When auditing T&E expense reports, a key red flag isamounts just below the approval threshold, as employees may intentionally submit expenses slightly under the limit to avoid additional scrutiny or approval, potentially masking fraudulent or non-compliant claims. This practice, known as “threshold manipulation,” requires close attention during audits.
The web source from Tipalti states: “During T&E audits, pay particular attention to expenses just below the approval threshold, as employees may manipulate amounts to bypass additional review, indicating potential fraud.” This directly supports Option C. The other options are less critical:
Restaurant receipts with client names (A)may be useful for substantiation but are not a primary audit concern.
Highly itemized receipt details (B)are desirable for clarity, not a red flag.
Airfare with hotel costs (D)is a common combination and not inherently suspicious.
The IOFM APS Certification Program covers “Travel and Entertainment (T&E),” including auditing techniques for expense reports. The curriculum’s focus on “peer-tested best practices” aligns with scrutinizing amounts just below approval thresholds to detect potential fraud.
[References:, IOFM Accounts Payable Specialist (APS) Certification Program, covering Travel and Entertainment (T&E), Tipalti: “During T&E audits, pay particular attention to expenses just below the approval threshold”, , ]
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