Organizations looking to reduce T&E spend through a difficult period, often start by focusing on the big-ticket items. Cutting down on business class flights or downgrading the class of hotels your employees get to stay in are great when it comes to making instant, one-off spend reductions. However, in many cases, such actions create misgivings amongst your employees about their job security & career prospects leading to everyday minor extravagances from them with respect to expenses. Further, if not messaged correctly, old habits are quick to return as business circumstances normalize leading to a renewal in T&E spend extravagance.
Finding a long term solution
Sustainable long term moderation in T&E spend can come only from instituting a culture of fiscal prudence. Ensuring that checks and balances exist to cover 100% of expenditure is the first step in this process and here is why:
Empowering the Finance team with facts- Empowering your Finance team with a powerful custom tool that understands business policies, your firm’s spending habits, and history can go a long way towards enabling your Finance team with facts when having hard conversations with business teams.
Getting reporting managers out of the way - Making reporting managers the first level approvers in the expense audit process is innocuous at best and could potentially be detrimental to T&E expense management. Replacing reporting managers with an impartial automated expense audit system is a prudent step in controlling expenses in the long run.
Understanding your firm’s T&E spend DNA - Spreadsheets can’t do justice to analyzing your firm’s T&E spends. What your firm needs is an intelligent software that understands your firm’s expense policies and can discern from historic data what is and isn’t a representative T&E spend for your firm and go a long way in aiding financial planning and budgeting.
Tracking systematic skimming - Systematic skimming is a form of expense fraud that involves an employee repeatedly and opportunistically breaching an expense policy but for a small dollar amount each time. These repeated minor transgressions fly under the radar of human auditors and can add up over months and years into millions of dollars worth. Automating expense audit is the first step towards tracking systematic skimming
Addressing the long tail - The long tail of one-off expenses is difficult to write expense policy rules for and in many situations might not be caught by human auditors or managers. Audit automation software that understands your firm’s spend DNA can highlight such spending easily for human auditor inspection.
Robana is an automated expense audit solution that helps CEOs & CFOs ensure that their T&E spends are under control. If you’re interested in knowing more about how automated expense audit can help reduce spend you can read about that here.