Nervous about whether your year-end expense report will fly? At least you (probably) didn’t claim any of these items.
Ah, the corporate expense account. It’s one of those traditions, part necessity and part perk, that has hung on through the worst of the recession — and even serves as an informal gauge of economic recovery: As the U.S. economy keeps climbing out of the doldrums, Certify, a provider of electronic expense-account systems, reports that employee expenses overall rose about 3% in 2013, or slightly ahead of the official inflation rate for the year.
“At the same time, though, companies are still trying to keep expenses under control,” notes Robert Neveu, Certify’s CEO. “They’re urging employees to limit airline travel and use teleconferencing instead wherever possible, and look for bargains like the lowest car rental rate.”
That didn’t discourage some road warriors from asking to be reimbursed for expenses you might call, umm, creative. Certify asked about 60,000 accounting staffers at big companies what were some of the weirdest expenses people claimed this year. Here’s a partial list of the answers they received, and from whence they came:
• “Apartment rental in Hong Kong. All the hotel rooms were booked.” (vice president of business development, telecommunications, Richardson, Texas)
• “$500 worth of taffy apples for clients’ sweet tooth” (executive vice president, banking, South Holland, Ill.)
• “9 official basketballs to be signed by Magic Johnson” (creative director, creative services, St. Louis)
• “Table dance in Las Vegas for a client — but it was under ‘entertainment’” (accountant, technology company, Alpharetta, Ga.)
• “$91,237 for a Caribbean deep-sea fishing trip” (finance director, sales company, Chicago)
• “Human skull” for unstated purposes (secretary at an antique business, Cassopolis, Md.)
• “Mittens for a team of clients that was cold on a research trip” (vice president of research, digital design company, Brooklyn)
• “Pet boarding expenses” (auditor, software technology company, New York, N.Y.)
• “Purchase of 200 used hub caps for a trade show display around a celebrity chef with a huge ego” (treasurer, wholesale consumer goods company, Garden City, N.Y.)
• “Weight bench and weights to prepare for the season” (partner, landscaping company, Bethany, Okla.)
• “Golf tournament tickets to get close to a client — and I hate golf!” (sales director, hospitality company, Charlotte, N.C.)
• “Evening escort services” (corporate treasurer, consulting services company, New York, N.Y.)
Clearly, lots of people are going above and beyond for their clients. Moreover, says Neveu, “Not all of these expenses are as outrageous as they seem. For instance, the guy who expensed the $91,237 fishing trip may have been trying to sell a $2 million boat.”
Even so, Neveu is the first to point out that the Internal Revenue Service demands a “business reason” for each expense. “You can always submit an expense,” he notes. “But that doesn’t mean it will be approved.”
That’s usually no big deal but, every now and then, the consequences of overspending are severe. Last year, for example, Certify’s survey turned up a financial services manager who treated himself on the company dime to a bottle of Henri VI cognac that cost about $1,300. “Take that, recession!” he was heard toasting — right before he was fired.