You know you need to pay expense reports and bills, but you may underestimate the importance of paying efficiently.
A disorganized payment process can take 20+ minutes in total for a single expense report and cost over $35.00 in the process – a serious drain on time and money. Slow payments can leave employees or suppliers waiting for reimbursements and getting more discontent by the day. Even customer/client relationships can suffer.
To put it another way, paying expenses can be an obstacle to a business or an advantage. The question is how to ensure the latter outcome? Start with these 3 tips:
- Build an Approval Process – Every expense report should go through an approval process. And even though efficiency is the objective, each report should undergo at least one level of review to confirm the numbers. Reports suggest that one in five expense reports contains an error, and fraud is unfortunately common in this space. A thorough approval process may take more time to complete, but it saves more of everything (time, money, disruption etc.) overall. For efficiency’s sake, however, standardize and streamline the approval process as much as possible. With this and with cash management controls, it helps to codify everything: write each step out in detail and train people on exactly what to do. Efficiency comes from consistency.
- Explore Tech Solutions – Important as the above two tips may be, building processes and mastering controls takes time while paying expenses efficiently needs to happen ASAP. Tech solutions can help bridge the gap with out-of-the-box processes and controls. Ramp, Expensify and Bill.com are three popular spend management tools. All can fine-tune the cycle of review, reimburse, reconcile while integrating with accounting software to make this process as efficient and error free as possible. Be advised, however, that the benefits of these tech solutions can be improved by having a partner to implement, integrate, and optimize the software and reorient the accounting team around it. Technology is not a solution unto itself.
- Control Cash Management – Proper controls for cash management include things like doing employee background checks, segregating duties, safeguarding the location of cash, and a lengthy list of others that are all prerequisites for paying expenses efficiently. These controls were developed in response to real (often repeated) cash management issues companies have faced, and they are the best and least measures you can take to prevent these same issues. Apply any controls that may be specific to your industry or business model – the goal is to be as rigorous as possible.
Paying expenses efficiently is exactly the kind of attainable (but often neglected) operational strength that gives you an advantage over competitors. Start sooner, finish faster, and put a stronger process in place with our help. Contact Proseer.
