Travelling expenses are normally payable to staff according to rules approved by directors or partners. Where no rules exist, the auditor should recommend that these be framed for controlling the expenditure. In the absence of T.A. Rules, the expenditure should be vouched on the basis of actual expenditure incurred. A voucher should be demanded for all items of expenses incurred, except those
which are capable of independent verification. As regards travelling expenses claimed by directors the auditor should satisfy himself that these were incurred by them in the interest of the business and that the directors were entitled to receive the amount from the business.
The voucher for travelling expenses should normally contain the undermentioned information :
- Name and designation of the person claiming the amount.
- Particulars of the journey.
- Amount of railway or air fare.
- Amount of boarding or lodging expenses or daily allowance along with the dates and times of arrival and departure from each station.
- Other expenses claimed, e.g., porterage, tips, conveyance, etc.
If the journey was undertaken by air, the counterfoil of the air ticket should be attached to the voucher ; this should be inspected. For travel by rail or road, the amount of the fare claimed should be checked from some independent source. Particulars of boarding and lodging expenses and in the case of halting allowance the rates thereof should be verified. The evidence in regard to sundry expenses claimed is generally not attached to T.A. bills. So long as the amount appears to be reasonable it is usually not questioned. All vouchers for travelling expenses should be authorised by some responsible official. In the case of foreign travel or any extraordinary travel, the expenses, before being paid, should be sanctioned by the Board. The travelling advance taken, if any should be settled on receipt of final bills. At the year, the amount not settled should be shown appropriately in the Balance Sheet. Unless the articles specifically provide or their payment has been authorised by a resolution of shareholders, directors are not entitled to charge travelling expenses for attending Board Meetings.