In some companies, employees are able to purchase things on behalf of that
company, but may not have access to a corporate credit card or payment
account. In other instances, an employee may incur costs, such as travel
expenditures, that need to be reimbursed. Essentially, reimbursed expenses
are an employee’s out of pocket expenses that are compensated by a
company.
As companies grow, there is typically more of a prevalence for these type of
expenses. How can you make them manageable and create guidelines
understood company-wide? It is important to set up a policy ahead of time so
that employees understand what is eligible to be claimed as an expense and
how much is acceptable. Beyond travel, gas, or food, you may also offer
continuing education whereas college courses can be reimbursed. Outlining a
policy upfront will help you clearly define categories and establish a process
internally. This will be helpful as your business grows and can control
employees from surprising you with unplanned costs.
When creating a policy, consider these points:
  • Create categories to define spending is appropriate
  • Create amounts that are considered acceptable within the categories
  • Create an easy tracking method – whether through a spreadsheet or app
  • Consult professionals (sometimes policies are in place, such as the amount paid for gas mileage)
  • Communicate the policy to all staff and include it in new hire packages, when relevant
  • Communicate how staff should submit a reimbursement claim and outline a standard timeline for reimbursement
In addition to formulating a proper reimbursement policy, you should also
consider how to account for these expenses. If you have questions, contact
our team for more information.