Employee Expense Reimbursement Management: Types & Policies

Vlad Falin

November 3, 2022


Business expense reimbursement is one area of spend management that business owners do not always give its due. And yet, nearly every organization will have to reimburse employees for their expenses at some point.

Part of the problem is that these expenses can vary significantly, from buying office supplies to traveling or even medical costs. If your business deals with many types of expense reimbursements, you might wonder what you need to cover and how you should handle it.

If you’ve had trouble working out your organization's different business expense reimbursements, or you want to learn more about repayments, you’ve come to the right place.

Today, we’ll take a look at the different types of business expense reimbursements and even share some tips to help you streamline your expense reimbursement process.


What is expense reimbursement?

A business expense reimbursement is simply the act of paying back an employee for expenses incurred while performing a job for your organization.

Technically, almost any type of expense can qualify as a business expense for the purpose of reimbursement, depending on the reimbursement policies of the business. But to give you a clearer idea, here are some common examples of reimbursable expenses:

  • Business travel costs
  • Meals and entertainment
  • Employee education or training
  • Medical expenses
  • Gas expenses for a company-issued or private vehicle
  • Business supplies or tools
  • And other miscellaneous business-related expenses

You could handle these expense reimbursements individually, meaning you review each expense separately, or you could create a policy for employee expense reimbursement. 


Do I Need to Have an Expense Reimbursement Policy?

You are not required to have an expense reimbursement policy, and in some cases, reimbursing expenses is not even mandatory to begin with. Though that largely depends on the legal framework of your country.

However, since it is customary in the UAE and the MENA region to reimburse employees for expenses, then it would be wise to create guidelines and policies to help you organize and streamline that process.

Creating a policy for reimbursements helps set the right expectations for employees about what qualifies for repayment and enables you to streamline your expense reimbursement process.

With an expense reimbursement policy, your employees will know precisely what they can be reimbursed for, how to request said reimbursement, and how long it would take to receive the funds.

Whether you have a business reimbursement policy or not, you need to have a clear picture of which expenses your employees might incur for your business and how you would go about reimbursing them.

  • Is the expense tax deductible?
  • Is this a common type of business expense in your industry?
  • Do you have a policy in place for this expense?
  • Are there any types of emergency purchases that an employee might need to make?

Types of expense reimbursements

Traveling and accommodation

One of the most common types of reimbursement requests is for travel expenses. Gas has been a particular pain point for many businesses in the MENA region due to the rising costs of fuel. Other examples of travel expenses include moving to and from an airport or travel terminal, travel tickets, public and private transportation expenses, car rentals, and lodging.

Office supplies and communication

If your organization relies heavily on digital work, you might need to reimburse your employees for supplies like laptops, tablets, software purchases or subscriptions, training materials, and more. 

Also, if your team needs to move around frequently and you need to maintain communication at all times, reimbursing them for their cell phone plans might be necessary. In particular, this applies to teams in sales, marketing, and business development. 

Food and entertainment

Business trips typically cover employee meals as reimbursable expenses. As long as the expenses are incurred in the interest of the business, they’re reimbursable.

Other expenses

Medical expenses, such as health insurance, insurance premiums, and tuition, are another form of employee expense that is often reimbursed by companies. If your business deals with these types of expenses, make sure you have a clear policy for handling them.

8 tips to simplify your expense reimbursements

1. Learn what you need to reimburse

Although the legalities of employee reimbursements vary from country to country, it’s traditionally customary for employers to reimburse their employees for expenses incurred on behalf of the company. 

It is important to note, however, that your employees cannot claim reimbursements for every purchase made, only those that are specifically tied to your business in some form.

While the specific type of expenses you have to reimburse will vary from industry to industry, you should have a general idea of what costs an employee might have to cover out of pocket in the process of working for you.

  • Do they need to travel around in their own vehicle?
  • Do you need them to be communicated at all times?
  • What kind of equipment do they require?
  • Are there any health risks associated with their job?

These types of questions can help you figure out which expenses you will have to deal with. Clear guidelines about what is and isn’t reimbursable will help reduce instances of fraudulent reimbursement requests.

2. Use a spend management platform

With the right expense management software, you would be able to automate and optimize end-to-end workflows throughout your process. 

For instance, with a spend management platform like Pluto, employees can use a mobile app to record expenses as they incur them.

In this way, your employees no longer have to save receipts or wait before entering their expenses. Plus, Pluto can automatically assign reports to the right reviewer, making the review and approval process more efficient.

Not only that, but Pluto can also tag the receipt so the categorization of the expense is much easier and reporting is real-time.

In addition to providing digital copies of relevant documents, Pluto can notify your finance team of approvals and deadlines.

Spend management platform for expense reimbursement
Pluto Spend Management Platform

3. Spend management platforms enhance collaboration

Pluto’s expense management solutions come with an employee portal so that your finance team can collaborate seamlessly with your employees. 

This allows you to save time when you need to discuss any irregularities with their expense reports. Additionally, your employees can use Pluto to check the status of their reimbursement requests.

The finance team can also use Pluto  to manage costs more efficiently due to its analytical capabilities, real-time reporting and instantaneous spend limit settings.   

4. Create a Thorough Expense Reimbursement Policy

When creating your reimbursement policy, you’ll want to make sure that it covers as many angles as possible. 

One way to do so is to invite stakeholders from multiple different departments, such as HR, finance, legal, and procurement, to a brainstorming session, as their knowledge will make it easier to draft the policy.

5. Crafting your reimbursement policy

It’s also critical to consider the following when drafting your expense reimbursement policy:

  • The specific type of expenses that can be reimbursed
  • The process your employees need to follow to submit their expenses, including any proof and supporting documentation
  • Whether any allowances will be given for expenses, and how to manage any excess
  • The specific time an employee has to submit their expense report
  • How the approval process will be handled
  • When and how your employees are reimbursed

6. Promote the adoption of the policy

One way to help employees adopt the policy more quickly is by making it readily available to them. The policy should be emailed to your employees or posted on your internal networks.

Employees should be informed when they will receive their payment from the company. You should set up a transparent and clear process to communicate what can be expected in terms of expense reimbursement. 

7. Be extra clear about deadlines and payments.

Be sure to let them know how they will receive the payment, such as via direct deposit or check, as well as how they will receive recorded confirmation of the payment made (such as a statement on their paycheque). You can complete this step easily with the help of an online payroll solution.

It is important to keep things running smoothly when it comes to paying employees. By processing reimbursements timely and reliably, you can easily prevent frustration caused by late payments. 

Having your employees pay out of their own pockets and not receiving payment back sooner rather than later can cause unnecessary ill feelings toward your company. When you handle reimbursements well, it reflects back on you as a respectable and considerate employer who cares about employees.

8. Make sure your employees follow the deadlines you set

You need to provide employees with deadlines for submitting expense reports, such as one week before their next pay date, so they can be reimbursed and get approval for their claims. 

Make sure the expense reports comply with the policy guidelines by giving yourself enough time to review them. By doing so, you can consult with the employee if there are any discrepancies, missing or incomplete documentation, or expenses that do not fall within the policy.

It’s important to submit expense reports on time since certain business expenses are tax deductible. 

Optimize your expense reimbursement management process

It’s not enough to know what your expenses are and to create a policy for their reimbursement. 

You also need to make sure that your reimbursement process is organized and efficient.

Otherwise, you run the risk of creating bottlenecks if you get slammed by more requests than you can handle. You can avoid this by optimizing the process used to submit reports and their attachments, ensuring all reports are reviewed in a timely manner and processing reimbursements as quickly as possible.

Having put all of this in place, it’s now time for the audit. The importance of audits is particularly important for enterprises and mid-size firms where employees incur large expenses. Auditing your expense reports also helps you identify loopholes in your policy and reduce instances of fraudulent claims.

You can also use audits to analyze your business expenses and identify areas for reduction.

Ensure there is an organized system for expense reimbursement requests

You should ensure that the system your employees need to use to submit their expense reports is easy to use and understand. 

Pluto allows the employee to submit all necessary supporting documentation, such as their receipt, the total amount of the purchase, a description of the goods or services purchased, and the date of the transaction.

Use a corporate card or direct deposits to remove the need for reimbursements

A corporate p card is a great way to prevent employees from paying out-of-pocket for business expenses.

You can track your expenses more efficiently and effectively with corporate cards, which provide spending limits that prevent employees from abusing their privileges.

Consider issuing corporate cards only to your regular travelers, or try direct deposits if you’re concerned about the cost. 

Alternatively, you can also use direct deposits of reimbursement funds to eliminate the reimbursement process. 

Two benefits result from this: One great perk of following either process is that your finance teams will have better visibility into the reimbursement process, making auditing employee expenses easier.

Key Takeaways

  • The best way to deal with business expense reimbursements is to have a rock-solid reimbursement policy in place. This way, you can reimburse employees for their costs on your terms.
  • Another great way to manage your expenses is to make use of a corporate card to eliminate the reimbursement process altogether, though this might not be feasible for all cases.
  • As in many situations, your best option will most likely come in the form of digitization. Using a spend management platform like Pluto, will not only give you much better visibility over your employee spending but also streamline the reimbursement process for you.

Find out how much your business can save with Pluto

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Learn how Pluto is helping Keyper        to eliminate petty cash spending and optimize spend management

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At Pluto Card, our mission is to assist businesses of all scales make well-informed choices. To uphold our standards, we follow editorial guidelines to guarantee that our content consistently aligns with our high-quality benchmarks.

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January 29, 2024

Mohammed Ridwan

Step-By-Step Guide for an Effective Procurement Audit (With Checklist)

Some common procurement challenges are inadequate documentation, ambiguous contracts, insufficient internal controls, risk management, and non-compliance with industry standards.

There are only two ways to identify such issues: wait for repercussions to disrupt the supply chain or conduct a procurement audit.

This post will cover how to conduct a comprehensive procurement audit with a step-by-step process and checklist.

What is a Procurement Audit? 

A procurement audit is a systematic review of the procurement process to ensure compliance, efficiency, and effectiveness.

The auditing team carefully reviews documents like contracts and purchasing records in a procurement audit. It examines each phase of the procurement process, from bid assessments to contract management, to identify discrepancies and optimize efficiency. The main goal is ensuring adherence to regulations, minimizing risks, and refining procurement practices for optimal organizational outcomes.

How To Prepare for a Procurement Audit 

For an effective procurement audit, consolidate all the documents with proper access for relevant stakeholders. Employ procurement software to create a single source of truth and avoid unnecessary friction.

Implement access controls to restrict permissions to view-only access for sensitive procurement data. This step ensures that only authorized individuals, such as the audit team, can access critical information, minimizing the risk of unauthorized alterations or data breaches.

Here is an exhaustive list of documents you will need for the procurement audit:

  1. Procurement policies and procedures, including the updates or revisions to these documents
  2. Contracts and agreements with vendors — amendments, renewals, or modifications to existing contracts
  3. Purchase orders issued during the audit period and supporting documentation for each purchase order
  4. Invoices related to procurement and payment records, including dates and amounts paid
  5. Goods received notes and delivery records, including dates, quantities, and item condition
  6. Vendor profiles, including contact information and details of vendor qualifications and any evaluation or performance assessment reports of vendors
  7. Bid and proposal documents, the evaluation criteria, and scoring records for vendor selection
  8. Records of communication that are related to procurement decisions and processes — correspondence with vendors, internal departments, and other stakeholders
  9. Documentation outlining internal controls within the procurement process — evidence of segregation of duties and authorization processes
  10. Previous internal and external audit reports and any actions taken or improvements made based on earlier audit recommendations
  11. Procurement budgets and any adjustments or variances with the original budget
See a Demo

Five Steps for Conducting a Procurement Audit

With all the documents ready, begin the procurement audit process. Here is an end-to-end five-step audit process with checklists for a successful audit:

1. Gather Stakeholder Input 

Conduct interviews with key stakeholders to gather insights. This adds a layer of understanding regarding the human aspects of the procurement process, helping identify challenges and opportunities for improvement.

Additionally, collaborate with relevant stakeholders, such as department heads and key project managers, to decide the scope and create an audit plan. This inclusive approach ensures an understanding of organizational needs and contributes to developing an effective and targeted audit strategy. 

2. Assign Roles

Create a clear roadmap for team members. First, designate a lead auditor to oversee the entire process. This person ensures coordination and consistency. 

Then, distribute specific responsibilities among team members, such as document analysis, interviews, and data assessment. This division of labor maximizes efficiency, expertise, and accountability, contributing to a well-executed procurement audit.

Here are the top four best practices when assigning roles to an audit team:

  • Clearly define team tasks to prevent confusion and streamline workflow
  • Implement segregation of duties for an unbiased audit process
  • Rotate roles periodically to encourage collaboration and shared expertise
  • Foster collaboration among diverse team members for a comprehensive assessment

3. Identify Problem Areas 

Examine the procurement process to identify weaknesses and assess the overall efficiency of the procurement process. Here are the top four steps to keep in mind:

Assess Purchase Orders, Purchase Requests, and Invoices

Examine the purchase orders, requests, and invoices for accuracy, completeness, and adherence to established protocols. Ensure that the documentation is easily accessible. Any discrepancies or missing information indicates inefficiencies or errors in the procurement process. 

Potential Loopholes

  • Misplaced signatures, unclear specifications, or missing supporting details
  • Discrepancies in recorded quantities, prices, or delivery dates
  • Mismatched product codes, incorrect quantities, or inaccurate pricing

Healthy Practices:

  • Implement a standardized checklist for purchase orders and requests, ensuring all necessary information is included
  • Conduct regular training for procurement staff on accurate and comprehensive documentation practices
  • Employ procure-to-pay software for storing and retrieving documents, enhancing accessibility and reducing errors

Review Vendor Relations

Evaluate the strength and effectiveness of relationships with vendors. Examine vendor agreements and contracts to ensure they are clear, comprehensive, and aligned with organizational needs. Also, verify the effectiveness of vendor vetting processes.

Potential Loopholes

  • Contracts lacking specificity in payment schedules, service levels, or delivery terms
  • Failure to verify vendor credentials, financial stability, or past performances

Healthy Practices:

  • Conduct periodic vendor performance reviews to ensure ongoing reliability
  • Develop transparent and standardized contract templates specifying payment schedules, service levels, and delivery terms
  • Diversify vendor partnerships to diminish dependency and enhance resilience

Analyze Procurement Practices

Assess the entire procurement process to check if it adheres to industry standards and complies with organizational policies and legal requirements. This involves comprehensively examining sourcing, contracting, and purchasing practices to identify deviations or shortcomings.

Potential Loopholes

  • Failure to adhere to industry standards or legal requirements, showcasing a disregard for regulatory protocols
  • Continued reliance on outdated or non-competitive suppliers, hindering cost-effectiveness
  • Lack of systematic identification and mitigation of potential risks, exposing the organization to unforeseen challenges

Healthy Practices:

  • Provide training sessions on industry standards and legal requirements to ensure ongoing compliance
  • Organize quarterly workshops focusing on proactive risk identification and mitigation strategies, fostering an aggressive risk-aware culture

Examine Internal Controls

Evaluate the segregation of duties, authorization procedures, and overall internal controls. Make sure that checks and balances are in place, preventing fraud, errors, or unauthorized activities that compromise the integrity of the procurement process.

Potential Loopholes

  • Allocation of responsibilities for both approval and execution to a single individual increases the risk of errors or fraudulent activities 
  • Insufficient checks and balances in the approval process, allowing unauthorized transactions
  • Absence of mechanisms to detect irregularities, fostering an environment conducive to fraudulent activities

Healthy Practices:

  • Provide employee training on fraud prevention and promote a culture of ethical behavior
  • Implement proper approval workflows to enhance control mechanisms

4. Spot Out-Of-Process Spending

Investigate expenditures to ensure they align with approved procedures. Any out-of-process spending indicates a lack of adherence to procurement guidelines, necessitating corrective measures. 

Potential Loopholes

  • Missing or inaccurately recorded receipts, making it challenging to validate and track expenses
  • Insufficient supervision that enables unsanctioned spending to go undetected

Healthy Practices:

  • Implement strict spending approval processes with explicit guidelines
  • Conduct periodic spending reviews to identify and rectify discrepancies
  • Use spend management software for real-time monitoring to detect and address unauthorized spending promptly 

Here is a list of elements to assess for the internal procurement audit: 

Procurement Audit Checklist

Check the following items to get a comprehensive overview of your procurement process. 

  • Standard operating procedures (SOPs)
  • Clear audit trail for procurement transactions, documenting each step in the process
  • Delegation of authority matrix 
  • Roles and responsibilities as per the matrix
  • Training manuals to help users
  • Logical access rights to respective users
  • Segregation of duty (SOD) rules in the software
  • The purchase order dump — pick samples to check
  • If each purchase is supported by at least three vendors
  • Cost-benefit sample for vendors
  • Terms for purchase orders
  • Agreements of major purchases
  • Terms of sample agreements
  • Annual procurement budget aligned with annual operations planning 
  • Goods received notes (GRN) report
  • Open purchase requests and purchase orders
  • Exceptions to the process being approved
  • The aging of material available in the warehouse
  • If the same material was purchased by multiple vendors
  • Vendors approval process
  • Duplicate vendors in the system (identified via PAN)
  • Dummy vendors
  • Minimum order quantity (if created)
  • If the company maintains any risk register related to the procurement function
  • Sample vendor payouts (as per purchase order terms)
  • Internal control over financial reporting related to procurement
  • Measures to secure procurement data and ensure confidentiality
  • Ethical vendor selection practices, ensuring fairness, transparency, and avoiding conflicts of interest

5. Prepare Audit Report

Compile all audit findings related to internal procurement processes. Then, based on the following inspection, create an audit report:

  • Ensure procurement aligns with policies, standards, and legal requirements, identifying non-compliance and assessing organizational risk and reputation impact
  • Analyze the workflow, pinpointing bottlenecks and assessing control effectiveness for optimal procurement efficiency
  • Evaluate resource utilization in personnel, technology, and budget to optimize productivity without compromising quality
  • Assess risk identification, assessment, and mitigation in procurement, recommending improvements for enhanced resilience and threat minimization

Once the assessment is complete, document recommendations to address identified issues and improve procurement processes. Also, highlight aspects of the procurement process that align with best practices. 

Compile all findings, analyses, and suggestions into an audit report. Present the identified strengths and weaknesses, seeking input and additional context to enrich the audit findings. Finally, establish a monitoring mechanism to track the outcomes of the implemented changes. Regularly revisit and update procurement practices based on changing organizational needs, industry standards, and regulatory requirements.

Regular Audits for Efficient Internal Processes 

Routine procurement audits aren't just crisis management tools; they are proactive investments. By dedicating time and resources to periodic evaluations, you prevent issues before they arise. The long-term gains in efficient processes, improved vendor relations, and heightened compliance far outweigh the initial investment.

Automation adds a transformative layer to your procurement process, speeding up audits and providing real-time insights. We have covered in-depth how procurement automation can reinforce your internal processes without impacting your supply chain. Read how you can automate procurement without unnecessary complications. 

Corporate Cards
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Leen Shami

What is Pluto Card?

What is Pluto Card?

At Pluto, we believe better expense management should be within everyone's reach. We solve MENA finance teams' pain points by replacing their business credit cards with Pluto corporate cards to help manage their expenses, saving them time and money.

How do we do that?

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Create Unlimited Corporate Cards

When multiple employees have access to one company credit card, it can be difficult for finance teams and business owners to track how much is being spent and where.

The result: everyone texting the CEO or CFO for OTPs during important meetings.

Pluto makes it easy to create and distribute virtual and physical corporate cards to each employee. Not only does this minimize fraud risk, but it also makes expense tracking simpler for finance teams, CFOs, and CEOs.

With Pluto’s unlimited corporate cards, you’ll be able to:

  • Create virtual cards in seconds.
  • Receive physical cards in 1-2 days.
  • Use cards for vendor-specific cases.
  • Assign every employee a budgeted corporate card.

Spend Control

Are you running ads at a cost that exceeds your marketing budget? Are you providing new hires with an allowance to cover the costs of their office equipment and software, or do you offer employees additional perks such as a monthly gym stipend?

Pluto gives you the ability to set limits and take control of your company’s business expenses, hassle-free.

With Pluto’s all-in-one expense management platform, you’ll be able to:

  • Assign virtual or physical cards with spend limits.
  • Allocate a specific budget towards daily, weekly, or monthly expenditures.
  • Create a single-use purchase card that automatically deactivates once it is used.
  • Control spending for different departments by allotting a budgeted amount to be spent.

Goodbye overspending 👋🏼

Reimburse In Record Time 

Reimbursements can be a painful process when the end of the month rolls in. Whether you’re scrambling to find lost receipts, trying to match receipts to their expenses, or organizing them in a document, there’s no easy way.

Drag & drop receipts

Pluto makes it easy for employees to list receipts.

Once a business expense is made by an employee, they’ll be able to drag & drop an image or screenshot of the receipt onto the Pluto dashboard.

Yes, as simple as that.

Easily reconcile receipts

Pluto allows you to seamlessly submit your receipts onto the platform. With Pluto, reconciliation is a breeze.

Once a business expense is made:

  • Attach receipts to card transactions with just a few clicks.
  • Transactions will automatically be categorized.

Add a memo to every transaction.

Get reimbursed in minutes

Waiting till the end of the month to get reimbursed for out-of-pocket business expenses is no longer necessary! 

Pluto gives you the opportunity to get reimbursed in minutes.

Once a reimbursable out-of-pocket expense is made, head to the Pluto dashboard to log the expense and get reimbursed as soon as it is approved.

Get Real-Time Data

Your month-end expense report comes in—and you find that you've spent more money than budgeted. Again.

With Pluto, you can stay on top of your expenses at any given moment.  

By getting real-time data, you can view reports of your company’s spending and ensure that your company’s finances are in check.  

It's simple, Pluto helps you avoid overspending and keep track of your company's finances in real-time.

So what does this mean for you?

  • See transactions happening on your cards in real time.
  • Receive notifications about every single card transaction, if needed.
  • Collect information on which vendors your company is spending the most money with.
  • Identify which employees or departments are spending the most.
  • Get an overview of the expenses you have incurred daily or month-to-month.

Pluto allows you to adjust if spending has gone off course—and plop some celebratory balloons if it hasn't 🎊!

Integrate With Other Platforms

Every business has multiple platforms, and we know how important it is for them to talk to each other. Pluto's integrations make it easy to get started and ensure you have all the data you need in one place. 

Accounting Integration

Pluto syncs your company's transactional data to the most popular accounting platforms through direct integrations so you can automate your accounting and close books faster.

No more end-of-month mayhem! 😅 

Mobile Wallet Integration

Pluto Virtual Corporate Card

With Pluto, you can add your virtual or physical cards to your digital wallet to make transactions seamless and easy.

We support Google Pay, Android Pay, and Samsung Pay.

What Else Does Pluto Offer?

Pluto gives you the opportunity to scale your business, without having to worry about the smaller details.

No FX Fees

Pluto doesn't charge you any foreign transaction fees for using your Pluto corporate card outside of the UAE.

If your business is expanding rapidly and your team is traveling more frequently, you won't have to worry about those pesky charges eating into your profits.

Or if your company needs to pay for subscriptions, contractors, or freelancers in a different country, you can do so without racking up a bill in FX fees.

Remote teams, frequent flyers, or big spenders, we've got you covered!

Accepted Worldwide

Whether your team is distributed, travels a lot, or makes international payments, Pluto’s corporate cards are accepted worldwide.

Advanced Security & Privacy

Pluto is PCI DSS Compliant. We take the safety of your information very seriously; all your data is stored and processed following the highest data protection standards in the industry. 

Get Started in Minutes

Pluto's sign-up process takes minutes, not hours. By adopting a KYB and KYC process that can be done within a few clicks, you’ll be making transactions in no time.

  • Simple application process.
  • No credit history is required.
  • Fast approvals.
  • Instant card access once approved.

Let us take the hassle out of managing your expenses. Start Using Pluto Today - For Free.

Spend Management
January 30, 2024

Mohammed Ridwan

How to Improve the Expense Reconciliation Process to Close Books Faster

For every expense, teams maintain extensive documents like purchase orders, goods received notes (GRN), invoices, etc. With each increasing expense, the finance team has to spend more and more time on spend management — maintaining these documents, syncing data across accounting systems, ensuring proper approval, categorizing accurately, etc.

This manual process is time-consuming and prone to errors like missing receipts, employee fraud, unrecorded expenses, data entry typos, etc.

As a result, teams have inconsistent data across company systems and spend more time fixing these issues than focusing on their core activities. So, when finance teams strive to improve budget allocations, streamline expense tracking, and enhance financial reporting, they find themselves dedicating substantial time to addressing discrepancies among different financial databases and systems.

This blog will cover improving the expense reconciliation process and replacing manual and old methods with an improved solution.

What is Expense Reconciliation?

Expense reconciliation is a process that matches the actual expenses with the corresponding book entries. It involves comparing two sets of financial records, such as bank statements, credit card statements, receipts, etc., to identify and rectify discrepancies between them.

So, for every expense, you have an entry at an external source and in the internal systems. You match them together to ensure the accuracy of financial reporting, compliance with accounting standards, and prevention of errors or fraud.

However, companies rely on outdated systems — entry-level accounting tools, spreadsheet-based solutions, or legacy ERPs, which cannot handle end-to-end reconciliation processes. These compel finance teams to spend valuable time on manual tasks like data entry and receipt management, hindering reconciliation efficiency and increasing the risk of errors in financial data. 

Hence, submitting and tracking expenses becomes cumbersome for employees, while finance teams face manual verification and reconciliation challenges. Managers struggle with delayed approvals, and the overall process becomes susceptible to errors, affecting accuracy and compliance.

How to Reconcile Expenses Faster

Invest in spend management software to reconcile expenses faster. With spend management software, you can track and monitor each transaction on a centralized platform in real time.

Expense reconciliation with Pluto

The automated process makes reconciliation simpler and faster by providing a single source of information and enabling advanced controls. You can create customizable approval workflows and specify spending rules to suit complex hierarchies and ensure compliance with company policies. 

Especially with Pluto, each expense triggers the approval workflow and notifies employees to upload the receipt through WhatsApp. The accounting system integration syncs data across the financial systems to provide a consistent and accurate database.

Here is how switching to Pluto helps you reconcile efficiently and close your books of accounts ten times faster:

1. Easy to Identify Discrepancies

Find expanse policy discrepancies

In a traditional manual reconciliation process, identifying discrepancies involves sifting through piles of paperwork or navigating complex spreadsheets.

With Pluto's automated system, this cumbersome task is simplified. The platform's alert system actively flags potential issues, promptly notifying users of duplicate receipts. It not only streamlines the identification of irregularities but also introduces a proactive layer of fraud prevention.

You can visualize and interact with discrepancies directly on the centralized platform, turning what used to be a tedious task into a more intuitive and efficient process.

2. Speed and Accuracy 

Automation, real-time tracking, receipt capture (via optical character recognition (OCR)), approval workflows, and robust controls accelerate reconciliation cycles on Pluto. 

You need not spend a minute on a manual redundant task. The platform captures and extracts invoices from emails and WhatsApp on a centralized platform. The trigger-based workflows ensure prompt approvals without any friction. Matching documents for three-way and four-way matching simplifies with all the documents on a single tool. 

Therefore, the inherent accuracy of financial data, coupled with efficient discrepancy identification, ensures speed and reliability in the reconciliation process. 

3. Real-Time Tracking and Visibility 

Expense reconciliation tracking

Unlike conventional tracking methods, Pluto offers real-time insights through its centralized dashboard. This furnishes internal teams with immediate visibility into transactions, guaranteeing proactive adherence to company policies.

The agility provided by real-time tracking enables timely data-driven decision-making based on the latest and most accurate data.

4. Better Data Sync for a True Picture

Integrate Pluto with your ERPs

Manual data entry is prone to errors and delays, leading to discrepancies in financial records. Pluto's seamless integration with major accounting systems like Xero, Zoho, QuickBooks, Netsuite, and Dynamics ensures that the financial data is up-to-date and aligns with the organization's accounting records. This synchronization eliminates the need for manual adjustments and corrections, providing a true and accurate picture of the organization's financial status.

5. Enhanced Controls Over Processes 

Expense workflow automation

Building intricate approval workflows is simplified with Pluto. You can set up approval processes using simple if-then rules without the need for complex coding. Devise custom workflows that align perfectly with your company policies, creating a seamless and controlled process.

6. Traceable Audit Trail

Pluto maintains a traceable audit trail of all financial transactions and activities. It provides a comprehensive record of changes made to financial data. From the initiation of a transaction to any subsequent modifications, the traceable audit trail ensures transparency and accountability. This trail helps you avoid fraud and trackback discrepancies without friction.

Also, you can lock transactions post-approval, which adds an additional layer of security and integrity, facilitating smoother audits.

7. Save Time and Money

Automating financial processes, including procurement, expenses, and payables, significantly reduces manual steps in reconciliation.

Pluto's ability to capture general ledger and tax codes from expenses automates data entry. It reduces the time spent on routine reconciliation tasks. This efficiency allows finance teams to allocate resources more strategically, focusing on higher-value initiatives rather than repetitive manual tasks.

Timely financial insights help finance teams support decision-making processes with precision and confidence, fostering a data-driven financial ecosystem.

Internal Controls Strengthen Expense Reconciliation

Expense reconciliation burdens finance teams with time-consuming manual efforts and the constant threat of challenges like duplicate receipts and policy violations. These complexities lead to prolonged reconciliation cycles, hindering financial efficiency.

However, the actual progress happens when you strengthen internal control over financial reporting (ICFR), which is the anchor for successful automation in finance.  

When you embrace ICFR strategically, it bolsters internal controls, protects against risks and fraud, and sets the stage for smooth automation. The impact goes beyond just easing manual work; it promotes precision, reliability, and transparency in financial workflows. 

In simple terms, ICFR mitigates risks tied to financial inaccuracies. Read how to improve your ICFR framework for enhanced reconciliation processes.