UAF Travel Reimbursement and Audit Processes

March 2016

Introduction

Through the Travel Process Improvement effort, it has become clear that the current travel process imposes an unsustainable administrative burden, is time-intensive for staff centrally and in units, and is frustrating for our travelers. Our current fiscal climate has led to reduced level staffing levels and calls for more efficient processes in all areas. This further calls for a review of the cost vs. benefits of controls and an assessment of an appropriate level of tolerance and mitigation. The TRIP team recommended moving to an audit-only role centrally, reducing the time and effort involved in processing reimbursements. This change will also allow UAF central travel to conduct regular trainings for travel coordinators and departmental staff, improving compliance without adding processing time.

The proposed processes below are designed to outline appropriate audit standards that reflect a balanced approach to risk, and to establish clear expectations of the audit outcomes.

The revised reporting model will more accurately reflect units’ compliance with UA Travel Regulations. For example, in the first quarter of FY16, 139 (18 percent) of the identified errors with expense reports were incorrect account codes. While it is certainly important to correctly account for our expenditures, such errors would now be addressed in the “best practices” section of the audit report, rather than in the regulations violations section. When combined with the critical regulation changes proposed, we could see a reduction in our “incorrect” expense reports of over 50 percent while still ensuring appropriate controls and risk.

Reimbursement Process

  1. Travel Authorizationincludes supporting documentation and receives needed approvals (Attachment I).
  2. Travel occurs.
  3. Traveler/Travel Coordinator prepares Travel Expense Report.
  4. If Expense Report is within 10 percent or $100 of approved TA, whichever is greater, only traveler must approve and sign, once proposed regulation is approved.
  5. Expense Report is submitted to Financial Services for issuance of payment (keying). No review of expenses will occur at this point.
  6. If there are any errors that prevent keying/payment (Attachment 2) then Financial Services will contact Traveler and Travel Coordinator for needed information.
  7. Traveler receives reimbursement via direct deposit.

Audit Process

  1. Financial Services will conduct monthly audits of expense reports, after reimbursements have been issued. Note: this can move to quarterly once the process is established and we are demonstrating compliance with regulations.
  2. Audits will include a percentage of all expense reports by Vice Chancellor/Provost or Unit level, as well as targeted high risk areas (such as international travel).
  3. Financial Services will produce an audit report that organizes findings by unit, identifying:
  4. Violations of UA Travel Regulations (Attachment 3)
  5. Best Practices (e.g. account codes)
  6. Discussion (including any trends or areas of university-wide concern).
  7. Reports will include the TA/ER number of the audited reports, and the errors identified.
  8. The audit reports will be provided to the relevant Vice Chancellor/Provost and Dean/Director.
  9. The relevant Dean/Director is responsible for compliance within their unit.
  10. If a unit has UA Travel Regulation violations in more than 10 percent of their audited expense reports in a given month, they will be placed on a watch list.
  11. If a unit on the watch list has UA Travel Regulation violations in more than 10 percent of their audited expense reports for two consecutive months, they will prepare a performance plan to identify how they will ensure compliance in future audits. This performance plan will be discussed with the Associate Vice Chancellor for Financial Services and the Travel Administrator.
  12. If the performance plan fails to improve compliance after an additional monthly audits, the unit will reorganize their travel processing (such as by partnering with a unit that has a successful record or by joining a successful shared service center).
  13. If a unit is placed on the watch list three times, they will reorganize their processing.
  14. When a unit consistently demonstrates a high degree of compliance with UA travel regulations (less than 10 percent of expense reports have errors) for three consecutive audit periods, they will be designated a Tier One unit and move to a quarterly audit schedule.
  1. If, in the course of an audit, it is discovered that a traveler was reimbursed for more than the allowable costs, the following will apply:
  2. For over-reimbursements less than $50, the unit has discretion on whether to collect the difference from the traveler. Over-reimbursements cannot be expensed to a restricted fund; those must be collected or Jv’d to a fund one.
  3. For over-reimbursements greater than $50, the unit will collect the difference from the traveler.
  4. For under-reimbursements discovered during an audit, the unit may elect to submit a new expense report to claim the expense(s) not originally reported.
  5. Units will have 5 business days to respond and submit additional information for audit findings.

Responsibilities

Traveler: The traveler is responsible for accurately reporting their allowable expenses in accordance with UA Travel Regulations, identifying the purpose of travel, identifying any personal travel taken in conjunction with business travel, and providing business justifications and documentation in accordance with UA Travel Regulations. The traveler is also responsible for signing up for direct deposit via the Finance tab of UA Online (note: this is currently a separate process from direct deposit of paychecks).

Travel Coordinator: The travel coordinator is responsible for assisting the traveler in completing travel authorizations and expense reports (or, in some units, completing the reports on the traveler’s behalf), for ensuring the accuracy and compliance with UA travel regulations of those authorizations and expense reports, for providing information to the travelers regarding UA Travel Regulation and best practices, serving as a point of contact between the unit and Financial Services, and in assisting the traveler in procuring travel.

Travel Administrator: The travel administrator is responsible for conducting the duties of their position as outlined by the UA Travel Regulations, and in conjunction with the travel auditor, preparing audit reports. The Travel Administrator is also responsible for developing and delivering training to travel coordinators.

Travel Auditor: The travel auditor is responsible for conducting travel audits as outlined in the above procedures, and in conjunction with the travel administrator, preparing audit reports.

Dean/Director: The dean or director is responsible for ensuring compliance within their unit with UA Travel Regulation.

Attachment 1. Travel Authorization Documentation and Approvals

When the following information and approvals are secured at the Travel Authorization stage, expense reports, once proposed regulation is approved, within 10 percent or $100 (whichever is greater) of the authorized amount may be reimbursed without re-approval by the supervisor or individual with authority to expend funds.

  1. Business-only estimate: Authorizations will include an estimate for the business-only cost, including as applicable:
  2. air itinerary based on business days, showing class of service, and amount
  3. business nights in hotel and hotel rate (if rate is greater than 150 percent of published per diem rate, noting why higher rate is needed- e.g. “conference hotel”),
  4. per diem rate for business days, at business destination rate,
  5. vehicle rental for business days (showing standard size, or noting why larger is required)
  6. conference program or meeting agenda
  7. registration fees
  1. Clearly defined business purpose: A single sentence is sufficient, a single word is not. For example, instead of “conference,” note “Annual AGU meeting,” or instead of “field work” note “conducting interviews with whaling captains in Point Hope.”
  1. Any personal travel taken in conjunction with business travel is clearly identified
  1. Approvals in accordance with UA Travel Regulations before any university resources are committed (additional approvals may be required to comply with UA travel restrictions).

Attachment 2.Travel Reimbursement Keying Checklist

The following errors on an expense report prevent the reimbursement from being keyed for payment:

  • A mismatch on the traveler (the traveler’s name does not match the ID, the travel authorization (TA), the travel expense report (TER), or the encumbrance)
  • For check payments, a missing address
  • A missing date of birth and/or address, needed when ID is not listed on TA or TER
  • Missing or closed encumbrance
  • If there is a mismatch between an advance listed on the expense report and in Banner
  • Missing attached backup (TEM)

Attachment 3. Audit Checklist

Category / Audit Questions / Documentation Needed / Potential Audit Finding / UA Travel Reg. Reference
Approvals / Was the TA approved before university resources were committed?
Were the needed approvals obtained for the type of travel? / -Approved TA
-Person authorized to expend the funds (e.g PI or signature delegation memo must be attached to backup)
-Supervisor approval
-For out of state or international travel, approved by individual designated by Chancellor (VC/Provost approval restriction lifted 10/24/16) / -Approvals missing or not obtained prior to commitment of university resources (Reg. Violation) / A.3.a
A.13.a
A.14.a
Personal Information / Is the traveler’s name, UA ID, and address correct? / - / -Best practice / -
Account codes / Are account codes correct? / - / -Best practice / -
Dates/Times / Do the dates on the itinerary (airfare/car rental) match the business purpose? Are travel status times provided?
Is personal travel time identified? / -Airfare itinerary/receipt
-Car rental agreement/receipt
-Conference program
-Hotel folio/receipt
-Travel Status start and end times / -Reimbursement for business purposes; direct route, and allowable per diem. (Reg. Violation) / A.1.b.(7)
A.3.c3
A.5.a
A.7.a
Destination / Does the destination match the business purpose? / -Reimbursement for business purposes (Reg. violation)
Purpose / Is the purpose clearly stated? / -One sentence noting business purpose (e.g. “Attending AGU meeting/conference,” not, “conference” / -Reimbursement for business purposes (Reg. violation) / A.13.b.
Personal Travel / Is personal travel clearly identified on the Travel Authorization Form?
Was reimbursement for business travel only? / -Business only comparison(vendor and class of service must be clearly identified)
-Any extra expenses resulting from travel by indirect route, vacation deviations or less efficient mode for traveler’s convenience will be borne by the traveler, reimbursement will be based only on such charges as would have incurred or reimbursed for business purpose and is reasonable based on the business plan to accomplish UA business. / -Reimbursement for business purposes (Reg. violation) / A.5.a
A.5.b.(2)
A.14.a.(4)
A.14.c
Unauthorized expenses / Are there any unauthorized expenses (e.g. expenses for family membersaccompanying traveler, expenses due to personal deviation)? / -Business justification if claiming reimbursement / -Unauthorized expenses (Reg. violation) / A.1.b.(3)
A.5.b.(2)
Non-reimbursable and reimbursable expenses / Are all expenses allowable per UA Travel Regulation?
Are non-reimbursable expenses identified? Are non-reimbursable expenses reported correctly?
Are reimbursable expenses appropriately allocated to the traveler? / -Receipts for expenses greater than $25 (currently) / -(Reg. violation) / A.2.
A.2.a
A.14.a.(2)
Airfare / Does the schedule match the business need?
Is the class of seating allowable?
Is the airfare compliant with FlyAmerica, if applicable?
Is there business justification noted for change fees?
Are all expenses allowable? / -Airfare itinerary/receipt
-If non-coach, ADA accommodation note
-When airfare credits or “my wallet” funds are used, include original purchased itinerary receipt and a screen shot of the “my wallet”(please see Accounting for and Applying Airfare Credits)
-Please see Fly America and Open Skies Agreements for further details. Regardless of business or personal/business itinerary anyairfarereimbursement on federal funds must be incompliance with Fly America
-Business justification required for change fees / -Direct route
-Business dates
-Class of seating
-FlyAmerica
(Reg. violations) / A.3.b
A.4.a
A.5.
A.5.b.(2)
A.5.h
Rental Car / Is the rental car for a UA employee? Is the size of car in accordance with regulations?
Is the car rental utilization in the best interest of the university?
Could a shuttle service be used?
Does the car rental include personal time? If so, is the reimbursement adjusted for any incremental personal cost related to extended term of contract, mileage driven, insurance or fuel cost? / -Rentals larger than “standard” require justification, e.g. multiple travelers, transport of supplies, etc.
-Personal expenses deducted, e.g. insurance, frequent flyer fees, fines or penalties for parking or other violations etc. / Rental car size and allowability (Reg. Violation) / A.2.a.(1)
A.2.a.(6)
A.2.a.(10)
A.4.cA.4.d
A.4.e
A.5.
A.14.a.(6)
Mileage / Does the reimbursement match the business destination?
Is the use of a private vehicle in the best interest of the university?
Is the mileage rate equal to or less than the approved rate? / -Either odometer readings or supporting documentation such as a screenshot from Google Maps or Mapquest
-Mileage rates claimed covers all transportation cost / (Reg. Violation) / A.2.a(2)
A.4.c
Other transportation / Use of Boat, Snowmobile, ATV, Motorcycle, Private Aircraft, or Other Non-Conventional Modes of Transportation requires prior approval of the Statewide Office of Risk Services or designee. / Motorcycles are not authorized
Piloting of aircraft by employees for UA business is not allowed exception must specifically be approved by Statewide Office of Risk Services prior to trip. / A.3.d
A.4.f
Lodging / Is the lodging rate either within the approved limits or supported by a justification and approval?
If non-commercial lodging is expensed, is it within approved limit?
Is lodging reimbursement limited to minimum amount of time required to conduct UA business? / -Hotel folio/receipt
-Reason for exceeding 150% noted (e.g. “conference hotel”, backup to support limited availability when justification is “only room available”)
-Travel should be confined to minimum amount of time required to conduct UA business (e.g. Are flights available to return to home/duty station same day the business ends?)
-Lodging expense outside of business days (one day before and/or one day after business) requires justification and approval of travel administrator / Allowable lodging rates (Reg. Violation) / A.3.c
Per Diem / Does per diem rate match the destination (based on lodging)?
Are provided meals deducted?
Do periods claimed match time in travel status?
Is travel for same day travel within Alaska?
Is travel 12hours or more?
Is travel greater than 30days? / -Hotel folio/receipt
-Conference program, if applicable
-Itinerary (e.g. airfare receipt)
-Exceptions to reductions must be justified in writing
- Same day travel (within Alaska) Per-diem rate for destination location shall be used.
-M&IE allowance not allowable for travel less than 12hours
-Long-Term per diem rate is used for trips greater than 30 days / Per diem (Reg. Violation) / A.2.a.(3)
A.6.
A.6.c
A.7.d
Travel advances / If travel advances were provided, were they noted on the expense report? / -If traveler repaid advance funds, provide deposit slip and/or banner screen shot / Advances (Reg. Violation) / A.12.
Group travel / Is backup included for all meal/lodging arrangements? / All group travel expenses will be reported at actual cost, receipts required
Or
-Cash meal and incidental expense may be paid to group members. Signed statement from group members for amounts or meals received. List of names and amounts signed by each group member when cash is handed out / A.6.g.
International currency / Is any international currency converted correctly? / -Foreign receipts must be itemized by type of expense in English (e.g. “taxi” written in)
-Rate calculation based on the date an expense was incurred
-Exchange rates must be attached to expense report / Currency conversion (Reg. Violation) / A.14.a.(5)
Receipts / Are receipts provided for reimbursable and non-reimbursable expenses reported?
Are receipts legible?
Are receipts provided for expenses greater than $25?
Do foreign receipts have an annotation in English (e.g. “taxi” written in)?
Do receipts match reported expenses? / -Receipts with notations as needed (if faint, please noteamount, and , write in brief explanation of cost)
-Reimbursable and non-reimbursable (e.g. JV travel expenses, banner screen shots when receipts are not available) receipts must be included in backup / Receipts (Reg. Violation) / A.14.a(2)A.14.a(5)
A.14.b
Disallowable Expenses / Are expenses reasonable for business purpose timeframe and business plan?
Are expenses adequately documented? / -Expenses must be within the business timeframe or justification must be attached / A.14.c
Other / Are baggage fees for business purpose?
Is valet parking fee the only parking option? / -Provide justification for baggage fees when fees are excessive or unreasonable (e.g. Alaska Air solely in-state travel allows 3 bags no charge additional baggage fees should be justified)
-Valet parking support, such as a hotel fact sheet is required to substantiate the charge / A.2.a(11)
A.5.e

Page 1 of 11