Many expense reports are submitted by employees, some with enormous amounts of fully-justified detail. It is rarely cost-effective to review all of these expense reports, since most employees honestly report only those expenditures for which they should legitimately be reimbursed. However, it is still useful to review a sampling of these expense reports, in order to send the message to employees that there is a chance that their expense reports could be analyzed - and in detail. When an expense report is selected for review, consider engaging in a detailed review that includes the following methods:
- Boarding pass. Verify that an airline boarding pass is included in the receipts. This is better evidence than a payment receipt, since an employee could have purchased a flight and then cancelled it for a refund.
- Course grade. Verify that an official grading document was submitted for a course taken by an employee. As was the case for a boarding pass, an employee could have obtained a receipt for a course and then cancelled it for a refund.
- Group payment. If an employee submits a receipt for a payment that was made for a group of employees (such as for a group dinner), check the expense reports of the other employees in that group to see if they also submitted receipts. If so, someone is fraudulently claiming a reimbursement.
- Similar dates. If there are several receipts submitted from the same store, see if they have similar dates and times stamped on them. If so, it could mean that an employee collected receipts from other shoppers exiting the store at the same time.
If it appears that a claimed expense reimbursement has dubious receipts associated with it, then refuse reimbursement until the employee forwards his credit card statements for the related periods. If you cannot trace the original payments to the credit card statement, do not issue a reimbursement payment. Of course, this backup control only works if you mandate that all payments be made with employee credit cards, rather than with cash.