With a traditional paper-based expense report system it’s a given that mistakes will be made. No system is perfect, and when it comes to filling out a report and submitting receipts or other documentation to show how money—personal or corporate—was spent, it’s easy to see how a few errors may creep in here and there.
Of course, there’s also a difference between honest mistakes and deliberate, fraudulent attempts to exploit a system. Unfortunately, it’s easy for both errors and exploits to occur in a system that relies on the memory and honesty of an employee. In a perfect world, both of these factors would be enough, and, fortunately, in many cases they are.
But for that margin that does make errors, or, worse yet, exploits the system deliberately, a paper-based expense report system is one of the easier ways for these acts to occur.
Automation Is Vigilant
In Canada in 2014, two senators were charged with breach of trust. They attempted to get payments for personal travel and housing footed to the public bill as expense accounts, and nearly got away with it were it not for the diligence of the RCMP.
With an automated expense reporting system, it would be even faster and easier to catch out errors or deliberate fraud attempts, thanks to the vigilance of the system.
Because an automated expense report system like ExpensePoint can be customized to suit your own needs, a company can define the parameters for what is an acceptable expense and what falls out of corporate policy. If a large transaction occurs that is put on the company credit card, that transaction is automatically logged and can be perused by financial staff for authenticity. The same holds true for a large cash purchase, where a receipt imaging system is required to take a photo of the receipt for the purchase in question. These processes happen just moments after a transaction goes through, giving an alert, diligent financial staff member plenty of time verify whether expenses fall within appropriate policy parameters, or whether an honest mistake, or deliberate fraud attempt has occurred.
This ability to catch mistakes or deceptions shortly after they occur is very different from a traditional paper-based system. With paper, employees must rely on memory and whatever documentation they can reproduce or submit as proof of their transactions. All of this can be prepared after the fact, upon return from a trip. With the “moments after it happens” nature of automated expense reports, there’s less chance of mistakes occurring since they can be flagged by the system itself, or discovered by the accounts department when they check the information online. This reduces the chance for error or exploitation for everyone, which makes for better, smoother, more efficient business.