For the average UK business, expenses account for between 8% and 12% of overall expenditure. With an overwhelming 85% of employees admitting to overclaiming on expenses in the past year, this poses a real problem. Argos for Business comments on how companies can take back control of their cash flow with better expense management.
Businesses that struggle with cash flow can allow little room for error in terms of expense management. A tight reign should be kept on outgoings to avoid shortfalls, which can, in some cases, force a company to borrow money to make obligatory payments. When you consider that almost 100,000 businesses in the UK are worried about cash flow, and nearly half of SMEs say this is an area of concern, the issues around expense management are all the more important, especially as many businesses approach financial year-end.
Many businesses don’t have the time or resources to scrutinise all expense claims. In addition, some use complicated or outdated payment processes that make it even more difficult and time consuming to spot discrepancies. For example, businesses that still rely on paper-based expenses may be faced with more errors, or if a business uses petty cash, they might not have it on the radar as far as expense claims go, meaning it adds up over time.
Businesses would be well placed to add a review of their current processes to this year’s development plan to ensure they have an effective expense management system.
To address expense management issues, businesses could think about setting up business accounts, helping with VAT reclaim and also reducing misuse, as well as giving managers peace of mind. One example is the free Argos Business Account, which features line item detail for easier VAT reclaim. It allows more control over expenditure, meaning there are fewer opportunities to overclaim on expenses, as it reduces the need for petty cash and expense approval and reimbursement. As a fully secure payment method it also removes the need for timely and complicated expense forms that make it more difficult to identify misuse.
Organisations can have multiple account cards on a single Business Account – perfect for consolidating spending across multi-site organisations while allowing numerous employees to have purchasing power. Purchasing responsibilities can be delegated to others in the business while control is retained centrally under one account, which is recommended in light of the recent findings surrounding expense claims abuse.
Jacqui Glenn, director at Argos for Business says: “Simple yet robust systems are required to ensure finances are well controlled. By having clear processes in place, it’s much easier to ensure you have visibility over budgets and spend.
“The Argos Business Account can help provide businesses with an increased level of control and accuracy when it comes to spending, reducing the number of inaccurate expense claims. It is a simple but effective solution to a common issue.
“Business managers should ask themselves how they are currently managing expenses and if old processes are still in place that are costing money. In an environment where cost control is more in focus than ever before, a review of expense management solutions could free up cash to be used elsewhere and reduce the administrative burden.
To apply for an Argos Business Account online, please visit argosforbusiness.co.uk