With the advent of smartphones and cloud services, small business owners have plenty of expense management tools to choose from. Used properly, they can radically simplify expense tracking and accounting.
Where they fall short is preventing expense leaks, according to Farhan Ahmad, CEO of Bento for Business, an issuer of small business employee-expense cards. Most expense tracking apps rely not only on steady and sustained use, but on a certain level of trust.
Unfortunately, many business owners find that trust betrayed. Some employees fudge numbers and wrongly calculate expenses, which strains a company's bank accounts and creates a murky picture of a company's financial standing.
Intentionally or otherwise, improper expense reporting contribute to the nearly $3.7 trillion lost to fraud by the world's businesses each year, said Ahmad, citing a 2014 report from the Association of Certified Fraud Examiners (ACFE).
By and large, "[small business] owners are very trusting," Ahmad discovered while forming his San Francisco startup. Whether your business is carpentry, plumbing, or coding apps, "you do what you're good at," and that doesn't necessarily involve spotting the nuances of fraud, he said.
That financial blind spot can sink an entrepreneur's dreams. Thirty-three percent of all small and midsized business (SMBs) bankruptcies are caused by "fraud, misuse, or theft" related to expenses, said Ahmad, citing figures from the U.S. Chamber of Commerce. The American Management Association estimated that employee expense losses are the cause behind 20 percent of SMB failures.
Instead of focusing on helping employees accurately capture and track receipts, Bento puts the power of expense management in the hands of business owners.
Fraud-fighting Expense Management Cards
Bento acts as both a funding source—technically an intermediary—andas an expense-management platform that eliminates petty cash boxes. "Bento offers smart employee-expense cards—corporate cards [of sorts]—that the owner can control remotely," Farhan Ahmad, CEO of Bento, told Small Business Computing.
Companies can issue their workers a Bento Business Prepaid Debit MasterCard, which they can use practically anywhere that accepts credit cards. Using Bento's online dashboard, small business owners or bookkeepers can place limits on how and when employees can use the cards.
For example, a cleaning company or an appliance repair firm can issue its drivers a Bento card for the sole purpose of gassing up their vans, complete with daily, weekly, and monthly spending limits. If they try to stop by a supermarket on the way home to subsidize their household grocery bills, the card will be declined.
"Bento is a 24/7 sentry," said Ahmad. Bookkeepers no longer have to pour through credit card statements to find evidence of fraud. With Bento, the fraud never occurs. "It gives you a lot of protection and peace of mind."
Automated Expense Tracking and Reporting
However, Bento exists for more than just curbing fraud, said Ahmad. It also provides business owners with a way to automate their expense budgeting and management and to cut their reliance on cash or personal credit cards for day-to-day expenditures. It also provides business owners with much-needed visibility into where their company funds go.
Bento features a real-time "dashboard to see exactly where your employees are spending," said Ahmad. Web-based controls lets you configure alerts, attach receipts, and track expenses down the last cent. With one click, Bento can export data into QuickBooks and other popular small business accounting platforms.
Since it's a prepaid card, "we approve the vast majority of applicants instantly in real-time," said Ahmad. After linking a bank account, small business owners can elect to issue cards for each employee, department, or even a project. Instead of tracking petty cash, businesses can issue one card for a project, with the knowledge that Bento will accurately track related expenses for accounting and tax purposes.
Bento for Business is available now. The free Starter plan includes up to two cards, while the popular Team subscription includes up to 10 cards for $29 per month. The Professional plan—with up to 20 cards—costs $69 per month.
Pedro Hernandez is a contributing editor at Small Business Computing. Follow him on Twitter @ecoINSITE.
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