Expense reimbursement is among those financial processes that every organization needs to handle even though it may seem like a chore. Employees hate them because there is so much paperwork involved, and they hate filling out all those forms. This is particularly the case when these employees have just flown in from their business trip.
From the perspective of the finance team, the paperwork from expense reimbursement takes just too much time to verify, to process claims, to approve them individually and finally pay the respective employee. This is something businesses should control and automate because everyone would be happier if things moved a little faster. Also, it is vital not to leave these expenses unchecked.
What Is Expense Reimbursement?
Expense reimbursement signifies a way that businesses can pay their employees back when they spend their own bank balance for expenses that are related to the organization. For example, when an organization sends an employee on a business trip. If you have worked in different industries, you will know that business travel reimbursements are quite common, but there are so many other types of reimbursements, too. Some employees get reimbursed for their healthcare or education or any expense related to the affairs of the business.
The Three Types of Expense Reimbursements
The most common forms of employee expense reimbursements seen in organizations include:
- Healthcare Reimbursements
- Business Expense Reimbursements
- Travel and Mileage Reimbursements
A lot of businesses deal with this form of reimbursement because their employees make business trips. This is done beforehand because a lot of the travel expenses can be anticipated, such as the accommodation expenses or the cost of air tickets.
There are, however, some expenses that are made during the course of the trip, such as the costs of meals or cabs. For such unavoidable expenses, businesses usually set a ‘per diem’ allowance. Even though this is the case, it isn’t uncommon for employees to incur a few more incidental expenses.
Healthcare Expense Reimbursements
Oftentimes, businesses will offer their employees an HRA which is also known as a Health Reimbursement Account. Other organizations may call these FSA’s or Flexible Spending Accounts, but the idea is more or less the same.
A Better Way of Handling Expense Reimbursements
Well, here we are talking about expense reimbursement software and workflow automation. These dedicated reimbursement systems can be the obvious choice for so many organization out there because of the fact that there is no better one-size-fits-all solution.
All your business would need is an expense reimbursement software or application, and you will be able to completely customize the process to your benefit. The system will, therefore, adjust its working to your business’ specific expense policies and enforce it on employees.
Why Would You Automate the Expense Reimbursement Process?
Both employers and employees can benefit from the automation of the expense reimbursement process. Setting aside the tax benefits for both parties, there are a lot more intangible benefits to be gained from here.
If your business pays for educational courses, their employees will automatically be motivated to develop the skills that greatly save their time and benefit the business. Getting healthcare benefits from your organization, on the other hand, naturally proves that the organization cares about you. These and every other expense reimbursement has been proven to improve employee retention while increasing their loyalty.
Keeping track of these reimbursements has the ability to help organizations control their expenditures. Other than this, businesses gain the ability to identify areas where employees have been spending unnecessarily while making insightful decisions regarding how costs can be cut down.
Say goodbye to huge piles of reports and paperwork. They caused more trouble than they were worth. Whether you are a business owner or a manager, your troubles will never lessen if you don’t make the jump to expense reimbursement software.
With such software, paperwork will become a thing of the past. All the important information will be moved online, and all the approval flows will be easier to manage. Your business will, therefore, be much more efficient, organized, and much easier to manage.
When expense reports will be added to the software and into the system of an employee, the process will only take a few steps before the payment is administered. The process couldn’t get any easier than this!
- Another thing you could consider before transitioning to expense reimbursement software is the relationships between employees and managers. The unavoidably slow process of expense reimbursement has the ability to strain these relationships. Now, you wouldn’t want that, would you?