Why paper-based expenses simply don’t cut it
There are some of reasons that companies typically give for not moving away from paper-based expenses management. Their system may not be cutting edge but it works and they don’t see any reason to change.
This enduring attachment to paper is understandable in the business world. It has been the main method we’ve used to manage and record business activities for the past 700 years.
Some of the earliest surviving business documents are expenses records dating back to the emergence of double-entry bookkeeping in 14th century Italy.
So why should companies suddenly abandon paper and move over to some swish new digital system like webexpenses? Well, here are some reasons:
The bottom line for any company is cost. If you can do something faster and more efficiently, you make substantial savings. It’s the primary reason so many businesses are now moving across to digital management systems.
A paper-based system locks in cumbersome manual processes. Claims are manually entered by employees with forms submitted alongside clumps of paper receipts. The details will be entered into spreadsheets and often duplicated for reports.
With a digital system, the paper receipts are turned into a digital form and automatically integrated into the accounts system; no need for manual entry or duplication.
It’s estimated that moving to webexpenses provides a 25 percent saving in processing costs.
A major problem with a paper-based system is time lag. It’s the time it takes between an employee incurring an expense to that cost being processed. With expenses traditionally submitted each month, this will usually be weeks.
During that time the company does not know its cash flow. There may be a problem, an employee or department may have strayed wildly outside of policy, but this will not be known until the claims are processed.
A digital system changes this. A smartphone app allows employees to upload claims within seconds of the expense being incurred. It provides finance teams with the real-time information they need to allow robust and reactive management.
The day-to-day inefficiency of paper-based expenses is not the only cost to factor-in. There’s also the threat posed by any failure to comply with tax and legal requirements with companies facing prosecution, fines and even imprisonment.
What digital management enables companies to do is to integrate their compliance policies into the daily work routine of their employees. Webexpenses allows companies to set-up reminders, compliance checks and alerts via the user’s smartphone.
By maintaining and recording these procedures, organisations are able to show that they had adequate processes in place to prevent any compliance breach.
One of the reasons expenses are such a dreaded part of business life is the sheer drudgery of making an expenses claim. It is a time-consuming drudge, requiring employees to try and decipher scraps of old paper receipts.
And with no effective way to manage and monitor paper-based processes, expenses have been largely reliant on trust between employers and employees. It has allowed them to become a toxic area of business life which breeds distrust.
A digital system removes both of these problems. Recording and submitting an expenses claim now takes seconds and robust management tools mean expenses are no longer need to be such a workplace battleground.
The best way to get a feel for how digital expenses management system could help your organisation is to give it a whirl. You can sign up for a demo of the Webexpenses system here.