Employee Expense report
refresher
Top Ten Expense Reports Gaffes
David Salchow, MDVA Internal Auditor
651-757-1548 david.salchow@state.mn.us
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Resources for Expense Report preparation
MDVA Agency Resources: http://intranet.mdva.state.mn.us/forms/index.htm
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Resources for Expense Report preparation continued..
Minnesota Department of Management and Budget: Employee Business Travel
Expense Policies and Procedures:
http://www.sema4.state.mn.us/htmldoc/eng/webhelp/hrpayrol.htm
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Resources for Expense Report preparation continued..
Labor Contacts and Compensation Plans:
http://www.mmb.state.mn.us/compensation
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And Now….
The Top Ten
Expense Report
Gaffes!
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#10 – Direct Billed Expenses
• Usually hotels with a valid purchase order or contract
with the State OR Enterprise Rental Car.
• Please send invoices to Central Office (CO) Accounts
Payable separately from your expense report. CO
will pay the bill immediately.
– Individual bills matched up against master billing in the
Central Office
– Please send as soon as available to ensure the bills are
paid on time.
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#10 – Direct Billed Expenses continued..
• However, continue to indicate “DB” for hotel expenses, rentalcar usage, and/or any other travel or lodging arrangements.
• Continue to input mileage travelled, but not mileage
reimbursement if using State car:
– Substantiates the mileage travelled to justify overnight travel, meal
entitlement or other travel expenses
– Avoids confusion when processing reports – Clarifies why no mileage
expense is claimed.
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#10 – Direct Billed Expenses continued..
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#9 - Deadlines
• For your expenses to be paid on your next
paycheck, signed expense reports are due
Noon the day after “Timesheet Tuesday.”
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#9 - Deadlines continued…
• The $ total of expense reports processed 60 days after travel was
completed are automatically added to your paycheck as a taxable,
unpaid item. Meaning, you pay taxes on the amount as if it were
income!
– IRS Publication 15 (Circular E) of the Employer’s Tax Guide – NOT a State or
MDVA requirement.
–
The Internal Revenue Service (IRS) requires employee business expenses to be submitted for reimbursement within 60
days after the expense is incurred. If not submitted within 60 days, the reimbursement becomes taxable for federal,
state, FICA and Medicare; and withholding tax must be taken. The agency must match the FICA and Medicare tax paid
by employees.
• Date calculation automatically occurs in SEMA4 during
expense report entry.
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#8 - Meal reimbursement claim when
meals are provided by an event
• Employees are only reimbursed for expenses actually
incurred.
– If a meal is included with the conference registration fee and the State
pays the fee, then employee is not entitled to meal reimbursement.
– No recent MDVA examples, but a County Veterans Service Officer
recently reimbursed 104 meals from a conference funded by a State
grant, and now the County has to repay over $1,500!
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#7 Not Signed by a Supervisor
• Expense reports must by signed by both the
Employee and the Supervisor
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#6 Exact Locations needed
• Whenever possible precise locations should be included to
substantiate mileage reimbursement, meal and overnight stay
entitlement.
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#6 Exact Locations needed continued..
Include full addresses on the expense report:
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#6 Exact Locations needed continued..
Mapping and Driving Directions websites are excellent
for documenting mileage and locations driven.
Any of these sites are perfectly acceptable:
http://www.mapquest.com/
http://maps.google.com/
http://maps.yahoo.com/
http://www.randmcnally.com/
http://www.bing.com/maps/
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#6 Exact Locations needed continued..
• My personal preference is Google Maps:
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#6 Exact Locations needed continued..
Example from Google Maps continued..
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#6 Exact Locations needed continued..
• Print-out from Google Maps gives all the information needed!
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#6 Exact Locations needed continued..
• Google Street views are interesting to look at, but serve no
real business purpose!
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#6 Exact Locations needed continued..
Even private residences viewable!
David’s Residence:
Harry’s Residence:
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#5 Meal Entitlements
• Lunch: Must be traveling greater than 35 miles from your Permanent
Work Location and traveling over your normal lunch hour.
– Actual costs up to $9.
• Breakfast: In addition to being the most important meal of the day, travel
requires leaving your residence before 6:00 AM.
– Actual cost up to $7.
• Dinner: If travel requires you to arrive back at your residence after 7:00
PM.
– Actual cost up to $15. (AFSCME $14)
• Continuous travel status when overnight travel is required.
– Meal costs may be combined not to exceed an amount equal to the
total of all meal periods travelled. ($31 daily; $30 AFSCME)
– Also, meal costs go into a different column on the expense report so
the cost of the meals are not taxed as income.
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#5 Meal Entitlements continued..
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#4 Receipts Required
Original receipts are required in the following circumstances:
Lodging (DB-Invoice to Central Office
or receipt with expense report)
Conference Registration fees (also
include agenda)
Any single item exceeding $25 (except Office Supplies (If not available
mileage)
from Innovative or exceptional
circumstances)
Taxi or Transit fares
Parking (except meter)
Laundry and Dry Cleaning
Airfare
Special Expenses
Rental Car Expenses (Gasoline)
Rental Car receipt
Airline Baggage fees
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#4 Receipts Required continued..
• May file an Affidavit of Lost Receipts, if needed (but should
not be a customary practice.)
– Must be notarized – several MDVA notaries available
• http://intranet.mdva.state.mn.us/forms/Receipt_Affidavit.pdf
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#3 Special Expenses
• All employees are Special, but not all expenses are.
• Special expenses are things not normally reimbursable to the
employee.
• Advanced approval is required. A statement of explanation
must accompany emergency expenses, when advanced
approval is impossible.
• Examples of Special expenses:
Conference, meeting
meals over lunch hour
Lodging, when NOT in
travel status (i.e. Intown)
Employee Awards/
Recognition
Refreshments
Tuition
International Travel
State Fair expenses
Registration
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#3 Special Expenses continued..
• You must follow Administrative Procedure 4.4 to have Special Expenses
approved. http://www.sema4.state.mn.us/htmldoc/eng/webhelp/hrpayrol.htm
•
You must use a Special Expense approval form PE-00668:
http://intranet.mdva.state.mn.us/forms/Special_Expense.pdf
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#3 Special Expenses continued..
• Prohibited Expense Items:
Private Club Memberships
Alcoholic Beverages
Entertainment
Employee Parties (Retirement
Cakes)
Meals and Refreshments when the
Majority of participants are State
employees.
• Exceptions to the right. -------
Meal and Refreshment Exceptions:
• Meal or refreshment integral to meeting
and to sustain flow of the meeting, AND
one of the following:
• Majority of participants in travel
status
• Annual/Quarterly Staff or Mgmt
meeting
• Senior Mgmt planning or
organization meeting
• Structured Training session
conducted by persons outside the
agency.
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#2 Combining Business and Personal Travel
• Only the Business portion of the expense can be reimbursed.
• Using personal vehicle instead of flying is allowable, however,
employee will be reimbursed the lesser of
1.
2.
The mileage amount, or
Airfare + ground transportation expense
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#2 Combining Business and Personal Travel continued..
•
Employee should “estimate” business portion and personal
portion of the expense in advance and submit to Payroll for
approval.
– Under no circumstance should the total cost reimbursement exceed
the estimated cost of the business only amount/portion of the travel.
Example:
Reggie travels to Washington D.C. for Monday AM – Wednesday PM
conference and wants to bring the family along to sight see
Reimbursable
Not Reimbursable
Lesser of: Reggie’s airfare or Reggie’s airfare
had he only made the business trip
Reggie’s family airfare
Hotel for Sunday, Monday, and Tuesday nights
Hotel for extra nights
Reggie’s meals on Sunday PM – Wednesday PM
Family meals plus Reggie extra meals
Reggie’s rental car Sunday – Wednesday
Rental car for extra days
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#2 Combining Business and Personal Travel continued..
• Personal use of State vehicle (Enterprise rental) is allowable
under limited circumstances:
– Employee is “on call.”
– Employee is permanently assigned vehicle
– More cost effective than leaving vehicle at permanent
work location.
– An authorized rideshare program has been established
• The benefits obtained from personal use of a State vehicle IS
considered taxable income and must be reported to payroll.
• The “Commuter Rule” can be applied - $3 taxable income
round trip.
– Much more information at: SEMA4 Policy PAY0019:
http://www.sema4.state.mn.us/htmldoc/eng/webhelp/hrpayrol.htm
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..and the Number #1 Expense Report
Gaffe is…
THE BERMUDA TRIANGLE
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#1 The Bermuda Triangle
When an employee does not report to his/her permanent work location
during the day or makes business calls before or after reporting to his/her
permanent work location, the allowable mileage shall be:
•
•
•
the lesser of the mileage from the employee's residence to the first stop or from
his/her permanent work location to the first stop;
all mileage between points visited on State business during the day;
the lesser of the mileage from the last stop to the employee's residence or from
the last stop to his/her permanent work location.
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#1 The Bermuda Triangle continued…
• NEW mileage rate beginning 1/1/2011: 51¢ per mile
• Please use the “Veterans Homes Mileage Chart” in the
Intranet when travelling between Homes.
Examples:
David’s Travels around the State:
•
Google Maps can be used to conquer the Triangle!
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#1 The Bermuda Triangle continued…
•Also note 9 miles is the “Mileage chart distance” between MVH-M and CO!
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#1 The Bermuda Triangle continued…
•Note: The Veterans Home mileage chart shows 23 miles from CO to MVH-H,
BUT David is only entitled to the lesser amount of 18 miles from his castle!
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#1 The Bermuda Triangle continued…
• Multiple stops during a business day.
– Home to Mora
– Mora to Federal Building
– Federal Building to Home
• The “lesser of” rule only applies to the first
and last lag of the journey. All middle lags are
actual miles travelled.
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#1 The Bermuda Triangle continued…
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#1 The Bermuda Triangle continued…
Actual Travel
Home to Mora
Measurement Locations
# of Miles
Mileage
Claimed
Home to Mora
82
Perm Work Loc to Mora
72
72
Mora to Federal Building
Mora to Federal Building
76
76
Federal Building to Home
Federal Building to Home
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Federal Bldg to Perm Work
8
Total Mileage Claim
8
156
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Employee Expense report refresher
Contact People:
Elizabeth Zuehlke
Accounting
Supervisor
651-757-1573
Elizabeth.zuehlke@state.
mn.us
Isis Mateo
Payroll Coordinator
651-757-1547
Isis.mateo@state.mn.us
Nazira Sotolongo
Accounts Payable
651-757-1546
Nazari.sotolongo@state.
mn.us
David Salchow
Internal Auditor
651-757-1548
David.salchow@state.mn
.us
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Employee Expense report refresher
Questions?
Thank you!
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