Tracking Travel Expenses: Reimbursing Once (and Only Once)

It’s not hard to understand how some bills might get paid twice under certain circumstances. Imagine a married couple both using electronic bill-pay to pay the same bill from different accounts; or an invoice routed to several different departments with each paying a portion and with some portions being paid twice. Sometimes bills are paid twice because the provider double-billed. Obviously, there should be checks and compliance controls in place to eliminate these things, but it’s even worse when it comes from inside your own company or inside your own department.

Frequent business travelers attend one of three "schools" to become educated in the ways of expense reports. As the recipient or processor of expense reports, you'll find it helpful to understand these different backgrounds so that you can correct and retrain your business travelers as necessary.

1. I fill out an expense report when I happen to remember, or when I need money. This school is, by far, the most popular “party school” of expense reporting. The problem with this approach is that there’s no real accountability standard for auditors to base their work upon. Literally any receipt with a date that falls within the range of dates specified on the report by the traveler are fair game. Without meticulously scrutinizing each address and date on each meal receipt and comparing that to the departure and arrival times of each corresponding airline ticket, it becomes very easy to let receipts that should not be expensed slip through the cracks. Departments full of travelers can leak a significant amount of money this way. This approach lends itself to fraud because it's so easy to “lump in a lost receipt” and see it get lost in the bundle. The temptation for travelers to do it more often and with bigger receipts can be hard to resist.
2. I fill out an expense report every single time I buy something. This school offers a fair approach and is attended mostly by engineers and meticulous travelers. Travelers who take this approach are reimbursed quickly, to be sure, but is it worth it to spend the extra time and paperwork, engaging the accounting and auditing departments, for so many reports? Also, it’s easy to submit receipts multiple times using this method. For example, a traveler might have a meal on Tuesday at the hotel restaurant and fill out a quick report to get reimbursed for it. At checkout this same meal appears on the hotel receipt folio. When the hotel bill is submitted separately, there’s no way for the auditors to know that portions of that receipt have already been accounted.
3. I fill out a single expense report for each trip. This is the most elite, or “Ivy League,” school of expense reporting. Travelers who approach their expense accounting with this method are always the most straightforward and cooperative-thinking. It's easy for accountants and auditors to look at the expenses for an entire trip in one sitting. It also makes it easy for management to run metric reports that calculate such things as “Average trip expense” or “Average cost per day, inclusive” for trips, etc. Knowing that this type of expense approach will be required of them allows travelers to adjust their expense habits accordingly, and it allows them to organize their trip expenses on a “by trip” basis in case of future audits, etc. Graduates of this school of thought usually have a file full of little envelopes with the city, trip name, and date written on it, and those envelopes are full of that trip’s receipts. It’s a win-win for everyone.

It may not seem like much of a mistake to let an occasional meal receipt or latent taxi receipt slip through or accumulate on subsequent expense reports. But you need to correct the bad habits that are reflected in sloppy expense reports. The temptation that sloppiness offers and the cumulative total of all of these types of mistakes can really take their toll on your budget.