It is becoming increasingly difficult for corporations to effectively and efficiently manage employee expense reports. Travel transactions are growing in volume as corporations become increasingly globalized. In the face of increased travel and accompanying expenses, it’s become more of a burden for corporates to manage these expenses, and they’ve seen upticks in fraud and waste.
The commonality and effects of fraud are just one reason corporations must invest in robust expense report software.
Below are some of the key things corporations should know about expense report abuse and fraud.
Double billing is usually the most common form of expense report fraud in most businesses.
In these instances, employees submit duplicate receipts multiple times. In some cases, an employee may also use a company credit card and submit the receipt for reimbursement on the expense report.
When this happens, the company pays the credit card bill and provides reimbursement to the employee.
Other Common Forms of Fraud
Other examples of common expense report schemes include expensing personal items or doing small things that accumulate over time, such as adding a few dollars to every cab ride.
Employees may claim cash expenses so they don’t have to provide receipts, they may exceed limits for expenses by splitting it up into several items, or they may simply claim items that they’re not entitled to getting reimbursement for.
Corporations need to realize that if they do identify something like this happening, particularly with their well-paid executives, it could indicate that other forms of fraud are also happening.
Expense report fraud can be just one red flag of what else is happening out of view. Sometimes it’s not necessarily the expense report fraud itself that’s the biggest problem for corporations. Instead, it’s the concept that it can indicate more unethical behavior and a toxic culture in the company that can contribute to dishonest and a number of other problems that could even become legal in nature.
Be Aware of Credit Cards
As was touched on above, one of the primary ways employees may be fraudulent with their expenses reports and reimbursements is in how they use the company credit card. Along with charging items to the card and then submitting for reimbursement, they may simply be using the cards for things they shouldn’t be, hoping the company won’t go over the bill with a fine-tooth comb and notice them.
These are some of the many reasons it’s becoming critical for corporations to rely on software to manage employee expenses. It can eliminate abuse and ensure that your company stays on budget and remains efficient in handling these issues. It’s much faster and easier to identify duplicates and other potential problems and to set defined limits for employees to follow without confusion.
It’s easier to implement and enforce various policies, including not just spending but policies related to all things dealing with employee travel.