Tips to Speed up the Expense Reporting Process

Managing expenses is a top challenge for businesses, especially startups grappling with the complexities of growth. A study by TrendsMENA reveals that 63% of SMEs in the UAE face issues with inefficient expense management systems, leading to delays and errors that can affect cash flow.

A critical component of this process is expense reporting, which, if handled poorly, can become a significant bottleneck. Slow, inaccurate, or disorganised expense reporting leads to wasted time, increased frustration, and ultimately harms profitability.

The good news is that businesses don't have to remain stuck in this cycle. By streamlining expense reporting, startups can improve operational efficiency and gain better control over their finances. 

In this article, we will explore proven tips to speed up the expense reporting process, helping businesses save valuable time and resources while maintaining financial accuracy.

What is Expense Reporting?

Expense reporting is the process of tracking, recording, and submitting expenses incurred by employees or business owners while performing business activities. These expenses can include travel costs, office supplies, utility bills, and other operational expenditures. The goal of expense reporting is to ensure that all business expenses are accounted for and reimbursed promptly while maintaining financial control.

For startups, managing expenses effectively from the outset is crucial. It not only ensures smooth operations but also helps in building a solid financial foundation for future growth. However, as the business grows, managing expenses manually can become cumbersome and prone to errors, which is why having a streamlined process is essential.

Challenges in Processing Expense Reports

Many businesses face common bottlenecks in their expense reporting process. Some of the main challenges include:

1. Time-Consuming Manual Entries

Manual data entry is one of the most significant issues businesses face when processing expense reports. Employees often need to manually input receipts and data, which is not only time-consuming but also error-prone. Mistakes in data entry can delay the reporting process and require additional resources to correct. A study by the Global Business Travel Association (GBTA) found that manual expense report processing costs an average of $58 per report, with an additional $52 for resolving errors present in one out of every five reports.

2. Missing Receipts and Documentation

Employees often forget to submit receipts or fail to attach supporting documentation, which can cause delays in processing and reimbursements. When receipts are lost or not submitted on time, it can lead to discrepancies and the need for follow-up, which ultimately extends the processing time. Research indicates that 24% of employees have had their expense claims rejected due to missing receipts or incorrect documentation. 

3. Approval Delays

In many organisations, expense reports need to go through multiple levels of approval before they are finalised. These delays in the approval process, especially in large organisations or during busy periods, can cause a backlog of reports, leading to slow reimbursements and frustration among employees. A study by the Center revealed that 46% of respondents reported spending significant time on filling out expense reports, with 43% experiencing delays in the approval process.

4. Lack of Transparency and Oversight

Without a centralised system to track and categorise expenses, businesses often struggle to monitor spending effectively. The lack of real-time visibility into expenses can hinder decision-making and impact financial forecasting, making it difficult for businesses to optimise their spending. According to a report by Databox, over 40% of businesses face challenges with data accuracy in financial reporting, which can be attributed to a lack of transparency and oversight in expense management. 

How to Streamline Expense Reporting

To address these challenges, businesses can adopt several strategies to speed up the expense reporting process and enhance financial control. Here are some tips that can help:

1. Automate Expense Reporting

Automation is one of the most effective ways to speed up the expense reporting process. By using expense management software, businesses can automate key tasks such as receipt scanning, categorising expenses, and generating reports. With Alaan, businesses can automate key tasks such as receipt scanning, categorising expenses, and generating reports, allowing for a seamless and efficient workflow. This eliminates the need for manual data entry and significantly reduces the time and effort required to process reports. Similarly, tools like Zoho Expense, Concur, Tally, Certify, and Brex offer advanced features to optimise these processes, ensuring greater accuracy and efficiency. 

Benefits of Automation:

• Accuracy: Manual data entry often leads to errors, whether it's mismatching receipts or entering incorrect amounts. By automating these tasks, businesses can ensure that all expenses are captured correctly. 
• Time Savings: Employees spend valuable hours sorting receipts, categorising expenses, and preparing reports. By automating these processes, companies free up their employees' time, allowing them to focus on more critical tasks.
• Real-Time Tracking: Instead of waiting for a monthly report to see how funds have been spent, finance teams can instantly access reports and identify discrepancies or overspending. 

2. Set Clear Expense Policies

One of the key factors in speeding up the expense reporting process is to establish clear, concise expense policies. By setting clear guidelines on what is reimbursable, how receipts should be submitted, and the approval process, businesses can avoid confusion and delays.

Key Policies to Consider:

• Categorise Reimbursable Expenses: Clearly define which types of expenses can be reimbursed to avoid misunderstandings. This might include categories like travel expenses (flights, accommodations, transportation), meals, office supplies, or client entertainment. 
• Set submission Deadlines: Establish clear deadlines for when expenses should be submitted. This prevents reports from piling up, which can lead to delays and inefficiencies. Setting deadlines, whether on a weekly, bi-weekly, or monthly basis, ensures that all employees know when to submit their expenses and avoids last-minute rushes. 
• Specify Required Documentation: Specify the types of documentation that are required for reimbursement, such as receipts, invoices, or expense reports. Clear requirements help prevent incomplete or inaccurate submissions that can delay the approval process. Providing a checklist of required documents can help employees submit everything they need in one go. 

3. Use Mobile Apps for Receipt Management

Switching from paper to digital receipts offers numerous benefits, making expense reporting more efficient, accurate, and streamlined.

Advantages of Digital Receipts vs Paper Receipts

Digital receipts save time and space, eliminating the need to store paper copies and reducing the risk of loss or damage. They also enhance accuracy by ensuring that important details are always accessible and searchable. Additionally, digital receipts are often required for tax compliance, making them a more practical choice for businesses.

Solutions like receipt capture apps and OCR technology play a key role in simplifying the expense reporting process. Alaan’s OCR technology allows employees to easily capture receipt images using the Alaan mobile app or Chrome extension, automatically extracting important data such as dates, amounts, and vendor details. Whether on the go with the mobile app or working from the desktop with the Chrome extension, employees can quickly and easily upload receipts, ensuring that expense reporting is fast, accurate, and hassle-free. 

4. Streamline the Approval Process

Approval delays can be a significant roadblock in expense reporting. By setting up automated approval systems, expense reports can be automatically routed to the appropriate approvers without the need for manual intervention.

How to Streamline Approval:

• Centralised Approval Workflow: Implement a system that allows managers to approve or reject expense reports from any device, reducing delays caused by waiting for physical signatures or approvals.
• Set Approval Limits: For smaller expenses, consider allowing employees to approve their own reports within set limits, which can reduce the workload on managers.
• Instant Notifications: Set up notifications to alert managers when reports need approval to ensure nothing falls through the cracks.

Automating the approval process and making it more centralised ensures quicker decisions and a faster overall turnaround for expense reports.

5. Use Integration with Accounting Software

Integrating expense management tools with accounting software is another effective way to speed up the reporting process. By automatically syncing expenses with accounting systems like QuickBooks, Xero, or NetSuite, businesses can ensure that data is accurate and up-to-date without the need for manual input. Alaan takes this a step further by seamlessly integrating with leading accounting software, allowing businesses to automatically sync expenses, track spending, and generate reports.

Benefits of Integration:

• Reduced Data Entry: The automatic transfer of expense data to the accounting system cuts down on manual entry, preventing data entry errors and freeing up valuable employee time for more strategic tasks. This also ensures that financial records are accurate and up-to-date, enhancing overall financial transparency.
• Real-Time Financial Insights: Integration gives businesses the ability to monitor expenses in real-time, offering an up-to-the-minute view of cash flow. This allows businesses to make informed, data-driven decisions, improve budgeting, and quickly identify any financial irregularities or opportunities for cost savings.
• Faster Reconciliation: With data syncing automatically, there’s no need to manually cross-check transactions, which reduces the time required to ensure accounts are accurate and up-to-date. This streamlined reconciliation process can significantly shorten month-end closing times, giving businesses more time to focus on growth and strategy.

Also read: Ranked #1 for Expense Management in G2’s Grid® Reports for Middle East

6. Encourage Real-Time Expense Reporting

Encouraging employees to submit their expenses in real-time can significantly speed up the entire process. Rather than waiting until the end of the month or when they are busy with other tasks, employees can enter expenses as soon as they occur.

Why Real-Time Reporting is Important:

• Quicker Processing: By submitting expenses as they occur, the finance team can process them almost immediately, reducing the time spent on approvals and ensuring expenses are recorded and reimbursed in a timely manner. 
• Better Tracking: Real-time reporting allows businesses to track spending as it happens, offering a clearer picture of how funds are being allocated. This immediate visibility helps managers and business owners make more informed decisions and enables them to adjust spending if necessary, preventing overspending.
• Reduced Backlog: With fewer receipts and reports piling up, the accounting team can avoid the stress of catching up on a month's worth of expenses all at once.

Common Mistakes to Avoid When Choosing Expense Reporting Solutions

While implementing tools and strategies can significantly improve the expense reporting process, it’s important to avoid certain pitfalls that could undermine your efforts. Here are some common mistakes businesses make when choosing their expense reporting solutions:

1. Overcomplicating the Process

The goal of streamlining expense reporting is to simplify the process, not complicate it. Avoid using overly complex systems that are difficult for employees to use and that create unnecessary hurdles. Choose software that is intuitive and easy to integrate into existing workflows.

2. Focusing Only on Rewards

While rewards like cashback or travel points can be attractive, they should not be the primary factor in choosing a solution. Focus on the overall functionality of the expense management system, including its ease of use, integration capabilities, and how well it fits your business needs.

3. Ignoring User Training

To fully take advantage of an automated system, it’s important to train your employees on how to use the tools effectively. Without proper training, employees may not use the system to its full potential, leading to delays and errors.

Best Practices for Effective Expense Reporting

To simplify the expense reporting process, businesses must implement best practices that ensure timely and accurate reporting. Here are a few effective strategies:

• Standardising Submission Timelines: Set clear submission deadlines for employees to submit their expense reports. Regular submission cycles, whether weekly, bi-weekly, or monthly, prevent backlogs and ensure that expenses are processed on time.
• Regular Audits and Expense Review Processes: Conduct regular audits and reviews of expense reports to detect any discrepancies, fraudulent claims, or inefficiencies. Implementing periodic checks helps identify potential problems early and ensures financial transparency.
• Continuous Monitoring of Expense Reports: Continuously monitor expense reports to identify trends, inefficiencies, and areas where spending can be reduced. 

A great example of this in action is Quiqup, which successfully overcame their expense management challenges with the help of Alaan's solutions. Let's take a closer look at how they achieved greater efficiency and control.

Case Study: Quiqup’s Efficient Expense Management with Alaan

Problem
Quiqup encountered significant challenges with their expense management system. The main issue stemmed from the shared use of a single company card, which led to complications with OTPs and made it difficult to collect invoices and allocate responsibilities for different expenses. 

The manual expense tracking system was not only inefficient but also problematic when it came to handling VAT claims. Quiqup required a solution that would provide real-time visibility into their spending, optimise their financial processes, and resolve the issues surrounding the use of a shared card.

Solution
To address these issues, Quiqup adopted Alaan's smart spend management platform. By integrating Alaan’s corporate cards and automated expense management tools, the company streamlined its expense reporting processes. The system enabled Quiqup to issue and freeze cards instantly, giving them control over their expenses without relying on the banks. 

Additionally, our solution simplified the process of transferring invoices into Xero, speeding up the review and VAT validation process. Tarryn highlighted the system's efficiency, noting that, unlike competitors, Alaan not only enhanced their operational efficiency but also offered cashback, providing Quiqup with cost savings rather than additional charges for the platform.

Outcome
Through collaboration with Alaan, Quiqup resolved issues related to shared cards, streamlined expense management processes, and simplified VAT claims. This tailored approach allowed Quiqup to gain better control over its expenses, reinforcing its focus on operational efficiency and financial accountability.

Conclusion

Accurate and optimised expense management serves as the financial backbone for startups, transforming complex spending data into clear, actionable intelligence that supports strategic business development. By implementing automation, setting clear submission timelines, and integrating expense management tools with accounting software, businesses can streamline their processes, reduce errors, and save time. 

Mobile apps, receipt capture solutions, and real-time financial tracking further accelerate the process while enhancing financial transparency. These strategies enable businesses to make quicker, informed decisions, improve financial control, and boost operational efficiency. As demonstrated in the case of Quiqup, adopting these practices helped resolve shared card issues, streamline VAT claims, and optimise expense management, leading to increased control and cost savings. By embracing these strategies today, businesses can lay the foundation for a more organised and financially agile future.

Transform your expense management with Alaan's intelligent financial platform. From automated accounting to powerful corporate cards, we make it easy to track, manage, and optimise your company's finances. Book a free demo today!