uncovering the employee t&e spend trends of 2017

Uncovering the Employee

Greg Lloyd, PayStream AdvisorsBob Neveu, Certify

T&E Spend Trends of 2017

Today’s Presenters

Bob NeveuPresident and Co-Founder

Certify

Greg LloydSenior DirectorPayStream Advisors

PayStream Advisors

• Purchase-to-Pay Research, Tools, and Education• NavigatorTM Solution Ratings and Reviews• Process Reviews, Assessments, and RFP’s

Research and Advisory Services for Financial Strategists

• Industry-leading, first fully automated travel and expense management system

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

• #1 highest rated expense management software for user satisfaction on G2 Crowd

• PC Magazine Editors’ Choice for best expense management software of 2016

• Processing nearly 40 million expenses and receipts valued at $10+ billion in 2016

About Certify

Certify Annual Trends Study 2017

600+ accounting professionals from outside the Certify customer base:

Agenda

Common Expense Management Process Challenges

Expense Management Technology Usage & Trends

Benchmark Averages for T&E Expense Spending

How T&E Automation Improves Visibility and Control

Common Expense Management Process Challenges

Common Process ChallengesA manual, inefficient process is the primary challenge for most organizations.

“What are the top three challenges your organization faces in the expense management process?”

PayStream Advisors’ 2016 Travel & Expense Management Report | All rights reserved.

Common Process ChallengesMost companies submit expense receipts via inter-office mail.


“Which of the following methods do your employees use to submit expense receipts?”

Common Process ChallengesMost companies submit expense receipts via inter-office mail.


“What is the reason your organization has not automated the TEM process?” (top five answers shown)

Common Process ChallengesDirect deposit is most common reimbursement method.


“Which of the following methods do you use to reimburse employee expenses?”

Common Process ChallengesLess than half of organizations audit every expense report, increasing fraud risk.

“What percent of expense reports do you audit?”

Preventing Fraud in Employee Expense Management| PayStream Advisors 2016 | All rights reserved.

Common Process ChallengesMost organizations have an inconsistent approach to report auditing.

“If you audit less than 100%, how do you select reports to audit?”

Preventing Fraud in Employee Expense Management| PayStream Advisors 2016 | All rights reserved.

Expense ManagementTechnology & Usage Trends

Expense Reporting Inefficiencies

up tominutes to complete one expense report

minutes to correct expense reports errors

average number of reports with errors

23 15-22

22%

Expense Reporting Around the World: Practices, Pain Points, and Productivity, GBTA, 2015

2014 2015 2016 2017

44

3735

37

2932

3734

57

5 64 4

86

18 1915

17

Methods for Managing T&E ReportingConsistent mix of expense management systems:

Cloud/web-based

Excel spreadsheets

ERP system

Homegrown solution

Pen and paper

Certify Annual Expense Management Trends Report 2017

SMALLBUSINESS

MID-SIZEBUSINESS ENTERPRISE

33%

37%

8%

6%

16%

56%

10%

2%

8%

24%24%

55%

7%2%

12%

Web-based solution (Concur, IBM, etc.)Microsoft Excel/spreadsheetsPen and paperHomegrown solutionERP/accounting package (Oracle, SAP, etc.)

T&E Systems by Company Size


56%

10%

2%

8%

24%

SMALLBUSINESS

MID-SIZEBUSINESS ENTERPRISE

24%

55%

7%2%

12%

33%

37%

8%

6%

16%

Web-based solution (Concur, IBM, etc.)Microsoft Excel/spreadsheetsPen and paperHomegrown solutionERP/accounting package (Oracle, SAP, etc.)

T&E Systems by Company Size

AUTOMATED SYSTEMS: 80% enterprise • 36% small businesses


Integrated travel booking technology

Multi lanugage/multi-currency capabilities

Instant reporting and analytics

Automated expense report build technology

Mobile report creation and approval

Mobile receipt capture technology

Direct deposit via ACH

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

18%

19%

27%

30%

30%

31%

39%

Current Expense System Features

% reporting


Polling Question 1

a) Paper-based/spreadsheetsb) ERP system (Oracle, Microsoft Dynamics, etc.)c) Web-based expense software (Certify, Concur,

etc.)d) Not applicable

How does your organization currently manage T&E expense reporting?

Leading frustrations for T&E program administrators:

Top Expense Management Pain Points

2015 2016 2017

Employees losing paper receipts/submitting without receipts 33% 50% 52%

Employees failure to submit reports on time 39% 45% 51%

Time it takes to reconcile, review and approve reports 38% 38% 36%

Reviewing for policy violations 20% 30% 28%

Errors on expense reports (incorrect codes, amounts, etc.) 23% 28% 26%


Top T&E Pressures to Improve in 2017

36% Need to reduce expense processing costs

31% Lack of control over T&E spending

31% Poor visibility into travel/expense data

21% Frequent non-compliant travel/expenses

20% Lengthy reimbursement times


Cost to Process a Single Expense Report

$6.85fully automated

$17.31 semi-automated

$26.63 manual process

PayStream Advisors 2016

31%

16%9%

44%

Under $7 per report $10−$20 per report$25 or more per report We do not track these costs

PayStream Advisors’ 2016 Travel & Expense Management ReportCertify Annual Expense Management Trends Report 2017

Jimmy LeFever

I'm confused. Is this our data or their data?





21% Frequent non-complaint travel/expenses


✓✓✓






21% Frequent non-complaint travel/expenses


✓✓✓

TRAVEL POLICYCOMPLIANCE ISSUES!


Budgeting & Category Spending Caps

We do not have expense category limits

26%

Based on internal historical spending

23%Follow U.S. GSA per rate

guidelines23%

Determined by annual budgeting process

21%

Other7%


T&E Policy Compliance

79%of all companies report

having a writtenT&E policy in place

75%manually review each expense report report

for policy violations


0%5%

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

7%

39% 41%

15%26%

Policy Enforcement Practices (all companies)


Reimburse employees faster

Improve employee compliance rates to corporate policy

Gain reporting and analytics around T&E spend

Provide system accessibly from anywhere (online, mobile)

Simplify process for employees and managers

0% 10% 20% 30% 40% 50% 60% 70%

27%

27%

30%

40%

59%

Driving Force Behind T&E Automation


Benefits Achieved Through Automation


Polling Question 2

a) Reducing process and workflow inefficiencies b) Tighter controls for employee T&E spendingc) Lowering expense report processing costsd) Increasing travel policy compliance

What is your organization’s top area for T&E improvement in the year ahead?

Benchmark Averages for T&E Expense Spending

T&E Spending by U.S. Companies

$293.1b 2017 travel and entertainment

spending by U.S. companies

+ 3.8% from the

previous year

Global Business Travel Association 2016

Business Investment in T&E

Company Revenue Annual Spend

Under $100MM $700,000

$100MM to $500MM $1,500,000

$501MM to $2b $7,400,000

$2b and above $58,000,000


1. Meals 19%

2. Airfare 15%

3. Lodging 14%

4. Misc. 13%

5. Gas 11%

6. Taxi 9%

7. Cell phone 5%

8. Car rental 5%

9. Supplies 5%

10. Shipping 2%

11. Tolls 1%

12. Parking 1%

How the Expense Budget is Spent

Meals

Airfare

LodgingMisc.

Gas

Taxi

Cell Phone

Car Rental

SuppliesShipping Tolls Parking

Certify SpendSmart Report, Q4 2016

1. Meals 19%

2. Airfare 15%

3. Lodging 14%

4. Misc. 13%

5. Gas 11%

6. Taxi 9%

7. Cell phone 5%

8. Car rental 5%

9. Supplies 5%

10. Shipping 2%

11. Tolls 1%

12. Parking 1%

How the Expense Budget is Spent

Meals

Airfare

LodgingMisc.

Gas

Taxi

Cell Phone

Car Rental

SuppliesShipping Tolls Parking

$98.74DAILYMEAL COST

2016

Certify SpendSmart Report, Q4 20162016 Business Travel News Corporate Travel Index

Category 2016 2017 Difference

Gas $30.32 $29.77 –1.81%

Airfare $274.00 $316.17 +15.39%

Lodging $223.45 $210.19 –5.93%

Car Rental $186.45 $190.74 +2.30%

Cell Phone $92.24 $89.00 –3.51%

Meals $26.06 $27.02 +3.68%

Misc. $55.71 $68.20 +22.41%

Taxi $31.82 $27.90 –12.31%

Benchmark Spending by Category

Certify SpendSmart Report, Q4 2016-2017

2017 U.S. GSA Per Diem Rates

GSA Lodging, Meals & Incidentals for San Francisco, CA

Lodging (per night) Breakfast Lunch Dinner

$267 $17 $18 $31Incidental -- $5 $5 $5

www.gsa.gov, accessed 1/20/17

Polling Question 3

a) Mealsb) Mileagec) Airfared) Not sure

As a percent of total spending, what was your company’s largest expense category in 2016?

How T&E Automation Improves Visibility and Control

Must-Have Expense Reporting FeaturesAutomation: Expense report creation, workflow process and approvals, direct credit card feeds

Mobile Applications: Smartphone-enabled receipt image capture, mobile report creation/approval, and policy tools

Compliance: Duplicate receipts/expenses, category spending limits, automatic notification of violations

Integration: Accounting software, general ledger, HRIS, CRM, ERP, ACH direct deposit

Reporting: Greater visibility into process and spending by category, department, employee, etc.

Certify Annual Travel & Expense Management Survey 2017

Mobile Makes T&E Easy for Employees

• Optical character recognition/auto-fill: snap photos of receipts, automatically parse data into reports

• Mobile report creation: build expense reports from the road as receipts are captured and saved

• Remote approvals: managers can review and approve reports from any location to reduce delays

Top features for mobile T&E reporting:

90%

2016

97% of business travelers carry at least one mobile device; 80% used their smartphone to plan or book corporate travel in 2014

Expedia/Egencia Mobile Index 2014

Control Spending Before It’s Expensed

Pre-Trip Approval:Requires manager authorization prior to booking; configurable by employee,

policy specifics, etc.

Lowest Logical Fare:Automatically identifies best available rates for proposed itinerary (and only

best available rates)

$

Companies that track and apply unused tickets can save 5-8% of total annual travel budget

2015 GBTA Ancillary Fee Handbook

Automate Policy Enforcement

• Set hard/soft policy controls: spending caps, report requirements (i.e. meal attendees), vendor preference

• Eliminate duplicate receipts/expenses: automatically identify duplicate receipts, flag out-of-policy expenses

• Manage expense reporting on time: automatic report build reports, employees/manager notifications

Instant policy check via the mobile expense reporting app

Integrate Systems, Maximize Efficiency

• Accounting systems: automate key accounting functions and streamline workflow

• Corporate credit cards: direct control over employee spending, faster reconciliation

• Corporate systems: reduce data entry and errors across multiple redundant systems

• ACH reimbursement: direct deposit for more efficient reimbursement, simplified accounting

Reporting Visibility Delivers Control

Workflow: monitor people and process, approval paths, identify delays and other roadblocks

Compliance: review processed and in-progress reports, policy violations, fraudulent behavior

Spending: analyze by expense category, mileage, department, employee, and more

Improving visibility into spend is a driving force behind the switch to automation for 30% of companies


Questions?

Please continue to type your questions into the chat widget. If we run out of time to answer them here, we will follow up shortly via email.

You can also contact our presenters directly:• [email protected] • [email protected]