How schools can cut the red tape in expense management

How schools can cut the red tape in expense management

In recent years, the conversation around school funding has reached a crescendo after reports highlighting the ever-growing gap between the nation’s wealthiest and neediest schools. However, our schools have another big money problem, albeit one that often flies under the radar.

Amid the worsening cost-of-living crisis, surveys have revealed that many Australian teachers are spending hundreds of dollars per year of their own money to make sure kids don’t miss out on vital education activities.

In 2023, polling from the Australian Education Union (AEU) found when it comes to forking out for classroom supplies, a staggering 85% of principals, teachers and support staff spend an average of $885 a year, with those in NSW, WA and the NT spending more than $1,000 each a year. Based on the national average, the total spending by teachers is just under $160m a year.

As well as enduring the financial pain of having to spend their own money on school supplies and activities, teachers are also faced with a long, paperwork-heavy reimbursement process. This frustration also extends to finance departments, which are often dealing with outdated systems relying on paper forms and receipts.

Work credit cards are generally reserved for principals, and even when teachers are granted access, there’s a lack of visibility or limits set on spending.

Hassle-free spending for teachers

One company that is helping schools put an end to these expensive, time-consuming, and outdated practices is Budgetly. Four years on from its launch in 2020, the company has a strong presence in Australia’s education sector and has helped over 1,100 customers with their budgeting and expenditure.

“We started having quite a lot of larger not-for-profits coming to join Budgetly in late 2021 and then word spread to private schools. Word then started spreading to the wider education industry including other schools, universities and online education,” Matthew Clements, Budgetly’s Head of Growth, told The Educator.

“Once we had a few principals coming to us inquiring about our expense management system for schools, we started to hear firsthand, the problems with their expense management process.”

Clements said principals and finance team members at schools that used the company’s services early on quickly told their peers about Budgetly, helping the company build a working relationship with more than 100 schools.

“Once we have the opportunity to sit down with a new school to hear about their challenges, the decision to bring on Budgetly is an easy one,” he said.

“We currently have 61% of all school ‘demos’ we've done end up in the school bringing on Budgetly. The typical reasons why a principal or finance team at a school tell us they ‘can't do a demo right now’ is ‘I'm just too flat out’ – usually with their admin-heavy expense process.”

‘Everything is just there, and it saves us a lot of time’

Director of Hillsborough OOSH, Judy O’Leary, said her school has saved more than 10 hours a week on manual admin since using Budgetly.

“The main thing for us with Budgetly was the convenience. The Budgetly account on Xero pretty much reconciles itself because everything is just there, and it saves us a lot of time,” she said.

“We were contacted by another company that offered similar expense management services, but we decided to use Budgetly in the end because we wanted to engage with an Australian company. They also had a good background of working with other childcare companies, which gave me a lot of confidence.”

For O’Leary, a significant benefit of using Budgetly’s prepaid corporate cards was the visibility and accountability of each staff transaction. This visibility on transactions helped her save even more in terms of company costs.

“I can now set a cap on my [company] spending. For example, previously, staff would tell me that they would spend $400 on equipment, but now I can set how much they should spend on equipment, making it more transparent for staff and reducing the risk of overspending. So that’s handy.”

Where the greatest demands lie in 2024

Clements said the greatest demands the company is seeing with schools it speaks with are around tracking and chasing receipts; the lack of real-time visibility on transactions (especially against budgets); and time-consuming reimbursement processes.

In other words, the same old problems are not being addressed, making services like Budgetly’s all the more important as more teachers reach into their own hip pockets to cover school expenses in the slowing economy.

“Budgetly currently solves all of these problems in a black and white sense,” Clements said.

“A key area that our customers are asking us for help with is automating the accounts payable process for supplier invoice management and payment automation,” he said. “This product will be called Bill Payments and is coming July 1 this year.”

Looking ahead, Clements said Budgetly will be evolving its offerings based on the shifting economic climate and the needs of Australia’s schools.

“With whatever schools tell us they need next. Bill payments is the next major product delivery to solve even more problems in the expense management spectrum and what we build next depends on what our customers tell us they need,” he said.

“We take on board customer feedback seriously and that helps us priortise our development.”

For more infromation on how Budgetly can help schools save time with automatic expense management, click here.