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Pleo - An Alternative to Expenses

My colleague Jason wrote a wonderful piece on Receipt Bank.

However, what if companies want to manage cost, especially watching what employees spend on personal expenses? One option is to use Pleo. Pleo is the same as a bank account, but with the possibility of giving your employees a bank card each so they can spend company cash, without spending their own.

With Pleo there is one overall owner of the account, and they keep an eye on the balance in the account. When the account is running low on funds they would be responsible for topping up the bank account with the funds from the main company bank account.

So that is the basis of Pleo, but what else does it do and how can it be used to a company’s advantage?

Setting Up

The problem when going through a main stream bank is the time it takes for background checks to be processed. Well, with Pleo there are no background checks involved, which is definitely a bonus. As well as a bank card you also have a virtual card. This virtual card can be used when purchasing anything online. This means that you do not have a reliance of having your Pleo Card handy. And with Pleo you can get a 3 month free trial, which means if you don’t like it you can cancel.

Time Saving

Just like Receipt Bank, once you purchase an item, you take a picture of the receipt/invoice and attach it to the transaction, then you can chuck the receipt away. This means that once the image is taken then the work is done. A notification is sent to an employee’s phone asking them for the receipt, which is a helpful reminder and avoids missing receipts. This slick process means that all the information is available for the accountant/finance team on the first day of the month. Hakon Junge from Pleo explains this here.

Tracking VAT Receipt

Pleo has a mobile app which employees can download, and use it to take a picture of the VAT receipt/invoice. The VAT receipt/invoice can be attached to the relevant statement line, meaning when an accountant comes to reconcile the bank statement they can claim the appropriate VAT. Every time a transaction is purchased, a message is sent to a mobile asking you to take a picture of the receipt, therefore the chance of forgetting a receipt is reduced. When it comes to us accountants, the purchase will be coded to an account code which is linked to a code in the chart of accounts. Accountants can set a default VAT code which is most commonly used in order to claim the correct VAT and help save time. However, you are able to change the VAT code in your accounting system if need be. Hakon explains this here.

Online Reporting

As well having a mobile app, Pleo has an online feature which can track a variety of areas. In an ideal world, each bank statement line should have a receipt/invoice, but what Pleo can do is highlight:

• How many receipts are missing
• Which employees do not upload every receipt
• Areas people are spending the company money on (E.g. Travel, food etc).

Platform for Accountants

In Pleo there is an option for an accountant or bookkeeper view. This means that accountants can manage more clients under the one email. From there, all that is left to do is input the date range and obtain the transactions for a particular period and put this in your accounting software. There, the accountant can see what transactions have taken place and what receipts are missing and therefore who needs to be chased. Hakon explains this and more in this video, including how Pleo can now apply Xero tracking categories to transactions.

Spending Limits

Limits can be allocated so employees can only spend up to a certain limit. Although giving employees a card can be empowering, setting limits also gives directors comfort.

Xero integration

At Blu Sky we are big supporters of Xero, and Pleo has an integration with Xero so that all transactions appear there, just like a bank feed, which saves your accountant time, too. As well as Xero, Pleo also has an integration with Quickbooks and Sage One.

Why will your staff love it?

The main reason why staff will love Pleo is it eliminates the possibility of an individual being out of pocket. Expense claims are done once a month or even once a fortnight, therefore if an employee has spent a lot of their own personal money they do not need to wait to get that money back. Hakon explains this and more here.

Losing/misplacing a card

The main worry whether it be personal or company is losing the bank card. The time it takes to cancel your card only for it to turn up a few days later can be a pain. With Pleo there is a possibility of deactivating a card temporally or permanently. Therefore, as soon as you lose your card you can deactivate the card immediately. If you eventually find the card you can reactivate it with no waiting time. If you cannot find your card you can order a new card online.

Limitations

But with everything there will be a disadvantage. The main disadvantage revolves around trust, and trusting the employee to spend appropriately for the good of the business. On Pleo you can download a bank statement which shows who spent what on each day. If something does arise then obviously tackling this problem is always going to be difficult. The other disadvantage is cost. To create a user, it costs £7 per user. With a normal bank account, you will be given one bank card as well as no setting up fees, but with the possibility of setting up multiple users and giving employees the freedom to purchase items to do their job, potentially warrants the extra £7 a month spend. Finally, Pleo does not have a mileage tracking facility. However, mileage would normally be claimed on personal expenses, which would probably mean Receipt Bank would be a better go to app. Hakon explains this in this video.

Does this spell the end of Receipt Bank?

Personally, I do not believe this spells the end of Receipt Bank. Receipt Bank differentiates between company spend and personal spend really well, so for any companies who are still willing to use the expenses route then receipt bank is your go to software. Hakon explains how Pleo compliments Receipt Bank here.

However, for companies who want to keep a hold on money and reclaim the most VAT possible then Pleo is definitely an option.

If you have any questions, please do not hesitate to get in touch.

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