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The Serious Side of Laughable T&E Reimbursement Submissions

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August 21 2019

Mark Brousseau, Analyst and Researcher in Business Process Automation, Brousseau & Associates

Would your business reimburse an employee for…

... a cow?
...a bear rug?
... a pogo stick?
... a bag of cat litter?
... Super Bowl tickets?
... clothing for a child?
... invoices for a side business?

These eyebrow-raising expenses are just some of the real inappropriate reimbursement submissions cited by CFOs surveyed by Robert Half Management Resources.

While reimbursement submissions for bed bug removal, pearls and doggie daycare are laughable, they illustrate the financial havoc that poor travel and expense (T&E) management can cause.

Fifty-six percent of CFOs say their business has experienced an increase in inappropriate expense report submissions over the last three years, Robert Half Management Resources reports.

Without effective systems, processes and policies in place for reviewing the expense reports submitted by employees, businesses are putting their profitability and productivity at risk.

Here are three ways that businesses can reduce inappropriate expense report submissions:

  1. Automate: Fourteen percent of businesses rely on manual processes for T&E reporting, Robert Half Management Resources reports. Manual processes increase the chances that inappropriate expenses like a tree or a motorcycle (actual reimbursement submissions cited by CFOs!) will go undetected. Mobile solutions help identify non-compliant expenses by capturing information from key fields such as merchant, expense type, date and location from receipts. Over time, the system learns to classify receipt types to deliver even better results. Capturing complete data from receipts and streamlining the handling of report submissions makes it easier for managers and accountant to spot outrageous expense line-items.
  2. Make your T&E policy clear: Businesses should do everything possible to ensure that there is no ambiguity among employees about what constitutes a valid expense submission, warns Tim Hird, an executive vice president with Robert Half Management Resources. Review your T&E policy with all new hires, ensure that the policy is easily accessible to employees, make employees aware of any changes to the policy, and periodically highlight key policy points in your employee newsletter, on your corporate intranet or through employee e-mails. Additionally, consider clarifying “gray areas” or tricky situations during staff meetings.
  3. Hold emplyees accountable: Whether they were result of bad behavior or a lack of understanding about what constitutes a valid expense submission, any inappropriate expenses must be discussed with the employee to avoid problems in the future. Because of the burden of manually processing T&E reports, many businesses carefully review only a random sample of reports for irregular or non-compliant purchases, allowing many inappropriate expenses to slip by. Mobile T&E solutions make it easy to review every line-item of every T&E report and immediately address any red flags to reinforce company policies.

Following these steps will helps ensure that your businesses isn’t unwittingly reimbursing employees for a chandelier, a tractor, toys or a personal trip to Italy (incredibly, all expenses cited by CFOs).

The mobile T&E solution from CIIS can help your business stop inappropriate reimbursement submissions in their tracks.