Per Diem system creates a win-win situation for both employee and employer. The employer pays a fixed amount per day. On the other hand, the employee is free to use that amount as per his convenience and can save a portion out of it. Moreover, in the per diem system, the employer doesn’t need to keep records of receipts. This also saves time for the accounting department.
Whereas, in the actual reimbursement system, it is hectic for both employees as well as employers. The employee will need to keep the receipts for approval and the accounting department’s work will also increase. Hence, the Per Diem system is better.