Using Per Diem In Expense Reports

In this blog we will concentrate on using the per diem expense type and the advantages associated with it.

If you are interested in what per diem is or what the rates are for different states you can take a look at our earlier blogs.

• What is per diem?
• GSA – IRS Per Diem Rates Within Continental US
• Expense Report Policies for GSA Per Diem Rates and IRS Publication 1542

Why bother with per diem rates?

I think this is a very valid question instead of using actual expenses why do you bother using per diems. There can many different answers as with every question, let’s try to summarize them:

• Financial – Per diem provides a financial cap on what the employee or a contractor can spend.
• Operational – When per diem expense type is used instead of recording actual expenses you do not need expense receipts to process the expense. Operationally, this will significantly reduce the paperwork and allow your accounting department to process expense reports quicker.
• Economical – If a company pays actual expense incurred for meals, incidentals and lodging, it is not in the best interest of an employee to find a more economical alternative for meals and lodging expenses.

From a business perspective, all of the reasons above are valid. However, it is easy saying to use per diem expense type in an expense report process what’s not so easy is implementing it.

At that point you should be thinking the pros and the cons of an automated versus non-automated expense report management solution.

You should also be thinking about the differences between alternative automation solutions.

Web2Expense provides a web based expense reporting solution that requires no initial software or hardware investment. Don’t get me wrong Web2Expense is an enterprise class software therefore you need to invest minimal time and effort to learn and understand the software. Once you understand and configure the software according to your needs everything runs like a well oiled machine.

Adding per diems into an expense report literally requires a few simple clicks.

Next screen shots provided as an example for this usage.

Step 1 – Start Per Diem Entry Process

Step 2: Enter Required Information

Step 3 – View Expense Report

As you can see in this example the employee’s meals and incidental expenses for the New York trip is capped at $64.

The system brings this information from a policy/project document that was configured for the project in New York. To learn more about how to setup an expense policy and other important documents you can watch our flash videos posted on Screencast.com.

•  ACME MEDICAL Expense Report Business Scenario
• ACME MEDICAL Expense Report Implementation Part 1
• ACME MEDICAL Expense Report Implementation Part 2
• Expense Approval – Employee Perspective
• Expense Approval – Managers’ Perspective

Got questions? Post them to this blog or visit our portal to learn more.