Are employee expenses causing confusion (and chaos) in your small business? Is your finance team or bookkeeper spending way too much time reviewing and reconciling expense reports?
If you answered yes to either of these questions, then it is more than likely time you need to consider creating an expense policy, or at least do some serious updating on the one you have. By doing so, you can make the entire expense process (reporting, reviewing, and approving) clear and easy for your employees. And when has anyone ever complained about clear expectations?
When it comes to creating a brand new policy or even updating the one you have, it can be hard to know where to start—especially for SMBs that are growing quickly. Here are a few tips and tools to get you started creating an effective expense policy.
Key items to consider in your expense policy
A good expense policy aligns with corporate goals, and makes expense report submissions easy and efficient. Keep in mind:
- The policy should be clear and to the point: Ensure your policy is straightforward. Cover the basics and don’t include any legalese or corporate jargon. All points should be stated clearly. The easier your policy is to understand, the easier it is for your employees to follow (and enforce).
- The policy should be easy to find: If your policy is buried in an intranet or at the bottom of a notebook, it isn’t going to be used. Making your policy visible keeps it top of mind. And if you make updates, ensure employees are aware of this change, either by sending out an email or printing and handing out the updated sections. If the change is large, it is probably worth having a meeting to discuss it with your team.
- The policy should emphasize the benefits: No one likes being told what to do. But, by explaining the reasoning behind the policy, and how it benefits all employees, does help with acceptance and compliance. Not only having a policy to follow, but holding everyone accountable (no exemptions, regardless of status), keeps it fair all around.
Keep in mind, these three points are only the tip of the iceberg. There is more to making a strong expense policy, such as addressing ambiguity and use of corporate cards, not to mention rules around booking travel and personal expenses.
Must have: Automated and mobile-ready tools
Using technology to supplement your expense policy makes it that much easier for your employees to follow. With technology solutions such as Concur Expense, your expense process gets an upgrade in both automation and mobility. Employees simply take a picture of their receipt, submit for approval, and the system takes it from there. No lost receipts, no lost expense data. This industry-leading automation helps you not only process expenses easier and faster, but stay in-policy while doing so.
Where does your expense policy stand?
Are your employees set up for success? Taking the time to review and update your expense policy now will save you time and headaches in the future.
Ready to learn more? Watch our Crafting a customized travel and expense policy webinar on-demand to get the information and support you need when updating your expense policy.