Employee Reimbursement: A Guide to Efficient Expense Management

Most businesses rely on employees to have a certain level of responsibility when it comes to business expenses. In the line of business, employees may need to make purchases and spend money to perform their duties. When it comes time to reimburse employee expenses, it’s important there’s a plan in place.  

With the right processes and technology in place, you can remove some of the confusion and misconceptions surrounding employee reimbursements, and better manage this critical part of business operations. 

What is Employee Expense Reimbursement? 

First, you need to know what business expense reimbursements are and their importance to business management and financial planning. In their most simplistic form, these are payments employers give to their employees to help cover business-related expenses that were incurred during authorised business operations.  

But what exactly counts as employee business expenses? Here are some examples: 

• Business-related travel expenses and costs 

• Approved or required education or training 

• Business supplies, office supplies, and materials 

• Business tools and hardware/software 

• Miscellaneous business-related expenses 

 

How to Create an Expense Policy

Follow our guide and template as a starting point to create your own T&E policy today!

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It’s important that you understand how these expenses play into the day-to-day operations of your business, and how they can help you save money. Knowing to what extent your employees are covering costs and how you can help offset that burden goes a long way in keeping productivity levels high.  Clear guidelines for what can be reimbursed, and quick payment processes will keep employer-employee relations in good standing. 

Travel and Expense Management - Understanding Reimbursement Options 

One of the most common reimbursement claims filed by employees is travel expenses. As a business owner or leader, you want your employee reimbursement policy to align with travel and expense (T&E) policies and legal regulations. You should be familiar with the most common methods of tracking and paying travel-related expenses. This will make it easier to understand how efficient planning makes the process more manageable and streamlined. 

Expense management software, like Concur Expense, allows employees to submit expense reports electronically. Managers can review and approve these reports, even from mobile devices, using cloud-based solutions. And in the backend, the software can easily integrate with accounting systems.  

H2: Managing Receipts and Documentation for Reimbursement Payments 

What does reimbursement mean for your company? We recommend the following tips to help you streamline your expense tracking: 

• Implement a strong expense policy: Develop an inclusive expense policy and make sure all employees understand it to ensure everyone is on the same page with reimbursements. 

• Use a centralised system: Set up a central all-access place for employees to log, report, and check their expense records for easy collaboration and fewer paper-trail-related issues.  

• Check itemised receipts: Request employees record and submit receipts for all claims made and double check amounts match those being requested for reimbursement. 

• Set clear expectations: There must be clear deadlines for receipts and reimbursement requests to ensure accurate tracking, less confusion, and fewer errors with payments. 

• Perform audits periodically: Automated checks and audits can help ensure the accuracy of reports, prevent unethical behaviours, and keep everyone on the same page and held to the same standards. 

• Monitor spending trends: Keep an eye on pending trends with digital tools and real-time monitoring to watch for unusual spikes in employee claims or times of excessive spending. 

• Integrate new technology: Integrate any new or existing expense tracking system with other departments to simplify data transfer and maintain accurate financial records. 

By following these tips, employers can establish an organised and efficient expense tracking process, reducing the chances of financial discrepancies, and making it easier to manage company finances. 

Importance of Automated Expense Management for Employee Reimbursement and Monitoring 

There are many benefits of an intelligent, automated, and easy-to-use solution. These include: 

 1.      More extensive business spending control 

Traditional employee reimbursement and financial management processes often provide only a disjointed or fragmented solution and are an overall inconsistent process for tracking and monitoring important data.  

 2.      Improve compliance and reduce fraud 

With business going global, and with such a focus on digital work, remote jobs and wide-spread collaborations, an up-to-date planning and management system is critical to meeting the demands of employee reimbursements.   

 3.       Data-driven support for employers 

A well-rounded financial and employee management solution offers employee and employer alike visibility, insights, customisation, and control over the entire process, from recording expenses to ensuring payments are received. 

 4.      Improves employee experience 

Traditional employee reimbursements rely on cumbersome manual data entry of travel expenses, which is slow, prone to errors, and wastes employee time, whereas innovative tracking and payment methods are the exact opposite.  

Whether the funds are used to purchase office supplies, travel to and from work, attend required training classes, or business-related food expenses, reimbursement is an important part of the e puzzle. It is important that you understand the different types of employee reimbursements and how to account for them. 

How to Build a Clear and Fair Framework for Reimbursement  

Businesses across all industries will find there are times they need to reimburse employees for various expenses. Here at SAP Concur, we understand how complicated these processes can be as well as how integral they are to smooth operations and continued growth. Regardless of how you decide to reimburse employees, having an updated and integrated expense reimbursement policy is critical to smooth payments and accurate expense tracking. 

Adopting an expense management solution like SAP Concur provides your company with near real-time data and takes advantage of AI to analyse transactions. SAP Concur allows businesses to see what they’re spending, improve compliance, and avoid possible blind spots in the budget.  

Our vision is a world where travel and expenses practically manage themselves, helping businesses run at their best every day.  

Take a quick tour of Concur Expense and contact us today to see how we can help make managing employee reimbursements easy and stress free.