In recent times, initiatives such as the Sarbannes Oxley Act in the US have dramatically raised the profile of compliance within the corporate world. As a key element of any corporate compliance policy, expense management has shared some of the limelight. As a result, corporate expense management software is now critical to any business concerned with corporate compliance. But what is corporate expense management software? Does your company need it? And where do you find a good corporate expense management software solution? Just as importantly, how do you successfully implement and integrate corporate expense management software into your corporate environment. This article sheds some light on these issues.
What is corporate expense management software?
Corporate expense management software is a software program that processes:
- transaction records received from a credit card issuer (detailing employee use of corporate credit cards0; and
- cash reimbursement claims originated by an employee.
In practice the target application is Travel and Entertainment expenditure. A robust corporate expense management software solution will also support procurement (pCard) activities as part of a broader strategy of effectively managing lower value, high volume business-to-business transactions.
The three core steps of any expense management process are:
- the acceptance/input of validated source data;
- the application of predetermined rules of handling expense records; and
- the posting of transactions to a corporate repository such as an ERP system.
What is the purpose of corporate expense management software?
The objectives of corporate expense management software implementation should include the following:
- to automate the preparation, submission, approval, and auditing of travel & entertainment claims, thus improving the productivity of account holders and reducing the time and cost of accounts staff;
- to support the implementation of a standardized best practice method of managing high volume expenses through the use of corporate credit cards; and
- to increase the transparency and enhance the governance of financial transactions conducted on behalf of the enterprise.
Sources of corporate expense management software
Australian and international organizations now have access to a range of quality corporate expense management software solutions which are well suited to driving down administration cost whilst meeting corporate compliance requirements. There are essentially three sources of “corporate expense management solutions”:
- ERP systems;
- systems offered by card issuers; and
- best-of-breed solutions.
Each will have their own merits and will suit organizations in different circumstances.
Enterprise Resource Planning (ERP) Systems
ERP sourced expense management has the attraction of being fully integrated within the financial suite of software, therefore offering a standard look and feel to all users of the ERP. With ERP sourced expense management functionality, the ERP supplies the core software, and the enterprise needs to customize and configure the system to reflect its own structures and rules regarding the management of staff expenses. If you’re considering the option of using their ERP for expense management, you need to be conscious of a number of factors, including:
- the actual functionality available within their specific installed ERP system;
- the backlog of work on the ERP system accumulated for the IT department; and
- the deployment time and the cost of the project (which will usually be substantial).
License costs can be an issue if an enterprise if your company has not paid a license fee that will cover all card account holders and cash claimants.
Card Issuer pengeluaran hk Systems
Some card issuers promote “expense management” solutions which can range from a computer generated report through to an online system with some embedded workflow concepts. The attraction of card issuer expense management solutions is that they are offered as part of a card deal, sometimes (apparently) for free. If you’re considering a card issuer expense management solution, you need to know:
- will you be ‘locked in’ to the card issuer?; and
- will you be able to configure the expense management solution to adequately reflect internal requirements?
Best-of-breed expense management solutions from specialist providers can be relatively seamlessly interfaced to an organization’s internal systems such as HR and ERP, but will not present a common look and feel to the ERP system. You would usually choose a best-of-breed expense management solution if you want:
- your company to be independent of a particular card issuer;
- to achieve a fast implementation; and/or
- to configure the solution to its own unique rules and policies of expense administration.
Best-of-breed expense management solutions are typically deployed as either an ASP (Application Service Provider) or self hosted solution. Although exceptions are common, small to medium enterprises tend to appreciate the lower up-front cost of an ASP expense management solution, and larger enterprises are attracted to the control available through a self-hosted corporate expense management software solution. ASP expense management solutions are typically paid for on a per statement per month basis, and self-hosted corporate expense management software solutions have a range of options available from up-front license fees to monthly license rentals.