One of the reasons behind the ever-growing costly trends of companies is expense reimbursement fraud by employees. Tracking these corporate frauds using business mileage expense tracker software is of utmost importance.
Expense Fraud can be defined as deliberate inflation reimbursements as a result of inaccurate expense claims made by the employees. These off-the-wall business expenses encompass erroneous mileage totals, bills of lavish homestays and trips, inexact money spent on office supplies, and whatnot.
As perplexing as it could be, a study by the Association of Certified Fraud Examiners suggests that expense reimbursement fraud makes up 17% of all business frauds. Additionally, another report by Robert Half Management Resources survey claims a 50% increase in the number of inappropriate reimbursement submissions. These jaw-dropping statistics speak volumes about millions of losses that a company has to borne every year.
To better tackle the issue and to forestall major losses, here are some tips for company leaders:
Strengthening Company Policies
To demystify the reasons behind outrageous expense claims, the first move should be to revise the Travel and Expense (T&E) policies. Having too strict and too vague T&E policies results in employees cheating with reimbursement reports due to resentment and carelessness respectively.
The best T&E policies are designed in a way that it neither takes away allowances that employees deserve nor puts too much financial thrust on the company’s finances. It is advisable to keep allowance rates up to date as a justified behavior in favor of trustworthy employees.
Monitoring and Guidance
Forestalling the major company losses may not be as simple as it sounds because the company leaders are required to work cohesively. Apart from clear and concise directions on preparing the reimbursement reports, sending out regular reminders through notice boards, company newsletters or staff email is a wise step.
To add, monthly meet-ups should necessarily bring up the topic of previous employees that may have cheated to highlight the bumps of the inappropriate actions. Moreover, HR can advise employees to clear their unusual expenses with the management before they spend some more bucks.
Humans tend to make mistakes even in doing simple Mathematics, while some may do it and others accidentally. To counter both cases, an immediate follow-up must be done with the concerned employee if any erroneous estimation of reimbursement funds is observed in the reports.
A quick counter-action may not be able to give any extra time to employees cheating with the numbers out there. Moreover, building up a conversation with the employee will reduce the chances of him being careless the next time.
A stringent action, however, may be considered in the case of an untrustworthy employee.
Keep Technology at Hand
Living in an app-driven market has made it easier to connect with technology that can help track expenses and receipts. With more than 100+ relevant mileage tracker applications, companies can prevent expense reimbursement frauds.
There are various apps that can store frequent tips with simple mileage taps and an easy interface to share reports daily. Some of the most advanced applications can directly connect to the credit card, scans the receipts, generates the expense reports, and allows for quick sharing through emails.
With an ever-growing technology, it perpetually lowers the chances for cheating by employees and employers. A survey by Robert Half Management Resources shows that 85% of companies in the U.S. are using technology-driven solutions of which 44% use internally developed software and 41% resort to third-party applications.
Reviewing the Firebrand
Every company has a few trouble-makers who repeat odd mistakes and yet don’t feel the guilt. It is advisable to pay special attention to the employees who have strayed before which led to losses for the company.
The finance and accounting staff should repeatedly and deliberately audit the reports submitted by such a firebrand because you never know what brain games they are playing. Keeping a close eye on them would be a wise step to follow.
While it may become a little easier for the company leaders to tackle the situation now, it is best advised to resort to technology-based solutions. Online expense report software helps in the identification of common expense report issues.
It also allows you to set reimbursement limits and provide you the receipts to forestall the expense reimbursement frauds to a great extent. Remember, the right mix of policy and technology can help counter this problem and save your company from drowning in big losses. So, stay aware and follow the above-mentioned tips to keep your company free from corporate fraud.