Expense Management Software – Overview, Importance, Usage

Every organization incurs expenses in many forms. If they want to stay in business, it is essential for them to keep a track of where the money is going. A major chunk of such expenses comes from employees working outside the office. These can generate from anything – be it traveling expenses or food bills. The amount is paid by the employees out of their own pockets and is to be reimbursed later. In the era of the traditional paper tracking method, everything was done manually. Yes, that is very much outdated now. It seemed fairly straightforward till the time came to file the bills. Physical copies were to be kept intact and in-store. Paper bills were compiled and submitted in a tedious monthly or quarterly process. This posed a huge risk of fraud, caused discrepancies, and often resulted in confusion. But for every problem, a solution is bound to be developed. Expense Management Software was an innovation that came as a savior.

What is Expense Management Software?

Expense Management Software is an application that digitizes the entire process of management of expenses. It is a tool for tracking employee spending, recording soft copies of bills, and promptly distributing reimbursements. It allows the employees to keep pictures of their bills on a centralized platform that automatically files for reimbursement. 

What makes Expense Management Software so important?

This application certainly does a lot more than just take away the hassle of keeping a bag of bills. In a growing firm, maintaining a manual record of every individuals’ expenses can be a challenge. It also wastes resources in terms of money, time, and effort. This digital tool eases the process of recording and tracking details. Here is a gist of how it benefits both the employees and the organization.

Read More: A complete Guide to Expense Management Software 

Controls employee expenditure

The software comes with features that allow a bifurcation of what is to be reimbursed and what is not. It also alerts the employees when they seem to be spending way more than they should. Quick action can keep a check on unnecessary expenses.

Makes the reimbursement process quick

Let’s be real – no one likes to wait for months to get their money reimbursed. With this automated system, the process is almost instantaneous. It eliminates the need for the employee to file an expense report. This comes as a big relief. Once the bill is uploaded, all that is required is approval after which the payment is automatically scheduled.

Leaves a digital paper trail

All receipts can be stored by the employees as pictures. Just click and upload, it is that easy! These are saved on the software for approval and as a permanent record. Any action then taken against the receipts can be traced. This paper trail created further facilitates the audit procedures. 

Improves financial productivity

Aligning the Expense Management Software with accounting procedures improves the firms’ financial productivity. The accounting team gains ease in overseeing records by keeping all information under one software. It also helps in determining analytics and trends based on historical data, which improves decision-making. Any unusual or large amount of expense can be singled out and analyzed.

What are the uses of this software?

Creation of a centralized portal

The software allows the employees to click a picture of the bill from their phones and upload it on the common portal. From here, the bill can be re-routed to the concerned person for approval. A problematic request can be flagged and returned with a justification for violation of policy. All receipts are tracked in one place, minimizing any scope for confusion. Further, all travel management systems and card programs can be integrated with the software. This brings everything under one platform, streamlining all activities.

Optimization of policies

All organizations have separate policies for different categories of expenses. These policies also determine which expense is to be reimbursed and to what extent. The expense management software allows employers to set limits on the amount spent by employees. It also explains the extent of reimbursement. Any deviation from policies is corrected in real-time to avoid undesirable expenses.

 Reduction of errors

The software minimizes the manual tasks to be performed by the accounting staff. This automation results in a reduced risk of human error. No more data is stored across multiple spreadsheets or in thick files. It saves time and the employees from a lot of chaos-prone activities. It improves the compliance of the organization as well.

Minimization of costs

It not only takes time but also money to analyze individual expense reports. A majority of organizations still do not recognize the hidden costs that the manual process comes with. Opting for expense management software cuts down costs considerably. This makes the working of the firm more efficient. After all, time is also money. Time saved is money earned.

Also Read: Importance of Expense Tracking Software in Business World

Verification of documents

The software has the ability to adapt as per the policy. It reacts in accordance with the constraints given. Approvals and verifications are all automated. Any violation of policy is flagged by the software. This prompts the concerned person to check the discrepancy without digging through a bunch of physical documents. This immediate response also lowers the chances of any fraud claims going unnoticed. 

The expense management software is something that must be adopted by all growing firms. With a variety of such software available, what is best suited to organizational needs must be researched. It is, without a doubt, a transformative tool for the expense management process. It provides a reliable way of tracking individual expenses and minimizing costs. With its flexibility to adapt to policy changes, it makes a lot of lives easier. As we progress into a modern, tech-driven world, this brings about a much-needed upgrade to traditional time-consuming methods. 

Looking to invest in one? Be sure to check the best expense software offered by Dext.