Employee-generated expenses, if not properly managed, can seriously setback any growing business. 15% of employee fraud is related to inflated travel and other expenses, according to The Association of Certified Fraud Examiners. Manual systems are tedious and make it easy to get away with inflated expenses. As a small business, how can you effectively manage employee-generated expenses?
A cloud-based employee-generated expense management system is one such solution that can be beneficial to both employer and employee. Here’s how:
- Employers minimize fraud by getting more accurate and timely information without the burden of collecting expense receipts—employees simply take a snapshot of receipts and the program uploads the photos, extracts the data, and categorizes them.
- Mileage trackers keep employees honest about their business mileage.
- Employees no longer need to save receipts or get copies of lost ones and do not have to manually fill out expense reports.
When shopping for an expense management system, take the following items into consideration:
- Cloud-based technology. When employees are out of the office, they should be able to photograph and upload receipts immediately.
- Capacity to set limits. The software’s capacity to accept your firm’s current and changing sets of rules on employee expenses and setting different limits for different items—e.g., meals and airfare—make it harder to fudge expense reports.
- How easily expenses can be evaluated. The system should be able to evaluate trends in expenses by department and by
employee to reveal overspending and violations of limits.