Acting Human

Once a while companies have to deal with travel expense reports handed in by their staff. Travel expenses are costs which arise during business travels. Depending on the duration they differ in the extent. The travel expenses also include such things like costs for meals, hotels, admissions for business relevant exhibitions and similar ad hoc expenditures.

Clearly there must be distinguished between travel expenses and the private ones. Sometimes it happens that an employee decides on staying longer and uses a trip for private purpose. That is his right as long as he neither doesn’t harm the business of a company in anyway nor uses company’s money for his private business.

Mainly there are two different ways a company can handle travel expenses. The first one consists in that the employee collects all bills from his business trips and cedes them to the responsible person in the company afterwards. The company may then refunds or reimburses the incurred costs. An itemized list is also helpful in that case because it gives the responsible person (normally the HR Manager) the possibility to compare the costs. On that way the company can avoid that it pays too much.

The second possibility is to provide the employee a budget which allows him to cover his costs. This opportunity is also known as pay a per diem, pay per day or day money.  The budget then covers all needed travel expenses even so the traveler can choose a more expensive hotel or flight and pay the additional costs on his own. Here, too, an itemized list can be helpful.

The longer a company is in business there more experience it will get on how much the travel expenses are to different locations. Doing business with mainly the same clients helps also to get a good overview about costs incurred. That doesn’t mean that travel expenses will always stay on the same level. Special factors have also to be considered like economic ones. So might e.g. the price increase of oil lead to higher travel expenses because of the increase of prices for airline tickets.

Nowadays the accounting of travel expenses is much easier with the help of PCs. There are Excel Sheets and free programs available as well as professional business solutions. Depending on the size of the company and the amount of business trips made in a year - every company needs to find their best solution for handling travel expenses and reports.