The Forestry Commission, the government department
responsible for managing the UK's woodlands, has dramatically cut
its costs and improved its VAT recovery seven-fold by replacing its
manual expenses system with expenses management
software.
The Edinburgh-based body employs more than 3,000 people, from
the board of commissioners, to rangers and foresters, and has an
annual employee expenses bill of more than £2m.
The commission implemented the Employee Expenses Management
Module from CedarOpenAccounts, integrating it into the
CedarOpenAccounts' eFinancials core financial management system,
which the commission had been using for eight years.
The roll-out has been particularly protracted, partly due to the
remoteness of some locations. The project began in April 2005 and
is now approaching its final phase.
The expenses system replaced costly and inefficient manual
processes, whereby employee expenses had to be signed off by line
managers before going to the finance team. It required the original
paper-based submissions to be completed by employees and
accompanied by receipts. The expenses then had to be processed
through the finance system.
"Under the manual system, we only claimed back about £4,000 in
VAT from a total expenses bill of £2m," said Steve Atkins, head of
finance systems at the Forestry Commission.
"With the CedarOpenAccounts system in place, we expect to be
much more efficient in our VAT claims, particularly for expenses
such as hotel bills. Early indications show our VAT recovery is
seven times greater than the manual system, and we expect this to
make a significant contribution to our return on investment."
The automated web-based system allows employees to input their
own expenses. The software then automatically transfers the data to
the accounts department for processing.
The Commission also introduced self-approval, with
pre-determined expense limits. The Commission checks 10% of the
claims, rather than 100%, and this has cut the time and cost of
processing and approving claims, said Atkins.
Staff still need to produce receipts to accompany the claims and
back up VAT reclaim, but these are retained at local offices, and
the rest of the process is now electronic.
"We have already seen quantifiable improvements in terms of the
accuracy of claims, along with reduced processing costs by about
60%. In addition, we have a single electronic record of each claim,
which has helped us with our analysis and reporting, revealing
further savings."