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Ask, Share, Learn – Within the Largest Community of Corporate Finance Professionals
2016 Emerging Trends in T&E Expense Management and Business Travel
• Annual T&E expense spending trends and benchmarks by category
• Most expensed and top rated vendors for meals, lodging, airfare, and more
• Why 20% of company T&E spend is out of policy (and what you can do about it)
• How mobile technologies are transforming corporate travel and expense reporting
• Five strategies to simplify expense management and keep spending in check
Learning Objectives
After attending this event you will understand:
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Proformative Event Notes
• The PPT is available under “Handouts”
• We will send you links via email to the presentation and the recording within 24 hours
• For CPE: Answer all polling questions and remain for the duration. CPE Credits awarded in 24 hours– Questions on CPE? Email [email protected]
• We want to hear from you! Ask questions for the Q&A session at the end of the event
• Please take the short survey at the end of the webinar
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Welcome to Proformative
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If you want to learn more: Tell us on your survey!5
Ask, Share, Learn – Within the Largest Community of Corporate Finance Professionals
2016 Emerging Trends in T&E Expense Management and Business TravelRobert Neveu, President and Co-Founder, Certify
Christopher Pless, AVP/Senior Accountant, Crestmark Bank
T&E Spending and Business Travel Trends
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$310b
T&E Spending Around the World
$1.25tglobal business travel
spending 2015
Global Business Travel Association 2015
U.S. business travel spending 2015
Average Base Cost Per Trip
Travel Leaders Corporate 2015
Average business trip cost for air, hotel and car rental:
INTERNATIONAL DOMESTIC
$2,502 $1,002
U.S. Business Travel Breakdown
74%under 250 miles
from home office
48%involves a
personal vehicle
31%require
air travel
Global Business Travel Association 2015
U.S. Travel Association 2015
Of the 1.3 million domestic business trips made daily:
Business Investment in T&E
8-12%total annual budget
for T&E expenses(Aberdeen Group 2015)
PayStream Advisors 2016
Company Revenue Average Annual Travel Spend
Less than $100 million ~ $700,000
$100 million to $500 million ~ $1,500,00
$501 million to $2 billion ~ $7,400,000
Greater than $2 billion ~ $58,000,000
How the Expense Budget is Spent
1. Meals 19%
2. Airfare 17%
3. Misc. 17%
4. Lodging 14%
5. Gas 11%
6. Cell phone 5%
7. Car rental 5%
8. Groceries 5%
9. Supplies 5%
10. Taxi 3%
11. Shipping 2%
12. Tolls 1%
13. Parking 1%
Certify SpendSmart Report, Q4 2015
$98.75DAILYMEAL COST
2016
Certify SpendSmart Report, Q4 20152016 Business Travel News Corporate Travel Index
1. Meals 19%
2. Airfare 17%
3. Misc. 17%
4. Lodging 14%
5. Gas 11%
6. Cell phone 5%
7. Car rental 5%
8. Groceries 5%
9. Supplies 5%
10. Taxi 3%
11. Shipping 2%
12. Tolls 1%
13. Parking 1%
1. Meals 19%
2. Airfare 17%
3. Misc. 17%
4. Lodging 14%
5. Gas 11%
6. Cell phone 5%
7. Car rental 5%
8. Groceries 5%
9. Supplies 5%
10. Taxi 3%
11. Shipping 2%
12. Tolls 1%
13. Parking 1%
How the Expense Budget is Spent
Benchmark Spending by Category
Category 2014 2015 Difference
Gas $40.41 $30.32 –24.96%
Airfare $345.21 $274.00 –20.62%
Lodging $213.90 $223.45 +4.64%
Car Rental $193.58 $186.45 –3.68%
Cell Phone $89.30 $92.24 +3.29%
Meals $25.67 $26.06 +1.52%
Parking $32.70 $32.23 –1.43%
Taxi $31.81 $31.82 +0.03%
Certify SpendSmart Report, Q4 2015
T&E spending ranks as the 2nd most difficult operating expense category to control Forrester Research 2015
How Travelers Spend the Company Dime
Most expensed and highest rated for dining:
Certify SpendSmart Report, Q1 2016
Most expensed and highest rated for hotel:
How Travelers Spend the Company Dime
Certify SpendSmart Report, Q1 2016
How Travelers Spend the Company Dime
Certify SpendSmart Report, Q1 2016
Most expensed and highest rated for air carrier:
Mobile is Made for Travel
Expedia/Egencia Mobile Index 2015
97%of business travelers carry at least
one mobile device
Ground Transportation Trends
51%45% 37%
13%31%
49%
36%24% 14%
Q22014
Q22015
Q22016
Certify SpendSmart Report 2014 - 2016
Certify SpendSmart Report 2014 - 2016
51%45% 37%
13%31%
49%
36%24% 14%
Q22014
Q22015
Q22016
Benchmark Spending by Category
+1176% ride-hailing receipts in 2 years
Expense Technology Trends
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a) Paper-based/spreadsheetsb) ERP system (Oracle, Microsoft Dynamics, etc.)c) Web-based software (Certify, Concur, etc.)d) Not applicable
How does your organization currently manage T&E spend?
POLLING QUESTION 1
23
T&E Expense Systems Used
Consistent mix of expense management systems in use over time:
Certify Annual Travel & Expense Management Survey 2013-2016
Expense Reporting’s Hidden Costs
$6.85fully automated
$17.31 semi-automated
$26.63 manual
PayStream Advisors 2015
• 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 and lost opportunity
37%
37%
9%
4%
13%
Web-based solution (Concur, IBM, etc.)
Microsoft Excel/spreadsheets
Pen and paper
Homegrown solution
ERP/accounting package (Oracle, SAP, etc.)
T&E Systems by Company Size
22%
55%
10%
5%8%
46%
16%
4%
6%
28%
SMALLBUSINESS
MID-SIZEBUSINESS
ENTERPRISE
Certify Annual Travel & Expense Management Survey 2016
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MANUAL SYSTEMS: 70% small businesses, 26% enterprise
Expense Technology Migration
37%SMALL
BUSINESS
46%MIDSIZED
COMPANIES
53%ENTERPRISE
Certify Annual Travel & Expense Management Survey 2016
62% of all companies planning to make the switch will do so in the next 12 months
Leading frustrations for T&E program administrators:
Top Expense Management Pain Points
50% employees
losing receipts
45% employee’s failureto submit reports
on time
38% time it takes to
reconcile, reviewand approve
30% reviewing for
policy violations
28% errors onthe report
Certify Annual Travel & Expense Management Survey 2016
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Top Goals for Improving T&E
Certify Annual Travel & Expense Management Survey 2016
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
25%
28%
32%
40%
66%
T&E Policy Compliance
73%85%of all companies report having a written T&E policy in place
of those companies are manually reviewing
for policy violations
Manual policy review is inefficient, prone to error and fraudCertify Annual Travel & Expense Management Survey 2016
For the average company, an estimated 20% of a total T&E spend is considered out of policyAberdeen Group 2014
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 2
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Five T&E Strategies to Streamline Process and Improve Spending Control
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Mobile: Make it 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:
Mobile expense reporting reduces processing costs by 65%, delivers quicker report approval and reimbursement timesAberdeen Group 2014
T&E Policy: Make Enforcement Automatic
• Set hard/soft policy controls: apply spending caps, reporting requirements (meal attendees, receipts, etc.), vendor preferences, and more
• Eliminate duplicate receipts/expenses: automatic system reviews identify duplicate expenses, flag out-of-policy expenses, reduce fraud, and save money
• Manage expense reporting on time: set a schedule to automatically build reports, notify employees and managers, and submit expenses (specific to Certify)
Flagged violation, notifying manager amount exceeded policy limit
Businesses under 100 employees have a 28% higher median fraud loss than those with >100Association of Certified Fraud Examiners 2015
Travel: Control Cost Before its Expensed
Pre-Trip Approval:Requires authorization prior to booking;
configured by employee, policy, etc.
Lowest Logical Fare:Automatically identifies best available
rates for proposed itinerary
$
• Category spending limits (i.e. amount not to exceed)
• Preferred travel vendors for air, hotel and car rental
• Acceptable classes of service for flights
Controllable costs via integrated travel booking:
• Advance purchase and connecting flight requirements
• Ancillary fees (upgrades, boarding, airline clubs, etc.)
• Changing or cancelling flights
Companies that track and apply unused tickets can save 5-8% of total annual travel budget2015 GBTA Ancillary Fee Handbook
Integrations: the Key to 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
T&E automation increases employee productivity 29% via reduced data entry, mobile tools and other timesaving efficiencies Aberdeen Group 2014
Reporting: Insight and Accountability
• Spending: analyze company spend by expense category, department, individual employee, monthly reimbursements, etc.
• Compliance: review processed and in-progress reports, policy violations, identify risk and offenders, and improve compliance rates
• Workflow: monitor people and process; documented path of approvals ensure expenses are reviewed and approved according to guidelines
Actionable analytics and insights into key spending and performance metrics:
Lack of visibility into spending is the top T&E area of improvement for 51% of all companies
Aberdeen Group 2014
Automation Gets Results
Thank You
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Q & A
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• Join us at www.proformative.com to continue the conversation with your peers in our community
• If you want an introduction to today’s speakers or sponsor, or want to know more about Proformative Academy, tell us on the survey!
• Thanks to our speakers
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A Few Final Items
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Sponsor
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?
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POLLING QUESTION 3