Sample Relocation Expense Report Forms - PDF

Document Sample
Sample Relocation Expense Report Forms - PDF Powered By Docstoc
					RELOCATION                                                     TAX TICKER
Third Edition                          ExpensePro, LLC
                                       1801 Broadway, Suite 1010 Denver, CO 80202
Summer 2005                   p. 303.299.9191 f. 303.299.9292

                 Sarbanes-Oxley Act: Section 404
In July 2002, the Sarbanes-Oxley Act was enacted to address accounting controls and procedures to en-
hance the level of confidence the public has in corporations. Our focus is Section 404 - Management
Assessment of Internal Controls. There is a framework that surrounds this Act that gives a foundation for
proper assessment, procedures and controls with financial transactions. Within relocation expense man-
agement and tax processing, there are numerous financial transactions that should be documented,
tested and controlled.
A standard matrix/framework for Management’s Assessment of Internal Controls, is COSO (Committee of
Sponsoring Organizations of the Treadway Commission).

                                                                                     5 COMPONENTS
Statement on Auditing Standards (SAS) Number 78
                                                                            Control Environment
COSO and SAS 78 work hand in hand to provide reasonable assurance
regarding the achievement of objectives in the following categories:        Risk Assessment
Internal Controls = process to provide reasonable assurance regarding:
                                                                            Control Activities
              -Effectiveness and efficiency of operations
              -Reliability of financial reporting                           Information and communication

              -Compliance with applicable laws and regulations              Monitoring

Control Environment provides discipline and structure; setting the tone of an organization.
Risk Assessment forms a basis for determining how risks should be managed.
Control Activities are those policies and procedures that help ensure that management directives are
carried out.
Information and communication are the identification and exchange of information in a form and time
frame that enable people to carry out their responsibilities.
Monitoring is a process that assesses the quality of internal control performance over time.
These components have to be balanced as to the cost of controls. What is the cost of the control meas-
ure? What is the cost of the realized risk? What is the organization’s security level? It is Balancing The
Cost Of Controls.
RELOCATION                                                         TAX TICKER
                   Sarbanes-Oxley Act: Section 404
Implementation - Relocation Expense Management
Establishing an internal control design for relocation, especially for expense management and tax proc-
essing financial transactions/activities, is the first step to having better internal controls. These controls
will help when there are internal and external audits and reviews by management, vendors and/or con-

•   File Process - the life cycle of a file
        Chart out the life cycle of a relocation file. From initiation to completion of the move and all things
in between including expense management, vendor management, destination and home sale.

•  Audit Process - policies and procedures to abide by
      There should be a proper relocation policy in place and a matrix for each level/tier. Understand
how certain expenses are coded per the policy’s allowances and exceptions.

•  Data Storage/Backup Process - data maintenance, integrity and security
      Understand the technology, access, passwords, security and storage/backup of the relocation
technologies in place and how they work with the internal accounting and payroll systems.

•    Payment Process - vendor and employee payments
        Flow chart the employee and vendor reimbursement processes between relocation, A/P, A/R, pay-
roll and accounting. Understand the timing, cut-offs and have a log sheet for each relocation file. If there
are any outside consultants and/or vendors, make sure that a definitive statement of work is in place.

•   Reporting - who, what, when, where and why reports are needed
       The reports should cover fee billing from vendors, funding requests, check requests, general
ledger updates, payroll earnings updates and H/R reports for management and relocation. Also, form W-
2, form 1099, transferee and year-end reconciliation reporting should be properly established.

•  Tax Assistance Process - gross-up and year-end
       Have a tax information implementation plan that establishes transferee tax information in accor-
dance with the relocation policy for tax assistance on any relocation. There should be a direct correlation
between payroll, IRS and transferee reporting. There should also be payroll guidelines for pay-period up-
dates, year-end updates and reconciliation for gross-up versus withholding.
RELOCATION                                           TAX TICKER
                Sarbanes-Oxley Act: Section 404
Key Activities of Transactions

     -Relocation authorization/initiation form
     -Tax information
     -Relocation policy guidelines and procedures
     -Review and approval


     -Expense coding per policy and tax guidelines
     -Vendor data
     -Transferee data


     -Payroll processing
     -Gross-up processing
     -Check cutting


     -Payroll reports
     -H/R reports
     -Vendor reports
     -Accounting reports
     -Finance reports
RELOCATION                                                  TAX TICKER
                 Sarbanes-Oxley Act: Section 404
5 Categories to Assure Accuracy
•   Completeness of Input - ensure the transaction was entered
       -use of prenumbered documents
       -use of batch, hash and dollar totals
       -one for one matching of documents and records
       -prior data matching
•   Accuracy of Input - ensure data in key transaction fields are entered and recorded accurately
       -use of batch, hash and dollar totals
       -one for one matching of documents and records
       -use of prerecorded data input
       -use of edits, including programmed edits in computer systems
•   Completeness of Update - ensure transactions post to their ultimate destination in the system
       -use of prenumbered documents
       -use of batch, hash and dollar totals
       -one for one matching of documents and records
       -prior data matching
•   Accuracy of Update - ensure integrity of key transaction data fields throughout the accounting
       -use of batch, hash and dollar totals
       -one for one matching of documents and records
       -use of edits, including programmed edits in computer systems
•   Data Maintenance and Security - ensure data is not amended, deleted or appended until authorized
    processing resumes; data remains accurate and complete
       -maintenance of backup data stored off-site
       -reconciliation of file totals
       -exception reports
       -one for one checking of data on file
       -security controls including facilities controls and computer controls
                                                Q & A for Rufus the

       Q: Audit, Test and Review Your Relocation Processes; how do you assure some sort of
compliance with Sarbanes-Oxley?
                                           Relocation Director
       A: Let’s go over what should be in place with your relocation program in regards to audit and re-
view. ExpensePro’s Service Elements and Implementation Procedures should do the trick! Take a look
at the next four pages. You can always find helpful information on our website at

                                        Rufus the ExpensePro
                             Service Elements
•   Expense Processing & Management
•   Audit & Compliance Review
•   Relocation Policy Design
•   Relocation Policy Implementation
•   Accounts Payable Reporting
•   Vendor Management
•   Vendor & Employee Check Cutting
•   Payroll Reporting
•   Pay Period Withholding
•   Monthly, Quarterly & Yearly Reporting, Consulting & Auditing
•   Gross-up/Tax Assistance Calculation
•   Tax Reporting (IRS)
•   Transferee Counseling
•   Additional Tax Make-ups (ATMs)
•   Tax Return Preparation

    I.     Implementation
           a.   Attend implementation meeting
           b.   Coordinate implementation documentation
           c.   Review implementation docs with Client
           d.   Set up Relocation System/Technology to Client specifications
           e.   Create sample data runs / calculations for Client approval
           f.   Create management reports for Client approval

    II.    Expense Report Audit
           a. Audit expenses to policy
           b. Communicate out-of-policy to Client
           c. Track approved exceptions

    III.   Track Expenses
           a. Tax code expenses
           b. Enter expenses into Relocation System
           c. Run monthly/quarterly management reports

    IV.    Payroll
           a.   Communicate and establish payroll cycles
           b.   Gather year-to-date wages from Payroll
           c.   Run payroll gross-up & withholding
           d.   Audit report for accuracy
           e.   Pass report to Client
           f.   Verify Payroll acceptance
           g.   Post payroll in Relocation System
                       Service Elements
V.    Year-end
      a. Coordinate year-end team
              i. Client Payroll / Accounting
             ii. Client Counselor
            iii. ExpensePro
      b. Run audit reports and resolve issues
      c. Analyze files for completeness and accuracy
      d. Communicate and establish year-end time-line
      e. Run pre-year-end calculations
              i. Validate numbers with Payroll
             ii. Communicate to Client results and options
      f. Communicate year-end process to EE (September/October)
      g. Identify potential Closed and Cancelled files
              i. Communicate to Client for direction
             ii. Handle files in Relocation System accordingly
            iii. Potentially feed closed file gross-ups to Payroll early
            iv. Gather year-end wages from Payroll
      h. Upload wages into Relocation System – verify missing data
      i. Calculate gross-ups
              i. Produce year-end gross-up report
             ii. Calculate gross-up reconciliation
            iii. Produce reconciliation report (if necessary)
            iv. Pass gross-up information to Payroll
             v. Verify Payroll acceptance of gross-ups
      j. Produce year-end Relocation Tax Reports
      k. Run yearly Management Reports
      l. Email year-end packet to Transferee in January
              i. Relocation Tax Report
             ii. Memo explaining information
            iii. RiTA tax booklet (optional)
      m. Answer Transferee / Accountant Questions

VI.   Expense Payments
      a. Process Payments
             i. Client Payables
            ii. ExpensePro Payables
                    1. Zero-balance account
                    2. Monthly reconciliation of bank statement
                    3. Monthly account reporting to Client
                    Implementation Procedures

ExpensePro will work with the client to establish proper lines of communication.
What are the client’s policies and procedures? What are the customer’s policies
and procedures? What forms, documentation and process flow are in place for
each customer?

Review relocation policy, procedure and system/software:

      •   Planning
          o Review/determine: all program components/services for each
             policy level; identify roles & responsibility for delivery of each

      •   Meetings
          o Review policies, process flow, reporting requirements, forms,
            transition and communication timeline
          o Define funding method, payment process, gross-up methodology,
            reporting requirements, transition, communication, and data
            transfer requirements
          o Determine vendor invoice requirements. Determine and set up
            funding process and reporting requirements

      •   Policy
          o Review current policies and summaries
          o Revise according to current program requirements
          o Document process flow – map out

      •   Forms/Documents
          o Review current forms
          o Revise according to current program requirements & process flow
          o Create final documents

      •   Procedures & Process Flow
          o Review current relocation process flow
          o Revise according to current program requirements
          o Create final documents (flow charts)
              Implementation Procedures

•   Software/system
    o Audit files for completeness accuracy
    o Audit system for accuracy
    o Audit system gross-up policy for compliance with client policy
    o Review customer, payroll and gross-up reporting
    o Audit system gross-up policy for compliance with client policy
    o Review Year-end forms and communication pieces
    o Assist in customizing forms per requirements
    o Help managers identify timeline for year-end processing
    o Review system audit capabilities
    o Review prior year documentation
    o Identify potential problem areas
    o Conduct several client set-up calls and set up expectations

Shared By:
Description: Sample Relocation Expense Report Forms document sample