Expense approvals seem pretty straightforward, except when they aren’t. What could be easier than approving expense reports? Well, maybe you’ve never had to approve a request for renting a llama for a photoshoot. (That one got approved, in case you’re wondering.)
There are a lot of moving parts when it comes to expense management, and even a minor mistake can prove costly. Having a competent expense approval system in place is crucial for prompt reimbursements.
What is Expense Approval Workflow?
An expense approval workflow is a sequence of steps that finance teams use to ensure their budgeted expenses stay within the organization's means of spending. It essentially entails the process of streamlining approvals for expenses that have been incurred.
Why use an expense approval system?
An expense approval system helps businesses streamline the repetitive and predictable tasks associated with expense approvals like creating, validating, and approving expense reimbursement claims for employee-incurred expenses. It helps them enforce the organization’s expense policy, thereby making it easier for managers to approve or reject a claim.
4 step guide to implementing an automated expense approval system
Kissflow can help you design, and implement the expense approval system with ease. Here’s how you do it in Kissflow Finance and Operations Cloud:
1. Design the workflow
Once the form is ready, you need to design the sequential path of tasks to complete an expense approval workflow. Depending on your requirements, an employee expense approval claim can be approved by the direct manager, the travel desk, or the finance team.
You can also have multiple levels of approvals. If you’re looking to automate approvals based on predefined criteria, this is the stage where you do it.
2. Set permissions
Once the expense approval workflow is ready, you can assign stakeholders and set permissions. Roles and responsibilities are assigned to individuals based on their tasks in the finance workflow.
You can even provide role-based access to hide sensitive information.
3. Implement the process
After everything is set, you can publish the expense approval workflow. Employees can initiate instances of the workflow and submit their expenses claim for managers approval.
4. Improve the workflow
Once the expense management system has been implemented and has run for a while, it collects enough data to give you insights into how these approval processes can be made faster and more efficient.
You can find the time taken to submit reports, the average approval time, and other such information to improve the expense workflow’s efficiency.
Benefits of using an automated expense management system
1. Compliance with Travel Policies
The expense management software identifies policy violations and throws up red flags if a request violates them. This makes it easier for finance teams to approve or reject a claim. Ensuring that corporate travel policies are adhered to takes a huge burden off their shoulders. This will also help reduce expense fraud and enforce compliance.
2. Visibility Into Financial Health
Finding where your money goes helps you plan an effective budget for business trips. When you track how much money goes out, you get a better picture of the cash flow. You can identify areas where you’re spending unnecessarily, and make insightful decisions that can help you cut down on costs.
3. Tax Deductions and Audits
Travel and expense processes must be handled in the right way in order for an organization to mark them as a legitimate expense. Without tight control over the process, you may be missing out on benefits. In addition, records and audit trails need to be present to show that you’ve properly managed travel expenses and haven’t opened yourself up to claims to mishandling funds.
4. Happier Employees
Submitting expenses and waiting for claims to be approved can easily become a full-time job and can affect productivity. When you have an easy-to-use travel and expense approval system in place for employees to submit expense reports and claim reimbursements, it makes their lives a lot easier.
The best way to handle business expenses
With Kissflow Finance and Operations Cloud, you can streamline all your key finance processes like expense approvals, travel approvals, and budget requests. Get improved control over finance approvals and see your efficiency soaring. Get your free demo today.
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