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The problem of Duplicate Expenses

Posted by Indrajit Palit | Nov 07, 2019

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Duplicate expenses are a persistent issue for companies and pain for everyone. Submitting the same expense twice is one of the common errors an employee and in most cases, they are honest mistakes. However, occasionally, they are attempts to commit expense fraud by double-dipping. Whether intentional or not, duplicate expenses are an area of vulnerability for corporate spending programs.

According to the Institute of Finance & Management, 40 percent of organizations indicate that duplicate payments represent 1-5 percent of their total spending, depending on their automation and centralization.

Here are few of the examples of the most common ways to find duplicates in expense reports

Duplicate expense claim in the same report - Employees while creating an expense report add the same expense twice (lunch receipt with the same date appearing twice). There is also the case where a charged expense was included as a service with some other expense. For example, Breakfast is included in hotel expenses but the employee still expenses separately for breakfast.

Duplicate expense claim in different expense reports - It has been noticed that sometimes the same expense is repeated in two different expense reports. This can happen with the same employee or different employees. A classic case would be, one employee pays for the meal with a company card, while the other employees submit an itemized receipt for the same meal as an out-of-pocket expense.

Expenses claimed by the employee also charged to the company - In some cases, employees’ pay out-of-pocket for some emergency supplies for the office or while traveling, and files them in their expense report. But the vendor also raises the company an invoice for the same which is goes into the AP system, hence potentially creating a situation where the company pays the same expense twice.

Double-dipping and duplicate expenses keep on adding over the lifetime of the business. It is estimated that duplicate expenses can range from 1%-5% of the total spend of the company.

To eliminate this problem, innovative companies are implementing AI-based solutions to audit and manage their spend management program. With an AI-powered solution like Robana, you can prevent duplicate payments, track repeat offenders and find the root cause of the behavior that needs to be corrected, so you can educate employees and vendors, and avoid compliance risk.

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