How’s the default expense type derived?

Expenses can automatically suggest an expense type based on the information available for an expense. This reduces manual entry and helps ensure a consistent user experience.

The default expense type depends on the source of the expense such as

• Uploaded receipts
• E-receipts
• Corporate card transactions

In each case, the application evaluates available transaction details along with existing setup configurations to determine the most appropriate expense type.

Uploaded Receipts and E-Receipts

For uploaded receipts and e-receipts, the application analyzes receipt details, primarily the merchant and the receipt type (for example, meals, travel, or miscellaneous), and attempts to match them with expense types defined in the organization’s default template.

Derivation logic

1. Employee’s Expense History (Highest Priority)

   The application checks the employee’s past expenses for the same combination of merchant and receipt type.

   If found, it selects the most frequently used expense type.

   If there’s a tie, the most recently used expense type is selected.

2. Business Unit Expense History

   If no match is found in the employee’s history, the application checks usage within the employee’s business unit using the same logic (frequency, then recency).

3. Default Template (Single Expense Type)

   If no history-based match is found and the default template contains only one expense type, that expense type is used.

4. No Match Found

   If none of the above conditions are met, the expense type remains blank for manual selection.

Note: If a receipt is from a new or unfamiliar merchant, select or correct the expense type once. The system learns from this and applies it automatically in future transactions.

Corporate Card Transactions

For corporate card transactions, expense type derivation is based on predefined mapping rules.

Derivation logic

1. Card Expense Type Mapping

   The application derives a card expense type using the transaction source mapping rule assigned to the corporate card program.

   Mapping is based on either:

   • Merchant Category Code (MCC)
   • Standard Industrial Classification (SIC) code

   If a matching MCC/SIC code is found, the corresponding card expense type is used.

   If no match is found, the default card expense type defined in the mapping rule is used.

2. Mapping to Expense Type

   The application identifies the default template for the employee’s business unit.

   It then looks for an expense type mapped to the derived card expense type. If found, that expense type is used. If not, the default expense type is applied.

Summary of Defaulting Behavior

Expense type defaulting varies based on the source and available data.

Expenses may use:

• Merchant and receipt type details
• Employee and business unit expense history
• Default templates
• Subcategory defaults (for e-receipts)
• Corporate card mapping rules

If no applicable rule is found, the expense type may remain blank depending on the configuration.

Customer Guidance

To ensure accurate expense type defaulting, review and maintain the following setup elements:

• Default expense type templates
• Merchant and receipt type-based history
• Subcategory default mappings (for e-receipts)
• Corporate card transaction source mapping rules

Keeping these configurations up to date improves both accuracy and consistency.

Tips to Improve Accuracy

• Regularly review and maintain default expense templates for business units.
• Validate and update MCC/SIC mappings in corporate card programs.
• Confirm lookup values for subcategory defaults (for example: TAXI, FUEL, PARKING in miscellaneous flows).
• Monitor usage patterns and incorporate user feedback to refine mappings.
• Include merchant and receipt type combinations, especially for multi-service vendors, to prevent misclassification.