The old saying “Time is money” rings true for your travel reimbursement process.
You know that the sooner expense reports are approved and paid, the better. Not only does quick reimbursement keep employees happy (and therefore, more compliant), it means you don’t have to worry about making your plan nonaccountable in IRS’s eyes.
Benchmark 1: The approval cycle
First, the survey asked how much time it takes from when employees submit expense reports to their managers to when managers approve them. Respondents said:
- one day or less (28.5%)
- two to four days (56%), and
- five or more days (15.5%).
The actual task of approving reports shouldn’t take too long. But they tend to sit idle for days – pushed off as a noncritical task to do later. How can you spur managers companywide to quicker action?
- Get specific in policy. If you haven’t yet, consider adding specific requirements to your T&E policy. For example, Managers are expected to review and authorize expense reports within two days of receipt. (And if you’re going this route, you could get reports in managers’ hands faster by adding similar language for the employees submitting them, like Employees are expected to submit T&E expenses for managerial approval within one week of incurring expenses.)
- Track their actions. If your company has an automated workflow that shows others’ actions in the T&E process (e.g., if they’ve received/approved a file), have your staffers use that visibility to track when managers do or don’t follow the rules. If certain managers frequently get behind, staffers can approach them with the concrete evidence.
- Issue reminders. If it’s been a while or managers seem to be getting lax, bring the rules to the forefront again. Have your staff send a reminder email with the specific guidelines attached.
Benchmark 2: The reimbursement cycle
Next, the survey asked how long it takes from expense report approval to employee reimbursement. Respondents answered:
- less than one week (40.5%)
- about one week (30%), and
- two or more weeks (29.5%).
Your A/P staff has lots to do, but you know this task should be a top priority. To speed things up:
- Assess their approach. From time to time, your staff should rethink the most productive way to handle expense reports. Does it work well to schedule a block of time once a week? Or are staffers more focused and efficient if they do an hour here, an hour there? Depending on how many people are on staff, the time of year and what projects/initiatives are currently in the works, the answer could change.
- Streamline problematic reports. You should also verify your staff has a set approach for what to do when they find an error or issue. If there’s not (or they’re not sticking to it), it’s time to outline a clear process. That way, problematic expense reports don’t get pushed aside to “handle later.” If staffers start solving the issue right away, reimbursement isn’t delayed.