting systems like bexio. Additional interfaces to popular solutions are already available or in development.
Additionally, cardholders and administrators are separated, allowing you to apply limits, set expiration dates, or block cards in case of unwanted spending, adding another layer of security. Thus, amnis’ multi-currency business debit card contributes to a streamlined expense reporting and management system.
Watch the short video to discover how amnis simplifies team-wide expense management. From automatic transaction tagging and receipt uploads to smart notifications and real-time updates – experience how easy and efficient your expense workflows can be with amnis.
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