The High Cost of Expense-Report Errors


In advance planning and then managing meetings and incentives while on-site, planners don’t focus on the last piece of the process: attendees’ filing expense reports. Not that they should: planning and on-site management are intense and time-consuming enough. Though monitoring expense reports probably shouldn’t be a total afterthought either.

As evidence, just check out new research by the research arm of the Global Travel Business Association. It turns out that, on average, 19% of expense reports filed by business travelers contain an error or missing information. The average cost of correcting one report: $52 and it takes an average 18 minutes to make the correction. That’s on top of the $58 it cost to process an expense report in the first place for a single night hotel stay.

More startling still, companies around the world spend an average of roughly $500,000 and close to 3,000 hours fixing expense report errors. Data can be entered incorrectly or simply omitted. Travelers can fail to attach necessary receipts. Clearly an expensive and time-consuming pursuit.

For their part, meeting attendees and other travelers mostly find filing expense reports tedious, even when their company uses third-party software intended to expedite the process. Once back in the office, travelers find other, more pressing matters take priority. When they procrastinate long enough, travelers of course end up with a whole stack of reports that need completing, increasing the chances that receipts and other documentation get misplaced.

According to GBTA executives, planners focus almost exclusively on saving money on direct costs, such as the price of flights and hotel rooms. Rather, they might want to devote at least some time to preventing those chronic expense report errors—in the process saving a significant number of dollars.

Hoping to combat the problem at the individual traveler level, planners should consider taking one or more of the following remedies:

Train and Retrain. Just because you’re providing group training in small groups doesn’t mean the savings opportunity message is getting through loud and clear. The next time you offer such training sessions, make sure the expense report piece is front and center (i.e. not buried at the end as an afterthought).

Opt for Transparency. Certainly for companies involved in finance, but for companies across the board, don’t hesitate to use the GBTA’s actual numbers in your training. Let meeting attendees know exactly how much their errors—taken cumulatively—are costing the company. And, by extension, describe how those same dollars could be used to enhance the program at future meetings.

Try the Carrot Approach. To encourage more careful expense reporting, propose an award or some form of recognition for attendees who repeatedly submit 100% error-free expense reports. Possibly it’s a raffle where the names of all those who qualify are entered and one chosen for a special prize. It’s a not-so-subtle way of reminding those who didn’t qualify to do better.

If All Else Fails… If the carrot doesn’t work, there’s always the stick. Consider identifying the biggest culprits—those whose reports are rife with errors and omissions (wrong dates, no documentation, inappropriate charges)—and calling them on the carpet (stern warning, getting senior management on their case and so on).

Bruce Serlen

Bruce Serlen

Bruce Serlen is a veteran travel writer, based in New Jersey, who has written extensively on meetings management and hotel operations. Most recently, he was executive editor at Hotel Business.

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