Five common missteps on the road to expense management maturity

For years, expense management sat in the back office: delayed receipts, spreadsheet reconciliations and spending nobody could really see. That passive approach doesn’t hold up any more. Manual data input is responsible for 63.6% of corporate reporting errors, and 39% of UK SME finance departments still use spreadsheets as their main way of tracking expenses. Every one of those businesses carries audit risk it doesn’t need to.

Most of the missteps below are a reasonable decision made too early, with too little information, by a team under pressure to show progress quickly.

1. Under-scoping who needs the system

The most common early mistake is rolling out to the highest-volume claimants, usually leadership and sales, and leaving everyone else on paper and spreadsheets. The result is a two-tier system: finance runs the automated process and a manual one alongside it, and most of the efficiency gain disappears. Manual claims also sit in glove boxes and email drafts for weeks, so finance can’t see the liability until the paperwork turns up.

How to avoid it: map every role that spends, not just the frequent travellers. That includes remote workers buying home-office kit, IT staff buying software licences, facilities managers and field technicians. Bring in AP, HR, IT and department heads before the rollout, and give each role the interface that suits it: a mobile app that works offline for the field, a proper desktop portal for the office.

2. Assuming claimants will “just figure it out”

Launching with one company-wide email and hoping the interface speaks for itself breeds quiet resistance: shadow spreadsheets, late submissions and the software taking the blame for a process problem. Projects with strong change management meet or exceed their objectives 93% of the time, against 15% where change management is poor or absent.

How to avoid it: train on two levels. How do I photograph a receipt and submit it? And why are we changing, and how does it get me paid faster? Find a champion in each department, and check in at 30, 60 and 90 days. The system’s own data will show you which teams need more help.

3. Assuming your finance stack already talks to itself

A slick mobile app is worth very little if the data goes nowhere useful. A tool that doesn’t integrate natively with your ERP, card provider and HR system means CSV exports and manual upkeep of GL codes and cost centres in two places, and decisions made on numbers two to four weeks out of date.

How to avoid it: audit your systems before you shortlist anyone, and favour native, API-driven integration over file transfers. Bring IT and finance into vendor selection early. For IT, it’s a security requirement. For finance, it’s the difference between closing on day two and day eight.

4. Relying on spreadsheets and email as “the system”

Excel plus email approvals isn’t a process. A spreadsheet can’t stop someone entering £150 against a £75 policy cap, and without an audit trail the same taxi receipt can be claimed in March and again in November. Expense reimbursement schemes make up 14.5% of occupational fraud cases and typically run for 18 to 24 months before anyone notices.

How to avoid it: enforce your real policy rules at the point of entry, so a breach is flagged or blocked straight away. Build an unbroken, timestamped audit trail, ready for HMRC or internal audit, and use OCR receipt capture to make figures harder to alter and duplicates easy to spot. For a quick view of where you stand, try the outgrown spreadsheets checklist or the Expense Risk Checklist.

5. Chasing a “silver bullet” instead of the right partner

Judging software on a feature list for where the business is today can lead to a dead end. As you grow, you need multi-entity consolidation, multi-currency, VAT reclaim analytics and card management. If the tool can’t stretch, you either stitch together more tools, recreating the silos you set out to remove, or start again.

How to avoid it: judge the depth of the platform and its integrations, not a static feature list. Look for a partner that scales from SMB to enterprise, and ask for case studies showing how they have supported clients through growth. Five steps to find the right expense management solution walks you through the evaluation, and The business case for expense management automation helps you take it to the board.