Action Fraud UK, the National fraud and cyber-crime reporting centre defines travel and subsistence fraud as when employees of a company claim for travel or subsistence expenses that are not owed.
Typically for mileage fraud this includes:
These overstated mileage claims help to account for the 5% of revenues organisations lose every year to workplace fraud according to the ACFE.
One of the of the biggest challenges of detecting, investigating and preventing employee fraud with a paper-based or spreadsheet-based expense management system is the fact that it’s an extremely time consuming, manual task to validate the actual distances travelled between business premises. As a result, mileage fraud goes largely undetected unless something out of the ordinary triggers a special investigation for the finance team.
That’s where using a modern expense management system like Zetadocs Expenses can help. It automates these checks so that employees are discouraged in the first instance from making fraudulent claims. Any exceptions are flagged up to approving managers for resolution, well before the finance team need engage.
Zetadocs Expenses uses Google Maps to assist employees enter business journeys. It does so by searching business place names as they are entered, for both starting point and destination.
Once the journey has been entered, the map can be toggled into view so that a visual check can be made, and any fine tuning made to the journey – say you had to pick-up something en-route for your next business meeting.
Most recently used destinations are remembered so that they can be more easily selected from the list without having to retype them, and any return journeys are also simple to calculate automatically by using the Return Journey checkbox.
If you have set policy warnings or hard mileage limits, Zetadocs Expenses will make this very visible to the employee so that they have the opportunity to either rectify the journey or justify the excess mileage.
Administrators set the company’s route calculation policy based on the shortest route or Google’s suggested route, which takes into account a number of factors, like travel time and congestion.
Mileage warnings and maximum limits can then be set on a percentage and exceeded mileage basis for each type of vehicle. These visual policy warnings or limits make it possible for the manager to check by exception rather than conducting manual spot checks. They ensure any excess is appropriately addressed ahead of approval.
The app prompts the approver that warnings exist on the employee’s expense report. These prompts follow the expense report throughout its approval workflow, making sure the finance team is aware of the manager’s decision.
So in summary, Zetadocs Expenses offers you full oversight into how business journeys have been calculated, with the ability to validate them on-screen using maps and visual warnings. This was almost impossible using manual methods due to the sheer effort of checking distances by hand.
Employees are discouraged from making overstated mileage claims by the transparency of the system, and your business is spared the costs of reimbursing excess miles that might previously have been added to business journeys.
Whilst we’re on the topic of business mileage, Zetadocs Expenses will also help you recover the correct amount of VAT paid on fuel for business mileage by exporting this automatically to your ERP system. Too many companies don’t bother to reclaim this fuel VAT because it’s more trouble than it’s worth with a paper-based or spreadsheet-based system. But it’s easy with Zetadocs, and another reason to switch to a modern expense management system!
For your demo of Zetadocs Expenses, join our live webinar here.
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