In large groups, such as mass-market retailers, expense reports can quickly become an issue.

Dealing with expense reports is tedious, and employees often wait until the last minute before submitting them. The company’s accounting teams then face a work overload, preventing them from performing their day-to-day activities and delaying employee reimbursements.

In some groups, expense reports are so complex that employees are assigned to them full time!

Expense reports in large groups: a cause of tension

Currently, many companies, even large groups, still operate “the old way”. In concrete terms, employees must keep their receipts, often fill in a summary Excel file, and then send all the receipts to the accounting department. The accounting department compares the receipts with the spreadsheets, and often has to make several entries in additional documents.

In fact, large groups may have several types of accounting lines for the same expense (e.g., training). For the Administration and Finance Department, managing professional expenses is a time-consuming task with little added value and a high risk of error.

Not to mention the fact that every receipt must be kept to be able to justify all professional expenses if there is an audit. The accounting department will lose even more time filing and storing these documents!

For employees, this is an onerous and non-value-added task, and a source of frustration as they may have to wait several weeks before being reimbursed.

Fraud and errors: the high cost of poor expense report management

With this type of system, which involves significant manual intervention and handling, there are numerous risks of error and fraud. While some employees may simply be disorganized, others won’t hesitate to inflate their invoices or to present the same receipt several times. In fact, 89% of fraud cases in companies relate to expense reports.

Of course, it’s difficult to know what is an error and what is attempted fraud. In any case, if the accounting department is overwhelmed by thousands of invoices, it’s clear that there is a high risk of not identifying these errors.

However, fraud has a significant cost: €747 per year, per employee on average! These fraud-related costs amount to 5% of companies’ annual revenues.

Errors are costly too! It is estimated that 20% of employees submit inaccurate expenses. The cost of an expense report is estimated at €53, with each error costing an additional €48. Not to mention lost receipts, which force the company to choose between not reimbursing employees or reimbursing them but not recovering the VAT.

💡On average, it is estimated that poor professional expense management costs companies €300 every month. When you add this to the €747 of fraud per year, per employee, and when it comes to large groups that have to manage the expense reports of thousands of employees, you can see how essential it is to spot errors in order to control the budget!

How can you best manage thousands of expense reports each month?

To save time and money and improve your tracking of employee expenses and reimbursements, we recommend that you to opt for expense report software.

The fully paperless process significantly facilitates the task. From the creation of the expense via a simple photo of the receipt to the payment, through validation by the manager and the accounting entries, the expense is fully traceable.

According to a study conducted by N2F, implementing an expense report management solution allows you to divide the processing time by 4! How?

  • By automating time-consuming tasks;
  • By avoiding the need to rekey data;
  • By simplifying the validation process; and
  • By allowing an accounting export in one click.

You also avoid the risk of errors and fraud, since everything is automated.

Large groups: the five essential features for an expense report solution

#1 – An app and a smart scan

Your expense report solution must eliminate as much manual intervention as possible. To do this, it must be available as an app, so that employees can easily manage everything from their smartphone.

Ideally, the expense report application should include a smart scan. The employee simply takes a picture of the receipt and the smart scan automatically extracts the information and saves it (date, amount, VAT, tourist tax, currency, etc.).

Thanks to the app and the smart scan, everything becomes easier! Before, your employees would keep expense receipts in their pockets for weeks before sending them to accounting, but now they can take a picture of them as soon as they have paid. The expense is created in a matter of seconds: name (of the restaurant, for example), amount, recoverable VAT, multiple VAT rates, etc. Processing is instantaneous!

To make the process even easier, we recommend that you opt for an expense report app that also works offline. No time is wasted: your employees take a picture of their receipts, and the information is extracted as soon as they have access to the network again!

#2 – Automatic currency conversion

Having to check exchange rates and regulations is very time consuming and stressful. That’s why your expense report solution should be able to automatically convert currencies, with real-time exchange rate updates.

This is the best way to gain peace of mind and to streamline the management of specific expense reports.

#3 – Legal compliance archiving

The digital archiving of expense reports is legal as long as it guarantees the durability and security of the data.

Choose expense report software that offers this legal compliance archiving feature so that you can save, store, and retrieve documents (such as receipts) while guaranteeing their integrity.

You no longer need to collect all the receipts in one place, to store everything in boxes and binders: everything is centralized, and you can access it easily at any time.

It is also a real time saver because if you are audited, you will be able to access the requested documents immediately. It will even be very easy for you to pull out just one category of expenses over a period of time (e.g., all meal or travel expenses between 2015 and 2018). When you have thousands of expenses every month, this is an essential feature!

#4 – Alerts for errors or attempted fraud

An expense report solution can alert you to suspicious expenses:

  • Duplications
  • Expenses incurred on a day not worked
  • Limit exceeded
  • Etc.

This has two advantages: you can immediately spot any attempted fraud or errors, and you ensure that the expense reports comply with your expense policy. All you have to do is check whether the expense is correct, validate it if it is, or send it back to the employee if necessary.

Let’s take a look at expense limits: you will be able to configure your solution so that employees are informed as soon as they exceed the limit. So, if your employees incur an expense that exceeds the limit for that category (e.g., meals), they will receive an alert warning them that they will only be reimbursed up to the limit. The accounting department will also be notified for better visibility.

#5 – Automatic updates

To save time and avoid errors, your expense report tool should update automatically and regularly to take into account:

  • Currency updates;
  • VAT rate updates; and
  • Changes in mileage allowances.

You limit the risks of errors linked to manual management and reduce the verification time required by the accounting department.

🔥 Are you convinced that going paperless is essential if you need to manage thousands of expense reports? Discover in our case study how Bioderma digitized its expense reports thanks to N2F! 🔥