What is Spend Management Software?
Spend Management or Expense management software is a Software as a Service (SaaS) product that strengthens and streamlines the complete expense management process so your finance team and other employees can focus on what’s important.
A spend management software streamlines processes such as invoice uploads, approval flows, expense budgeting etc. It also automates expense reporting, policy compliance, invoicing and billing, and integrates with your accounting software, thus encompassing all tasks under one platform i.e. the software itself.
The aim of spend management automation is to reduce errors in financial data entry and speed up the whole process while complying with company policies and tax guidelines. You replace inconvenient manual labour — safeguarding physical receipts, submitting them and digging them up in case of discrepancies — with a completely digital, secured, streamlined software.
Once you find the best spend management software that suits your business needs, you save up on time and money. It majorly contributes to employee happiness as the software promises faster reimbursement and lesser workload.
How does spend management software help small and medium businesses?
Expenses are an integral part of running a business; from travel expenses to client lunches, expenses need to be audited, approved and reimbursed.
To handle this, you need a robust system in place as manual spend management requires paperwork and spreadsheets which is time-consuming and prone to errors.
Here’s an overview of what goes behind one manual reimbursement cycle:
- If we consider the bare minimum, spend/expense management starts with employees submitting paper receipts which are recorded in spreadsheets.
- The finance team audits these receipts, approves them, and forwards them to managers or executives for review.
- Managers approve some of these reports and send back the unapproved ones to the finance team and thus, to the employee.
- The finance team enters the approved and verified reports into a file for tax and accounting purposes.
- The accounts department has to enter the correct tax codes and post the report into the company’s accounting system.
- The reimbursement amount is issued to the employee or the credit card company.
A hefty task for a bare minimum workload scenario, isn’t it? Moreover, lost receipts, inefficient policies and poor visibility over reports make it harder. Remember we have currently not even considered all the hassles of procedures involved for employees to take care while making their spends, and all the analysis that needs to be done by the finance team after the reimbursements.
So, what’s the solution?
Introduce spend management software to your workflow and streamline/automate the long list of manual, tedious tasks. A software takes the load off your finance and accounting team as it can process, audit and pay any employee-initiated claims without any hassle.
It cuts down all tedious tasks involved in expense reporting thus increasing the efficiency of the finance and accounting team. A spend management software also tracks receipts, reduces errors in data entry, enforces expense policies, streamlines approval flows, sets in the practice of budgeting, monitoring, analysing and as a result, prevents overspending and saves your business.
Let’s understand how to efficiently manage your business expenses with spend management software.
What does spend management software do for your business?
A spend management software reduces errors, speeds up your expense management process, and provides maximum visibility over your cash flow. While we briefly covered it in the above section, here is the detailed list of tasks that the software will take care of:
Keeps Track of your Expenses
Expense management automation puts you in control of your budget. Set expenditure limits, and the software pings you when you cross it so you don’t overspend drastically.
- Set Specific Budgets for Teams and Projects
A spend management software lets you set specific budgets for teams and projects. It ensures all expenses are accounted for and owned. This helps distribute spending power across the organisation in a responsible manner.
- Monitor budgeted spends
Without monitoring, you may overspend without realising. A spend management software matches your bills to a pre-set budget thus preventing overspending.
- Improves Visibility and Forecasting Expenses
A spend management software has many features dedicated to higher visibility of the cash flow. Budgeting, expense monitoring and reporting ensures that you have an overview of all payables and dues so you make the best business decisions.
Streamlines Expense Submissions and Reporting
- Allows for Claim Submission on the go
It’s hard to keep track of paper receipts; employees have to save all receipts and physically submit them. A spend management software allows employees to submit receipts on the go and claim their expenses.
Mobile apps allow them to photograph the receipt and upload it straightaway. Finance teams get a notification whenever a new claim is submitted which makes it easy for them to track submissions.
- Tracks receipts
Employees lose receipts all the time. That’s why the spend management software stores all these receipts under a common dashboard. It proves extremely valuable at the time of verification as the finance team can check the origin of each claim from any device, anytime.
If the need arises, they can backtrack any reimbursed claim without digging through a pile of paper receipts.
- Reduces Errors
Manual data-entry is prone to error, spend management automation automatically gathers data from submitted receipts, thus making it more accurate.
Integrates with Accounting Software
A spend management software integrates with your accounting software. With this, bookkeeping becomes a piece of cake. Most software offer accounting integration so you must compare thoroughly and find features that ease your business.
For instance, Aspire offers hourly updates of your transactions — 24 times faster than banks — with automated general ledger mapping so you close your books twice as fast.
It also lets you send invoices from the app itself. When you receive a payment, the app marks the invoice “paid and reconciled”. Accounting integration takes a lot of tedious tasks off of your hands and also reduces the room for error.
Enforce Travel and Expense Policies
Travel and expense policies serve as guidelines for employees to spend company funding while travelling on its behalf. Travel expense reports are prone to fraud as employees can amplify the claims.
Here’s how a spend/expense management software ensures correct enforcement of travel and expense policies at scale:
- Set Parameters for expenses
Spend management software allows you to pre-set expense policies based on different parameters such as the goal of the visit, employee designation and expenses. The software audits the claims based on these parameters.
- Reports Fraud
It integrates with your corporate credit card to reconcile with direct bank feeds in case of policy violations. It reports to the authorities if any expense goes against the guidelines. You can modify the travel and expense policies as and when you need.
- Approval Flows
With approval flows you can set pre-defined approval processes. You an assign different owners for different budgets, projects or payments. It decentralizes your finance processes and removes bottlenecks while providing more control over your expenses. It also ensures efficient and robust implementation of your policies.
Best spend management software for small businesses
Choosing the best spend management software for your small/medium business is crucial as it can make or break your overall finance management strategy. You must compare all options in terms of budget and functionality so you land the best expense management software in the market.
Read the reviews below to select the top spend management software for small businesses as well as large enterprises.
Top Spend Management Software For Start-ups and Small Businesses
Rydoo is one of the top expense management software in the market that lets you speed up the reimbursement process and boost the team’s overall productivity by cutting down tedious tasks like physical report submission. When the software takes care of the expense management, employees can focus on other important tasks.
- Quickly approves or rejects expenses based on company policies and prevents elongated reimbursement cycles.
- Rydoo maintains a smooth workflow for different countries with correct rules for each region, and proper exchange and tax rates.
- Essentials Plan: $8 per user per month billed annually
- Pro Plan: $10 per user per month billed annually
- Enterprise: Talk to the sales team
Certify is one of the top expense management software for SMBs with award-winning customer support. It provides user and accountant training to help you understand the functionality so you can make the best of the product. Certify offers webinars and several “how-to’ resources to help you learn.
- Certify comes with a customer service partner, dedicated to your business needs. He/She helps you with product usage, efficient reporting and policy creation.
- Administrators can create a company-wide schedule for submitting expense reports. Certify reminds users to submit claims before the deadlines. When the day arrives, it automatically compiles all receipts and expenses into a sophisticated report.
- Standard: $8 per user/per month for 1-25 employees
- Professional: Contact the sales team. Built for 25-200 employees
- Enterprise: Contact the sales team. Built for 200+ employees
Aspire is one of the best expense management software that allows you to make better business decisions with real-time expense tracker and efficient spend control.
- Set spend limits and receive notifications whenever you’re about to overspend. It prevents extra expenditure that otherwise misses the eye.
- It lets you distribute spend management among various employees while retaining complete visibility. You deploy budgets across teams and appoint budget owners to manage expenses within their teams so you can focus on scaling the business.
- Aspire offers real-time visibility of your company’s expenses. You get to create unlimited corporate cards for your employees to get a birds-eye view of the overall expenditure. Moreover, you can freeze, cancel or update the card as per the need.
- Aspire lets your employees submit claims on the go. After that, it notifies the finance team who can disburse them with one click. At the time of reimbursement, you’ll find all receipts at one place so you don’t dig through a pile of paper receipts. Your employees will thank you for the quick and hassle-free reimbursement.
Aspire is value for money as it comes with a wide variety of features like corporate cards, streamlined claim submission, one-click reimbursement, budget compliance and approval flows. Explore pricing here.
Quickbooks is a cloud accounting software that manages your expenses on the go.
Use mobile apps to submit expense reports and access your Quickbook account anytime, anywhere. The software backs up your data every day so your books are always up to date.
- Facility to collaborate with your accountant and have it review and make corrections to your books.
- Quickbooks automatically updates your transactions with its banking integration.
- Simple Start – Priced at $12/month, made for 1 user
- Plus – Priced at $40/month, supports up to 5 users
- Advanced – Priced at $90/month, supports
- Desktop Pro Plus – $349.99/year
Features that best spend management software must have
There are numerous spend management software in the market, however when we reviewed them, we found that the best one’s generally have these key features:
Affordability: The best spend/expense management software is the one that fits your budget. Most software offers different plans as per the features and number of employees. Choose one whose features fit your needs to get your money’s worth.
Easy to Use: The whole purpose of implementing software is to ease the work. Choose a software that fits well with your workflow and comes with tutorials to help you understand the functionality.
Automated Workflows: Who doesn’t like automation? The best spend/expense management software has automated billing, invoicing and fraud reporting which takes mundane tasks off of your hands.
Effective Budget Tracking: Budget tracking is a crucial feature to look for. Opt for software that checks your invoices, bills and reports for extra expenditure so you prevent overspending before it happens.
Compatible with accounting software: A spend management software that integrates with your accounting software helps you close your books twice as fast.
Corporate Card Linkage: Corporate card is a must-have feature in expense management software as it puts you in control of employees’ expenditures. You set spend limits and review payments as it offers full bank records of the expenditure.
Customer Support: Any SaaS product is incomplete without customer support. Read reviews and talk to previous customers about the support to make sure the software company provides help when customers need it.
Choose the best Spend Management Software for Your Business in 4 Easy Steps
1. Evaluate your goals
Begin by evaluating your goals and analyse the problems you want to solve with the spend management software. Below are some common problems that small businesses face with expense management:
- Expenses going over the budget
- Time consumed in creating expense reports
- Inaccurate financial data leading to poor business decisions
- Several cases of frauds with no probable culprit or outcome
- Delayed reimbursement leading to employee dissatisfaction
- Difficulty in compliance with taxes
Take these points into consideration and create measurable goals about what you want to improve with the spend management software.
2. Narrow down the most important features for your business
A SaaS product comes with a variety of features but you might not need them all. It’s good to differentiate “the absolute needs” and “wants” from the beginning.
The best spend management software is the one that has a perfect combination of your desired features.
For instance, a small business certainly needs the following solutions:
- Integration with ERP and accounting software
- Expense Reporting
- Real Time Analytics and Fraud Reporting
- Compliance with Tax Guidelines
- Available as mobile app
- Updated exchange rates for global currencies
But they also feel it’s good to have:
- An intuitive dashboard
- Great UX
3. Assess Other Important Criteria
Below are three major project parameters that you should consider:
Complying with a budget doesn’t always mean choosing the cheaper option. A good spend management software will reduce costs over time so consider long term benefits over short term priorities.
Moreover, you can choose software like Aspire which offers all features at no hidden fees so you confidently implement spend management automation in your workflow and reap the benefits.
Consider whether you need to train your employees to use the product as that would entail additional cost which affects your overall budget.
Consider how much time you need to train your employees and achieve your financial goals.
4. Compare available options
Look into each product and then decide the best fit for your company. It’s a good idea to involve other executives in the finance department in the decision making process.
Choose the best
We provided the list of top 5 spend management software available in the market. Now that you know what to look for in an expense management software, we know you’ll make the best decision. Don’t forget to consider budget, technological capability and time before sealing a deal.