If you’ve seen The Wolf of Wall Street, you’ll have a good idea of where the inspiration for this advice article came from. The film revolves around a young stockbroker who enters the industry with absolutely nothing in his back pocket but the lining of his trousers. Fast forward half an hour, and he’s living a life of raucous hedonism funded by his own brokerage firm.
The moral of the story and motive for this article? Company expenses can be risky business if you don’t have a solid handle on the situation.
Create a clear and concise expenses policy
Put an expenses policy document together for both you and your employees to refer to when needed. This is your chance to formally set out some rules and guidelines which need to be adhered to.
Know where to cap company expenses
Supplying every member of staff with a company card can quickly lead to problems. Limit it to essential staff, and stipulate a strict spending limit. Purchases should be authorised prior to spend, or at the start of a trip away.
Take alcohol out of the equation
Travel, food, and accommodation are understandable expenses if staff are travelling for work. Some items, such as alcohol, should be considered a luxury, and eliminated from expense allowances. That said, there might be times when you’re entertaining clients and those expenses might be necessary. Understand when exceptions might apply, and make sure that it’s documented.
Limit the unnecessary luxuries
Unless the company can definitely afford it for every employee, limit the first class travel (unless it’s the cheapest ticket!). Shopping around for a good deal should always be part of the procurement process, and the same should apply to company expenses.
Keep close tabs on receipts
You can set out rules and do damage control to stop any excessive spending, but it’s vital that you then monitor this. Receipts should be submitted with claims, and create monthly expense reports to monitor who is spending what, and where.