Skip to main content
T&E best practices for return to travel
Business Travel

T&E best practices for return to travel

6 min read

As your business prepares for the return to travel, you also need to prepare for the return to travel budgets. This means knowing how to plan for and prioritize business travel and expense spending (T&E) in the post-covid 19 world. 

Divvy’s resident expert in T&E, Craig Pickett, recommends three best practices:

  1. Simplify your chart of accounts.
  2. Establish smart policies for spenders. 
  3. Make processes fast and secure with Divvy.

Simplify your chart of accounts

In accounting, your chart of accounts (COA) defines the buckets into which your business spending falls. Your COA informs how an admin can simplify their budgets. In general, Craig recommends keeping as few budget categories as possible in your chart of accounts as they relate to corporate travel. 

Typically the larger the business, the more specific they need to be when coding the COA. The benefit of breaking out the corporate travel and expenses budget as its own category is that it allows reporting precision that can make the case to get contracts. 

For example, you might make a specific budget for lodging if your business traveler will frequent the same vendor every month for lodging. After a few months, you can create a report that shows how much money the company has spent at this particular vendor and make a case to get a contract with that vendor for corporate or loyalty discounts. 

If the business is not trying to move in this direction, then a complicated COA will lead to a complicated three-way matching process. Matching the budget, the actual spend, and the receipts at the end of the month will be increasingly complicated with more separate budgets. You’ll need to determine what the best budgeting strategy is based on the size of your business.

Establish smart policies for spenders

Companies who are successful in their T&E budgeting create a separate travel expense policy from their general expense policy, and as we slowly climb to pre-pandemic levels of corporate travel you’ll have time to address your travel policy. 

Elements of the T&E policy include:

  • Booking date requirements — How far in advance must a business traveler book their lodging, airline selection, and transportation?
  • Last-minute travel rules — Due to health and safety restrictions or changes
  • Executive travel rules — Different procedures required for senior roles
  • How spend is tracked on each business trip — Per diems provided in advance, receipts submitted after the fact, real-time tracking through mobile expensing apps
  • Rules for completing transactions — How long does the spender have to complete and add receipts? Will their card be frozen if they don’t meet the timeframe? 
  • Using virtual cards vs. physical cards — For non-discretionary and discretionary spending
  • Meals & entertainment guidelines — Can the business traveler include leisure travel expenses? 
  • Consequences for breaking this policy — Including reimbursements, preapprovals, etc.

Comprehensive T&E policies require the spenders to agree to a set of rules when they travel, and clearly outline instructions for how to spend on company cards and complete transactions using the mobile app. For example, with Divvy’s budgeting software, finance teams can freeze employee cards if receipts have not been submitted within a deadline. 

If the company utilizes reimbursements, this policy should also describe the reimbursement policy (i.e. what types of transactions are eligible, how to submit a request for reimbursement, and timeframe for pay).

What’s the difference between discretionary and non-discretionary travel spend?

In T&E policies, non-discretionary expenses typically include lodging, airfare, and transportation. Discretionary spending may include meals, entertainment, and other non-essential purchases.

Make processes fast and secure with Divvy

Companies who are successful with their T&E policy establish a certain set of rules for how company cards and budgets are structured. 

In Divvy, admins provide individual cards to spenders so there’s no last minute or off-the-record card-sharing. Then, these business leaders, managers, and decision makers have control of the amount of funds each employee receives. 

Anyone traveling can receive a unique virtual card for non-discretionary funds related to business travel. The travelers should then attach all non-discretionary (lodging, airfare, transportation) expenses to that virtual card rather than use their  physical card. With Divvy virtual cards, funds can be allocated faster, and spend monitoring is easier. 

This is beneficial for a few reasons. The business traveler cannot misplace the virtual card, so they will have secured their airfare, lodging, and transportation within the online travel industry but without interruptions. If there are issues or suspected fraud, admins can easily freeze the cards while they investigate. 

Traveler’s discretionary spending (meals and entertainment allowed by the business) should be attached to the physical card, whether for domestic travel or international travel.

Return to business travel with confidence

Take the stress out of business travel by budgeting and booking with Divvy. Get exclusive rates, real-time data, and our best rewards with Divvy Travel, powered by TravelPerk. With booking and budgeting controls that really work, watch your savings take off.

Leave a Reply

Close Menu