Reimbursing contractor expenses
Step-by-step guide to processing expense reimbursements through invoices
Step-by-step guide to processing expense reimbursements through invoices
This guide walks you through the complete process of reimbursing contractor expenses using the invoice adjustments API. You will learn how to create, document, review, and track expense reimbursements from submission to payment.
Use this workflow when contractors incur business expenses that your organization agrees to reimburse:
Before you begin, ensure you have:
invoice-adjustments:write scopecontract_id of the contractor requesting reimbursementMost organizations require receipts for all expense reimbursements. Always attach documentation to maintain compliance and create a clear audit trail.
This example demonstrates reimbursing a contractor for travel expenses totaling $847.50 for a client meeting.
Before creating the reimbursement, collect all necessary information:
Example expense breakdown:
If you have a receipt or invoice to attach, upload it first and note the file key.
Combine multiple receipts into a single PDF before uploading to simplify the reimbursement process. Include a summary sheet with itemized expenses.
Create the expense reimbursement with detailed description and attached receipt.
Always include a breakdown of expenses in the description. This provides transparency and makes the approval process faster.
Response:
The reimbursement is now created with pending status, waiting for review and approval.
Check that the reimbursement was created correctly with all documentation attached.
Response:
Verify that the attachment is present and the amount is correct.
For expenses that repeat monthly, such as internet or phone stipends, use recurring adjustments.
Use auto-approval for standard recurring stipends to streamline processing. This is ideal for fixed monthly allowances that don’t require receipt verification each time.
When the recurring reimbursement is no longer needed, delete it to stop future occurrences.
If a reimbursement doesn’t meet policy requirements, decline it with a clear explanation.
When declining reimbursements, always provide specific reasons and actionable feedback. This helps contractors understand what they need to fix for resubmission.
After addressing the decline reason, the contractor can submit a new reimbursement.
Always attach receipts that include:
For travel expenses:
For equipment:
Before creating reimbursements:
For large or unusual expenses:
Create clear expense policies that define:
Maintain a complete audit trail by:
Attach a clear, legible receipt that includes all required information (vendor, date, amount, items). If the original receipt is lost, request a duplicate from the vendor or provide a credit card statement as supporting documentation.
Verify the total amount includes all line items from the receipt. If you made a mistake, update the pending adjustment with the correct amount before approval.
Convert the amount to the contract currency using the exchange rate from the transaction date. Include the original amount, currency, and exchange rate used in the description. Attach the receipt showing the foreign currency amount.
Provide a translation of key information (vendor, date, items, amount) in the description field. For large expenses, consider attaching a certified translation.
Create separate reimbursements for each contractor’s portion. Clearly indicate in the description that the expense was shared and specify each person’s share. Attach the full receipt to all related reimbursements.
If the expense exceeds policy limits, either reduce the reimbursement amount to the policy maximum or request special approval from senior management before submitting.
Combine all receipts into a single PDF file before uploading. Include a cover sheet summarizing all expenses with a total. Many free PDF tools can merge multiple files.