In many businesses, cost control often only begins when invoices are sent to the accounting department or when employees complete reimbursement procedures. However, by then, the expense has already been incurred, and the business is almost powerless to prevent it if errors are discovered. The only thing that can be done is to check the documents, adjust the accounting entries, or handle cases of policy violations.<\/p>\n
That's also why more and more businesses are shifting from a post-audit to a pre-audit approach to expenses \u2013 that is, controlling spending before it occurs. Instead of only verifying after the money has been spent, businesses establish layers of control from the moment a need arises for purchases, business trips, advances, or payment requests. These layers of control include: corporate spending policy<\/a>, spending limits, budgets, and procedures for approving expenses before they are incurred.<\/p>\n For CFOs and finance teams, pre-auditing is more than just an approval process. It's a management method that helps businesses proactively protect their budgets, improve cash flow forecasting, and significantly reduce the amount of error handling required during post-auditing. So, what is pre-auditing of expenses, how does it differ from post-auditing, and where should businesses begin implementing it?<\/p>\n