The end of financial year (EOFY) is a time that many small and medium businesses (SMBs) dread. In addition to the complexities of JobKeeper, knowing every financial obligation and entitlement can become overwhelming, particularly if businesses are not overly confident in their books.
Lost receipts, expense mistakes and inadequate recordkeeping result in a stressful and potentially non-compliant EOFY. From a managing director’s perspective, automation turns a stressful, tedious scramble into an efficient process.
It also makes it easy to forecast the business’s cashflow and gives the management team valuable information they can use in business planning and strategy.
Additionally, an automated invoice and expense management system provides businesses with confidence in their compliance when approaching EOFY.
Having all finance and payment data digitally viewable and stored in one accessible, secure, and mobile-friendly place can help SMB management teams and their employees easily and efficiently complete tax returns, without needing to chase missing files.
Accurately filling out tax documents also means SMBs won’t be liable to pay more tax than they rightfully need to.
Beyond this, modern invoice and expense tools can help SMBs use EOFY as a time to review payment data and make critical decisions about future expenses to cut, and areas to invest in more heavily. I have identified three issues that prevent an efficient month-end for SMBs:
1. Accessing the paperwork
Even though employees may be required to submit expenses by a certain date each month, finance teams are often left chasing expense reports, rather than focusing on value-adding activities.
An automated invoice and expense management system makes accessing the required paperwork each month effortless. Employees can upload and submit expense claims in real time, regardless of their location.
They can simply photograph their receipts on their smartphone and the expenses are automatically converted into claims to be reviewed and submitted.
Additionally, company policies are automatically applied to the system, to proactively ensure every detail and expense submitted is compliant. This gives finance teams more time back in their day to focus on tasks that contribute to business growth.
2. Data entry
Data entry is time-consuming and tedious. When data entry is rushed, mistakes are made and accuracy is quickly compromised.
Automation removes the need for manual data entry by automatically capturing data code costs. Data flows seamlessly into the finance system to ensure everything is in one place.
With the risk of manual error eliminated, SMBs can save time and be confident nothing has been missed.
3. Data quality
Finance teams are working with figures in arrears, meaning they don’t always have a clear picture of the current finances. This is something that’s all too clear when an unexpectedly large expense claim or invoice arrives and disrupts the cashflow forecast.
An automated finance system provides real-time visibility so the finance and management teams can instantly see the full picture. All data is digitised and connected, so finance teams can interrogate and analyse information easily, while also enhancing their reporting capabilities.
An efficient, compliant month-end ensures the same for the EOFY. An automated system streamlines the expense and invoice process, giving SMBs confidence in their financial data when submitting their tax returns, even in the current complex business environment.