Role of Audit in Expense Management and Its Benefits
Travel and entertainment (T&E) is one of the leading controllable indirect expenses for a company. By making audit an easy step of the expense reporting process, an organization can minimize fraud before it causes major loss. Organizations are looking for effective and cost-efficient methods to control expenses, and a solution that can streamline all of the processes involved, including auditing.
An online expense management solution offers significant opportunities to drive policy compliance and prevent fraud if it occurs. The solution provides the most accurate, reliable, and complete data available in a timely manner and helps businesses make better-informed decisions around policies and internal controls.
When it comes to expense report audit, the most important factor for any organization to deploy tighter controls, drive compliance, and reduce the risk of fraud is visibility. The best ways to achieve the highest level of visibility is to document, standardize, and communicate strategies, automate processes, and accumulate data for review and analysis. A comprehensive view of all expense data will give businesses the information they need to identify problems, refine policies, drive compliance, and support better decision-making and strategic planning.
Most of the organizations choose to audit expense reports before expense reimbursement. Their main aim is to shape the behavior of the traveler and catch exceptions up front. It is best-practice for businesses to have audit occur before manager approval of an expense report to improve the workflow process. However, some companies choose to conduct an audit after expense reimbursement. For them, the objective is to perform a post-payment audit of their process for compliance validation and analysis purposes.
An audit of a business expense reports should be mainly based on its regulations and corporate policy, but there are other criteria to be considered. Businesses should check the validity of receipts submitted with expense reports by comparing the date, amount spent, type of expense, the method of payment, and supplier.
Organizations should combine corporate card and expense data to monitor expenses. With corporate cards, data automatically links to the expense reporting solution, it provides a way to get more corporate travelers to use their corporate cards, thereby driving more spend through preferred channels, increasing the opportunity for rebates and presenting more visibility into business spending.
Managing large quantities of paper receipts is a challenge for many organizations. Automated spend management processes significantly reduce paper by making the expense report paperless, and by also converting paper receipts into electronic images. This helps businesses save money by eliminating many of the costs and complications associated with maintaining a paper-based filing system. Electronic imaging of receipts provides better security and is the best way to archive receipts for regulatory compliance.
An automated solution is essential to optimize internal controls, achieve unified insights, and re-focus resources, time, and attention to more strategic tasks. The robust audit tools offered by the expense management software free up businesses from the heavy burden of manual activities and help them achieve unified insights for better corporate expense management.
