Travel & Expense

Tip #3 for Cutting T&E Waste and Abuse

on September 05, 2013

Our third in a series of tips for cutting T&E waste is focused on suspicious out-of-pocket expenses.

Out-of-pocket expenses are a fact of life in business travel. Not all taxis accept credit cards, gratuities for hotel staff are cash expenses, and in many European locales outside of major cities, cash is the preferred form of payment. However, corporate travel card programs benefit from maximum travel spend, so unnecessary out-of-pocket expenditures can impact card program rebates. Out-of-pocket expenses also can be used as a way to circumvent blocked merchant category codes (MCCs) on corporate cards or can be a way for travelers to accumulate expenses on their personal credit cards in order to add points, miles, or rebates for their own uses.

A key to cutting waste related to out-of-pocket expenses is for travel managers to identify statistically high out-of-pocket expense claims. These are usually indicative of card spend that has been re-directed to an employee’s own credit card. It is also useful to identify out-of-pocket expenditures on the same date and for the same amount as corporate card expenditures that have been expensed on other expense reports. This usually indicates a duplicate submission.

The impact of identifying suspicious out-of-pocket expenses goes beyond any recovery of out of policy reimbursement. By inspecting what is expected, travel managers can influence the behavior of all travelers. Word travels quickly and our customers indicate that the impact of observation has a positive impact on traveler behavior and compliance with policy.

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