Month-end and a big bag of receipts on a desk. Hello, expenses.
It’s amazing that this practice has been accepted for so long, especially by a profession famed for busy periods – whether that be month-ends, VAT quarters or financial year-ends.
Now, think about the knock-on effect of this bag of receipts. How many days after the month-end do you trust your staff’s expenses to trickle into your accounts department in order to be processed into your month’s performance?
Thankfully there are now apps in the market to make this historically painstaking process a lot more palatable (dare we say, enjoyable!) including our favourites – Dext Expenses and Pleo. The aim of each is to simplify spending, but they do it in different ways:
- Dext Expenses aims to simplify receipt management by enabling your staff to snap, scan and upload receipts from anywhere, at any time. Through use of the Dext app, it allows a staff member to spend money from their personal account, take a photo of the receipt which is then read and uploaded to an expense report. The expense report is automatically closed and submitted at month-end for approval. The reimbursement can then be issued.
- Pleo eliminates expense reports altogether through the use of prepaid expense cards (though it can also account for out-of-pocket expenses).
For us, there are three main considerations when assessing the compatibility and effectiveness of introducing new tech into your expense process – Compliance, Control and Time.
Compliance
When it comes to document storage, the key question is ‘Will HMRC accept digital copies of invoices and expenses, over paper originals?’. Nowadays, it’s a resounding ‘YES’. So, save yourself from having to hoard every single receipt or invoice in a shoebox or folder moving forwards.
Another key question relating to compliance is whether VAT can be reviewed when adding the documents. This is where Dext and Pleo both excel, as both have the technology included to read the invoice/bill for its VAT amount and apply this to your posting.
If you have ever tried to create a mileage log, you will appreciate how clunky and long-winded the process is. Within Pleo, there is a map integration with their expenses to record start and end points, along with any detours or additional passengers. From an employer’s perspective, the allowance for mileage rate can be set per employee in order to streamline your expense claim and reimbursement process.
Control
Both Dext and Pleo provide significant control over expenses, however they are applied in very different ways.
Dext Expenses aides your control in the form of oversight. With the correct routine in place for the expense submitters, bills and invoices for reimbursement are updated throughout the month and the final expense report is submitted for approval automatically on a set date. The approval is then processed by an Admin user and then processed to your Purchase Ledger for payment.
Pleo gives control and assurance through a series of specified mappings for each employee based on set spending limits, restricted use of accounts nominals, and set approval workflows for each member of staff. The mappings are highly customisable with the option to map based on stipulations (e.g. items under £X are approved by a specified manager, items over £X are approved by a director).
Time
Ultimately, the software needs to provide a time-saving to the company in order to justify any software subscriptions involved.
Both Dext Expenses and Pleo aim to provide this with the following key features:
- Invoice image capture – take a picture or email in the attachment, rather than scanning or manually processing.
- Invoice automation – the software is smart enough to extract essential information from each item, rather than typing everything. Extract the Supplier, VAT amounts, issue date and due date with minimal effort.
- Quick approvals – each software aims to streamline the approval process immensely. Approvals can either be done online, or via the mobile apps, to save you from the ‘approval bottleneck’ that affects a lot of companies.
How can we help?
Think you could benefit from automating your employee expense process? Speak to our team to see how we can help you to save time on admin and speed up your reimbursements. Call us on 0161 905 1616, email us on fintech@haroldsharp.co.uk or contact Ryan below.
Ryan Alderson, Cloud specialist
T: 0161 905 1616
DD: 0161 926 0512
E: ra@haroldsharp.co.uk