Reimbursement is a monetary payment made by an organisation to an employee for expenses incurred with his/her own money, and also includes the compensation made by an organisation to customers or third parties who have spent on business-related expenses. In a nutshell, reimbursement is money paid to an employee, a customer or third party as repayment for a business expense.
The following are the 3 common types of employee reimbursements:
(includes the following items, but not limited to them)
Here are four steps to consider:
Establish all rules and guidelines that clearly outline what comprises a reimbursable expense, before spelling them out in the expense policy for employees to follow. In doing so, employees’ submissions for reimbursement will be in line with the company’s requirements for making claims. Payment method and payment timeline must be indicated in the expense policy.
An example of a company rule or guideline: Employees shall not incur any expense on products manufactured by an industry competitor.
For each type or category of reimbursement, create an exhaustive list of allowable expense items as shown above under Point B.
Prior to making an expense, a pre-approval must be sought from the department head or manager. This is to prevent and protect both the company and the employee from making unauthorised expenses. Pre-approvals must be presented in the submission for reimbursement.
Finally, proof of expense (receipts) and proof of approval of the expense should be attached alongside the submission.
Automate reimbursement requests using Forma for easier management and higher efficiency. Moreover, you don’t need to build your own forms from scratch. Simply choose from one of our ready templates, such as the expense claims form as shown above.
Once you’re done customising your template, you can move on to design your drag-and-drop workflow as depicted (or in any other way you wish). After users have submitted their form, the following steps will proceed as ordered in your workflow.
For similar articles, check out How Does An Online Purchase Order System Work?