If you have a sales team, chances are good that they’ll be inviting prospects and customers out to dinner or to the golf course. A lot of good will and negotiations are still made outside of the office. However, mistakes and even fraud can be found in time and expense (T&E) reports. As noted in “T&E Expenses: What Happens in Vegas Does Not Stay There,” posted by Chris Stewart-Smith on CFO.com, it is difficult to weed through piles of expense reports for valid travel, food, and entertainment expenses. What you don’t find or can’t control can cost you in the long run.
Your sales team is going to incur expenses – lunches, travel, and other business-related purchases – and may use a combination of cash, corporate credit cards, and may use their personal credit card on occasion. Verifying purchases from receipts and coordinating reimbursements to the employee or payments to corporate credit cards can be time-consuming and get very confusing. Keeping track of the expenses, methods of payment, and matching that data against corporate policy also requires a great deal of time. Although it can be easy to put expense validations on the back burner or spot-check intermittent receipts instead of review all of them, you could miss simple mistakes, signs of abuse, or, worse yet, fraud.
Honest mistakes, such as two employees submitting the same receipt for lunch, can happen easily. The problem is that if you don’t discover that mistake, you obviously pay twice for the same meal. You could be losing money and be none the wiser. You may also have policies that define expense limits for things like per diems or hotel reimbursements. However, if you aren’t regularly checking to see if employees are working within those limits, then it can be easy to bend the rules in the future, and you could lose even more money, greatly affecting your bottom line. While this may be harder to imagine, employees could also commit fraud, and if you aren’t monitoring expenses, the U.S. government might take notice and bring an extensive audit at your doorstep.
Basic accounting software and expense spreadsheets don’t make managing complicated expense reports any easier. A more efficient system, such as an enterprise resource planning (ERP) solution, can make managing expenses more efficient and accurate. You can monitor expenses, compare them against policies, and make sure that they match corporate and legal regulations. Contact RAM Software Systems for more information about taking the confusion out of expense management and protect your business with the right technology.
By RAM Software Systems, Epicor ERP partner out of Texas