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Expense Management: What It Is And How To Choose The Best Software

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Global Payment and Compliance

Expense Management: What It Is And How To Choose The Best Software

Proper expense management ensures that money is spent wisely on important resources and is tax-compliant. Without an efficient way...............

Workpay
May 20, 2024
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May 20, 2024
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Expense Management: What It Is And How To Choose The Best Software

Running a business is not always as easy as most people would like to think. One of the most challenging issues in business is expense management and accounting. No company wants to spend money without proper accountability and a clear idea of where it's going. 

Luckily, with evolving technology, expense management has become easier with the introduction of expense management apps and systems. Investing in expense management software has many practical benefits that both small and large corporations can use to ensure a better competitive edge and compliance in growing African markets

If your current expense management system is holding you back, this article is your best fix. We will examine expense management systems, the benefits and drawbacks of using these applications, and what to look out for if you decide to purchase an expense management app. As a bonus, we will also offer some of the best systems available, especially if you are trying to break through in the African market. 

What is Expense Management?

Before discussing the software and systems you can use to improve expense management, we should consider what they are. Expense management is the process of budgeting, processing, and managing all expenses related to your business. 

Expenses are any deductions that the business experiences during their cost of operation. In most cases, these expenses can include:

  • Purchasing raw material
  • Operational cost
  • Payrolls
  • Professional development expense
  • Office supplies expenses
  • Taxes
  • Employee benefits
  • Travel expenses
  • Advertising
  • Accommodations expenses
  • Subscriptions to services
  • Depreciation in prices
  • Insurance payments
  • Maintenance of equipment in the office

Why is Expense Management Software Important for Your Business

You might wonder why expense management is important for an organization. Proper expense management ensures that money is spent wisely on important resources and is tax-compliant. Without an efficient way to track expenses in the office, your business might risk going under or, even worse, filing for bankruptcy. 

That is where expense management software comes in. These automated systems help track and manage all business expenses under one roof. Through proper integration with other systems at the workplace, they store and provide real-time information, making the accounting process more streamlined. 

Benefits of Expense Management Software

Here are some of the benefits of using an expense management system in your business:

  1. Automatic expense workload

A major perk of using expense management apps is digitizing and automating all data entry processes in the organization. Automating these processes removes the hassle of manually entering data or physical documents, which can take time. Automation also means that your business can save on space instead of having multiple filing cabinets because they are all stored on a physical server or online. 

  1. Reducing redundancies in data

Additionally, using expense management software also helps reduce data redundancy in the office. By automating the management, the system generates real-time information on all accounts in the office, making it harder to record previously recorded data, like you would do while filing physical paper records. 

  1. Integration with other management software in the office

Thirdly, most expense management apps can easily integrate with other systems in the company, such as accounting, HR, and inventory systems. All the data will automatically propagate throughout the system, ensuring that everyone with access has a proper look at how money and resources are allocated within the organization. 

  1. Giving real-time data on expenses in the office

Expense management systems that integrate with other systems also allow people to glance at all company expenses in real time without looking at each company's accounting books. Additionally, administrators can have remote access to real-time information no matter where they are, allowing them to make better administrative decisions about the business. 

  1. Improved productivity

The expense management system's automated feature also improves company productivity. Because the system offers real-time data on all business expenses, enhancing office efficiency. Administrative processes can be handled faster without delay, and processing, reconciling, and approving expenses can be handled quicker. 

  1. Custom notifications and reminders

Likewise, expense management systems provide automated reminders and notifications if bills or invoices require payment. This makes it easier for businesses to stay on top of expenses and prepare effectively for payments. 

  1. Improve accuracy

Automation also makes it easier to improve the system's data accuracy. With reduced human error and redundancy, your company can more effectively ensure that expenses are allocated to the proper resources and processes. 

  1. Improving employee experience

Some expense management applications also have nifty features that allow employees to work more efficiently. These can include uploading invoice requests, printing receipts, and digitally providing expense statements, which makes the experience smoother for them. 

  1. Reduces cost and saves money

Expense management systems are a perfect way to reduce costs in the organization. Automating tasks around the office reduces available office space and the need for physical paper documentation, which can increase the company’s expenditure. Additionally, automation reduces redundancy errors, which can profoundly affect a company’s profitability. 

  1. Fraud detection

Expense management apps also reduce business fraud. The system allows users to have different access privileges and manipulate expense data. Additionally, any modifications to the expenses can be easily monitored using users' login credentials, making it easier to detect fraud.  

  1. Enhances the business level of compliance with regulations

Lastly, using expense management systems also ensures that businesses comply with regulations in the country, especially if you are thinking of a startup in Africa. By tracking all expenses in real-time, a company will have updated records showcasing payrolls and other expenses-related costs, which they can use during audits and tax filings. 

Challenges of Using an Automated Expense Management System

However, there are some challenges to using these systems. They include:

  1. Compatibility issues with old systems

Some expense management systems might be incompatible with old systems in your business. It can cause a problem with integration, as the systems might not communicate properly and not provide real-time data due to migration issues that you need to operate the organization. 

  1. User adoption and training

Some expense management apps can also have difficult user interfaces, making it hard for employees to use them. This can lead to operational issues, especially when you need to train every new employee to use the system. 

  1. Data security and privacy challenges

Like manual expense management systems, automated systems also carry the risk of security risks and breaches. Expense reports that contain sensitive financial information might be at risk if they fall into the wrong hands, especially if they can be accessed remotely. 

  1. The high initial cost of investment

Additionally, the initial investment cost when buying expense management software can be high. Implementation, integration, and employee training can also take time, which can be expensive, especially for small- to medium-sized businesses. 

How to Choose the Best Expense Management System in Africa

On the bright side, the pros of using an expense management system outweigh its cons. If you decide to buy an app to manage your business expenses, here are a few things to consider:

  1. Determine the challenges your business might be facing

The first step is determining the issues you want to fix with your current expense management system. Then, list your business's essential features and functionalities and how they would benefit from it. 

  1. Consider the cost of the expense management software

Secondly, you must consider the budget you are willing to spare when purchasing an expense management system. This can include the initial investment and recurring costs like support, maintenance, and other upgradeable features. 

  1. Reports and analysis offered by the management application

Additionally, you should look for a system that provides real-time expense analysis and reports that provide real-time data on monetary usage in the company. This will help enhance productivity and make administrative decisions about budgets. 

  1. Think about compatibility with other systems in the business

Though system automation is handy, you also need software compatible with other systems like Excel expense management. You should also consider that it takes seamless data migration to ensure all systems like payroll, accounting, and ERP communicate effectively and smoothly. 

  1. How easy will using the expense management system be

The interface of the software or app should also be intuitive and easy to use. It would make it easier for employees if the software had an expense management template to use and input data without hassle. Easy-to-use interfaces also improve user experience, enhancing the app's acceptability in the workplace. 

  1. Does the expense management system offer accessibility

Additionally, the software or app should offer robust features like remote accessibility. Employees and managers can actively monitor expenses from any location and make informed decisions to help the company. 

  1. Security features of the expense management system

In the digital age, software security plays a crucial role in your financial data and in the trust clients, employees, and other stakeholders have in the organization. Ensure that the expense management system offers end-to-end encryption that protects data traffic as it is transmitted through the network, especially remotely. It should also provide access control classes limiting who and what role a person plays when accessing expense data. 

You should also ensure the system complies with security regulations such as CCPA, GDPA, or other industrial specifications.  

  1. Scalability of the expense management software

You should also consider expense management, which can be used by organization branches, especially if considering growing and expanding. It should handle the increased transaction volume and more workflow from other branches. 

  1. Customization of the expense management application

Lastly, you should look for a customizable system for your business. Customization might include adding features that fit your company, like custom fields, reports, or approval processes that meet your needs. 

Which are the Five Best Expense Management Apps

Now that you know what type of expense management systems you should look out for, here are some of the best systems in the African market. 

  1. Workpay

Workpay Expense Claims offers a range of comprehensive expense management solutions that can help your business succeed. Their automated solutions encompass everything from expense management, payroll management, real-time report generation, approval workflows, and multi-language and multi-currency support. They also provide mobile accessibility, allowing remote data entry and viewing reports from anywhere in the world. 

  1. Concur Expense

Concur Expense is another widely used expense management system. It offers numerous features and capabilities to improve expense management in a business. These features include automation, report creation and generation, and workflow approvals. It also allows intelligent expense capture, where individuals can upload digital receipts, minimizing the need for manual entry. 

  1. Navan

Navan is another leading expense management system application. It provides robust features centered on automation, a user-friendly interface, and strong security features. It is also ideal for organizations that want to scale up their business and provide real-time expense reporting. 

  1. Expensify

Expensify is another good expense management system option. It provides full automation for key aspects of expense management, including generating real-time reports and approval workflows. It also seamlessly integrates with other ERP systems for smooth data flow, reducing data entry. 

  1. Zoho Expense

Zoho Expense has been an operational expense management system for a long time. It offers robust features such as automation, real-time expense report generation, a friendly user interface, and remote access to all expense reports. 

Final Thoughts

Managing business expenses efficiently is critical for maintaining financial health and gaining a competitive advantage in today's market landscape, particularly in rapidly growing African regions. The introduction of expense management software has transformed how businesses manage their finances, providing various advantages to both small businesses and large corporations.

Investing in the right expense management software is more than just using a tool; it is about embracing a strategic solution that promotes financial transparency, accountability, and operational excellence. Businesses can use modern expense management systems to optimize their financial workflows, mitigate risks, and ensure long-term growth and success in today's dynamic business environment.

Workpay provides the leading solutions for business management systems in Africa. We ensure your business gets quality services that allow you to concentrate on improving your profitability. For more information, get in touch today. 

FAQS on Expense Management Systems

  1. What is an expense management software/ system?

An expense management software or system is a digital tool that helps automate and streamline expenses in a business or organization. They do this by processing, tracking, submitting, approving, and reporting expenses within the business.

  1. What is the best software for keeping track of expenses?

Choosing the best software for managing business expenses is not easy. Here are a couple of things you should consider before deciding on which application you should select:

  • Determine the challenges your business 
  • Consider the cost of the expense management software
  • Reports and analysis offered by the application
  • Compatibility with other systems
  • Its user interface and ease of use
  • Accessibility
  • Security features
  • Scalability 
  • Customization 
  1. What is an expense management scheme?

An expense management scheme is a structured approach businesses take to manage and control their expenses effectively. It might involve policy and procedural changes or an overall change in the tools used to monitor, track, and analyze organizational expenses. 

  1. What is the meaning of management expenses?

Management expenses are the structures a business or company puts in place to track and manage its overall operations expenses. 

  1. How much does expense management software cost?

The cost of expense management software can depend on several factors. They include:

  • Type of software features
  • User Agreement, whether it is a one of payment or subscription bases
  • Support and maintenance
  • Implementation of software and training
  • Customization and integration with other business systems.
  • Vendors reputation

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Workpay is a HR and Payroll software company that offers time & attendance, payroll, human resource, leave, expenses and remote teams solutions to businesses across Africa.

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