Is Mileage the Financial Black Hole for European Businesses?

Business travel – both international and national – is a key requirement for thousands of companies across Europe. However, the way that business expenses are submitted and processed is outdated and prone to abuse.

My recent article for AccountingWEB, outlines the issues surrounding these inaccuracies in mileage expense submissions. Based on our recent pan-European mileage research, it gives an in-depth insight into how businesses can tackle this, addressing:

• The lack of checks: there needs to be a better understanding of the processes and checks in place when mileage is submitted in order to protect a business from paying out more than they should. 56 per cent of mileage claims that were submitted were rarely or never queried. And only 27 per cent of respondents said that they analysed mileage claims ‘often’,

• False confidence: there is a distinct lack of concern when it comes to the accuracy of mileage receipts. Almost a third of respondents (29%) were still very confident in the results; 17 per cent ‘so-so’ or not very confident; and 34 per cent of respondents oversee expenses for employees submitting upwards of 50 mileage claims a week. This opens up a huge opportunity for exaggerated claims.

• The grind of submission: a large number of expenses are submitted through paper processes and spreadsheets. Only a third of respondents across Europe had access to an online or web-based tool (34%). Using these tools, that trend of over-the-top submissions can be quickly identified – especially in comparison to tracking through an Excel document to find out who might be doing something similar.

• Duty of care: this is the need for an employer to make sure that those travelling on its behalf are kept safe, healthy and productive. It is something that needs to be applied to both international and national travel. A properly analysed and tracked set of mileage expenses can give managers the insight into, and the ability to address and resolve, any employees who are potentially at risk.

• The devil being in the detail: mileage, at a handful of small change per mile, may seem like an unnecessary burden for those in finance to look at. But it adds up. The extra pound on each trip may seem insignificant on its own, but over the course of a year, in a company with hundreds of employees on the move? That’s something few businesses can afford to ignore.

Businesses need to ensure that they have the right tools in place to make the task of analysing mileage a doddle. This can be as simple as moving away from the spreadsheet and stapled receipt. That’s how the travelling employee can continue to work efficiently and safely into the 21st century.

Do read the AccountingWeb article where I discuss the above content in more detail.