Keeping track of spending is critical for the company’s overall financial strategy. Due to inaccuracies in cost management and reporting, many businesses find up overpaying for their workers’ travel and entertainment costs. The absence of systematic expenditure management software also adds to employee unhappiness, since the time and effort necessary to record spending may be better spent obtaining new business and income for the organization.
The primary issues that corporate finance professionals encounter as a result of a lack of an accurate expenditure management system are as follows:
The Five Most Serious Consequences of Not Using Expense Management Software
Utilizing expenditure management software becomes critical in this setting since it assists workers in tracking, regulating, and monitoring their spending while saving them time so they can focus on their primary task without interruptions.
We’ve compiled a list of the best eight free and open source cost management tools that you can use to optimize your business’s expenditure management process.
However, before we go into the intricacies of each program, we’d want to educate you on what expenditure management software is, how it works, its advantages, and how to choose the best one for your organization.
Expense Management Software – What Is It?
Expense management software is a system that organizations use to track and manage travel expenses, business calls, housing, meals, and shipping of papers or work-related goods incurred by workers, managers, and officials, etc. during business travels or during normal business hours. Expense management software is not to be confused with spend management, which manages an organization’s various costs such as raw material procurement, investment, and service provision.
The cost management software automates and streamlines the whole process of expenditure reimbursement and reconciliation. It contributes to the elimination of paperwork and the reduction of manual mistakes. Employees are not need to juggle paper receipts in order to be compensated. Additionally, the finance staff does not have to spend hours manually calculating each employee’s spending.
Expense management was not always as efficient as it is now. Let’s take a look at how expenditure management software was developed and where it’s headed.
What is the Purpose of Expense Management Software?
Because it is a widely held belief that expenditures can be calculated using Excel spreadsheets, why is it necessary to invest in an expense management solution? This duty of expenditure management is not as straightforward as it seems when it comes to correctly reimbursing workers’ costs on time and in accordance with corporate standards.
Manual expenditure management is inefficient and prone to mistakes, which may result in increased administrative costs, lost productivity, and unsatisfied staff.
If you compound the aforementioned statistics by the number of expense reports you manually generate and approve for reimbursement, you’ll see that the overall cost and time spent on this procedure are far greater than they should be.
You may agree with the axiom “time is money.” If your staff are spending so much time manually creating expenditure reports instead of concentrating on their main responsibilities, this might prove to be quite costly for your business in the long term.
The following advantages demonstrate the critical nature of expenditure management software for businesses.
Expense Management Software’s Advantages
Every business traveler would agree that calculating expenditures and submitting receipts and spreadsheets after a trip is time consuming and inconvenient. Following then, it becomes far more difficult to wait for approvals and get appropriate reimbursements. An expenditure management software may address these concerns and result in happier staff, which results in increased productivity and profitability for the firm.
What to Look for When Choosing an Expense Management Software?
Due to the abundance of expenditure management software available, it may be challenging to choose which software best meets your business’s needs. Thus, here is a basic checklist to consider while selecting expenditure management software.
Simple to Use
The most critical criterion to consider when evaluating expenditure management software is its usability. If your business travelers find the system difficult to use, they will avoid it. This complicates matters further for your finance staff, notwithstanding the software’s deployment.
Before you choose a cost management software, the most critical thing to ask yourself is this: can this product scale with your increasing team? You have no need for a cost management product that works for just five people and is incapable of growing as the number of workers increases.
You may be utilizing other tools for bookkeeping, business travel, attendance and reporting, and so on. The expenditure management software you choose should interact seamlessly with any other tools you’ve implemented, such as time tracking software, travel management software, payroll software, accounting software, or workforce management software, to streamline your company operations.
Capabilities for Mobility
Nowadays, everything from buying to banking is conducted by smartphone in this digital age. The expense management software you choose should enable business travelers to submit receipts and obtain cost reports from their smartphones on the road.
Finally, and you would agree, cost is critical for a firm. While we have included free software in this section, if you are considering purchasing expenditure management software for further capabilities, just check that the solution you choose is worth the cost.
Invoice Ninja is an open-source invoicing and expenditure management software that is completely free to use. It enables you to store and manage all of your profits, expenditure, customer and vendor information in an one system. It automates your invoicing process with the push of a button and supports numerous currencies. With exceptional simplicity and convenience, get a comprehensive picture of your company expenditure.
- Contributes to the creation, import, and viewing of costs.
- Allows for the transmission of invoices to clients
- Has the ability to input bank costs
- Allows for the creation of vendors and the organization of categories
- Produces profit and loss statements
- Contributes to the creation of recurring expenditure
- Allows for differentiation in reimbursable expenditures
- Is it possible to export costs and vendors?
HomeBank is a completely free spending management application developed to help individuals manage their own finances, finances, and budgets. It is simple to use software that offers strong filtering options that enable you to do in-depth analyses of your personal finances. You may browse your data visually and instantly receive an overview of your transactions and reimbursements.
It is compatible with GNU/Linux, Microsoft Windows, and Mac OS X.
Data may be simply imported from Intuit Quicken, Microsoft Money, or other applications.
It is capable of detecting duplicate transactions throughout the import process.
Allows for automated cheque numbering
Can setup many account types, including bank, cash, asset, credit card, and liability.
Possibility of scheduling transactions
Internal transmission is facilitated
Produces robust reports complete with dynamic charts
It is capable of being translated into 56 other languages.
3. Firefly III
Firefly III is a self-hosted cost management application that enables you to manage your costs, income, and budget effectively. It is capable of supporting a variety of bank accounts, including credit cards and personal savings accounts. It may be used to keep track of your costs and help you save money. It is based on the notion of insight into where your money is going in order to prevent it from getting there.
- Allows for comprehensive financial management, including the ability to save, amend, and delete withdrawals, deposits, and transfers.
- Contributes to the management of several account types, including asset accounts, shared asset accounts, savings accounts, credit cards, and liabilities.
- Using tags and categories, transactions may be organized.
- Contributes to the achievement of savings objectives
- Access and manage revenue and cost reports
- Facilitates the use of two-factor authentication for maximum security
- Supports all available currencies, including Bitcoin and etherum
- It also has simple navigation.
- Gives you a comprehensive picture of your spending
- Provides visually appealing reporting in the form of graphs
Tems is a simplistic expenditure and time tracking software that is suitable for managing expenditures and invoicing for small firms and freelancers. It is a free and open source piece of software that is used by consulting firms, attorneys, and accountants, among others, that need to charge their clients on a regular basis. Additionally, it can monitor the specifics of employee spending and compute mileage automatically.
Allows for the entry of costs and their separation by account and project.
Consultants and workers may record time spent on various initiatives.
With a simple click, creates a preview of the bills.
Instantly produce expenditure reports
Automatically calculates miles
Skrooge is a free and open-source expenditure management application that enables you to keep track of your own expenses. It is often regarded as the most effective way for submitting, tracking, and analyzing costs. It is built on the KDE foundations and is compatible with a variety of operating systems, including Linux, BSD, Solaris, Windows, and Mac OS.
- Allows for the import of files from other spreadsheets, applications, and the bank’s website
- Reports are generated in the form of adaptable charts.
- Contributes to budget management by establishing basic rules
- Allows for the configuration of distinct expenditure categories
- Organizes operations
- Manages payees Enables the addition of all essential attributes to all objects, such as transactions, accounts categories, and so on.