Businesses could be losing £100 million a year because of false and exaggerated expense claims, a recent survey by software company webexpenses has found. More than 4 in 10 respondents admitted that they had fiddled their expenses, with travel being an area in which many employees felt they could elaborate the truth. Almost 50% of respondents said that they had claimed for more miles than they had actually travelled.
Adam Reynolds, CEO at webexpenses, commented that there had been a “shift to more subtle methods” that didn’t raise big causes for concern, and that the culture of fraudulent claims was changing. Whilst exaggerations may be relatively small – which is perhaps why 8 in 10 workers had never had their claims challenged or denied – they can add up, and be a real cash drain for many businesses.
The key takeaway here is that it’s very likely that you’ve got problems under the surface with expenses, and now might be a good time to reconsider your approach. After all, what’s the point in working furiously to achieve your revenue goals, when you’re wasting cash unnecessarily? Here, we take a look at top tips for combatting fraudulent claims…
Create a robust policy so your employees know exactly what the process should look like
Do your members of staff really know what’s expected of them when it comes to claiming for expenses? Does your policy clearly state what they can claim for, and how they should do it? Are your current processes clear and well communicated, or are they vague and not really adhered to?
Creating a policy that’s fit for purpose is often the first step towards stamping out any future problems. Everyone from your staff to their line managers should be aware of how they should claim, and what they’ll be entitled to.
Conduct regular checks
The survey found that very few companies carried out adequate checks when claims were submitted. This inevitably means that mistakes are being made – sometimes, even because of genuine human error – and a culture of over claiming can be the norm.
You might decide to give line managers responsibility for carrying out checks at stipulated intervals, or you may give the task to a member of your HR team. What’s important is that there’s a process in place, and someone really owns it.
Keep things simple
Many companies have long winded expense-claiming provisions that are time consuming for everyone involved. Improving how you do things isn’t about adding in more hoops to jump through, or making things more complicated. It might even be the case that you need to go back to basics, and take out unnecessary steps in the process.
Perhaps your technology needs an update. Requiring staff to keep track of receipts can turn into an administrative nightmare, and there are now apps on the market that can make your life a load easier.
It’s important to recognise that many of your staff members will be making accurate expense claims, and are simply being suitably compensated for costs that they’ve genuinely incurred. It’s never wise to start throwing around accusations or making your staff feel like their honesty is being questioned.
Still though, it’s important that you ensure that fraudulent expense claims don’t damage your business.
We understand that no two businesses are the same, so having a process tailored to your specific requirements and needs is essential. Give us a call today and we can arrange a no-obligation review of how you could re-consider your approach.