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Slightly OT, but I wonder if you should be able to claim yoga/gym or even clothes as an expense. If being a consultant means projecting a certain image (fit, well-dressed), shouldn't you be paid for maintaining that image?

The IRS in the US has rules that designates things as taxable income or not for many of these questions. Businesses can still reimburse regardless of IRS categorization, but you may be taxed on the reimbursement as income.

To avoid that issue, most businesses will avoid reimbursing for incidentals that should be considered income. Suits or standard office clothing, I believe, are taxable in most circumstances. Uniforms are not. Of course there's lots of grey areas that keep accountants in business. I'd assume yoga would count as an exercise allowance and not be taxable, but that's just a guess.

Safety-related clothing is also deductible. When I worked in the oil business I could deduct things like steel-toed boots, overall, gloves, etc. off my taxes (or the company could have provided them for me as a business expense). At the same time, as you say, even if I only wear a suit for work, it's not deductible. Such is the simplicity of our tax code :-)

>You can very reasonably disapprove of taking clients to strip clubs, of course, but doing so and then openly disclosing it isn't dishonest.

Doing so and then submitting the expense as a steakhouse is dishonest at the _minimum_.

If I go to a steakhouse and then a strip club, submitting all the receipts for the night under the heading of "steakhouse business dinner" seems basically honest. I'm assuming that's what happened, just because in my imagination a typical night out at a strip club starts somewhere else first. Maybe the version of events in my mind doesn't match reality, but the article doesn't explain either way.

If you disagree, would you also consider it dishonest to submit receipts for the client's transport to and from the steakhouse under the same heading? Or drinks in a bar afterwards? If not, why not?

Actually yes. I would consider it in any case dishonest to cram an expense item into something different. Expenses are itemized for a reason.

As an analog I would also consider it dishonest if a company fibs its accounts by booking items into different categories.

There is usually no other reason then to hide an expense, which should not be there.

If a company approves taking customers to strip clubs then there's no reason not to itemize it as such.

Inconvenience/can't be bothered? Seems highly plausible to me and not that difficult to relate to. I hate filling my expense reports, I'd rather not have to pay stuff out of pocket in the first place.

> If a company approves taking customers to strip clubs then there's no reason not to itemize it as such.

Who says it wasn't itemized as such? We know nothing about how the expenses system in question works, and a hierarchical submission that looks like

------

# Steakhouse business dinner

* Client taxi fare to steakhouse - $xxx

* Steakhouse bill - $xxx

* Strip club bill - $xxx

* Client taxi fare to hotel - $xxx

------

with a receipt for each seems perfectly reasonable (to me; apparently you think that it's dishonest for 3 out of 4 of those items to be there) and is consistent with the nonspecific description of events in the article. Evidently, the employee provided enough information for it to be clear that this was a strip club bill, because the auditing system could tell that it was a strip club bill. In order to create a narrative of dishonesty, you're having to add in details that aren't specified in the article and seem to fly in the face of the fact that an audit looking purely at the information submitted identified that it was a strip club bill.

The story is about how AI helped discover fraud, so presumably it was not expensed correctly, but the all seeing AI went on the internet and discovered that even though the receipt is titled "Sams Fine Steak House", the address on the receipt from the limo company was a strip club. Or something like that.

Maybe I'm more cynical, but I presume that the AI just looked at the strip club receipt, identified as a strip club because the submitter had made no attempt to hide that fact, then determined that according to some official company expenses policy it was impermissible to bill for strip clubs, and then the AI's masters triumphantly declared it to be "fraud" - without worrying about niggly little questions like whether the employee had read the policy, knew the policy existed, or even had access to the policy, nor whether the employee had been authorised by their manager to submit the expense claim despite it violating the written policy.

Do you really need a formal company policy to know that you shouldn't expense a strip club?

Why shouldn't I, if the strip club bill was racked up for business purposes? My employer doesn't expect me to take clients to strip clubs, but if they did, I'd damn well expect to be allowed to expense them.

I'm not totally sure you aren't trolling me.

Somehow I just assumed it was universally agreed upon that strip clubs are not something that you go to for business reason.

And if a sales person invites a client to a strip club, they would do so understanding that it's a questionable thing to do, and that they would be smart enough not to file it in their expense report.

Even if their manager said it's okay. I mean, that would just be a perfect reason for the company to fire both the employee and the manager for colluding to defraud a totally ethical company.

Are you in sales?

You are clearly not in sales.

> I just assumed it was universally agreed upon that strip clubs are not something that you go to for business reason.

Not for personal benefit, but in the interest of winning over a client, coke-fueled stripper parties are fair game.

Do you recommend putting the receipt from the coke dealer in your expense report as well? (As long as there's no company policy against narcotics in expense reports, obviously)

Strip clubs are legal, and many people don't have any ethical issues with them.

Presumably a coke dealer is dealing in illegal drugs.

Unfortunately, I don't think coke dealers are in the practice of providing itemized receipts.

Uh, no. Happens all the time on wall st. Have you been living under a rock?

> And if a sales person invites a client to a strip club, they would do so understanding that it's a questionable thing to do,

Don't presume the sales person is inviting the client.

I do consulting now, and periodically have to go to client sites for presentations and training sessions. There's almost always a big client dinner one of the days we're there. Where we go out to eat, and what we do afterward, is usually driven by client suggestions. In my case, the "after dinner" activities almost always entailed some form of bar hopping, and has never included strip clubs. But that doesn't mean it wouldn't include strip clubs if that's what the client wanted, just that the specific clients I've serviced haven't ever had that particular inclination.

Note that I've only ever been the most senior person present from my company once, and therefore responsible for expensing the client-servicing night. The only direction I was given that time was to keep the client happy and to not blow past the budget for that trip (which had about $5k worth of cushion, after anticipated employee travel expenses). Most of the expenses are passed through to the client however (which is what dictates the budget), and some client agreements do have very strict stipulations on allowable pass-through expenses.

Up until 5-8 years ago, it was still standard business practices at most major accounting firms to take clients to strip clubs.

It's still SOP for many investment firms...

So, no, he's not trolling you. Since the article didn't provide details, it's very possible that the expense was submitted during the transition time when there was no firm policy banning taking clients to strip clubs.

The initial examples clearly list that the employees pretended the charge was for something else. One can reasonably argue the employer should consider covering those things, but the process should be honest on both sides. (Clearly tell employees what's covered, how to submit it and how to ask for clarification/extra consideration, in exchange for accurate claims)

None of the examples "clearly list" this. All of them permit this interpretation, but it's far from clear.

Lol big local strip joint in Denver is also a 'steak house' (they serve some type of meat and call it steak) and now I'm wondering if expensing is the reason for it haha

They do it for anyone who might take a look at expenses: spouses, etc.

I think you misunderstood.

> One employee traveling for work checked his dog into a kennel and billed it to his boss as a hotel expense.

I read this as "employee pretended that the kennel expense was a _human_ hotel expense". (And, presumably, the employee stayed with friends/family)

I read it as "the expenses software requires expenses to be filed under one of a small number of categories, and the employee went for 'hotel' because it was the closest one available". I guess both interpretations are possible.

Haha. Almost certainly what happened. If you want your people straining to figure out which category something is in then you're wasting their time.

Should've used the tool to select the right category instead of making a human select a category and then dinging them for it. Then Finance can approve or whatever.

The real thievery is the time expense software is stealing from the company by making people pick among all these categories.

If it takes you an hour to fill in expenses, that task just cost the company half a grand.

> The real thievery is the time expense software is stealing from the company by making people pick among all these categories.

Oh yes. At my first workplace, I ended up using Emacs keyboard macros to convert from a bank statement dump to a format that could be imported into expense reporting system, and it took me less time than it would take to type in everything manually, because the system UI was so broken.

Possible, yes, but one requires multiple other leaps.

But as an aside why shouldn't they be covering a dog's kennel bill? If the employee only needs to utilize the kennel because of the work-related travel, that is a travel related expense.

Seems like great software if your goal as an employer is to make your employees outright refuse work-travel or to find a different job without it.

Don't misunderstand: Outright fraud is wrong. But in a lot of cases employer's travel expenditure policy was never fit for purpose, and employees worked around the problems by submitting mis-characterized claims like the dog-kennel example.

Instead of fixing the policy, they'd prefer to ignore WHY employees are doing these things (i.e. talk to them) and just lash out with punitive measures.

My children get great child care paid by the goverment just for this reason, to help me be able to work. It would not be very popular to offer the same thing to handle dogs atm.

>But as an aside why shouldn't they be covering a dog's kennel bill?

Because it's not the sort of expense that companies normally cover. Especially people who travel a lot have all sorts of second and third-order expenses resulting from the fact that they're away from home, may have to dress up for client meetings, etc. that are rarely covered by expense policies. They're also working extra hours when they travel. As partial compensation, many are also expensing fancier meals than they'd have at home--and are presumably being paid a competitive salary that reflects a fair bit of business travel.

Whether all this is "fair" is at least somewhat a value judgement but has been the approximate norm since I first traveled for work a very long time ago.

> Because it's not the sort of expense that companies normally cover.

Which is precisely what my post was saying was an issue with existing policy. I find it a little odd that you'd respond to point out the norm, to a post complaining about the norm, and expect the norm to be in and of itself a justification.

Work created an additional cost via required travel. It isn't at all similar to your "clothing for meetings" example because you'd need those without the travel component. When travel itself creates additional costs: those costs should be compensated.

And I'm saying there are any number of second order expenses associated with traveling a lot. For example, I have a lawn service that I probably wouldn't need if I were at home all the time. My driveway is too long to shovel by hand anyway but even if it weren't I'd need to get a service for when I'm away in the winter.

Maybe the norm is wrong and a company should cover those things. (And the kennel seems to be more directly connected to travel than my other examples.) But it's not really surprising that most don't.

I had a friend whom an employer pulled back from a tropical vacation a day early for an emergency. They wanted him to fly somewhere directly from a beach to somewhere very cold. When he brought up the logistical problem that he wasn't ready for that climate, the answer was to expense a cold weather wardrobe sufficient for his stay. Abnormal, but legitimate situations come up all the time.

Sure. Exceptional situations arise. And, maybe, if someone basically never travels and they have to make a one-off trip for a customer problem or whatever, maybe it makes sense for them to tell their boss they'll need to get a dogsitter or pay for a kennel or whatever and they'll want to expense it. (At which point boss probably looks at them funny, sighs, and says "whatever, sure.")

I did work for a company once that had an "offshore inconvenience allowance" fr when we were on rigs and shipyards. It was mostly in the vein of living conditions aren't great and you're working long hours, so here's some extra money. So that's one relatively fair comp mechanism you can use. But mostly it's just baked into people's normal comp plans.

“For my friends, everything. For my enemies, the law”

> by analysing the receipts that the employees submitted.

The article implies that at least some of those receipts were faked.

The article reads to me as a press release from the company with the barest of value-add from the author.

There's a good chance this company had humans review the receipts and calls it "AI".