How can you enforce a set of rules – if nobody knows what they are? This is a question that arises from the findings of a recent survey into expense fraud, commissioned by webexpenses.
It revealed that nearly two-thirds (65 per cent) of UK office workers had not seen their company’s expense policy in the previous 12 months. It’s a statistic that’s eye-opening but not entirely unexpected; finding ways to communicate expense rules has always been a challenge – particularly so, for a growing business with an expanding workforce.
Without employees knowing the rules covering reimbursements, a policy can’t be effectively enforced. It creates a “lawless” environment in which behaviour is liable to be guided by what employees can get away with. It helps to explain why expense fraud remains such an intractable problem – causing UK companies to lose in excess of £100m each year.
It’s not just businesses affected either, ignorance of policy was one of the most common justifications used by politicians who were found to have wrongly claimed more than £1.3 million during the 2009 parliamentary expenses scandal.
It’s a problem that can be linked to the method that organisations have traditionally used to manage employee expenses. The webexpenses survey found that only 38 per cent of UK respondents had employers who used a cloud-based system to handle reimbursements.
The majority of companies are still using traditional methods that combine the use of paperwork, Excel spreadsheets and the manual processing of information. Using this approach, an expense policy will typically take the form of a static document that’s accessible via a company intranet.
It becomes a constant struggle to make sure that employees read and absorb the contents of this policy and remain aware of any revisions and updates that are made over time. Without a constant effort, knowledge of an expense policy will quickly fade.
This is a problem that a new generation of digital expense systems are helping growing businesses to tackle. With cloud-based technology and real-time processes, these fundamentally transform the way that an expense policy can be communicated to a workforce.
A system such as webexpenses allows real-time policy reminders and “nags” to be delivered to claimants via on-screen notifications. These can relate to the specific types of expense that are being claimed. The system can also automatically flag any claim that breaches any policy limit that’s set.
It can inform the employee of the breach and prevent the claim from being submitted or it can simply alert a finance team, allowing them to verify the cost is legitimate. It makes expense policy an active part of everyday workflow in a way that’s not previously been possible.
Rather than seeing what they can get away with, employees are constantly informed of exactly what the rules are and what’s expected of them when it comes to reclaiming costs. They also know that finance teams have the accurate information required to identify and challenge any compliance breaches.
By ensuring an expense policy remains front and centre, a growing business can create a workplace culture which promotes compliance and prevents expense fraud from becoming normalised. For any business that’s scaling-up, it provides a simple and effective way to avoid a policy becoming “invisible” and supplies the tools needed to properly manage and police rules.
Webexpenses provides a better way to manage employee expenses. Find out for yourself by requesting a free demo.
This article is part of a wider campaign called the Scale-up Hub, a section of Real Business that provides essential advice and inspiration on taking your business to the next level. It’s produced in association with webexpenses and webonboarding, a fast-growing global organisation that provides cloud-based software services that automate expenses management and streamline the employee onboarding process.
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