It’s hard to know whether your business’ T&E expenses are normal and necessary expenses to running a successful business or excessive costs that are dragging your company down. All you know is that the expense reports keep rolling in and your business is spending a lot of money on reimbursements.
If you’re not sure whether your expenses are under control, there are several warning signs you can look at that may indicate your employees’ expense reports are larger than they should be.
1. Neglected Travel Policy
Travel expenses are one of the largest expenses for your business. Your business should be performing regular reviews of preferred vendor relationships and your employees’ travel spending habits to keep these expenses in check.
If your company hasn’t reviewed or changed its travel policy in several years, it may be reimbursing more than it should.
2. No Employee Training
Although this may be surprising, many employees do not even know that their companies even have travel policies at all. You can’t enforce a policy that nobody knows about, so it’s important to educate your employees on your company’s policies.
If you haven’t provided such training recently, some of your newer employees filling out inflated expense reports may not even know what they’re doing is wrong.
3. Your Expense Reports Are Not Processed Efficiently
Slow reimbursement times are an indication that your expense reports are being processed inefficiently. This means that your company is spending way too much wasted time and money processing expense reports.
4. You Process Your Expense Reports Manually
Processing expense reports manually is extremely expensive. Each expense report uses paper and toner and whoever is reviewing the report must manually enter the information into database or spreadsheet.
If your company has multiple offices, you may also have to pay for postage to mail your expense reports to a central accounting department. All this shuffling around provides ample opportunities for lost receipts, expense reports, and other inefficiencies that can add to the cost of processing.
Automated expense report software can help you streamline the process and reduce the costs of processing your expense reports.