Employee Biz Expenses for the experts?

Hi. This is a question for the real tax experts out there. A friend of mine got a fairly large weekly per diem for job-related travel expenses. This amount was NOT included anywhere on his W-2, neither in box 1, box 12 or box 14. He is on an unaccountable plan. My question is: does he need to report the per diem as income and then deduct the actual expenses *or* does he not report it as income and not deduct any travel expenses? Please cite the reference(s) with your answer. Thanks!