Here’s the 1,2,3 (and 4!) on how to build some internal controls around expense reporting with your employees or contractors:
- Provide company-issued credit cards. (Or don’t. But we highly recommend you do.)
Once upon a time, providing company-issued credit cards might have been more headache than their worth. With new technology, however, (see #2) those days are behind us. Besides other obvious reasons, providing a corporate card allows a company to more closely track employee spending and the exact amounts being charged. It prevents opportunity for personal and business expenditures to be mixed on the same card and with proper controls in place will ultimately save you time and worry.
Related Read: The business meal expense deduction lives on post Tax Cuts and Jobs Act (TCJA). Read more to understand the deductibility requirements.
- Get an expense reporting tool.
It’s likely no surprise that a cloud accounting service might suggest using technology to tackle expense report fraud. Ditch the accordion folder for an expense reporting tool. Hands-down, our favorite for streamlining expense reporting is, Expensify. The pros of adapting Expensify greatly outweigh the learning curve:
✓ Expensify will sync with many accounting systems including QuickBooks Online.
✓ It offers smart scanning of receipts allowing users to snap a photo of their bill and then auto-populates the fields. This increases efficiency and lowers the risk of lost receipts while allowing for review and audit to happen easily online in a timely fashion.
✓ Expensify’s Concierge feature automatically flags altered receipts and ignores duplicate receipts reducing the risk of reimbursing someone twice for the same expense.
✓ And now here is where Expensify really shines: when it syncs with your accounting system, it can automatically code expenses from both receipts and credit card statements to the correct expense account. This is a two-fold time saver for both your company and your employees. No more tracking down employees to code it themselves. No more missing receipts at month-end. No more submitting and coding monthly reports. It’s been taken care of on-the-go.
✓ Finally, by enabling Domain Control, (see #3) your credit card reconciliations have practically been completed before you even receive your statement! That’s what you call real-time bookkeeping!
- Turn on Domain Control in Expensify.
Domain Control is a “centralized company card management” aka beefed-up company card system that allows you to ensure your employees and Expensify users (identified using their emails at your domain name) are following your expense policy workflow.
Advanced reporting, automated workflows and company card monitoring lowers the opportunity for undetected fraudulent activity. Domain Control also allows you to import your commercial cards and connect bank feeds, connecting those feeds to your respective users which streamlines the reconciliation process.