Although hybrid working is still evolving, its potential to help curb expenses has become increasingly relevant — 2023 began with the tremors of an economic downturn, and as
But while remote working is now commonplace, companies still face challenges in the financial realm, specifically when it comes to analyzing employee expenses from afar. Financial and accounting teams are inundated by new data streams that accompany hybrid work on a global scale, and they are struggling to parse the troves of decentralized expenses.
Fortunately, new solutions are arising to help accounting teams better manage the increased amount of data they face.
Tax complexities of remote and hybrid work
Remote work brings the complexities of coordinating employee expenses and tax filings into sharper focus.
Allowing workers to take charge of at least a portion of their expenses can alleviate the burden on technical and financial teams and decrease overhead. But the more organizations shift toward "consumer style" business spending, the more they need to ensure their compliance controls are in place and up to the task.
Consider that every time an employee crosses domestic or international borders to work, the varying regional regulations can have ramifications in tax reporting. This can yield unprecedented risk management challenges and increase the complexity of overseeing new legal and financial obligations.
Part of the remote working "pact" is that employees be responsible for filing the growing number of remote work-related transactions for the finance team. But the lack of precedence for these filings can create errors and confusion for those analyzing the expenses. With employees carrying the onus of tracking and managing their own business transactions, finance departments are tasked with reviewing a growing number of disparate transactions from numerous locations. If not managed properly, that can be a recipe for financial chaos.
Regulatory changes have come about alongside this shifting work culture, but they don't always address the issues financial teams face. For example, the EU's proposal for
Leveraging tech to overcome complexities
Companies feeling burdened by these shifting winds would do well to seek out technology that addresses these problems — namely, through automation. Automated solutions are uniquely poised to help accounting teams maintain compliance across regions and varying technical platforms.
By automating their processes of tracking and parsing expenses, finance departments can say goodbye to chasing down employees who may have submitted an expense incorrectly or without enough detail. They can instead rely on technology to flag discrepancies, find the source of the error and sift through confusing financial statements to identify the correct expense category.
Adopting automation also boosts accuracy and reduces the level of expense noncompliance, which is vital for companies keen to reduce costs: noncompliance can cost businesses around
Tax complexities tend to proliferate as companies scale up. Instituting a sustainable automated system to handle these new expense intricacies is vital for growing a company, particularly during these volatile economic times.
Don't let taxes take a toll
Companies want the best of both worlds from remote work — cutting costs and keeping employees happy with increased flexibility. It's an obvious evolution for industries of any kind, but the financial and legal implications of this new arrangement cannot be overlooked.
Financial leaders and the accounting teams they manage need to future-proof their operations if they hope to succeed in the face of the new work landscape. And in our rapidly digitizing world, that means finding the tech-first, automated solutions that can aggregate and accurately analyze financial data with increased control and visibility, while accounting for every change to tax compliance regulations.
Who wouldn't want to make taxes a little less taxing?
