Petty cash is a security risk and is difficult to track efficiently. It’s time consuming due to employees needing to write up transactions by hand, alongside reconciliations having to be recorded manually. Petty cash is normally given to employees prior to spend so there is a chance it may become misappropriated.
Corporate credit cards suffer from a lack of visibility and inflexible spend limits. Transactions tend to be reconciled once a month so finance leaders are unable to track the value of what is being spent, alongside which categories it relates to.
A further complication is the cut off of credit cards being mid way through the month. This creates additional reconciliation work due to needing to reconcile what was paid off during the month, as well as what has been incurred on the live statement through to the month end. An inability to put controls in place means employees may incur spend levels exceeding company policy.
Out of pocket expenses are probably the most inefficient form of expense management. Significant effort is needed from employees to enter their expenses on template spreadsheets. The month close is often slowed down due to the quality of data from submissions being poor, and employees having to be chased to submit their reports. They also put a strain on the cash flow of workers who have to lay out cash, and may be put off from procuring vital products and services due to not having the personal means to do so.
With Soldo, make the switch from paper to digital, and from credit or cash to prepaid cards. This will also help support fulfilling the government’s Making Tax Digital (MTD) initiative, that aims to make the UK one of the most digitally advanced tax systems in the world.