Manual approval workflows are clunky, tedious, and inefficient, creating challenges for all stakeholders. 

Employees are forced to repeatedly chase approvals, causing delays in processing and disrupting their workflow. Managers face constant back-and-forth, adding to the frustration, while finance teams struggle with reconciliation delays and the risk of unauthorized expenses slipping through the cracks. 

These inefficiencies are the core reasons businesses turn to automated expense approvals. However, the real question is whether automation tools can provide the granular control needed to prevent unauthorized spending.

While these tools excel at flagging out-of-policy expenses, they fail to account for smaller, policy-compliant expenses that can still disrupt the budget. Moreover, the fear of complexity arises:

• What if employees find the new tool difficult to use, causing more frustration than the manual process? 
• Can a new approval automation tool strike the right balance between ease of use, security, and effective policy enforcement?

This post will evaluate how automated expense approval works, exploring the benefits and potential risks and how you can implement these tools while minimizing any negative impact.

What Is Automated Approval Process? 

The manual expense approval process involves several steps, each requiring different stakeholders to review and approve physical or digital paperwork. 

Employees submit their expenses, which are routed through various managers for approval. This process involves multiple back-and-forth communications, emails, or meetings, leading to delays and inefficiencies. Finance teams must manually reconcile expenses, ensure compliance with company policies, and deal with errors due to miscommunication or overlooked approvals. 

This method is time-consuming, prone to mistakes, and lacks visibility, making it difficult to track progress in real time.

On the other hand, the automated approval process digitizes the entire workflow. 

Employees submit their expenses through a centralized platform, which automatically routes them to the appropriate approvers based on predefined rules. These tools can instantly flag out-of-policy expenses, reduce manual reconciliation, and provide real-time visibility into approval status. 

By automating approvals, companies enforce policies consistently and increase efficiency, all while reducing administrative burden.

Here’s a step-by-step process of how automated expense approval works.

1. Create Custom Approval Workflows

You get a customizable no-code approval workflow builder, where you can create as many conditional approvals as you want with simple if-then rules. These multi-layer workflows enable you to route expenses through different levels of approval depending on factors like expense type or value. 

For example, high-value expenses may require management approval, while team leaders can approve smaller ones. This ensures that approvals are handled efficiently, without unnecessary delays.

2. Assign Approval Groups

Next, assign specific approval groups based on different types of expenses.

For instance, the finance team might approve travel-related expenses while department heads handle equipment or software requests. 

Clearly defining these groups ensures that expenses are sent to the right approvers based on department, spend type, or request category. 

3. Employees File Expenses

Employees file their expenses directly through the centralized platform. 

They can easily upload receipts, and OCR captures the information, auto-populating the fields. OCR categorizes and codes the expenses, allowing employees to submit expenses for approval with just a few clicks. 

The platform ensures that all required details are included and complies with internal policy rules, reducing the risk of incomplete or incorrect submissions.

4. Approvals via Centralized Platform

Approvals are processed quickly through a centralized platform. Once employees submit expenses, approvers are instantly notified via email or app alerts. 

The system provides real-time status updates and maintains a complete audit log, reducing back-and-forth communication and ensuring a seamless approval flow.

5. Data Flows to ERP

Once expenses are approved, the data automatically flows to the ERP system. 

This eliminates the need for manual data entry and ensures that financial records are updated seamlessly.

Dedicated Approval Automation Solution vs. Expense Management Tool

Now that we understand how approval automation works, should you invest in dedicated approval automation tools or a complete expense management platform?

So, while dedicated approval automation tools are excellent at streamlining workflows and enforcing policies, they don’t necessarily simplify the overall process for employees, often leading to resistance. 

These tools provide a granular, isolated view of expenses, making it harder to spot budget deviations or gain a holistic understanding of spending patterns. Additionally, while their customizable workflows allow for complex approval structures, managing user roles and access across disconnected systems becomes a hassle.

In contrast, an expense management platform like Pluto takes a more holistic approach. 

It centralizes all expense-related processes, offering a complete overview of employee spending with detailed insights available on an intuitive dashboard. Role access is simplified and well-structured, eliminating the complexities of fragmented systems. 

This centralized design not only makes life easier for managers but also ensures employees have a seamless experience, reducing resistance and ensuring efficient expense management across the organization.

How Platinum Heritage Streamlined Expense Approval with Pluto

Platinum Heritage, a leader in Dubai’s luxury desert safari industry, faced challenges as it grew—specifically with tracking and approving expenses. They used petty cash and corporate cards, but lack of real-time tracking created inefficiencies and increased the risk of errors.

“We wouldn’t know until the statement turned up at the end of the month what had been spent and where.”

~ Christopher Anthony, Global Business Controller, Platinum Heritage

By adopting Pluto’s expense management solution, Platinum Heritage was able to automate expense approval workflow. 

1. Real-Time Spend Visibility

Pluto’s corporate cards enabled the company to track expenses in real time. 

Unlike the previous system, where corporate cards were shared among multiple employees, Pluto allowed Platinum Heritage to issue individual, budget-controlled cards. 

This shift enabled real-time approval and reduced spending uncertainties. 

“We can go into an individual card user spent and see exactly how the money was spent effectively in real time.”

~ Christopher Anthony, Global Business Controller, Platinum Heritage

2. WhatsApp Integration for Receipt Management

Each transaction triggered an instant reminder to employees to upload receipts via WhatsApp. This automated receipt capture allowed for easy tracking and ensured that receipts were always linked directly to the correct expenses, reducing the manual workload and preventing missing receipts. 

“It simplifies things phenomenally because it’s easier to just take a photograph of the receipt before you even fold it up and put it into the wallet."

~ Christopher Anthony, Global Business Controller, Platinum Heritage

3. Seamless Integration Between Cash and Cards 

With Pluto, Platinum Heritage balanced petty cash flexibility and the visibility provided by corporate cards. This hybrid system gave the company detailed control over each transaction while simplifying the approval process. 

“Rather than waiting until the end of the week to collect enough receipts, you can actually see the money as it goes.”

~ Christopher Anthony, Global Business Controller, Platinum Heritage

Automate Expense Approval Without Fear

Automation makes expense management efficient, but it's natural to have concerns about security and the potential for system failures. 

The good news? You don't need to compromise on either. With the right solution, you can enjoy the benefits of automation without the risks.

Through Pluto’s centralized platform, Platinum Heritage experienced smoother approvals, minimized errors, and enhanced financial oversight. Real-time tracking and automated workflows led to faster approvals and fewer complications.

“We haven’t had a single transaction that when it’s received and gone through the approval process that we’ve said, 'Oh my god, that shouldn’t have been spent.”

~ Christopher Anthony, Global Business Controller, Platinum Heritage

If you want to see how expense automation can truly help your business, check out our blog post on ‘Expense Automation’ to learn more about how it can benefit your team.