Travel expense management is the aspect of expense management specifically concerned with controlling costs related to business travel.
The key travel expense management instruments are the travel policy and the expense policy, typically written by the functions responsible for travel management and purchasing, and they define who can spend how much on what, with what levels of approval. Travel expense management has numerous goals, including budget and cost control and productivity benefits achieved by smoothing the processes related to submitting, approving and reimbursing expenses, financial reporting, and auditing.
The tools used for travel expense management are increasingly moving online with dedicated systems for both corporate travel software and travel expense software available to facilitate trip booking, expense entry and process control. The greatest alignment of processes occurs when these two elements are linked into a single T&E system that provides a unified environment for submitting, managing, and reimbursing business travel expenses.
An important function of a travel expense management tool is the ability to configure the “per diem” allowance which is a (heavily state-regulated) flat rate allowance offered to business travellers, by their organisation, to cover travel expenses. The per diem allowances vary from country to country, some tools have per diems pre-configured or they may need to be configured in the expense management software for each country.
Learn about expense management solutions from KDS.