Tricks To Pad Expense Reports


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Tricks To Pad Expense Reports

  1. 1. THE TEMPTATION TO PAD EXPENSE AUTOMATING EXPENSE REPORTING CAN REDUCE THE COST OF EVERY EXPENSE TricksREPORTS CAN BE POWERFULIf an employee is in a position to claim $100 REPORT TRANSACTION BY 72%*OR MOREa week in false expenses, that employee boosts ADP’s Travel & Expense Management Solution giveshis or her take-home pay by $5,200 a year. you efficient tracking, reporting, and management – all Employees in one powerful on-demand service:Better yet – for the employee, at least – travel • An online booking system searches hotel, flight, and car rental inventory from virtually all sources and indicatesreimbursements are usually exempt from which options comply with your corporate travel policy.taxation. So that unreported $5,200 can turn • ADP’s Travel & Expense Management Solution Use tointo the equivalent of an $8,700 pretax pay raise. electronically captures receipts, generates expense reports, and deposits electronic payments to filers withinWe raise this example not to recommend four business days.cheating, but to illustrate how the temptation to • Automatic corporate credit card data import reduces Pad Theircheat – whether to earn tax-free cash or simply keying errors, resulting in fast report creation and cleaner data for analytics. Because it is an end-to-endtravel in greater luxury – can be powerful. A service, the click that books the trip also creates thewise administrator will learn the tricks and expense report.establish an audit program to catch them.The following examples are meant to alert youto tactics for padding flight, hotel, and car rentalexpenses. We hope you find them helpful in Expensemanaging what, for many companies, isthe second-largest area of expense after payroll.Certain material contained in this publication, Reportsincluding examples of potential employee tricks,are drawn from and reprinted with permissionfrom How to Pad Your Expense Report … andGet Away With It!, by “Employee X,” available ADP’s Travel & Expense Management Solution automatically displays an alert when anat online booksellers. online travel option does not comply with corporate policy. For more information, contact your ADP Representative, or visit and search for “Travel and Expense Management Services.” Canceling a leg of flight and *Travel and Entertainment Expense Management Automation: Reduce Costs, Improve getting a refund your employer Control, Aberdeen Group, June 2009. doesn’t know about. Filching hotel stationery to “create” your own receipt. These are just some Automatic Data Processing, Inc. One ADP Boulevard of the tricks revealed in this free Roseland, NJ 07068-1728 ADP® reference. The ADP Logo and ADP are registered trademarks of ADP, Inc. All other trademarks and service marks are the property of their respective owners. 03-342-070 2M Printed in USA © 2010 ADP, Inc.
  2. 2. Keeping discounts a secret until checkoutTRICKS EMPLOYEES USE TO PAD Claiming personal use of a car, but renting instead If an employee is eligible for a discount, she does If work requires an employee to drive to a distantFLIGHT EXPENSES not mention it until she has received a receipt for location (e.g., a trip that, with incidental stops andWhen employees want to put a few hundred the full “rack” rate. She then contests the charges, errands, might add up to 1,000 miles), he maydollars per expense report into their pockets, saying, “Hey, this was supposed to be the AAA profit by renting a car while claiming the miles onairline tickets are the easiest way to do it. rate. I mentioned that when I reserved the room.” his personal vehicle. A three-day car rental, with She submits the first, higher priced receipt with unlimited mileage, can cost as little as $77, whileDouble-booking tickets for profit her expense report. reimbursement at 55¢ a mile gets the employeeAs soon as the employee knows he’s making a $550. The employee saves wear and tear on histrip, he buys a ticket. He then waits until the Double-billing for room service car, while pocketing some extra money.week of the flight and books a refundable ticket, Room service meals usually arrive with a blankwhich will most likely be more expensive. Closer tear-off receipt. An employee charges the meal toto the day of the flight, he cancels the refundable his hotel bill. He then uses the tear-off receipt toticket, flies on the previously booked discount claim an additional expense at a different time. COMBINING A CORPORATE CREDIT CARDticket, and submits the higher-priced receipt with WITH AUTOMATED EXPENSE REPORTINGhis expense report. CAN DEFEAT MOST OF THESE TRICKS TRICKS EMPLOYEES USE TO PADAlternatively, the employee can book a refundable As you may have noticed, most of thesefare early and watch for fare wars. He books the CAR RENTAL EXPENSES vulnerabilities occur when employers cannotdiscounted flight and submits the earlier, higher- Submitting coupons after getting a receipt match reported expenses against actual spendingpriced receipt for reimbursement. Many rental companies offer discount coupons. and returns. An effective countermeasure, When an employee returns her car, she waits until therefore, is to combine a corporate credit cardFlying less to make more money after the attendant has printed out her receipt. She program with automated travel booking andAn employee books a fully refundable multi-city then goes into the office and claims there has expense reporting.flight and cancels the last leg of the trip (ending up been an error.where she meant to all along). The airline credits “With a solution like ADP’s Travel & Expense,”her credit card for the difference in fares. She Switching gasoline receipts explains Joy McManus, an ADP Travel andsubmits the original receipt with her expense report. Some older gasoline stations leave blank receipts Expense Specialist, “hotels, airlines, rental car and near the cash register for customers to take. If the credit card companies provide a nightly data feed service attendant insists on completing the receipt of transactions and receipts. The system comparesTRICKS EMPLOYEES USE TO PAD himself, but hand-writes a few dollars, adding a each credit card charge to the hotel’s e-receipt andHOTEL EXPENSES one in front can raise the amount from $8 or $9 to airline’s record of unused tickets. It automatically $18 or $19. Alternatively, a one can easily become matches them to the employee’s itinerary in theGetting blank invoices from the hotel a seven, especially on a carbon copy. booking system. Not only does this prevent nearlyWhen checking out, the employee says to the all the fraud ‘Employee X’ describes, it’s a greatclerk, “Hey, I really like the layout of your Another trick is to check the self-serve island for convenience for honest employees.”invoices. I’m sure my boss would like to see if receipts previous customers have dropped into theyour format would work for our company. May I trash. Travelers can find computer-printed receiptshave a few sheets to take back with me?” for many dollars more than what they paid. The receipt will have a location and date stamp thatYoung and inexperienced clerks are reluctant to match their travel plans.say no to a guest. The employee fills in the formson his home computer.