Employee expenses is quite a simple concept.
In a small business, employees can claim back their expenses with some sort of expense claim form and receipts. The amount of time and effort dedicated to this process is fairly minimal.
However, this sort of arrangement will only work smoothly with a handful of staff who are making simple and small numbers of claims.
When a business starts to expand, systems which are put in place to handle small volumes of claims, are no longer adequate, and the strain on the finance team becomes great.
It is at that point, that a company may consider a different kind of solution to manage their expenses. Ultimately the goal would be to save time, save money and also provide a more user friendly experience, not only to the finance team and authorising managers, but also the employee/claimant.
When considering this kind of investment, you may come across new terminology relating to the world of expense claiming. Understanding it can help you make an informed decision on the right solution for you, your company & your employees.
We hope this guide will help..
Automated or Digital Expenses
This is a term used for any expense software solution. Essentially moving away from manual claims/forms, spreadsheets and paper receipts.
Put simply, this is the term used to cover all employee expenses relating to “travel and entertainment”.
This has a twofold meaning. Firstly, there is the company policy compliancy – making sure that all your claims are submitted in line with the rules set out by your company.
Secondly, there is compliancy with external bodies, namely HMRC, in regards to reclaiming VAT & mileage allowances etc.
This is the process of checking expenses. Ensuring that the claims are genuine and “compliant” with company and HMRC rules. Thankfully, a software solution can take away a lot of the time associated with this. You might’ve heard that MyExpensesOnline can “cut down on processing times”. This is often down to the time saved by finance teams with automated validation
This relates to compliancy. An expenses policy will outline what your employees are allowed to claim for, any price limits, time frames and anything else you want to specify in relation to your expenses.
Finance & HR Integration
Your ideal expense software solution will allow integration with your finance or HR system, allowing the data to be pulled through automatically, and no more manual entry.
OCR stands for Optical Character Recognition. It is technology which will allow the software to read a receipt and fill in the key information on your expense claim automatically (again, saving your claimant time).