Expense Policy Changes To Consider Right Now
With all the disruptions to business travel, now is a good time to review expense policies and update them to reflect today’s environment.
The ripple effect of the Covid-19 pandemic extends into nearly all aspects of business life today, starting with the dramatic shift to work-from-home life to the urgent task of updating business plans and budgets. Since no one knows when we’ll return to business as usual, now is a good time to review your expense policies and update them to reflect today’s environment.
Expense policies naturally reflect your company’s fiscal culture, which is especially important during a time when you may be looking to contain costs. But they can also reflect your company’s overall culture—how you support employees when working remotely, and even how they can help support your local community.
As you think about how to update expense policies in the near-term, here are a few areas to consider:
1. Staying Connected
As the skyrocketing Zoom stock indicates, video conferencing is a new must-have for teams, but you want to avoid overspending through one-off purchases and duplicate subscriptions. Consider having one person (per team, per department, or even per company, depending on your size) sign off on any new subscriptions to ensure appropriate coverage with preferred pricing.
2. Powering Work From Home
Whether you typically reimburse employees for cell phones or not, it’s a good time to revisit your policy. It’s important to clarify which work-from-home “infrastructure” expenses can be expensed, in whole or in part—for example, high-speed internet service, cell phones, and landlines—and for what time period. This might be a policy offered only until your employees can return to the office.
3. Supplying Home Offices
You want employees to work efficiently from home, but expenses could get out of hand quickly. Make sure to clarify what employees are authorized to purchase for their home working spaces, and whether pre-approval or signoff by IT is required for computer equipment. Consider both large expenses (monitors, laptops, printers) and small ones (printer paper and ink, chargers and cables, pens, desk organizers).
- Shopify gave each of its employees a $1,000 stipend to buy supplies for working from home to help ease the transition to remote work.
4. Adjusting Approvals
With your team distributed, it’s more important than ever to have clear guidelines in place for spending limits and approvals. Whether you’re clamping down on spend or scrambling to meet unexpected demand, you likely need to adjust those policy limits, and make sure you have clear approval workflows in place. You could also adjust the limits on employees’ corporate cards as an added measure of security.
5. Supporting Your Teams
You might want to consider policy changes to provide extra support for your team’s physical and mental health during the conovirus crisis. You could provide an allowance for livestream yoga or fitness classes, for example, or for online counseling.
- Trader Joe’s empowered managers to reimburse employees for staying home sick, and Postmates covered the cost of medical check-ups for couriers.
6. Tackling Travel
Once the dust clears from unplanned cancellations, it’s a good time to revisit your travel policies for future plans. Did travel insurance help with unplanned cancellations? If so, you might require it for future trips, and specify which vendors should (or should not) be used.
For future trade show or travel commitments, establish clear guidance for no / no-go decisions and timing. And once you’ve had a chance to work out the kinks of videoconferencing, you might consider whether travel spend can be reduced going forward.
7. Building Community
Consider ways you might integrate community support into your expense policies. You could encourage team members to order supplies from local businesses, or empower managers to have lunch delivered to employees at home during a crunch time.
- Rubica CEO Frances Dewing encouraged her team to support local restaurants by ordering takeout or delivery and expensing it to the company.
8. Staying Nimble
During a time of uncertainty, questions will likely bubble up. “Can I expense noise-canceling headphones to drown out Frozen 2?” “Can I get a standing desk for my home office?” Keep the lines of communication open. Set up a clear forum (Slack channel, Google form, email Q&A, etc.) to consider new situations ahead of time and clarify what the policy is for everyone.
HOW CENTER CAN HELP
The COVID-19 pandemic caused an abrupt and unprecedented shift in how you, your leaders and your finance teams are managing the business. Paper receipts, expense reports, and invoices simply aren’t realistic, nor is the lag time in traditional reporting that accompanies them. If you haven’t already, now is the time to streamline your expense process to make it easier for your finance and budget managers to handle it remotely.
Center’s integrated corporate card and expense software eliminates paper receipts and expense reports. It allows you to see spend real-time and automatically audit 100% of expenses. Policies can be adjusted as the business needs—monthly, or even weekly—and everything flows right through the system. Most critical in these rapidly changing times, Center’s Insights dashboard displays current spend levels across the company for a snapshot of where you stand today, not last month.