T&E Management for 2015:Comparing Spreadsheets with Expense Report Automation

October 15, 2015

• The expense report processing costs for spreadsheet-based manual processes and automated systems

• How to improve control over employee spending and business travel decisions

• What companies like yours are doing to enforce policy compliance and reduce fraud

• New ways automation can tame your data management and simplify administrative reporting

• Strategies to streamline the expense reporting process and improve productivity

After attending this event you will learn:

Learning objectives

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• Today’s event will be recorded and all attendees will be kept in listen-only mode to eliminate excessive background noise.

• Links to today’s presentation and the recording of this webinar will be sent out to all attendees within 24 hours of the event.

• Please ask questions on today’s topic via the “Questions” box in your GoToWebinar control panel at any time during the event. We will do our best to get to your questions during the Q&A/panel discussion at the end of the event. If we do not get to your question, we will follow up with you directly to address your question.

Webinar event notes

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Ben ParkerRegional Sales Executive

Ernie HumphreyChief Executive Officer

Today’s speakers

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• Industry-leading with first fully automated expense system

• #2 expense report software providing travel and expense solutions since 2008

• 64 languages, 140+ currencies, clients in 80 countries

• #1 Highest Rated Expense Management Software on G2 Crowd, with a 4.8 out of 5 star rating

• Over 25 million expense transactions in 2014

• Processing over $10+ billion/year in expense reports

About Certify

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T&E Management Trends:

Manual vs. Automated

a) Paper-based/spreadsheetsb) ERP system (Oracle, Microsoft Dynamics, etc.)c) Web-based expense software (Certify, Concur, etc.)d) Not applicable

POLLING QUESTION 1

How does your organization currently manage T&E spend?

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Reference: Certify Annual Expense Management Outlook 2015

Manual processes are used by the majority of companies, however Excel or electronic spreadsheets, pen/paper and homegrown systems provide little control or visibility.

37%WEB-BASED

43%MANUAL

19%

ERP

Methods for managing T&E reporting

T&E Adoption Rates

Manual - 64%ERP - 11%Web-Based - 25%

Manual - 19%ERP - 33%Web-Based - 48%

Manual - 48%ERP - 19%Web-Based - 34%

Small Business Medium Business Large Business

Reference: Certify’s Annual Travel & Expense Management Survey 2015

T&E management trends

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10

$50k – $5mm

Mid-Size Company101 – 999 employees

> $5,000,000

Large EnterpriseMore than 1,000 employees

< $50,000

Small BusinessLess than 100 employees

Reference: Certify Annual Expense Management Outlook 2015

Annual T&E spend by company size

of small businesses have migrated off of Excel/spreadsheets as their expense management system within the last 12 months

of small businesses currently use a web-based expense system, compared to 8% last year.

20% 67%

25%

of companies indicated Excel/spreadsheets as their expense management system in 2014

Reference: Certify Annual Expense Management Outlook 2015

The shift to web-based expense systems

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Comparison #1:

Processing Costs

a) Under $7 per reportb) $10−$20 per reportc) $25 or more per reportd) We do not track these costs

What is the average cost to process a single expense report at your organization?

POLLING QUESTION 2

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$36−$64 depending upon the degree of automation used (American Express)

Best-in-class companies: $7.17 Laggard organizations: $41.12 (Aberdeen Group)

$26.63 manual

$17.31semi-automated

$6.85fully automated

(PayStream Advisors)

Expense report processing costs

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• Man hours to create, review and approve reports

• Hard costs for paper, printing and postage

• Time required for reconciliation and reimbursement • Storage fees to archive expense reports • Lost productivity

PayStream Advisors 2015

of all companies do not know their expense report processing costs80%

$$$Expense report processing costs

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Gather receipts, itineraries and write down

non-receipt items

Enter expenses in Excel with category, vendor, dates, etc.

Print spreadsheets, tape or staple receipts and make

copies

Sign report/date report and present or mail to

manager

And then … wait

Receive reports for all employees at different times

during the month/quarter

Check expenses for receipts, review for out-

of-policy items, etc.

If errors, return report to employee to start over; wait for resubmission

Sign/approve reports and route to the next manager or to AP

Receive reports for all employees at different times

during the month/quarter

Match receipts with line-items, verify all charges,

dates and vendors

Check for receipts, manager approvals, out-of-policy

items, etc.

Manually enter expense data into accounting

software

Manually enter data from accounting

software to payroll for reimbursement

Accountants

Managers

Employees

Manual expense reporting costs

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48%

28%20%

32%24%

13%

Best-in-Class Laggards

Top Pressures Driving T&E Improvements

Aberdeen Group Travel and Expense Management: Spend and Save

Cost and process inefficiency drive change

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Comparison #2:

Spending Controls

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Spreadsheets offer little control:

• Does not integrate with electronic systems for travel booking, corporate payments, AP, ERP, HRIS, etc.

• Inefficient and redundant manual data entry negatively affects employee productivity and leads to reporting errors

• Making the right policy choices left to employee discretion when planning travel and making business purchases

Spending control

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Aberdeen Group: Travel and Expense Management: Spend and Save Maybe …

Expen

se reports

audited re

gular

ly

Automatic li

nkage

betwee

n expen

se mgt. a

nd back-en

d syste

ms

Online t

ravel b

ooking syste

m

Commercial ca

rd syste

m/program

End-to

-end ex

pense

mgt. solution

88%

58%

87% 77% 68%63%

34%

63%50%

35%

Best-in-Class Industry Average

T&E strategies and tools used by best-in-class companies

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• Direct control over T&E expenses through policy restrictions, spending caps, reduced fees and more

• Full view into traveler data for tracking compliance and leveraging supplier negotiation

• Value-added services including fraud protection, travel-related insurance, global support, etc. Commercial card system/program

77%

50%

Best-in-ClassIndustry Average

Corporate credit card integration

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Open Booking

(through direct provider)

Online Travel Sites/Agencies(i.e. Expedia, Orbitz, Kayak)

Online Booking Tool (OBT)

(i.e. Carlson, Get There)

Travel Agency

(through a travel agent)

PRO: Flexibility

CON: No control over policy enforcement

PRO: Flexibility

CON: No control over policy enforcement

PRO: Policy enforcement

CONS: Contracts and systems; minimum transactions. Best for organizations spending over $2mm on T&E.

PRO: Full-service policy enforcement

CONS: Cost; $40-50 fee in addition to booking fees. Best for organizations spending over $4mm on T&E.

Online Travel SitesTravel AgencyOnline Booking Tool

68%

21%

11%

48%

42%

10%

How companies are booking travel:

Manual process

Web-based process

Integrated corporate travel

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Mileage reimbursement before and after using an automated system with integrated mapping

Oct. '13 - Mar '14 Oct. '14 - Mar. '15

$362,000SAVED

Certify enterprise client:

• 12,000+ retail locations

• 100,000 employees

• 58,000 users creating and submitting expense reports annually

in mileage

T&E control = real savings

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Comparison #3:

Policy Compliance

a) We have no formal T&E policy b) Manual review processc) Automated system that flags violationsd) Policy is not enforced

How does your organization enforce compliance with T&E policies?

POLLING QUESTION 3

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Manual policy review is inefficient and creates room

for error and fraud

78%Of companies indicatethey have a T&E policy

65%Of those companies are manually

reviewing for policy violations

Policy enforcement trends

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• Expense fraud accounted for nearly 14% of all occupational fraud in 2014 with a median loss of more than $30,000

• Businesses with fewer than 100 employees have a 28% higher median fraud loss than those 100+

• Organizations that monitor compliance experience a 70% decrease in fraudulent spending

Association of Certified Fraud Examiners

Oversight Systems

82%

Expense report fraud

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1. Establish a corporate travel and entertainment expense policy

• Clearly defined for all employees with ongoing training• Executive support for T&E policy is essential

2. Integrate your policy into the expense system, setting both:

• Hard Policies (decline expense exceeding X amount)• Soft Policies (manager’s discretion for approval)

3. Allow technology to enforce policies, notifying employees and managers of violations, including:

• Missing receipts• Duplicate expenses• Items exceeding spend limits

Flagged violation, notifying manager amount exceeded policy limit

Automate policy compliance

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1. An end-to-end expense management system allows administrators to automate policy controls across a single platform for improved employee compliance

2. Pre-trip approvals using an integrated online travel booking system can stop out-of-policy expenses before they occur (used by 87% of all best-in-class companies)

3. Mobile applications encourage policy compliance by making it easier for employees; mobile also reduces expense report processing costs by up to 65%

Adopt a unified platform

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Comparison #4:

Reporting Visibility

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One spreadsheet can’t tell the whole story:• Inability to link receipts or images with expense line items; you can email

spreadsheet expense reports but can’t link receipts

• Lack of integration with corporate and accounting systems limits availability and accessibility of expense data

• Inefficient, labor-intensive manual administrative reporting process subject to human error affecting accuracy of information

• Auditing expense reporting via a manual process is ineffective, often relies on sampling due to sheer volume

Reporting visibility

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• 55% of all organizations’ main priority for 2014 was to enhance visibility into overall T&E spend

• Manual processes provide only 30% visibility vs. 61%+ visibility with web-based expense systems

• 74% companies using cloud/web-based systems regularly audit expense reports vs. 44% of companies on manual system

61%57%

74%

57%

30%

40%44%

29%

Web-Based Expense System Manual Expense Process

Reference: Certify’s Annual Travel & Expense Management Survey 2015

Technology improves visibility

• Documented path of approvals—Has each expense report been reviewed and approved by the right person at the appropriate time?

• Expense reports by employee—Which individual employees (or departments) are expensing the most? Are they managing the budget responsibly?

• Expense spend by category—Which areas are costing the company the most? Can we add controls, negotiate preferred rates, etc.?

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Insight into process and spending

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Additional analytics for GL dimensions, pending reports, approval actions, processed reports, multiple input parameters and more

Expenses By Category shows totals for expense categories and employees simultaneously

Meals Attendees displays group meals expenses with detailed and free text attendee information

Mileage By Employee captures personal automobile usage including subtotals by employee

Expense Policy Review shows processed and in-progress expenses with policy violations and other potential issues

Reports available with automation

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Comparison #5:

Process Automation

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Reviewing for policy violations

Reconciling the data

Errors on the report

Employees losing receipts

Time it takes to reconcile, review, and approve

Employee's failure to submit reports on time

0% 5% 10% 15% 20% 25% 30% 35% 40% 45%

Inefficiency tops the list:

Reference: Certify’s Annual Travel & Expense Management Survey 2015

Top pain points in 2014

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Reference: Certify’s Annual Travel & Expense Management Survey 2015

Process is an opportunity:

Expense Management Process

Integration Between Systems

Travel Booking Mobility Software Deployment

36%

25%21%

14%

4%

Top areas to improve in 2015

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• Automated approval workflow: Managers instantly notified of reports pending approval, decreasing lifecycles and reimbursement times

• Online expense report creation: create, submit and approve expense reports online; no more time-consuming spreadsheets

• Mobile receipt capture: employees take a photo of a receipt with their smartphone instantly turning it into an electronic receipt

• Direct feeds: automated feeds sync data with accounting, credit card and HR systems to simplify reporting and eliminate redundant manual data entry

Examples of T&E automation

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Remove barriers to efficiency:• Take guesswork out of T&E policy compliance• Expedite spend capture and report creation• Eliminate manual processes, redundant data entry• Provide a single, familiar platform for all users

Give travelers the power of mobile apps: • Automate receipt capture• Reduce paper usage and storage• Streamline report creation and review • Approve reports anywhere, anytime (managers)

Streamline workflow inside and out

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• Transition from manual to automated expense management process with 500 company employees using the system

• Streamlined processes for expense report creation, plus mobile access with automatic receipt capture

• $40,000 first year savings from avoiding duplicate/out of policy expenses and reduced paper postage costs

• Increased visibility from extensive integrated reporting capabilities also used to help with annual budget planning

• Reduced overhead—the full-time accountant for expense auditing was reassigned to a higher-value function within the company

Benefits with Certify

Thank You

Q & A