Benefits of Automated Expense Reporting For the Accountant

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1 CERTIFY // 01 CFO S GUIDE TO CLOUD EXPENSE MANAGEMENT SOFTWARE

2 CFO s Guide to Cloud Expense Management Software Contents Introduction What is web-based expense management? Are their real cost savings for switching to cloud expense systems? Who should use cloud expense systems? Benefits for the accountant Benefits for the employee Benefits for CFOs Are their real time savings with automated expense processes? What vendor should you choose to use? CERTIFY // 02

3 CFO s Guide to Cloud Expense Management Software Introduction Expense management is an important process for any business, big or small. Yet, very few on the executive level think to consider the money and time lost by using Excel or other spreadsheets and systems to complete expense reports the old-fashioned way. A September 2013 Aberdeen Report found that 53 percent of businesses are still managing their travel expenses manually. That means that almost half of all polled organizations realizing the time they d wasted have already made the switch to cloud-based systems. Businesses who fail to do so will surely be ceding an advantage to their peers and competitors. It s just so helpful to be able to track our expenses in an automated fashion now, said Partha Mittra, director of IT at Cancer Genetics, Inc., which recently switched over to automated expense management techniques. We can see how much we re spending weekly and we can see a breakdown of expense categories. If all Chief Financial Officers knew about the benefits offered by the next evolution of the expense reporting process that being web and cloud-based automated expense management systems then they d surely all have made the switch to such programs on behalf of their business already. 1 What is web-based expense management? Web-based expense management programs offer your business the opportunity to take the next step forward in the travel and expense process. Manual expense reporting can be an arduous process for accountants, and create additional tasks for your employees. Worse yet, manual reporting can often result in a number of errors. All this wasted CERTIFY // 03

4 time, expended energy and loss of resources can be regained with the use of cloud-based expense reporting systems. How it works: A web-based expense management program would allow all the employees of a given company to upload their receipts into an online database, as opposed to saving the physical copies and then submitting them alongside a physical report. The system would then take these uploaded receipts and, on a day selected by company executives, collect them together in the form of a digital expense report. Such a system can cull all necessary information from an uploaded receipt from where the cost was incurred, to what time of day or form of payment was made, as well as whether or not the cost violates company policy and more in mere moments. What it does: The system presents this information to a company s accountants on the selected day for expense reporting. With a web-based expense management system, there are no costs violating company policy, because they ll be red-flagged before employees submit their reports. There are also no lost receipts and questionable costs, because every entry in a digital report necessitates a backup of an image-receipt. Every single receipt image and piece of information entered by a company into a web-based management system can be securely backed up and available for access from anywhere, via the cloud for as long as the company uses the program. 2 Are their real cost savings for switching to cloud expense systems? All the benefits don t mean a thing if cloud-based expense management tools can t create significant cost savings for a business. Businesses that make use of web-based expense management tools are able to lower their processing costs by 83 percent. However, the many reports saved on duplicate and out-of-policy reimbursements which are often paid to employees in full by companies that rely on accountants to manually check company policy against each report may lead to even greater savings. The average organization also saves $40,000 in reduced duplicate and out-of-policy expenses, which are no longer paid out thanks to the use of automated expense management systems. CERTIFY // 04

5 That represents a large amount of company funds the Aberdeen Report found that the average company spends 10 percent or more of its annual budget on travel-related expenses. That s not even to mention the smaller savings that result from going digital. For example, businesses that make use of online expense management often save up to $2,000 in annual postage costs. That s just one of many such savings experienced by businesses that make the switch from manual reporting. 3 Who should use cloud expense systems? Cloud-based expense reporting systems are already in use at a number of large multinational corporations. The current corporate mindset is often to digitize everything and cloud-based expense management allows an organization to do so with their travel and expense costs. As a result, many large businesses have swapped over to automated management strategies in years past. It allows an entire office to migrate yet another process from pen-and-paper to their smartphones and hard drives. Cloud-based expense systems can be used by more than just large organizations handling huge profits they can be beneficial for any business hoping to find a more efficient means of logging its expenditures. A return on investment from a cloud-based expense system comes quickly, because it improves the everyday process for employees and accountants alike. The question isn t who could benefit from the use of cloud-based expense systems. The question is, who couldn t? 4 Benefits for the accountant The benefits offered to accountants by automated expense reporting are myriad. First off, they ll be able to simplify their daily tasks, as all relevant CERTIFY // 05

6 data will be presented to them in an organized file, rather than in the form of a stack of paper receipts. They ll also no longer be responsible for handling policy violations, because the management system will inform employees of violations before their reports are ever sent to the accounting department. Take the example of the Holland Company, which instituted Certify online expense management programs at their offices. That company began saving at least six hours of work every month for its accounting department by eliminating the need for data entry, resolving policy-violation conflicts and other such tasks. The team was then able to repurpose that time toward completing other tasks for the betterment of the business, showing how the use of online expense management systems can make a business more productive. Some expense management systems are able to do even more than save time for accounting departments they offer access to valuable insights. Such programs can allow company representatives to analyze organization-wide costs by department, employee and project, and through a number of other comparable metrics. This allows executives to get a better handle of where their budgets have been spent, in a historical sense. These insights can greatly improve the efficiency of a business. For accounting teams, the key advantages of expense management programs include: Elimination of data entry Improved processing time for costs Access to automated trend insights and analysis Additional time for other essential tasks 5 Benefits for the employee Online management systems aren t just a tool for accountants they re aimed toward making life easier for employees. CERTIFY // 06

7 These people travel a lot, and I want them to be selling and energized,, explained Bill Hayes, president of Vendormate, a company that has found success with the help of automated expense management tools. Anything that gives more time back to them is not only cost effective, but it s creating value for the company. For employees, automated expense management systems offer: Quicker reimbursements Immediate data entry, via smartphone camera and online database No need to save receipts Automatically generated reports on company schedule Error-free reporting violations are flagged before a report is even published The Holland Company noted that it was able to cut its time for processing expenditure reimbursements from five days to three days. Similarly, the Pharmacists Mutual Insurance Company saw even more dramatic results when they began using the Certify expense management systems: Their employees use to wait at least 14 days to receive their expense-related payments, and sometimes waited up to three weeks. Now, they receive their payments in an average of five day s time. 6 Benefits for CFOs The benefits offered to CFOs by automated expense report technology are obvious they ll make your business run more smoothly than ever. Employees get their reimbursements faster. Accountants finish their daily tasks more quickly. Managing and publishing reports takes a fraction of the time it once did. All this adds up to your workers having more time than ever to dedicate to the work that truly matters to your business. With automated expense management systems, your ROI will also be swift, and will continue for years to come. With less time dedicated to unnecessary data entry, policy conflicts and all other issues presented by manual expense reporting, your entire team will find themselves producing at a standard that they ve never previously been able to reach. CERTIFY // 07

8 7 Are their real time savings with automated expense processes? The time savings offered to organizations that use automated expense reporting are very real and they stretch far beyond the reductions in processing and reimbursement time detailed above. Think of employees on a business trip: previously, they had to save every receipt, organize them, enter all the data from them manually, format their own reports and so on. This likely cost them hours every single month hours that they could have been spending on projects and other work that offer your organization greater upside value. It probably takes me one-third the time to do expense reports now, said Jeannie Hagmeir, the senior accounts payable specialist at icad Inc., a company that has instituted automated expense report programs. I m spending maybe a couple hours a week versus six hours. By allowing these employees to log their receipts rapidly using image capture, and by offering them a system that creates their expense reports without the need for almost any manual entry, you can repurpose that time to greater purposes. Accountants at an organization will have a comparable experience. Instead of spending their time comparing receipts to company policy, confronting those who violate rules, entering data, and other report-related tasks, they ll be able to focus on analyzing the numbers themselves and devising strategies for saving employers money in the future. For businesses that use online expense management, it s about more than saving time it s about using that additional time to achieve greater productivity. 8 What vendor should you choose to use? When you re selecting what specific expense management system to employ, consider what features each expense management program can offer you and your team. Does it allow you to log your costs and update your reports via mobile phone? Does it contain functionality that ties it to your specific company s expense policies? Is it capable of being implemented with the software currently in use at your business? CERTIFY // 08

9 These are all essential questions one should consider when selecting an expense management system, but are not the only important considerations to be made. Additionally, individuals should explore whether or not the company offering the expense management software has training programs and troubleshooting support. Expense management software that automatically creates trend and analysis reports in regards to costs can also make a major difference. Key features to keep in mind for expense management systems include: Mobile technology Cloud support Policy integrations Full-time support team Trend analysis capabilities Easy implementation So your business should never employ the use of an expense management program that doesn t offer all these features and much more. Arming your workers with automated expense management solutions is an absolute necessity but you ll only reap the benefits if you work with a provider who can offer you the best. CERTIFY // 09

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