Download an Expense Policy Template

In the field of expense planning for mileage reimbursement, smart workforce planning tools can be the assist you need to take your organization’s expense management to the next level. One such tool, hugely helpful but oft-overlooked? Your expense policy template.   

While expense policy creation and revision may seem like a simple enough task, a well-crafted expense policy is a huge part of any organization’s expense management process. And that’s where Company Mileage comes in, with our free expense policy template, to help your business get a leg up on creating your perfect policy for expense reimbursement. 

Reading and studying a strong expense policy template could help you and your business discover new ideas, get tips for language and structuring your own policies, and remember what you might otherwise forget. But before you jump the gun and check out CompanyMileage’s free expense policy template, let’s take a quick refresher course on what expense policies are, why they’re so important, and best practices for implementation by asking and answering six simple questions. 

1. What Is An Expense Policy?

Before you start writing a new expense policy for your organization, or updating your old one, it’s helpful to know exactly what we mean when we talk about the company expense policy. 

An expense policy is a written set of guidelines available to all company employees that clearly outlines how and when all relevant members of the organization’s workforce can be reimbursed for expenses that they occur on its behalf – for example, for the mileage they travel in their personal vehicles as part of their day-to-day work routines. It should set expectations for what is and is not eligible for reimbursement, the actions they will need to take to receive reimbursement, and penalties they may incur for expense policy noncompliance. 

2. What’s Wrong With My Old Expense Policy?

When updating your organization’s expense and reimbursement policy, take a look at the old one. What works? What doesn’t? What needs clarification, what needs to be excised, and what needs to be added? A good starting point for reviewing your existing policy for managing reimbursement and expenses is to check if it contains one or more of these common expense policy errors. 

Relying Too Hard On Manual Methods

While not technically disallowed by the IRS, manual expense reporting processes are infamously inaccurate, inefficient, time-consuming. What does your expense policy require from mileage tracking and reporting? Paper documents? Mileage calculations based on odometer recordings? Consider an upgrade. 

No Space For Accountability

Poor expense policies don’t make it clear to employees exactly what is expected from them. Your organization’s expense policy should communicate clearly defined expense categories, the parameters for spending and reimbursement, what constitutes fraud and other noncompliant behaviors, and the importance of accurate, timely reporting.

Counting the Wrong Mileage

Not all mileage is accountable mileage! If your employee expense policy doesn’t make it clear that side trips and home commutes shouldn’t be reported, it’s going to need a revision ASAP.

No Clear Guidelines

Your expense policy isn’t going to win any awards for using lots of SAT words and confusing language, and it’s not going to help you any by being overly vague, either. Instead your expense policy should be as clear, concise, and comprehensible as possible without sacrificing necessary details. 

3. Why Is it So Important to Create a Good Expense Policy? 

Before the process of updating and revising your organization’s expense policy can start, key stakeholders should agree on an important but often forgotten question: Why are we doing this? 

The exact answer may vary from organization to organization. Companies implement expense reimbursement for any number of reasons. Some businesses implement mileage expense reimbursement to avoid the hidden hassles of company-car ownership and the excessive expense of car allowances. Others do so to better compete with other employers seeking the best-possible employees, and to prevent employees from bringing bills or even lawsuits in an attempt to recover out-of-pocket expenses. What are your reasons?

Whatever the exact motivation, having a clear, comprehensive, well-written expense policy can only help your business ensure the cleanest reimbursement process possible. A good expense policy helps create and enforce transparency in expense management, promotes accountability on every level of leadership within the organization, sets parameters and limits for compliant reimbursement, provides clarity on reimbursable expenses to employees, and can even reduce costs for your organization.

Your company’s expense policy should act as a resource for employees, giving them an accessible reference that they can check when they have questions or concerns about company policy. It should also provide them with the best points of contact should that employee have an issue or query not covered by the policy itself. Creating, keeping, and maintaining the relevance of such a resource can only enhance comprehension, communication, and efficiency within the workplace.

4. What Should Employers and Employees Expect From Each Other?

We’ve said it before and we’ll say it again, because it has yet to stop being true; no matter how spread across the globe your mobile workforce may be, communication is key! Well-defined guidelines now will head off conflicts later, so go into the policy creation and revision process with the goal of emerging with a document that includes plenty of detail. 

Within this policy, add as many points as leadership and stakeholders deem necessary to cover anticipated contingencies. These may include outlining examples of activities and travel that are not eligible for reimbursement, like personal errands and commutes to and from home. There should also be explanations of what constitutes policy violations – for mileage reimbursement, these are usually reporting fraudulent expenses for reimbursement, or inflating actual expenses – and accompanying disciplinary action. 

Finally, make it clear the policy applies to everyone from top managers to the most-junior interns. No one should be exempt! 

5. What Processes Will Employees Be Expected to Follow? 

The goal in using an expense policy to outline reimbursement rules is to create a reporting procedure that is as easy and intuitive as possible for the employee and as accurate as possible for the company. This reporting procedure should set an expectation for accurate, timely, accessible documentation. It should also include a rigorous, standardized process that builds in safeguards, encourages questions, and features a monitoring system that enhances oversight, promotes accountability, and helps uncover potential abuse or fraud. 

Key to the explanation of any process are time frames. How long does the employee have after an expense is incurred before it must be submitted for reimbursement? How long should the employee expect to wait for that reimbursement?

With all that being said, it’s also important to remember that if you’re trying to create expense procedures that cover all possible scenarios, you’ll never be finished. Instead, consider the importance of flexibility when designing your processes. When emergencies arise, such as severe weather or public safety threats, they could affect your mobile employees’ expenses. In these instances, your expense policy should be nimble enough to respond. 

6. How Should You Communicate Your Expense Policy? 

In our fast-moving modern world, people expect to be able to consume information through multiple channels, and they don’t lose that expectation when they come to work. Be ready to present your new or revised expense policy via a paper memo, through an emailed pdf file, with a slideshow presentation, or by sharing a link to an explanatory video. But don’t stop there! 

Thorough distribution of a policy doesn’t automatically mean that employees have read it, understand it, or agree to follow it. It may be necessary to institute company- or department-wide training programs or to send out comprehension quizzes to encourage employee understanding. 

After policy rollout, seriously consider soliciting and analyzing feedback from all sectors of the organization. This can help leadership monitor its effectiveness, gauge employee comprehension, and identify any weak points or areas of contention that might require further consideration and improvement. Creating a continuous loop of constructive feedback and thoughtful response will help your employees feel heard and understood – and it’ll help continuously optimize company expense policies to be the best they can be. 

CompanyMileage Has An Expense Policy Template For That 

With these six essential questions answered, there’s no better time than now to take those first steps toward your new expense policy. We have developed a clear, comprehensive document that will set you on the right path with valuable tips, a suggested structure for your organization’s new expense reimbursement policy, and important details that will help you hash out the “nitty gritty.” Did we mention it’s free?

[download here]

Have More Expense Reimbursement Questions? CompanyMileage Has More Answers

But why stop there? In addition to our top-notch expense policy template, CompanyMileage has painstakingly created a suite of mileage reimbursement software dedicated to optimizing expense tracking and reporting and automating the expense reimbursement process without sacrificing efficiency or cost. 

SureMileage, our reimbursement software, eschews the need for mileage spreadsheets or paper mileage logs by using the starting and ending points of work trips to calculate mileage and expenses to be reimbursed. Using our SureMobile app, employees can enter trip data on-the-go and quickly submit reports and receipts for review, no matter where they are. From there, reports move quickly and efficiently through an automated approval workflow. Our software also integrates easily with all major payroll and accounting systems, so every step of the process is as simple and painless as possible.

While the sample expense policy template is a great place to start, don’t let that be the final way we help you with your company’s expense reimbursement procedures. To find out more about how we save our customers 20%-30% on mileage reimbursement, contact CompanyMileage and request a demo today!