Creating the right expense policy templates for your business

Expense management, expense policy

Managers and finance teams are increasingly implementing expense policy templates that are carefully structured specifically around their organisation’s duties, needs, and employees for enhanced flexibility and results. A formal expense policy provides employees with knowledge of what they can and cannot submit as reimbursable, cut down on expense report fraud while providing management with critical real-time visibility into budgets for faster decision making.

To create the best expense policy template for a business means understanding your employees, the budget, and the organisation’s profit goals. Growth can be supported by effective expense policies and stymied if expenses aren’t well-managed. It’s essential that these templates are clear, fair, and fully accessible at all times, to gain employee trust and compliance.

Here is how to create expense policy templates that work:

1. Ditch the jargon: Managers need to draft spend management policies in clear and understandable language. Important messages can get lost or misunderstood when they’re buried in complicated sentences and lengthy paragraphs. Managers should ensure key messages are simple and obvious and avoid using legal or financial terminology where possible.

2. Keep policies fair: The most effective spend policies will let employees feel that they have enough freedom and independence in the way they spend. It’s important to avoid restrictive protocols or rules that prevent employees from doing their best work. For example, employees travelling for business need to be supported with the right accommodation and transport options. Expense policies should exist to ensure all purchases are valid and accounted for, rather than to police employees’ activities and spending choices.

3. Invite participation: Organisations often consist of multiple departments, groups, and professionals, all of whom have unique and independent ideas regarding how spend management can suit their work best. Before implementing, or even drafting new expense policies, managers should liaise with different professionals in their organisation to ensure expense rules cater to their needs. Managers must acknowledge that different departments might need different flexibilities or leniencies for certain types of expenditure, or at certain times, and this should be accounted for in an expense policy template.

4. Make it accessible and easy to use: Employees are more likely to follow an expense policy that’s easy to access at any time, from any place, ideally via their personal smartphones and devices. When employees have expense policies at the ready, they can quickly check whether certain things are covered under company spend protocol, and use this to make quick and informed purchasing choices. Not only is this convenient for employees, but it saves managers and finance teams time, with fewer invalid reimbursement claims to process.

Implementing strong expense management policies can help organisations save time and money, and help employees work and travel with a clear understanding of how their organisations’ spend can support them. Taking time to realise each work group’s needs, ensuring employees have a say in the way policies are put into place, and making templates available to employees digitally at any time, is essential in creating an effective, foolproof spend management template, tailored to a specific company and its staff.

Matt Goss, Managing Director ANZ, SAP Concur