Enforcing spend control is critical in today's business climate as businesses seek to control costs in uncertain times. As budgets tighten, finance teams should take a closer look at their expense policies.
An expense policy is a set of detailed rules that outlines what employees can buy, and within what spend limit. When hundreds of employees across the company are purchasing various items for different business purposes, the money spent can quickly spiral out of control. If the rules aren’t properly enforced, your employees can either end up spending too much money or buying unnecessary items, causing a significant drain on company funds.
This can be difficult to do. Two of the most common challenges around expense policies are:
The reality, however, is that this approach puts an unfair burden on your employees. The time and resources this requires is the reason many organizations have accepted that financial losses due to error and fraud will inevitably occur.
Companies need to take a proactive approach to expense policies. Businesses have traditionally relied on policing their expense policies after the fact. They have tasked finance teams with playing detective, which required sifting through bundles of reports and paper receipts, searching for fraudulent and overstated expenses, or anything that poses a compliance risk.
But effectively policing expenses is difficult when there’s a reliance on static, paper-based policies. The emergence of automated expense management systems has significantly changed compliance, providing finance teams with powerful new ways to ensure compliance, while empowering employees to spend confidently on the things they need to get their job done. Today, we can put policy details in code and automate the enforcement of it at the moment that the transaction occurs.
Smart Corporate Cards with Built-in Policy Controls
While we know that issuing corporate cards offers a ton of benefits, it can also make companies feel vulnerable to employee misuse. With TripActions Liquid’s built-in policy controls, finance teams can easily create spend policies for a full range of expense categories tailored specifically to their company. These expense policies are programmed into the corporate card, so that employees can’t spend beyond the realms of the company-mandated limits.
Even when companies have taken all the preventative steps, out-of-policy corporate card spend can still happen. And with employees working from home and perhaps using a corporate card for the first time, they may not know what’s reimbursable and what’s not.
For an extra layer of insurance, TripActions Liquid also offers a recourse feature that makes it easy for finance teams to identify transactions that appear to be out of policy and to seek reimbursement from the employee. The admin can easily flag transactions that are out-of-policy, which will trigger an alert in the employee’s TripActions Liquid app. The employee can then reimburse the company with their personal card in a matter of seconds.
Policy at Your Fingertips
For most employees today, the T&E policy is usually within an employee handbook and only reviewed during the onboarding process. When they travel or make an expense, they forget all about per diems and what they’re allowed to spend. It’s a very realistic pain point for employees today.
With an expense policy right within the app, employees can easily access the company’s expense policy as it relates specifically to them. Employees can reference their expense guidelines across a variety of spend categories so they’ll never have to second-guess what’s within policy and what’s not.
Eliminating the Hassles of Expense Management
Employees today often need to make purchases quickly in order to stay productive. If they have to wait for the request to go through a lengthy and complex approval process, their efficiency and productivity takes a hit. Furthermore, managers are tasked with spending time reviewing and approving expenses, which takes away precious time from performing more strategic, value-added work.
While finance teams must maintain control, they need to do so in a way that doesn’t add friction and extra burden to the process. TripActions Liquid creates automated approval workflows so that finance teams get the level of oversight they need, without dragging managers into a drawn-out, convoluted approval process.
By setting rules up front and creating workflows based on those rules, finance teams will only need to review flagged expenses; the software will automatically approve and reimburse everything else.
Modern finance teams are turning to smart, flexible expense policies to proactively drive compliance, efficiency, and cost control. To learn more, visit TripActions Liquid.