Understanding Audit Rules

After you add a new policy, the system automatically prompts you to enter audit rules. Audit rules specify how the system randomly selects expense reports for audit. You can audit a percentage of expense reports based on:

Total amount of the report.
Percentage of exceptions in the report.

You can set up multiple ranges and percentages. Audit rules are based on the reimbursement currency of the employee.

This table describes each audit rule:

Audit Rule	Description
Audit Rule 1	The system randomly selects a specified percentage of expense reports based on the total amount of the report. You specify the range for the amounts and the percentage of reports that you want audited. The amounts that you enter are in the currency specified by the policy. You can define multiple rules for different amounts and percentages. For example, you might want to randomly audit 10 percent of the reports when the amount is between 500 and 1000, 25 percent of the reports when the amount is between 1001 and 5000, and 100 percent of the reports when the amount exceeds 10,000.
Audit Rule 2	The system randomly selects a specified percentage of expense reports based on the percent of exceptions on the report. You specify the range for the percent of exceptions and the percentage of the reports that you want audited. The system marks expense items as exceptions if the expense amount exceeds a predefined policy limit, or if a preferred supplier is required by the policy but is not used. For example, you might want to randomly audit 20 percent of the reports that have 10 to 20 percent exceptions, 50 percent of the reports that have 30 to 40 percent exceptions, and so on.
Audit Rule 1 and 2	If a policy has both types of audit rules defined (rule 1 and rule 2), the system randomly selects expense reports that meet the criteria of Audit Rule #1 and then selects expense reports that meet the criteria of Audit Rule #2.

Audit Rule

Description

Audit Rule 1

The system randomly selects a specified percentage of expense reports based on the total amount of the report. You specify the range for the amounts and the percentage of reports that you want audited. The amounts that you enter are in the currency specified by the policy. You can define multiple rules for different amounts and percentages.

For example, you might want to randomly audit 10 percent of the reports when the amount is between 500 and 1000, 25 percent of the reports when the amount is between 1001 and 5000, and 100 percent of the reports when the amount exceeds 10,000.

Audit Rule 2

The system randomly selects a specified percentage of expense reports based on the percent of exceptions on the report. You specify the range for the percent of exceptions and the percentage of the reports that you want audited. The system marks expense items as exceptions if the expense amount exceeds a predefined policy limit, or if a preferred supplier is required by the policy but is not used.

For example, you might want to randomly audit 20 percent of the reports that have 10 to 20 percent exceptions, 50 percent of the reports that have 30 to 40 percent exceptions, and so on.

Audit Rule 1 and 2

If a policy has both types of audit rules defined (rule 1 and rule 2), the system randomly selects expense reports that meet the criteria of Audit Rule #1 and then selects expense reports that meet the criteria of Audit Rule #2.

To bypass setting up audit rules or to set them up at a later date, click Cancel. The system displays the form for setting up expense category attributes.