Reporting expenses can be one of the more time-consuming and irritating aspects of doing business. When your employees are on the go, they might not keep travel costs top of mind, and nobody likes dealing with the paper forms and spreadsheets that have long defined expensing. Luckily, technology has come to the rescue.
Although you can't completely eliminate expense reporting, it's possible to minimize annoyance, encourage faster submissions, ensure full documentation and reduce the chances of error, all with the help of smartphone apps and cloud processing. Traveling employees will gain productivity, and your accounting department will appreciate the process.
Mobile Apps
For employees on a business trip, smartphone apps are a good approach to tracking expenses and will get the right information compiled much quicker than traditional methods. Systems available for Android devices and iPhones typically offer expense entry and receipt capture. By entering the relevant information and making copies of receipts as expenses occur, employees are able to generate an expense report in bits and pieces as they travel, rather than dealing with the unpleasant headache of going through the whole exercise upon their return. Some apps will even link up with the user's online credit card account to automatically import charges. Apps that use GPS technology to capture mileage are also helpful.
Look for apps that can generate expense reports in PDF format for emailing to the accounting department. Having everything legibly printed and accompanied by documentation makes the whole process much easier. Make sure, however, that the app you choose is appropriate for your business and your specific needs. Consult with your accounting people to get their opinion.
Cloud Services
While mobile apps are largely self-contained, cloud services move storage and processing to a cloud-enabled system that minimizes the amount of work involved in expense tracking. They often let people send images of receipts and then use character recognition to translate the image into appropriate text. Each receipt is then accompanied by a database record. A manual review is still needed because these systems won't catch everything with complete accuracy, but it's much faster than doing everything from scratch.
Cloud services, although relatively inexpensive, cost more than stand-alone phone apps. Although they offer more security and redundancy than apps do, they won't necessarily integrate into your corporate software, meaning some manual information transfer still needs to happen. Once again, be sure that your accounting team is on board with your choice of software, and seek the input of technical people within your firm, as well. Keep taxes in mind when you choose software, as it's convenient to have a system that uses an IRS-accepted format.
Ideally, you want a program that ties into your enterprise resource planning or accounting applications. At worst, you get a system that supports your expense codes, which employees can use to fully enter their expenses. At best, you'll get a mobile app paired with cloud capability. There are offerings out there that integrate with many commonly used accounting packages. Do research to find the tool that's best for your business, and with the support of your accounting and tech teams, you'll soon have a much easier time with a task that was once considered pure busy work.
How much should a middle market company spend on expense-tracking apps or cloud services? Let us know what you think by commenting below.
Erik Sherman is an NCMM contributor and author whose work has appeared in such publications as The Wall Street Journal, The New York Times Magazine, Newsweek, the Financial Times, Chief Executive, Inc. and Fortune. He also blogs for CBS MoneyWatch. Sherman has extensive experience in corporate communications consulting and is the author or co-author of 10 books. Follow him on Twitter.