Expense account padding is an age-old sport of sales forces and executives who travel on business. A firm policy, firmly enforced can go a long way toward controlling the temptation to fudge expense reports.
The Fraud
Expense reimbursements can be overstated or downright fictional. Duplicating receipts and changing dates on receipts for meals, taxis, fuel and, even, lodging is common.
Claiming reimbursable expenses for goods or services never incurred or incurred by others is also frequently done.
The Flaw
Lax processing is the root cause of reimbursing false expense accounts. Cases of collusion between the employee and the reimbursement clerk are not unheard of . . . splitting the take.
The Fix
Strict supervision and detailed auditing of expense reports before reimbursement is essential.
Internal control systems and strict policies must be established and enforced.