Travel & Entertainment Best Practices: Prevent Fraud and Comply with IRS Regs

Author: Mary Schaeffer

Expense reimbursement has never been trickier. The recently enacted Tax Act changed the deductibility of some items, employees and gotten better at sneaking through items on their expense reports that shouldn’t be there and there’s a raft of new technology impacting the function. Companies everywhere are eyeing the bottom line and a growing number are insisting on rigid travel & entertainment policy compliance. Compliance must now not only be to the company policies but also with IRS rules. Otherwise, you could end up answering not only to the CFO but also the IRS–and both are truly ugly.

And there’s another good reason for insisting strict adherence to the rules. In 75.6% of expense reimbursement schemes, the perpetrator was also undertaking at least one other form of occupational fraud. This startling fact comes from the Report to the Nations, one of the most respected fraud surveys conducted by the Association of Certified Fraud Examiners.

This session will also delve into the issue of refunds. While never a major issue in the past, when COVID hit and conferences and seminars were canceled, it became a major headache for the group monitoring travel. Alas, it also opened up an existing loophole that facilitates fraud.

This session will start with a review of IRS requirements and show how you can incorporate them into your policy. The session will then delineate the different games some employees play when attempting to get reimbursed for more than they actually spent along with tactics you can use to stop this problematic behavior.

Publication Date: December 2020

Designed For
Accountants, controllers, accounting managers, auditors (internal and external), Treasurers, CFOs, CEOs, accounts payable professionals, expense reimbursement staff, payroll professionals, procure-to-pay professionals, and travel managers.

Topics Covered

• Overview
• Implications of New Tax law
• Guidelines for Accountable Plan
• Other Monitoring Challenges
• Evaluate your policies to ensure they are compliant with the IRS guidelines
• Best practices T&E policy that meets IRS regulations
• COVID Impact
• The New Tax Law
• Best Practices to Ensure Compliance with IRS Regs
• Common Reimbursement Issues and How to Handle Them
• Addressing the Headaches around Documentation & Receipts
• Dealing with Expense Reimbursement Fraud

Learning Objectives

• Recognize the guidelines you need to adhere to if your company's T&E expenses are to be deductible on the tax return
• Identify the new rules regarding deductibility of meals and entertainment under the new Tax Law
• Describe how to create an appropriate review process for all refunds owed the organization
• Describe how to integrate IRS requirements into your organization's T&E policy
• Identify common games some employees play with their expense reimbursement requests
• Recognize how your organization's expense reimbursement practices stack up against others in the business world
• Identify how to deal with the new T&E issues—technology has made some old best practices obsolete
• Evaluate best practices to create an effective T&E policy & procedures
• Identify common expense reimbursement frauds some employees employ
• Recognize how to implement strong controls to deter expense reimbursement fraud

Level
Basic

Instructional Method
Self-Study

NASBA Field of Study
Accounting (2 hours)

Program Prerequisites
None

Advance Preparation
None