Expense Management- One stop solution to All Corporate Payments Need
In the fast-moving world, business is trying to acquire more markets daily, your sales team is travelling the world to explore new venture, marketing is focussing on brand promotion through both offline and online Ads, teams are travelling around the world. All looks dreamy and perfect, but what about Accounting, managing expenses especially taking care of expense receipts plus keeping control of company spending in comparison to the company earnings.
So first problem corporate need to solve is to move away from Cash, cash management is messy and prone to leakage, and moving to a 100% reimbursement model is bad, it's painful for employee and accountants to make sure every expense is refunded after due diligence on weather is the personal or corporate expense. But it's a bigger pain point for a Business Owner who might be your CEO, CFO or account team based on the size of your organization to keep a check on spends in order not to end up sinking. So the best solution to it is your corporate card with state of an art expense management portal which is loaded as per need by the business owner and every expense done on a corporate card loaded through the portal funds comes to them for approval in order to have a check. Each expense forms part of Analytics to prepare a view which suits you and your business needs the most. Budgeting is easy as you can easily keep the cap on loads, spending and even have card level limits to keep a check on employee spending how and where. An employee can request for the new load to plan future expenses. With multi-currency expense cards, employee planning to travel abroad for work can get card loaded based on the destination country in order to avoid crazy interchange and markup, plus is safe from fluctuating conversion rates. Plus of course, in case of theft or losing the card, the freezing card is few clicks away from the Expense Application, wish cash gave you such power.
So here you have sorted your expense with full control & analytics, now comes the dirty part. Receipts management, you will never hear an accountant or CFO saying he/she loves to collect physical receipts and do accounting manually. Plus it gets crazier when expenses and the number of employees expanded. But they can't just ignore it, as these receipts play a major role in being compliant for audits and filing annual taxes. Expense Management comes with receipt management where sharing receipt with your BO or accounts is one click away from your mobile to link with the expense. Tools are getting smarter to snip receipt from your email to the photo library and linking them with correct expense without any manual work. Makes it easier for Accounts team to approve expense and lot easier for Accounts to keep proof of expense in terms of soft copy of expense receipt. What can be easier to go paperless!
We talked about expenses, but it's not about just card spends there are two more major constituents to it — Invoices & Subscription Services. Every accountant has to deal with an endless number of invoices every month be it water bill to electricity bill to printing services and so on. Great expense management tools integrate invoice management as an integral part. Invoice reaching by email can be uploaded to the tool manually or auto-integration in order to go through a set approval process plus automatic payment on due date post-approval. Invoices have another side of the story, good expense management tool should have in the build tool to create invoices and send them to vendors. So accountants can schedule or build invoices using the company standard template and email the invoices to vendors without login into an email and that too a 100% paperless process.
The third expense mentioned above, is subscription management i.e. recurring monthly, quarterly, or even annual expense. For most people, it can be Netflix or Spotify payments, but for corporate, they can be services taken for other businesses and paid a fixed amount on a fixed duration. This can be easily automated as variables are static from the amount to duration to account where the invoice needs to be paid, plus do not need to go through an approval mechanism as it is pre-approved for a certain amount of duration.
One factor which can not be ignored is the fact that invoices (incoming & outgoing), plus subscription payment constitute a major chunk hence need to be well managed and should play an important part in Expense Management. Analytics should consider them as a constitute of expense or earning based on the flow. Corporations need to have regular checks as sometimes unwanted subscriptions or cheaper alternatives to these timely spent can bring a major impact on a company's balance sheet. Smart BFM analytics using AI & ML can help you find the leaks or ways to cut on unwanted expenses and help you to make a smarter decision.
Now comes the last part of the story, your expense is in control but that does not end the story. The last phase of every spend or earning is accounting tools so that it can be a club for clearer picture and need for accounting, auditing & tax filling. You do not want after automating, giving control & going paperless, you do not want your accountant to manually do the entry of expense from your expense portal to the Accounting portal. Thanks to next-gen accounting portals they allow easy integration with any tool so sending your expense to the Accounting tool is just a few clicks again thanks to the magical world of API integration.
Once your expense offering achieves the above you are all set for a class Expense Management product that can be enhanced to solve more problems address by the customer or to stay competitive in the market. Let's say handling reimbursement i.e. out of expense card expenses, making budget pool linked to department or project, petrol reimbursement based on travel distance by personal car and so on. To conclude I would like to mention the basic principle of expense — Penny saved is equivalent to Penny earned.