Recent statistics have shown that the vast majority of workers have lied on expense reports, with only a small percentage feeling remorse about doing so.
Whether it’s born from frustration, the economy or an honest mistake, fraudulent expense reports will cost your business and impact company finances. According to a recent survey, 85 percent of 1,000 employees questioned across the UK admitted to lying on expense reports.
Researchers discovered that the reason behind the dishonesty was, perhaps unsurprisingly, an attempt to be reimbursed with a more substantial sum than that spent. They also identified that 5 percent of the employees questioned admitted that they forged information on all of their submitted expense reports.
In analysing the survey's findings, researchers discovered that over £150 million is lost by businesses each year from employees overcharging on expense reports. Whether you are a small business owner or part of a larger firm, the cost of fraudulent expense claims must be minimised.
Overspending will put your company at risk. At Soldo, we enable finance teams to implement individual cardholder limits and rules through our expense management solution. Using a combination of a dashboard, prepaid business card and app, you can accurately control and monitor each employee's business expenses.
While companies try to review expense reports submitted by employees, many firms still use paper-based management methods, leading to hard-to-read or lost receipts. In contrast, using the Soldo app, employees can take a photograph of receipts immediately. This means that employees will no longer need to carry loose receipts and your finance team will no longer need to sort through them to reconcile them against expense claims.
The survey also discovered that 82 percent of dishonest employees have never been detected by their employers. Almost two-thirds of those questioned claimed they did not feel remorse for overstating their expenses, with 17 percent wanting to make up for low wages as a justification for seeking excess reimbursement.
Petrol appears to be the most common expense over claimed on reports, followed by drink, food and transportation. On average, it is believed that employees exaggerate spending by over £30 on each report submitted. No matter how small or great the amount is, fraud must be dealt with.
So what action can you take? Consider the following to weigh up the possible options:
After you have considered the significance of these factors, the employee must be confronted. You may opt to take legal action, ask the employee to reimburse the organisation or fire them. Whatever your decision, it is essential to remain calm and reasonable and ensure that you take advice and act within the bounds of employment legislation.
It can be difficult to summarise and make sense of employee expenses and company spending. Most solutions only offer simple snapshots and do not readily support a bigger picture.
Our dashboard, in contrast, allows you to drill down into expenses, and identify employee spending trends and patterns. Each department, expense type or individual can be isolated for simple comparison, while data can be exported so that relevant insights can be derived to help identify any potentially fraudulent activity.
For the most part, companies grudgingly tolerate a small amount of expense fiddling, but this is no longer necessary. Expenses fraud should not be legitimised or normalised; it can easily lead to a toxic work environment if not tackled correctly.
Without limits to employee spending, there can be unpleasant end-of-month expense claim surprises for your finance team. By using the Soldo dashboard, you can monitor employee spending in real-time, while setting individual employee spending limits and controlling allowable expense types and even locations for staff using the Soldo prepaid Mastercard.
Our solutions can help your business prevent dishonest employees from taking advantage of your firm and put an end to fraudulent expense reporting. Why not visit us here for more information on our business expense management solution.