Travel and entertainment—second only to payroll as the largest business expense—is becoming increasingly more difficult to control as companies expand across borders and grow through acquisitions. Therefore effective budgeting, planning, and management of T&E expenses is critical for companies of all sizes in 2015 and beyond. How does your company’s overall Travel and Entertainment spend, and spend within key categories, compare with other companies? How are companies leveraging automation to better understand and control how employees are spending the company dime? Unfortunately, benchmarks for overall T&E spend and key T&E spend within each categories are all but impossible to find.
2. Ask, Share, Learn – Within the Largest Community of Corporate Finance Professionals
2015 T&E Expense Benchmarking:
Are Your Employees Splurging on
the Company Dime
3. • Benchmark key categories of your company’s travel and
entertainment expenses
• Identify how to Improve the budgeting, planning, and
management of your company’s T&E spend in 2015
• Recognize current and emerging trends in T&E
automation
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Learning Objectives
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6. Ask, Share, Learn – Within the Largest Community of Corporate Finance Professionals
2015 T&E Expense Benchmarking: Are
Your Employees Splurging on the
Company Dime
Robert Neveu, President & Co-founder, Certify
Bradley Seitz, President & Chief Executive Officer, Topaz
International
8. Featured in:
About Certify
• Providing travel & expense solutions since 2008
• 64 languages, 140+ currencies, clients in 18 countries
• #1 highest rated expense management software on
G2Crowd, 4.8 out of 5 star rating
• Over 15 million expense transactions in 2014
• Processing over $5 billion/ year in expense reports
8
9. About Topaz International
As seen in:
• Global corporate travel auditing and consulting services
firm established in 1978
• Dedicated to finding a balance between cost savings and
service levels for managed corporate travel programs
• Clients include those with revenue as small at $1B up the
largest global firms (Typical T&E spend of $1M in air up to
over $200M annually)
• Independent assessments to accurately evaluate the
performance of corporate travel programs
9
10. The Importance of T&E
Reference: Corporate Card Benchmarking Survey, J.P.Morgan
Travel and entertainment (T&E)—second only to payroll as the largest
business expense, accounts for 10%-12% of total annual budget
$186,000,000,000
The projected amount North American companies will spend on travel and
entertainment (T&E) in 2015, according to a report by J.P. Morgan
10
11. Annual Spend on T&E
Reference: Certify’s Travel and Expense Trends Data, February 2014
0%
10%
20%
30%
40%
50%
60%
< $50k $50k - $499k $500k - $999k $1mm - $5mm > $5mm
Annual Spend on T&E
Small Business Mid-sized Company Large Enterprise
Less than 100
employees
101 – 999 employees More than 1,000
employees
11
12. How Employees Are Spending
Reference: Certify’s SpendSmart Report, Q2, 2014.
How the T&E budget is
being spent by business
professionals:
Meals Flight Hotel
Misc. Gas Cell Phone
Rental Car Taxi Office
Supplies
Shipping Tolls Parking
22% 16% 14%
13% 12% 6%
5% 3% 2%
2% 2% 1%
12
13. About the Data
Reference: Certify Annual Travel & Expense Management Survey 2015
• Third Annual Expense Management Trends Survey
• Conducted December 2014
• Total Respondents: 434 companies (non-Certify clients)
• Audience:
• 28% small business, less than 100 employees
• 37% mid-sized business, 101 – 999 employees
• 35% large business, 1,000+ employees
• Location:
• 6% International
• 94% U.S.
• Demographics:
• 38% C-level or above finance professionals
• 43% Manager, Controller, or Accountant
• 19% other (accounting staff, consultant, administrative, etc.)
Expense Management Trends for 2014
13
15. Top Pain Points
Largest Pain Points Surrounding T&E
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
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
15
16. Top Pressures & Areas for Improvement
Top T&E Pressures in 2014
36%
25%
21%
14%
4%
Areas to Improve for 2015
Software
deployment
Expense
management
process
Mobility
Travel
booking
Integration
between systems
Need to reduce expense costs
Poor visibility into spend
Lack of control over T&E spend
Lengthy expense reimbursements (16%)
Frequent instances of noncompliance (16%)
46%
27%
25%
16
18. 1. Automate key components of T&E expense management
• Ranked #1 for top priority in 2014 by 52% of companies in 2014
Aberdeen Report
2. Take measures to improve and enforce corporate T&E policies
• Ranked #2 by 48% companies
3. Arm travelers with better technologies to make T&E expense
management simpler and faster
• Mobile applications
• Globally accessible tools
4. Leverage analytics to improve intelligence and data
Key Strategic Actions to Improve
Processes
Reference: Aberdeen Group 2014, The Traveler & Expense Management Guide for 201418
20. T&E Expense Management Trends
Reference: Certify Annual Travel & Expense Management Survey 2015
38%
32%
19%
7%
4%
Cloud/web-based
Excel/spreadsheets
ERP
Home-grown
Pen & paper
How do organizations currently manage their
travel and expense reporting?
20
21. Reference: Certify Annual Travel & Expense Management Survey 2015
The Divide Between Small, Medium & Large Businesses
8%
47%
9%
1%
25%
Pen & paper - 8%
Excel/spreadsheets - 47%
Home-grown - 9%
ERP - 11%
Cloud/web-based - 25%
2%
11% 6%
33%
48%
Pen & paper - 2%
Excel/spreadsheets - 11%
Home-grown - 6%
ERP - 33%
Cloud/web-based - 48%
6%
34%
8%19%
34%
Pen & paper - 6%
Excel/spreadsheets - 34%
Home-grown - 8%
ERP - 19%
Cloud/web-based - 34%
T&E Expense Management Trends
21
Small Business Medium Business Large Business
22. The shift to web-based expense systems
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%
Reference: Certify Annual Travel & Expense Management Survey 201522
67%
25%
of companies indicated
Excel/spreadsheets as their expense
management system in 2014
23. T&E Expense Management: Looking Forward
Reference: Certify Annual Travel & Expense Management Survey 2015
53% of companies on a manual process, who have indicated they
will switch to a web-based expense system, estimate they will switch
within the next 12 months
23
21% 32% 26% 9% 9%
Within the next 6 months
6 – 12 months
12 – 24 months
24 – 36 months
Not sure
The timeframe anticipated to switch to a cloud-based expense system:
24. 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Improve employee compliance rates to
corporate travel policies
Provide an expense system accessible
from anywhere
Gain reporting and analytics around T&E
spend
Simplifying the expense reporting process
Reason for Switching
Driving force before the switch to web-based system
24
26. 13% 13%
44%
19%
14%
16%
6%
22%
76%
67%
60%
57%
43% 43%
31%
53%
0%
10%
20%
30%
40%
50%
60%
70%
80%
Mobile receipt
capture
Mobile report
creation
Direct deposit Automated
expense
reports
Reporting &
Analytics
Integrated
travel booking
Multi-language User support
for all
Features by Expense Management Process:
Are you getting the most out of your current process?
Manual process Web-based system
Feature by feature comparison
26
27. Features Requested by Finance Department
27
Must-Have Features From
a Cloud-Based System
#1 Feature:
Automation
Policy
Enforcement
Integrations
finance systems
Mobile
Technology
51%
44%
34%
33%
Ways to automate T&E management:
• Auto-fill (parsing) technology: Extracts
receipt and expense data from receipts,
eliminating manual entry
• Auto-created expense reports: Built by
technology to create expense report matching
receipt images to expense data
• Direct feeds: Automated feeds sync data with
accounting, HR, and corporate credit cards,
eliminating manual data entry between
systems
• Automated approval workflows: Managers
are instantly notified of electronic reports
pending approval, decreasing expense report
lifecycle and reimbursement times
31. 14%
35% 36%
21%
1%
4%
31%
27%
19%
63%
0%
10%
20%
30%
40%
50%
60%
70%
T&E policy is not
enforced
It is the responsibility of
the employee
Manager manually
review each expense
Manager manually
review, checking only
high value expenses
T&E system
automatically flags out-
of-policy violations
How companies enforce T&E policies
Manual process Web-based system
Policy Enforcement
31
32. Fraud in expenses
• 59% of companies indicated 20% of expenses submitted are in
violation of T&E policy
• 19% of expenses submitted are “fraudulent”, with average amount
of $115, amounting to $13.7 million in losses, according to a study
by Oversight Systems
• 5% of employees commit 82% of all fraud
• Organizations who monitor compliance have a 70% decrease in
fraudulent spending
32 Reference: http://www.businesstravelnews.com/Expense-Management/Study--
Fraudulent-Expense-Reports-Have-Cost-Cos--Millions-In-2014/?a=mgmt
33. Most Unconventional Business Expenses
in 2014
“Cher Tickets in Vegas – because I was in
Vegas and had a free evening”
– a $125 value, purchased by employee at a small insurance company
“2nd monitor– because I have two eyes”
– employee at a mid-sized company
“Two bottles of Johnnie Walker Blue – because
a client ordered it”
– employee at a small company
33
34. As a result of switching to Web-based expense systems,
your organization has experienced:
The Results of Switching
0% 10% 20% 30% 40% 50%
Reduction/elimination of spreadsheets
Decreased/eliminated manual data entry
Reduced time spent creating and approving reports
Increased insight into spend
Faster reimbursements
Increased frequency of expense reports being
submitted
Achieved
Perceived
34
35. ROI on Expense Report Software
35
Time to Recoup Costs After Switching to
a Cloud-Based System
Small Businesses
Experience Fastest ROI
9%
10%
24%
32%
25%
ALL RESPONDENTS
SMALL BUSINESS
Less
than 6
months
7 – 12
months
13 – 24
months
25 – 36
months
36+ months
57% report ROI within one year
70%25%Small businesses
currently using a cloud-
based system
Small businesses with
100% ROI in one year or
less
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• Thanks to our speakers
A Few Final Items
What is the Largest Pain Point Surrounding Expense Management?
Employees failure to submit reports on time
The time it takes to reconcile, review and approve reports
Employees loosing paper receipts/ submitting without receipts
Errors on the report (Incorrect codes, payments amounts)
Reviewing for policy violations
What is the Largest Pain Point Surrounding Expense Management?
Employees failure to submit reports on time
The time it takes to reconcile, review and approve reports
Employees loosing paper receipts/ submitting without receipts
Reconciling the data
Errors on the report (Incorrect codes, payments amounts)
Reviewing for policy violations
How does your organization currently manage its T&E spend?
Web-based solution (Certify, Concur, IBM)
Excel/Spreadsheets
ERP/Accounting Package (Oracle, SAP)
Homegrown solution
Pen and paper
SMB is under 200 employees, Enterprise is 201+ employees
*Simplifying the expense reporting process has been #1 for past three years
Need to change numbers in graphics
Numbers need to be changed in graphics
How does your company enforce T&E policies?
T&E is not enforce
It is the responsibility of the employee to be compliant
Manager/auditor manually reviews each expense
T&E system atomically flags out-of-policy violations