Study Reveals Increased Gas Costs Drive Workers To Over-Report Mileage
In a recent study, Natural Insight, a retail technology company engaged in workforce management, revealed a startling correlation between the over-reporting of worker mileage in expense reports with the rising cost of gasoline.
Using a statistically-valid sample of data over a six-month period, over-reporting of mileage for expense reports rose to thirty-two percent at the peak of gas prices and was still over-reported at eighteen percent during the lowest period. This proportional correlation during periods where gas costs ebb and flow leads one to believe that workers attempt to recoup increasing gasoline costs via over-reporting of mileage in expense reports, since most corporate reimbursement policies are set on a fixed cost per mile.
"While businesses are supportive of proper worker expense compensation, over-reporting on expense reports is more common than we expected to see and certainly presents a large opportunity for cost reduction if properly identified. Accuracy in reporting of mileage is the issue here. As actual fuel costs rise and fall, corporate reimbursement rates can work for and against the worker since guidelines are typically set on an annual basis," said Stefan Midford, President and CEO of Natural Insight.
The cost of expense reimbursement for mileage is a significant factor in profitability. Seemingly minor improvements in reporting can generate huge cost recapture.
The study ran from January 1 through mid-July of this year and draws upon a statistically-valid sample of over 2,000 days’ worth of individual worker data. In multiple examples, increases and decreases in fuel costs of up to $0.39 were matched by the incidence of over-reporting percentage in a nearly identical range. On average, over-reporting of mileage ran at twenty-four percent throughout the study period.