Time is money. That’s why organisations are placing an ever-growing emphasis on improving productivity and streamlining administrative processes to encourage employees to focus on value-added activities. So I’m staggered by how many otherwise forward-thinking companies are still reliant on old-fashioned, paper-based expense management processes. Expenses are an obvious time-sink for claimants themselves and is often portrayed as a dull task; but badly managed expense processing costs employees and businesses money. A survey conducted by Access aCloud has discovered that employees are losing £45 a year owing to interest charges due to the waiting period of reimbursement – with a collective £2.1 billion lost by 46 million workers each year. In the UK, the average waiting time for expenses to be paid is 3.3 weeks. However, the survey revealed that over 20 per cent of people spend 6.3 weeks chasing their employer for their claims to be paid.
These costs can fuel dissatisfaction in the workplace which, in the long run, can cost businesses money. With delayed or rejected claims, employees can be left with a feeling of resentment towards their employer.
While some organisations are starting to accept approvals via email, most expenses are still authorised by budget-holders on paper. So if a manager is out of office or on holiday for an extended period, employees may be left waiting for reimbursement longer than they’d like, or even incur interest penalties on credit card charges.
It’s not unusual for managers to sign off expenses without rigorous interrogation – whether on trust, through lack of time, complacency, or because they simply aren’t familiar enough with company policy. That shifts the burden onto finance teams to flag up errors (assuming they don’t introduce any more when rekeying the data into their financial systems), identify missing receipts, or query inappropriate or exaggerated items with claimants. There’s an opportunity cost to doing it, and a financial cost to not doing it.
In the survey of 2,000 UK workers it was found that 40 per cent admitted to losing receipts resulting in being unable to claim on business expenses. According to Access aCloud’s survey, on average, employees lose £17 a year through lost receipts, bringing the grand total of money lost by UK workers to a staggering £512.5 million each year.
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Richard Gyles, Head of aCloud Business Development
Having worked with the Access Group as the MD of dhc for the past 17 years we are now part of Access and I am working within the Sales team with responsibility for the new Business Intelligence software Access Insight which has recently been brought into the Access portfolio and the Access cloud suite of products Access aCloud.
You can find out more about creating a water-tight, automated expense management workflow in this white paper from Access aCloud.
May 29, 2014
What is expense management costing you and your business?
by Richard Gyles • Comment, Workplace
These costs can fuel dissatisfaction in the workplace which, in the long run, can cost businesses money. With delayed or rejected claims, employees can be left with a feeling of resentment towards their employer.
While some organisations are starting to accept approvals via email, most expenses are still authorised by budget-holders on paper. So if a manager is out of office or on holiday for an extended period, employees may be left waiting for reimbursement longer than they’d like, or even incur interest penalties on credit card charges.
It’s not unusual for managers to sign off expenses without rigorous interrogation – whether on trust, through lack of time, complacency, or because they simply aren’t familiar enough with company policy. That shifts the burden onto finance teams to flag up errors (assuming they don’t introduce any more when rekeying the data into their financial systems), identify missing receipts, or query inappropriate or exaggerated items with claimants. There’s an opportunity cost to doing it, and a financial cost to not doing it.
In the survey of 2,000 UK workers it was found that 40 per cent admitted to losing receipts resulting in being unable to claim on business expenses. According to Access aCloud’s survey, on average, employees lose £17 a year through lost receipts, bringing the grand total of money lost by UK workers to a staggering £512.5 million each year.
_________________________________
Richard Gyles, Head of aCloud Business Development
You can find out more about creating a water-tight, automated expense management workflow in this white paper from Access aCloud.