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How to Streamline the Employee Reimbursement Process in 6 Steps

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In most organizations, expense reimbursement procedures require employees to collect receipts, make spreadsheet reports, and submit their requests to the finance department.  

They also need to wait before the reimbursement claim gets approved, which can take days or weeks. The accounts payable teams have to check every receipt carefully to avoid any issues, plus cross-department approvals can take days to process.

If that’s your case, worry not. In this article, we’ll show you how to streamline the employee reimbursement process in 6 easy steps.

Table of Contents

1. Set a clear reimbursement policy

The first step is to create a company policy regarding business expenses and reimbursement procedures. 

Here’s how:

  1. Make a list of allowable expenses, such as healthcare, personal development, business trips, and team-building activities. 
  2. To make sure the claims are valid, set a rule regarding the required documentation, including physical invoices and reasons for the expenses.
  3. Determine a set schedule in which employees should submit expense reports. For example, every Monday and Thursday.   
  4. State clearly what expenses are not reimbursable and why. These might include car fuel, movie tickets, and personal meals.
  5. Set spending caps to avoid a budget deficit. For instance, the company will only pay for the most affordable airfare when an employee is on a business trip. 

To help with the process, using an automation tool is highly recommended. Finance teams can easily set a spending limit for every department and create a workflow for the entire process, from expense report submission to payout.  

2. Enable the employees to submit reimbursement forms in a breeze

In the manual reimbursement process, employees spend a lot of time filling out forms instead of focusing on work. This can significantly reduce their productivity, consequently slowing down business functions.

To avoid this, use automation software instead of online forms to facilitate an easy and quick receipt submission process.

Automation comes with bill scanning technology known as Optical Character Recognition (OCR), saving a lot of time from manual data entry and providing higher accuracy.

3. Set approval workflows with the right stakeholders

After submitting reimbursement forms, the next headache the finance teams face is following up with the approvers through long email chains. 

In large organizations, it can be hard to figure out where the claims must go and who should approve them. 

This is where using technology comes in handy. With automation, you can set custom approval workflows with multi-level stakeholders and assign them to the right budgets. 

Plus, you can easily track the status of reimbursements through a timeline with an audit trail, and consolidate communications in one place. 

4. Gain full visibility on the status of expense claims

The manual reimbursement process is prone to costly errors. Oftentimes receipts are scattered, thus leading to data discrepancies and duplicate payments. 

This method also lacks visibility as employees can’t see the status of their claims. Approvers are also more likely to miss unread email reminders, further delaying the process.

With accounts payable automation software, you can invite any team members with roles-based access. Both employees and approvers can track the status of reimbursement claims in one dashboard. 

Having a secure application to manage reimbursement data also helps organizations categorize expenses for audits and manage financial risks better.

5. Make it easy to send payments to your employee’s bank account

After expense reimbursement claims are approved, another hurdle to tackle is sending the funds to employee bank accounts.

In the manual process, finance departments need to log into a payment application first and ask for an OTP before making the payment. This requires frequent input of username and password, which poses potential mistakes and security risks. 

To ensure a secure disbursement process, we recommend connecting your bank accounts with an automation system. This way, you don’t need to manually enter payment details, send reimbursement funds in bulk, and make payments with a digital wallet that you can top up whenever. 

Most automation software also follows the highest standard of security practices, removing the worries of data breaches and fraud as well as payment declines.

6. Manage business expenses with real-time budget reports

In most companies, using spreadsheets for managing data is a common practice. The problem is, inputting and updating data manually are tiring and time-consuming.

Without technology, the finance team needs to set up budget reports for every department on a spreadsheet and maintain them regularly. This method of reporting doesn’t provide real-time visibility, making it difficult for budget owners to make strategic decisions. 

By using automation software, you can manage accounts payable processes effectively. The tool will automatically sync business expenses and set up real-time budget reports. Therefore, improving data accuracy and team productivity by twice.

More effective reimbursements and more productive employees with Peakflo

With Peakflo, you can streamline the reimbursement process using some of our handy features:
  • Automatic data entry. Seamlessly scan bills and input the data into the system with high accuracy using OCR. This technology helps your organization minimize human errors and save time by reducing the need for manual data input.
How OCR works
  • Automated approval workflows. Utilize smart approval workflows with which employees can easily set reimbursement policies, assign the right stakeholders, track the progress with the audit trail, trigger automatic reminders. Approvers can also mass approve bills. 
Bill payment workflow
  • Auto-disbursement. Schedule bills for payments in bulk and pay off local and international vendors securely using a digital wallet with 0% FX markup rate.
  • Real-time budget management. Set up a new budget in minutes and Peakflo will sync every bill to the right budget. Tag your team members and receive notifications once the budget limit exceeds 50%, 80%, 90%, or when the budget is finished or has exceeded the initial amount.
Budget dashboard in Peakflo
So, are you ready to streamline your reimbursement process?

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