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Expensive Expenses: Identifying Fraud in T&E


Expense Reports and Travel and Entertainment expenses are both common areas for fraud and challenging to find. These frauds are complex and contain a mix of prescriptive and behavioral analytics to detect and manage exposure.

There are 3 easy steps every company should follow to mitigate fraud risks in these areas:

  1. Put the Company Expense and T&E policies in writing
  2. Train everyone, current and new employees of the policy
  3. Commit to enforcement – executives are no exception

Regardless of how strong your policies and enforcement are, fraud (and errors!) are still likely to occur. Data analytics techniques and emerging technologies are well suited to detect fraud of all kinds. The forensic accountant can effectively wade through data lakes and oceans to identify outliers in the data, making them red flags for investigation.

Below are 7 common schemes for these types of expenses:

  1. Personal expenses represented as business expenses
  2. Modifying receipts
  3. Reimbursement for cancelled trips and events
  4. Purchasing items and then getting a refund without reimbursing the company
  5. Overstating mileage claims
  6. Claiming non-acceptable items like electronics and jewelry
  7. Multiple reimbursements for same expense either by multiple employees colluding with one another or through different proofs of payment

How CaseWare IDEA can help:

  1. Review of 100% of transactions rather than random samples
  2. Detect and investigate out-of-policy or suspicious transactions prior to reimbursement
  3. Identify elevated liability on P-Card program
  4. Use workflows and case management to investigate suspicious activities instead of ad-hoc emails and phone conversations
  5. Leverage data analytics to get a clearer picture of risks within the T&E program
  6. Get rid of duplicates

Many companies use a combination of IDEA and applications such as Concur to electronically manage expenses. Concur can help provide spend reports, reduce document storage and decrease the approval and reimbursement cycles, and then use IDEA for the analytics. We can provide the ODBC driver for seamless data importation. Even without an expense management application, a data analytics tool such as IDEA can help you to audit the transactions, provide cost efficiencies through reporting, and identify outliers.

We specialize in using data analytics to uncover potential fraud schemes and weak controls to prevent unnecessary losses. Call us today to see how we can help you put data analytics to work!


Audit , Best Practices , CaseWare IDEA , Fraud



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