Many employees are playing loose and fast with company spending rules during the coronavirus pandemic.
In fact, your peers are seeing a staggering 206% increase in the T&E spend violations rate. That’s despite a 63.5% drop in T&E spending.
So finds Oversight’s latest “Spend Insights” report.
Yes, some of those spending violations can be chalked up to ignorance, but some of them are simply blatant disregard for policies. Or worse.
Here’s what to watch for, based on the Oversight report, so you can protect your company’s cash.
The 5 biggest spend violations now
Check out the five places where out-of-policy spending jumped in the second quarter:
- fraud (14%)
- excessive meals (12%)
- out-of-pocket spending (11.2%)
- exceeding the expense threshold (10.1%), and
- policy-outlier expenses (9.7%).
The top offense is a real problem that no company can afford not to address.
The others can be attributed to either employees thinking they can take some extra liberties during this unprecedented time, or folks not understanding your T&E policies to begin with.
And there’s a specific group that’s falling in that second camp, says Oversight.
Correcting innocent spend violations
That group? First-time spenders. As employees were sent home to work remotely, many of them found themselves making purchases they never had before. Some may have never even filled out an expense report.
In fact, April 2020 saw a 12% increase in first-time spenders from a year before.
These folks make up a large portion of the out-of-pocket spending, threshold exceeders and policy outliers.
Of course, ignorance is no excuse. If you haven’t done so already, have A/P go over T&E policies and procedures with these newbies.
On the back end, have A/P flag all recent-first-time-spenders’ reports to give them an additional once-over.
Clamping down on fraudulent ones
But not everyone is new at this and not all “mistakes” are innocent. Some folks are simply trying to game the new normal.
When it comes to the fraudulent spending, here’s where folks crossed the line most often:
- electronic and computer stores
- cable and other paid TV services, and
- alcohol.
Granted your company may have made some adjustments to your T&E policies to account for the current situation, but chances are it’s not to help folks stream Tiger King!
Now’s the time to watch all expense reports extra carefully, especially if you’ve made any pay cuts – folks are more likely to try and make the money up in other ways.
