Why is it important to have a travel and expense policy?

Managing employee expenses is no easy task, especially for employees who travel frequently and are thousands of miles away from the office. To help everyone meet the company’s standards, a travel and expense policy is vital.

This is a set of rules that determines what you can and cannot do, how much you can spend and under what circumstances. It is, in short, a tool for controlling expenses and preventing fraud, as well as a vehicle for communicating the company’s values and culture to employees.

Why do I need to have a travel and expense policy in my company?

It may seem trivial to create such a document – after all, you can travel and still meet your objectives without it. However, its importance lies in the fact that it creates a framework for employees, sets limits and provides recommendations for travel, making travel more efficient and reducing costs.

Clear rules prevent unnecessary costs, or the use of inefficient channels. It is also a way to reduce errors and internal fraud when claiming expenses, as it establishes which expenses are reimbursable and which are not. This minimises, for example, personal expenses incurred outside of working hours getting through the filter. In addition, a statute of limitations can be set to ensure that claims are submitted within the correct timeframe, facilitating accounting.

What should a travel and expense policy be like?

Simple and appealing. We are talking about a standards manual, a type of document that does not normally invite reading, so it is vital to make it as simple as possible and to have a clean design that attracts attention. Use clear and short sentences that get straight to the point, avoiding any kind of legal or technical terminology – the aim is to transmit information, not to elaborate a legal text.

It is crucial to structure the content well so that it is easy to find the information needed and to ensure that employees remember the key points. The complexity of the document will depend on the size and activity of the company. As is normal, the travel and expense policy will not be the same for a small company travelling domestically as it is for a multinational company with several locations and travelling to different countries.

It is as important to have it as it is to ensure it is enforced.

There is no point in establishing a well thought out travel and expense policy or producing a clear and easy to read document if you do not have a system for enforcing compliance. It is true that simply having a clear policy in place reduces fraud and errors, but it does not eliminate them.

It is important to have a service such as the Management Software offered by 60dias, which allows you to cross-check the data of the settlements submitted by employees with the real data of the documentation to corroborate that they are correct, you can also: apply filters according to the type of expense to make sure that the amount does not exceed the maximum, check that the settlements are being submitted within the established deadline or that the suppliers recommended by the company are being used.