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Let¡¯s face it, we all knew we wouldn¡¯t be staying home forever. Whether new COVID variants?emerge and keep many of us grounded, the friendly skies are opening up, hotels are cleaning more than ever (thank goodness), and travel has or will start again. What that means for your health is one thing, what that means from a government contracts compliance standpoint is still unchanged, though. FAR 31.205-46 has and will continue to cover this key audit area. Any system worth its weight in government contract expense management will allow you to follow your procedures. Those that rise above will give you the ability to make compliance easy.

Before getting into how to support such a thing, let¡¯s discuss the topic of unallowable costs. In particular, FAR 31.205-46 deals with travel costs and specifically states that costs are allowable only if the contractor maintains specific documentation to support claimed travel costs. This is where many contractors fall down in their compliance. In?DCAA, there was a saying while I was putting in my time "if it¡¯s not documented, it didn¡¯t happen.¡± Today, the expectation is for much of that documentation to be electronic.

Many systems will capture documentation and it is important to ensure the requirements for documentation are met, too. Similar to the long-standing Internal Revenue Code rules covering the same area, for claimed costs to be allowable, contractors must, at a minimum, capture the following information:

1. Date of the expense
2. Location of the expenses
3. Purpose of the travel
4. Name of the traveler along with title and relationship to the contractor

How and where this information is kept is not dictated by the regulation outside of requiring the information to be captured. However, corroborating the information becomes key. A key factor in determining whether documentation supports the cost is whether there is an independent record of the transaction taking place like a cancelled check, credit card receipts, or hotel bills. It is important to note that these two things don¡¯t necessarily stand on their own for audit purposes.

How can SAP »ÆÉ«¶ÌÊÓƵ help with maintaining the sufficient documentation required for travel costs?

»ÆÉ«¶ÌÊÓƵ Travel and »ÆÉ«¶ÌÊÓƵ Expense allows your employees to capture required travel and expense information easily and accurately. Employees can scan their receipts and enter expenses onto expense reports in real time with critical aides such as optical character recognition (OCR). OCR scans the receipts to capture critical data points such as transaction date, amount, business name and location. SAP »ÆÉ«¶ÌÊÓƵ can even validate business names against known aliases that may conceal costs that should be unallowable.? There are no more lost receipts or forgotten expenses. Through TripLink, SAP »ÆÉ«¶ÌÊÓƵ even integrates with major expense providers such as airlines, hotels, and rental car/transportation companies to allow expenses to be captured with minimal effort from the traveler and immediately available for addition to expense reports.? In fact, SAP »ÆÉ«¶ÌÊÓƵ can be configured by the employee to recognize expenses during a trip and automatically have an expense reporting waiting for submission by the employee with all associated receipts.

For companies that must comply with GSA travel requirements, »ÆÉ«¶ÌÊÓƵ Travel & Expense will maintain current rates and apply the ceilings and rules to ensure that costs in excess of allowable rates are properly recorded to prevent them from accidentally being billed to the government or other clients.

To ensure compliance, SAP »ÆÉ«¶ÌÊÓƵ can perform audits on the expense reports to make sure that FAR requirements, as well as company specific policies, are being met and followed. This takes a great deal of risk off the companies and reduces their exposure to negative audit findings.

As your employees begin to venture out and travel once again, why not take the opportunity to improve their experience while simultaneously reducing the company¡¯s risks of non-compliance?

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