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What is the timing of expense reimbursement to employees?

We are trying to shorten our month-end close time and one of the areas we've identified that drags things out is our expense reimbursement timeline. I would like to propose that we shorten our deadlines to submit by day 3 and approve by day 5 (currently submit by day 5 and approve by day 8). Are these reasonable deadlines? Initial internal feedback is that they're not. Does anyone have people submit by the 25th and accrue the 5 days? Any other ideas or suggestions to close faster (yet retain accuracy) in this area? Thanks! -Carrie


Topic Expert
Wayne Spivak
Title: President & CFO
LinkedIn Profile
(President & CFO, |

I don't think they are unreasonable, however some items to consider:

Do employees use their own credit cards?
What is your threshold for receipts?
What if an employee is out (on the road, ill)?
Do you take weekly reports or only monthly?


Do you have an automated system for expense submission?
Do you pay by check or ACH?
Is the expense policy simple or complex?
Is it built into the automated system, if one is used?

Ken Stumder
Title: Finance Director / Controller
Company: Ken Stumder, CPA
(Finance Director / Controller, Ken Stumder, CPA) |

I think waiting on submission/approval will always result in timing issues. People are just not good at timely T&E.

What system do you use? We used to use Concur, which has reports that allow you to make accruals based on expense reports in process (various stages) and credit card transactions not yet added onto expense reports.

There are always out-of-pocket costs, but I've never experienced that we needed to get more detailed /exhaustive in chasing those down. If we were aware of something going on (like a specific meeting or event) we'd just top off as needed.

No way to absolutely perfect an accrual but at least our approach had "legs" under it.

Len Green
Title: Performance Improvement Consultant and E..
Company: Haygarth Consulting LLC
LinkedIn Profile
(Performance Improvement Consultant and ERP Strategist, Haygarth Consulting LLC) |

Do you know:
1. who is habitually late/inaccurate with expense reports? Who is accurate/on time?
2. are the execs timely?
3. are the amounts material to a month end close?

Can you:
1. make a case for why T&E reports need to be reported earlier/better? What pain do you/your staff/others encounter? How does it impair the company's performance?
2. get your CFO to support your proposal, then your COO/CEO?
3. show your colleagues who submit T&E reports how a better process benefits them and the company?

As mentioned above, do you really need to wait until month end? If you close T&E reports by the 25th each month, isn't that OK?

Anonymous User
Title: CFO
Company: Local Government Agency
(CFO, Local Government Agency) |

Materiality? - Agree! How much are we talking about here? How many T&E submissions aren't fully reimbursed after processing?

Qualitative statements are how we converse. But, as finance professionals we know that quantification is the most important detail if we wish to avoid being Shakespearian. "Much ado about nothing".

This has me thinking your problem isn't T&E submissions holding up month end closings, but your T&E reimbursement policies themselves.

Lyle Newkirk
Title: CFO
Company: Corrigo Incorporated
(CFO, Corrigo Incorporated) |

If you really want to shorten month end close, go to weekly expense reimbursements. That is more fair to the employee and it lessens month end crunch. Use strict cut-offs (reports in by Monday at 9 get paid by Wednesday at noon as an example). If you don't have reimbursement requests in by month end close, accrue rather than chase the actual. The above will shorten your cycle considerably.

James Scott
Title: Consulting CFO
Company: Early Growth Financial Services
LinkedIn Profile
(Consulting CFO, Early Growth Financial Services) |

Twice a month with payroll works best for me. But later when exceptions require manager approvals outside of policy is always OK. Must be received 2 days before reimbursement, all reimbursements by direct deposit.
Sometimes the staff will rush a payment or expedite when pushed or unusual circumstances warrant it, but that is their call and between them and the individual involved. But I rarely push them or bend the policy, and let them everyone know the rules and expect the same treatment.

Thomas Aiken
Title: Managing Partner
Company: Cedarwood Partners LLC
LinkedIn Profile
(Managing Partner, Cedarwood Partners LLC) |

I agree with Lyle. Get them in a routine to submit expense reports at the end of each week. You can pay them in a subsequent payroll, but at least you have the expenses captured. Many companies use software to submit and approve reports and accounting gets the data immediately upon approval to record and pay. In some instances accounting reviews detail receipts etc. after the fact which have been scanned.

Holly Olson
Title: Director of Finance and Accounting
Company: LS2group
(Director of Finance and Accounting, LS2group) |

Not sure of the size of your company, but consider asking them to submit expenses frequently/weekly upon incurred, then you reimburse them on set days in month, e.g., 2nd and 4th Wednesday, depending on $ amount. You need time for approval and processing. Agree with others that need to rules are for everyone, not someone else.

Vik Agrawal
Title: President & Co-Founder
Company: ExpensePath, Inc.
(President & Co-Founder, ExpensePath, Inc.) |

It is definitely reasonable for Finance to set these rules as the owner of the process, especially if you provide tools for employees to be able to easily create, submit, and review expense reports. We have found that the right process tools result in employees themselves speeding up their timeline to almost exactly what you are hoping to achieve for 2 reasons: they want to be reimbursed earlier and holding on to expenses makes it much more painful for them. I have a short case study that outlines this (happy to share).

You could create an incentive that leads employees to follow the rules and the one I can think of is that you set specific reimbursement deadlines. For example, you could state you will only do 2 reimbursement runs per month and to be included in a run, there is a deadline for the expense report to be submitted 2 days prior. Having to wait 2 more weeks for reimbursement will cause at least some employees to follow the rule.

Wayne's list of questions is a good starting point. Company credit cards can be an issue if they are direct-billed to the company so employees have low incentive to do their expenses but there are ways to make that happen as well.

Good luck.

Carrie Roesner
Title: Controller and VP
Company: Centro
(Controller and VP, Centro) |

Thanks everyone for the feedback; it is definitely helpful. We do use Concur so we can pull reports on the 3rd day regardless of status and accrue on that amount plus an estimate of what is missing.

We have a fairly simple expense policy and everything is paid via direct deposit. The process is automated through Concur so while there is always room for improvement, I do feel confident that our process is easy for employees to follow.

In terms of weekly expense reports, we pay a fee per report submitted to this process would effectively quadruple our administration costs which seems doesn't seem like the best approach although something to at least consider. I also think weekly actually causes a bigger burden on employees because now they have to submit 4 times per month instead of once.

Most of our execs and heavy spenders have company credit cards (and assistants to submit receipts and code expenses) so the heavy users of Concur are really our sales team (who is also the most likely to complain about deadlines).

Thanks again for the advice; it is much appreciated!


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