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CFOs and controllers of mid-market businesses could face expense report errors and manual processes that might delay critical financial data. Yet, some may not realize how much inefficiency might be present in their current expense management workflows.
For competitive mid-market companies, there may be little room for errors and delays created by manual expense management. Expense management tools can help streamline operations and potentially avoid the pain points and costs associated with manual processes.
The Hidden Costs of Manual Expense Management
Manual expense reporting may seem simple — submit a receipt, log a report, wait for approval. In practice, however, each manual step could result in errors or delays. Paper receipts might get lost; email attachments won't open; follow-up questions might go unanswered. CFOs may lack visibility into the time finance employees spend chasing down missing information, reconciling mismatched data, and monitoring expense policy compliance.
Manual expense reporting could cause more than an inconvenience for the finance team — it may also pose a barrier to more efficient, accurate, and robust financial management.
Some of the hidden costs of manual expense management might include:
- Fraudulent expenses
- Non-compliance
- Lost time
- Employee dissatisfaction
- Lost productivity
- Employee stress
How the Pain Points of Manual Processes May Effect Mid‑Market CFOs
These pain points may be particularly pronounced for mid-market businesses, which may be lean by design — the same employees might be in charge of reporting, forecasting, budgeting, reimbursement, compliance, and expense oversight. Manual expense processing could quickly become the lion's share of their workload, leaving little time for the tasks that best leverage their finance expertise.
Manual expense processes may also be slower, which means business-critical data may not reach CFOs and other finance leaders in a timely manner. Data delays could result in leaders adjusting budgets or identifying overspending based on outdated information, and decision‑making based on incomplete information.
Expense‑Management Tools Help Relieve the Pain
Automating expense management can help organizations avoid inefficiencies, compliance risks, and unwanted employee stress. CFOs and other finance leaders may experience direct benefits with real-time visibility and data-driven insights. More data points that are faster and more accurate may support better forecasting and proactive — rather than reactive — budget adjustments.
Automation could help make compliance oversight more consistent and thorough. Expenses that fall outside of company policies could be flagged before they become a problem to fix retroactively.
Some of the expense management tools that can help CFOs pursue those benefits include:
- Expense-tracking mobile apps
- Automated rules tracking software
- Real-time expense data insights
- Virtual cards
How Virtual Cards Can Help Simplify Spend Management
Virtual cards, which generate unique, digital numbers, may be particularly well suited for expense management.
Finance teams may be able to set custom spending limits on each virtual card, restrict merchant categories, and assign cards to specific vendors or projects. This pre-purchase level of control can help reduce unwanted spending and simplify reconciliation.
Virtual cards can also help enhance security. For starters, an employee can't leave a virtual card on a coffee shop counter. Unlike physical cards, they may be created for single‑use transactions, like a supplier payment, or limited time periods, potentially reducing the risk of misuse or theft. Virtual cards can also help enable oversight and purchase tracking that may modernize expense workflows.
With increased expense visibility and enhanced controls, virtual cards can help complement larger modernization efforts by potentially providing granular, real‑time insights into spending behavior.
Mid-Market CFOs Could Benefit From Expense Management Tools
Manual expense reporting could cause more than an inconvenience for the finance team — it may also pose a barrier to more efficient, accurate, and robust financial management. For mid-market businesses with already overstretched finance teams, eliminating error-prone busywork may be a game-changer.
Expense management solutions, like the oversight and security of virtual cards, can help empower finance leaders to better control spending, facilitate forecasting, and more efficiently manage their company's finances. Modernizing expense workflows may help save time and reduce risks, and could also help enable finance teams to focus on the more complex, value-adding work that can help their organizations thrive.
Photo: Getty Images
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