Why do companies use travel expense instead of per-diem.?

Question

What is the advantage or legal requirement? per-diem is so much easier and I would image less expensive becuase of the overhead.

Answer 1

My company alllows either per diem or payment of actual travel expenses.  Per diem is paid automatically, without receipts, under the assumption that a certain amount of travel expenses are unavoidable.  The amount paid will typically be either too high or too low; usually the latter.  Paying on documented expenses is more accurate, but the difficulty of keeping every receipt, no matter how small and getting receipts for every payment is considerable.  Think about the items you pay for in cash in the airport and the small tips that are paid in cash.  How can you document these?