Typically, when an employee uses either their own or a company-issued credit card for a business expense, there is a receipt created by the vendor. Finance and accounting teams need to collect these receipts to substantiate and review the charges, but collecting them often becomes a never-ending — and not very fun — game of chase.
You may ask why it’s important to collect receipts when details of transactions are recorded on the company’s credit card statement. The answer is that a lot of spend abuse can occur on credit cards, and receipts are the documents that substantiate the charges and business use.
Official receipts are the only backup that is acceptable to your internal or external auditors. This is because a receipt lists exactly what products or services were purchased, the volumes ordered, unit prices, and any discounts, fees, or taxes charged. This is in contrast to a credit card or bank statement that provides only the vendor’s name and the total amount of the sale.
If you are using only a credit card statement or bank statement, there would be no way to ascertain if a given charge was business-related or not. And for this reason, an auditor will always require a receipt.
Also, finance departments use the detailed information found on receipts to ensure the amounts billed were correct. For example, your team may have signed up for a “Basic” tier for a product, but the vendor mistakenly charged for the “Premier” tier.
In summary, receipts are important. So here are three easy steps to take to motivate your team and start winning the receipt game.
Let’s face it, even the smallest obstacle gives us the reason we need to not do the things we don’t want to do. Some receipt tracking applications require the use of separate logins and the physical printing, scanning and uploading of documents. These small but annoying extra steps will definitely decrease the probability of compliance.
At Glean AI, we suggest this highly effective hack: create the email address firstname.lastname@example.org.
Employees don’t forward invoices today because the process takes time. By giving vendors the email@example.com email (instead or in addition to theirs), they can cut themselves out of the process entirely! Your finance team won’t need to constantly send out reminders to folks to send their receipts. They’ll already have access to everything! And your teammates will be grateful for getting back valuable time.
Alternatively, if a receipt ends up in your employees inbox, they can simply forward it to firstname.lastname@example.org as opposed to logging into an app. All messages received this way are instantly forwarded to your spend management software and members of your finance team.
Automating this process should be your goal when it comes to receipt collection.
Utilizing a centralized inbox for receipts will save your employees and finance teams time and also provide very rich data to better understand your vendor relationships and spend trends.
Accordingly, it is important that your CEO or CFO set the tone at all-hands meetings or town halls to explain why receipt collection facilitates good financial hygiene and that every employee is expected to comply with the company’s policies. Remind employees of this frequently and even consider rewarding individuals that submit the most receipts.
The great news is that once your policies have been successfully adopted, they become part of the fabric of the organization and you will never have to struggle with receipt collection again. Try these three steps and we look forward to hearing of your success!
For more information about Glean AI or to book a demo, contact us at email@example.com.