Wednesday, September 21, 2005

"Find the Umbrella" and Other Expense Statement Stories

A guy I worked with was on a business trip to London. It was pouring down rain one day so he bought an umbrella to get his business done and duly put the item on his expense statement when he got back to the States.

His statement got bounced back with a friendly note from the trolls in accounting: "Personal items cannot be expensed." Roger thought about explaining the situation - the umbrella was a business expense after all - but decided it wasn't worth it. He redid his expense statement without the umbrella, but it magically came out to the exact same amount as before. He wrote a note back to accounting: "Find the umbrella." He got reimbursed the full amount without any more hassle.

This true story shows a well known fact about expense statements: they're easy to pad. Almost ridiculously so. But we're talking penny-ante amounts of money.

In my experience most people pad, but usually for reimbursing themselves for something that is not reimbursable like the umbrella above. Another reason is for the inevitable amounts of money that leak out of the pocket while traveling. For example, traveling in Tokyo requires cash for taxis, subways, trains, and other modes of transportation that usually don't issue receipts. A lot of people I know just throw $10 into a random lunch they didn't pay for instead of tracking $2 every time they step on the subway. Even doing this most people still end up behind. I know every single time I travel overseas I end up spending money out of my own pocket due to things like this.

But there is padding in order to try to keep ahead of minor expenses, and there is padding in order to pilfer money. And the fact that Intel just fired a bunch of people for expense statement issues shows that the issue in this case is pilfering rather than balance. At least I hope so. I would hate to think that Intel is so small as to fire people for expensing an umbrella.

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