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We've had this challenge as well at a smaller scale. People would go out to lunch all the time to "discuss work" and expense it. We were paying thousands a mont

We've had this challenge as well at a smaller scale. People would go out to lunch all the time to "discuss work" and expense it. We were paying thousands a month for that. After a while that, and a few other things, got a bit out of hand. Rather than just go after that, we've made it a goal (among other quarterly goals) for everyone to work towards a certain amount of profitability that people can have a part of. In addition to reducing expenses (yes, it's cheaper) it's also created a bit more of a frugal culture in the company. It's great, people watch what they spend themselves and are much more concerned about their departments' budgets. Mind you, we have less than 30 employees at the company (I'm one of the founders). Also, all expenses automatically go to your manager and then get reconciled by our accountant who basically has OCD and will question anything that even looks remotely questionable to anyone including management. Point is, we created this more frugal culture so everyone can have a bit more in the long run.

jeffmould 11y ago
It's funny you say that. In my 2nd example, at the startup, the culture initially was similar. We would go out to lunch as a team and expense it. We would go for drinks after work and expense it ("team building"). As we grew the culture shifted to a "frugal" one, but it was rewarded more with raises and bonuses. Executives sold it to employees not as "cutting costs" but as a gain for employees. At the time we were planning an IPO (this was during the first bubble) and we were sold that if we could show less expenses, more revenue we would end up with higher stock prices thus there was an incentive for us. For the most part though employees were not upset by the transition from spending freely to frugal. I learned from my first job doing expenses that the majority of employees, given simple controls/policies, will abide by them. Some may push the limit from time to time, but blatant expense fraud can be overcome, in most cases, with minimal time/effort and some basic oversight. Having a system of checks/balances (thresholds and management approval limits) along with a final accounting review prior to reimbursement prevents most cases.

jeffmould 11y ago

It's funny you say that. In my 2nd example, at the startup, the culture initially was similar. We would go out to lunch as a team and expense it. We would go for drinks after work and expense it ("team building"). As we grew the culture shifted to a "frugal" one, but it was rewarded more with raises and bonuses. Executives sold it to employees not as "cutting costs" but as a gain for employees. At the time we were planning an IPO (this was during the first bubble) and we were sold that if we could show less expenses, more revenue we would end up with higher stock prices thus there was an incentive for us. For the most part though employees were not upset by the transition from spending freely to frugal. I learned from my first job doing expenses that the majority of employees, given simple controls/policies, will abide by them. Some may push the limit from time to time, but blatant expense fraud can be overcome, in most cases, with minimal time/effort and some basic oversight. Having a system of checks/balances (thresholds and management approval limits) along with a final accounting review prior to reimbursement prevents most cases.