You know your employees well, and trust them to do the right thing. So you might not see the need for an expense policy for your business. But even in such a fraud-free utopia, having an expense policy in place helps keep everyone on the same page, preventing frustration and mistakes.
Many businesses also find financial benefits to adopting expense management software to authorize, procure, track, process and reimburse employees for business-related expenses.
An article on the Business Insider website offers these four tips for developing a clear, unambiguous policy, and getting employees on board.
- Use simple language: Making your policy simply to read and understand makes it easier for your workers to follow. Double-check your policy for any confusing jargon or corporate-speak. An automated policy, specifically designed to fit the organization’s culture and objectives, can support this clarity.
- Reward common sense: A fair policy means employees should not need to pay for anything with their own money provided that they follow the policy.
- Encourage participation: Employees should collaborate in creating the policy. By participating, they’ll better understand its value, and are more apt to adhere to the guidelines. An automated expense system supports this sense of fairness. Enforcement comes from the system, which is based on approved rules, not from an email sent by an expense payables clerk.
- Tailor the rules where necessary: A single policy won’t always work throughout the whole company, and travel costs vary widely by city. One solution might be to include a guideline for appropriate rates based on regions when it comes to hotels and other expenses. An automated expense policy can also help with refining rules and spending guidelines. By providing convenient access to facts and data, managers are better able to negotiate cost-effective travel arrangements, and identify opportunities for preferred vendor relationships.
Even if you don’t think you need an expense policy to prevent wrongdoing, having one in place can improve employee morale and your bottom line.
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- Why your Expense Policy Should Follow your Business Travelers (Not Just the Other Way Around)
- Why is Mobility the Foundation of Effective Expense Management in Construction?
- The Cost-Control Benefits of Analytics in Expense Management
- 7 Reasons Why the Finance Team Should Push for Expense Management Software
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