Category: Case histories

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The oil division of a major shipping group needed the facility to manage the expenses of rapid response engineers sent at short notice into locations as diverse as the USA, UAE, India, Malaysia, UK and Australia. To do their job the relocated engineers needed to be sure that local costs such as car hire or urgent ad hoc equipment purchase could be met quickly and efficiently.

This often involved reimbursement in multiple currencies through a diverse banking network. And of course all expenditure had to be accurately reconciled and controlled against cost centres. We got involved right from the start and developed a tailor-made programme which included the following:

• Development of a standardised invoice pro-forma to ensure information obtained from vendors was accurate and exchange rates were handled in a visible manner, particularly when dealing with non-convertible currencies
• Development of a simplified expense claim that could involve claiming expenses in one currency for payment in a second currency against funds held in a third base currency, subject to banking regulations
• Holding funds and tracking costs in multiple currencies and producing reconciliation and cost centre recharge reports
• Making cross-border payments, setting up and controlling bank accounts in non-UK countries for in-country payment services.

In this case we worked from the ground floor to help a newly formed centralised HR and finance division to develop policies and then expense manage over 500 domestic relocations and international assignments per year.

The client was keen to ensure that all administration and compliance was transparent, efficiently managed and that payments and reimbursements took place in a controlled, accurate and timely manner. As if 500 relocations annually weren’t enough, the project was made more complex because we were working across 10 separate divisions of the company.

Throughout we were audited by HMRC and had all the workflow audited for Sarbanes-Oxley compliance. We passed both these audits with 100% compliance.

The development and execution required us to consider the following:

• Development of 25 separate relocation and International assignment policies with bespoke downloadable expense claim forms for each policy
• P11D/PSA year-end relocation tax reporting
• Monthly payroll reporting for international assignments
• Quarterly accrual report for relocation costs
• Weekly recharging and VAT reclamation reporting
• Monthly disturbance allowance and transfer grant reporting
• BIK reporting for P11D for non-relocation benefits
• Support for those on assignment – managing three-year budgets for education costs and spouse allowances and policing expense claims
• Handling multiple payment of inter-company expenditure and property management in addition to all IA/Relocation reimbursement and vendor payments
• Development of a FastTrack® same day payment service for urgent payments
• Provision of payment services by BACS, CHAPS, cheque and automated cross-border payments
• Full reconciliation of accounts on a weekly basis. Click here to read more how Hessel helped a major shipping group manage the expenses of rapid response engineers in locations as diverse as USA, UAE, India, Malaysia, UK and Australia.

When Hessel were called in by the UK division of a global courier to help design a more tax efficient and accountable domestic relocation policy, a couple of things became clear pretty quickly.

Firstly, because the company had grown through M&A, there was no coherent relocation policy, and secondly there was little or no control over tax reporting. We worked closely with the client and their outsourced payment provider to design a relocation policy that was both equitable and accountable.

Of course we checked our proposals were aligned to ITEPA 2003 and ensured that there was no leakage of claimable items from qualifying to non-qualifying. Any ambiguous items were either clarified or removed from the policy. To further ensure compliance all relocation expense claims are now routed through Hessel where we check against policy, and if correct, record them for P11D/PSA reporting.

The client is delighted. Not only do they now have centralised, efficient and accountable policy management, but they’ve also saved an average 89% on the gross-up paid per employee. And all for a Hessel cost of less than 7% of the savings created.