Cows and Chandeliers: How to Deal With Improper Expense Report Requests

By Robert Half November 6, 2019 at 7:00pm

Outrageous business expense submissions from employees can run the gamut from the audacious to the ridiculous to the downright perplexing. But they all have one thing in common: They represent a growing and costly trend for companies.

In a Robert Half Management Resources survey, 56% of CFOs surveyed cited an increase in the number of inappropriate reimbursement submissions from workers over the last three years. And this growth in eyebrow-raising — and sometimes even jaw-dropping — requests is occurring despite many finance departments’ efforts to control costs and institute rigorous expense-reporting guidelines.

So, what types of off-the-wall business expense report entries have employees tried to submit? Here are just a few head-scratching (and real) examples, according to the executives we surveyed:

  • A trip to Italy
  • A bear rug
  • A pogo stick
  • Cat litter
  • Chandeliers
  • Bed bug removal
  • A cow
  • 300 tacos
  • Pearls
  • A chicken statue with a top hat
  • A Lamborghini

“Some of the more absurd expense report submissions may seem laughable, but they can be an expensive problem for businesses,” says Tim Hird, an executive vice president with Robert Half. “Companies must have effective review systems, policies and processes in place, or they risk losses in profits and employee productivity.”

As for strengthening policies and processes around expense report submissions, company leaders may want to consider the following strategies:

1. Make expense report guidelines clear and easily accessible

Yes, all employees should know the company’s policy on reimbursable job-related expenses. But clear communication to staff is an essential step toward preventing inappropriate expense report requests. There’s a good chance many employees need a refresher on where to find the policy and exactly what it says about what they can and cannot claim.

Providing regular reminders through the employee newsletter, company intranet or staff email is good practice. Consider including examples of past mistakes — without calling out specific employees — to help highlight tricky areas and explain how to avoid them.

Also, encourage employees to reach out to their manager or an HR representative if they need clarification on what they’re allowed to expense. Even better: Urge workers to clear unusual expenses with management or HR before they spend the money.

2. Follow up promptly on business expense missteps

Invalid business expenses are often the result of staff members’ confusion about company policy, but they can also result from a lapse in judgment or simple carelessness. And sometimes, egregious infractions are an employee’s attempt to push boundaries.

Whatever the reason may be for a worker’s inappropriate business expense report request, discuss the matter with that person directly and promptly so that mistakes are not likely to be repeated.

3. Carefully review new requests from boundary-pushers

While employees are expected to follow the rules when requesting reimbursement for job-related expenses, accounting and finance staff responsible for handling those requests also need to be thorough in their review of submissions. And it’s wise to give special attention to expense reports from employees who have strayed from company policy in the past.

That’s not to say these workers will repeat mistakes. But if they previously made a truly oddball request, it’s worth keeping a close eye on their future reports.

4. Streamline the expense-reporting process with technology

Investing in technology can also help by making it easier for employees to report and track expenses. Many expense report software programs let users monitor spending and submit receipts in real time.

Most companies (85%) are already using technology-based solutions in their expense-reporting process, according to other research from Robert Half Management Resources. In that survey, 44% of companies reported that they use internally developed software, while 41% said they employ third-party systems.

The embrace of technology for managing a routine — but often error-prone — process like expense reporting aligns with broader trends outlined in the latest Benchmarking Accounting and Finance Functions report from Robert Half and the Financial Education & Research Foundation. According to the 2019 report, organizations in North America have increased their use of automation for processes such as financial report generation, data collection, and documentation storage and compliance since 2018.

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