The Future of Expense Management: Key Technology Trends

Macro trends and changes have radically shifted the face of business over the last several years and the pace is only accelerating. From COVID, to the subsequent embrace of remote and distributed teams. From lockdown and the (temporary) end of the majority of business travel to its reemergence and growing importance, we’re now seeing. From hands-on, manual processes, to fully integrated, automated, at the speed of transaction operations. The list goes on and on.

With this pace of change, it’s more critical than ever to stay on top of new trends, technologies, and solutions emerging and influencing the worlds of accounting and bookkeeping. Not only does staying current allow you to better serve and understand your clients, but it can also often streamline your operations and give you a leg up on your competition.

Macro Trends Driving Changes & Innovation

Remote & Distributed Teams

Forced by COVID and lockdowns, most organizations had no choice but to finally adapt, adopt, and embrace remote working arrangements with teams distributed geographically. As a result, organizations have had to adjust their internal processes, how compliance is tracked and enforced, decentralized authority and decision-making, as well as numerous other changes. Inevitably they have leaned on technologies to help to enable and solve for these new challenges.

Mobile

Even prior to COVID, organizations were being forced to adapt to and adopt mobile solutions. Even while travel died during COVID the rise of distributed and remote teams led to the repurposing of much of the mobile-focused tech solutions to enable those teams no longer coming into the office.

Now with lockdowns well behind us (we hope) business travel is once again booming. Deals are being conducted and closed in person, dinners and events are occurring, and big conferences are beginning to see attendance returning to pre-COVID numbers. And while many mobile solutions were repurposed at first in support of remote workers, the use cases for mobile and remote are oftentimes quite different. As a result, we are beginning to diverge and specialize relative to these distinct use cases and needs becoming the norm again, following what had been a period of convergence.

Social and Cultural Awareness

Whatever your opinions and leanings, it’s impossible to deny that across the spectrum social and cultural awareness and concerns have spiked and continue to rise. Consumer, employee, and even company awareness, activity, and even responsibility relative to these issues and concerns remain the name of the day.

The upshot is that many things that used to not register have now become hot buttons for many. Take for instance concern and awareness around environmental issues. These concerns and priorities can play out in countless ways but have often impacted technologies and solutions. Whether that’s to improve environmentally damaging aspects of a specific product or solution or the creation of and embrace of specific products or even product categories specifically for the addressing of environmental concerns.

Data & Connected Systems

The insane growth of data being generated, shared, and consumed has been well documented and only becomes increasingly mind-boggling in its sheer pace and scale. The upshot has been the proliferation of more and more specialized digital solutions for the management and tracking of all aspects of business.

The corollary challenge created by the growth in these companies’ tech stacks is that we’re left with more and more data silos, ironically often making it harder than ever to actually understand what’s going on holistically. To counter these trends and concerns, interconnected systems, integrations, data orchestration, and the consolidation of tech stack where possible under fewer vendors that cover more have become increasingly critical priorities. Often how well the tech integrates and works holistically has become the bigger selling point than that it is best in class at doing one or a few specific tasks.

AI & Automation

Last year, 2023 marked the point where AI went from a pipedream and field littered with failed experiments and broken promises to something that has already upturned everything. Rising largely out of the data and computational trends discussed previously, we are at a tipping point where machines are able to operate increasingly autonomously, often performing better than their human counterparts.

How well organizations as well as individuals are able to embrace and adapt to this new reality will determine the winners and losers of the next several decades. But make no mistake, AI and automation are already transforming everything and the pace is only going to accelerate.

Problems with Legacy Expense Management Solutions

Legacy expense management solutions carry several issues that can slow down business and frustrate employees.

Here are some common problems:

Lost Receipts: It's easy to lose paper receipts, especially when traveling or juggling many transactions. This leads to incomplete expense reports and financial issues. This has become acutely problematic relative to the remote working and mobile trends we’ve already touched on.

Delayed Approvals: Waiting for expense approvals can take a long time. Often, managers are too busy to review submissions quickly, which can disrupt cash flow. Again, this has become increasingly problematic as teams have left centralized offices and become dispersed across towns, countries, and the world.

Manual Data Entry: Manual entry is annoying and can cause mistakes. Errors in expense reports lead to further delays and corrections, wasting valuable time. With the ever-increasing volume and velocity of data being handled, doing so manually is becoming a nonstarter.

Lack of Real-Time Visibility: Traditional methods often mean financial data isn't updated until reports are processed and approved. This delay affects budget tracking and can hinder timely decision-making. With the pace of change and the amount of data available, acting on out-of-date and unreliable data can be a death knell for organizations. Alternatively, those who have access to realtime, complete data, often have an insurmountable competitive advantage in the marketplace.

New Trends in Expense Management & Tracking

With all of this in mind let’s look at some of the specific tech trends that will be reshaping Expense Management & Tracking over the next year.

Optical Character Recognition (OCR)

In a nutshell, OCR is the process for converting different types of documents (paper docs, PDFs, images, etc.) into editable, indexable, and searchable data. Specific to expense management and tracking, OCR’s are most often used to extract data from scans of receipts, invoices, and bills.

As such, OCR helps with:

Automating Data Entry: By extracting details such as vendor name, amounts, transaction details, etc. OCR vastly streamlines the process of ingesting expense data while also decreasing human error.

Tech Stack Integration: Once the data has been extracted and transformed into a standardized format, it becomes radically easier to pass that data from one system to another, facilitating tighter and deeper integrations and eliminating data silos.

Expense Analysis & Reporting: By standardizing the data and its formatting it is much easier and more efficient to then incorporate that data into reports as well as analyze it. And since the process is largely, if not entirely, automated it means that the reporting and analysis are often nearly real-time if not actually so.

Compliance & Auditing: By standardizing data and making it easier to share, access, and process OCR makes it easier to enforce and ensure compliance across your teams and organization.

It is a tech that changes paper receipts into digital files. Originally used just for managing paper receipts and collecting invoices, OCR has greatly improved these processes.

Artificial Intelligence (AI) & Machine Learning (ML)

As noted previously, AI is already transforming virtually everything. Expense Management and tracking will be no different.

AI and ML will primarily impact expense tracking and management in 5 ways over the coming year:

Improved Automation: As integral aspects of OCR, advancements in AI & ML will improve the speed, reliability, and accuracy of the data extracted through OCR processes.

Smart Categorization: Once the data is extracted, AI will increasingly automate the downstream processes related to that data. First up is the organizing and categorization of the data by doing things like matching receipts with expenses and expenses with their appropriate category.

Fraud Detection: One of the challenges arising from the rising sea of data has been that it is often difficult to find the signal within the noise. AI will be integral in helping to sift and sort through that noise and find the critical signals to focus on. Nowhere will that be seen and felt more than in fraud detection where AI solutions will be able to more quickly and reliably detect anomalies and trends in the data indicating potential fraud.

Predictive Analytics: We already discussed how access to real-time data and analytics will make or break many organizations. As access to real-time data and reporting becomes table stakes predictive analytics will become the new differentiator. The sophistication of your AI and ML models will dictate the reliability of your predictive analytics and the effectiveness of the associated decisions.

Personalized Insights: AI will also allow us to democratize the presentation and analysis of data sets. With manual, human-driven analytics and reporting the focus is inevitably on creating reports and analyzing them for the benefit of the most senior team members and/or for the widest possible audience. The flexibility and customization of AI will facilitate highly customized and personalized reporting, analytics, and even the delivery of actual insights and takeaways from that data.

Blockchain

As the foundational technology behind cryptocurrencies, blockchains have already had an enormous impact. However, their use is hardly limited to crypto and it is increasingly finding its way into numerous new categories and use cases.

Relative to Expense Tracking and management blockchain is poised to influence things in several key ways:

Immutable Records: The key aspect of blockchain that makes it so integral to things like crypto is that it provides a tamper-proof ledger for storing expense data. In short, the blockchain ledger ensures integrity and traceability, making audits immensely more efficient and reliable.

Enhanced Security: The same technology that makes the ledger tamper-proof, by definition, also makes it more secure, thus decreasing the risk of unauthorized access or fraud.

Smart Expense Approval & Payment: The security related to blockchain technology means that expense approval and payment will become increasingly automated. This will not only speed what are now still largely manual and time-consuming processes, but will also lead to happier employees, vendors, and clients who no longer unnecessarily wait for approvals and payments to be processed.

Transparency & Compliance: Again, inherent in blockchain technology and that tamper-proof ledger we mentioned, is the corresponding transparency it creates. With greater transparency comes less compliance risk as well as less room for expense claim disputes.

Decentralized Expense Management: The other upshot to the security and transparency implications of blockchain is that those very same characteristics allow for more decentralized management of expenses.

Conclusion

The pace of change is only going to accelerate. These changes can be overwhelming and difficult to keep up with. However, by staying on top of the emerging trends as well as what is driving them you can establish yourself as a leading authority while carving out a competitive edge. So strive to remain intellectually curious, play with new tech, take product demo calls and meetings, discuss with your peers how they are adapting and what they are adopting, and most importantly listen to your clients and their needs! By doing so you’ll be able to successfully ride these waves of change and stay at the forefront of your space.

How Uncat Simplifies Receipt Tracking and Approval Workflows

And remember you don’t even need to wait for these tech trends to emerge over the course of the next year! With Uncat you can already accomplish many of the improvements discussed above.

In particular, with Uncat, you can snap a photo of your receipts using your phone to keep them safe. Once you upload a receipt, it gets organized and put into the correct expense report automatically, which saves time and reduces errors. You can even simply text your receipts directly eliminating the need to store them or remember to upload them later.

Additionally, Uncat speeds up the approval process by automating it. Managers get alerts as soon as an expense report is ready for review. They can approve or request changes right from their devices, speeding up the process. This quick workflow helps prevent delays that can slow down financial reporting and reimbursements.

By integrating these features, Uncat ensures that tracking expenses and getting approvals is no longer a source of frustration but a quick, efficient, and accurate process, freeing up time for more strategic tasks. This is how Uncat is making expense management simpler and more effective for everyone involved.

Simplify your workflow, reduce errors, and delight your clients with effortless bookkeeping. Try Uncat for free and increase your efficiency today.