Employee expenses system missing from a quarter of UK SMEs
19th June 2013 | News
A quarter of UK small businesses are currently operating without a policy outlining what employees can and cannot claim on expenses, according to new research by Concur.
The survey polled 200 individuals charged with handling expense claims within their organisation and the results demonstrated the extent to which UK firms remain vulnerable to fraudulent expense claims.
Only a third of expense processors rigorously check claims against their corporate policy.
Of the remaining three quarters of UK SMEs that do have an employee expenses policy in place, over a quarter (28 per cent) do not strictly enforce it.
It would appear that a lack of formal guidelines to protect against expense fraud is missing from the majority of businesses, placing them at risk of losing valuable cash and facing compliance issues.
Isabel Montesdeoca, general manager and senior vice president for Concur in EMEA, said: "The vast majority of all employees are honest and transparent when it comes to submitting claims.
"However, there is a small group who will always try to take advantage of the system by claiming illegitimate expenses.
"The best way for any business to avoid falling victim to expense fraud is to establish a clear, public, and well-enforced corporate policy."
Small firms are often the organisations with the tightest cash flow and appear to be the most susceptible to expense fraud, with only 27 per cent of respondents checking every single receipt issued by employees.
"Finance teams are typically under enormous pressure to deliver a wide range of demanding tasks on a day-to-day basis, of which expense management is just one," added Montesdeoca.
"For this reason, the vast majority are unable to invest the time needed to fully enforce their company’s policy and ensure all expenses are legitimate."
Additionally, employees need to be sure to claim all expenses and avoid losing money. Nearly a third (32 per cent) of UK employees that claim expenses regularly sacrifice at least £60 a year in unclaimed expenses, with 17 per cent losing more than £120.