T&E Expense Management:

The Art of Taming the Beast

Ernie Humphrey, CTP

CEO & COO

APP2P FALL CONFERENCE & EXPO

LEARNING OBJECTIVES

Discover current trends and benchmarks relative to T&E spend

and best practices in T&E expense management.

Identify specific opportunities to improve T&E expense

management at your company.

Understand how companies are leveraging technology to mitigate

expense report processing costs and control T&E spend.

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OUR AGENDA

Why T&E Expense Management Should Matter to CFOs

Managing T&E Expenses: Visibility, Benchmarking, Control

T&E Benchmarks

Leveraging T&E Technology

T&E Fraud Mitigation & Control

Closing Thoughts & Additional Resources

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WHY T&E MATTERS

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According to

Forester Research,

T&E spending

ranks as the 2nd

most difficult

operating expense

category to control.

WHY INVEST IN BUSINESS TRAVEL

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THE BENEFITS OF BUSINESS TRAVEL

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EFFECTIVE T&E EXPENSE MANAGEMENT

Visibility

Benchmarking

Control

Mitigating Processing & Reporting Costs

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T&E EXPENSE VISIBILITY

You can’t manage what you can’t see.

You need to know how much it costs your company to process

an expense report.

You need a system(s) that gives your company visibility into

T&E spend.

You need a system(s) that allows your company to deliver T&E

expense. reporting to travelers, managers, and company leaders

to benchmark and actively manage T&E spend.

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T&E EXPENSE BENCHMARKS

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T&E EXPENSE BENCHMARKS

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MOST EXPENSED BRANDS

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T&E EXENSE CONTROL: POLICY

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T&E POLICY: BEST PRACTICES

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?

Define travel parameters that are aligned with the company’s corporate

culture and budgetary goals, but flexible enough to account for travel in

response to business dynamics.

Meet all the rules that define an Accountable Plan as defined by the IRS. This

covers everything:

• Expenses and reimbursements, rules for independent contractors, how to

report travel, entertainment, gift and car expenses, and more.

Automate policy enforcement with clearly defined spending limits and

automatic notification of policy violations to ensure compliance.

T&E POLICY: BEST PRACTICES

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?

Institute a clear and transparent approval process including the timing of

when approval decisions need to be made and the turnaround times for

expense reimbursement.

Specify how travel is to be booked, whether through specific travel agents

and/or online booking tools.

Establish how payments are to be made to be eligible for reimbursement (a

corporate credit card).

Audit with purpose, be it budget management, fraud/loss protection or

auditing to test specific controls and processes.

T&E POLICY: BEST PRACTICES

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Outline conditions under which any exceptions can occur and create a clear

audit trail for any exceptions granted to travelers.

Integrate travel expense processing to facilitate compliance and create

efficiencies by streamlining processes.

Benchmark key areas of spend and require a review of policy if benchmarks

are exceeded by a target percentage. This practice keeps policies from

becoming outdated and keeps attention focused on T&E spending trends.

T&E EXENSE CONTROL: PEOPLE & SYSYEMS

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T&E Expense Report Processing Headaches

EXPENSE PROCESSING INEFFICIENCIES

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EXPENSE PROCESSING INEFFICIENCIES

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EXPENSE PROCESSING INEFFICIENCIES

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EXPENSE PROCESSING INEFFICIENCIES

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EXPENSE PROCESSING COSTS

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EXPENSE PROCESSING HIDDEN COSTS

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• 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

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CALCULTING COST & OPPORTUNITY

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Technology Trends in T&E Expense Management

T&E SYSTEMS BY COMPANY SIZE

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T&E SYSTEMS: WHY COMPANIES INVEST

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T&E SYSTEMS: KEY FEATURES

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T&E SYSTEMS: KEY FEATURES

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AUTOMATED POLICY ENFORCEMENT

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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

T&E SYSTEMS: INTEGRABILITY

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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 SYSTEMS: ROI

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T&E SYSTEM ROI: TRAVEL BOOKING

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T&E EXPENSE FRAUD EXPOSURES

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?

People

• Fictitious, overstated, mischaracterized or duplicate expenses

Process

• Ineffective controls and/or oversight in identifying out of policy expenses

Technology

• Ineffective and/or only manual audits and controls

LEVERAGING AI FOR EXPENSE MANAGEMENT

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- Integrates with Major ERP Systems

- Powerful Analytics and Reporting

enables visibility into your T&E spend

- Highlights of Real Time Audit Checks:

- Incorrect receipts

- Duplicate claims

- Out of policy purchases

- Upgrades, alcohol, gifts, etc.

- FCPA, Anti Bribery, Sunshine Act

- VAT Compliance

MANAGING T&E FRAUD: WHY COMPANIES FAIL

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Most companies only audit 1-15% of expense reports, and many still do it

manually.

Companies don’t have formal written T&E policy.

Lack of Effective Employee Training (Insufficient T&E Policy IQ).

T&E policies are too vague and/or out of line with relevant benchmarks.

T&E policy enforcement is lax or non-existent.

Opportunities for fraud exist.

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Four Preventive Measures to Reduce Expense Fraud:

Implement a formal written travel and expense policy

Train all travelers on your policy and establish accountability in

complying with all policy provisions.

Enforce all of your T&E policy provisions.

Implement cost monitoring measures such as proactive data

monitoring/analysis.

EXPENSE FRAUD: PREVENTATIVE MEASURES

CLOSING THOUGHTS

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Specific Tactics to Tame the T&E Beast

Review your company’s T&E policies. If you do not have them, you need to

create them.

• Ensure policies are consistent with your company’s current and future

travel needs

• Ensure policies include input from key travel groups

Optimize the travel policy IQ of your employees

• Make sure they understand the actions under their control which can

impact expense reimbursement

• Ask travelers what you can do to make things easier for them (and do it)

CLOSING THOUGHTS

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Specific Tactics to Tame the T&E Beast

Automate key components of T&E expense management

• Direct feeds, Auto-fill (parsing) technology, Automated approval workflows

Take measures to improve and enforce corporate T&E policies

• Automate compliance

Benchmark your T&E spending and policies

Arm travelers with better technologies to make T&E expense management

simpler and faster

Leverage analytics to improve intelligence and data

CLOSING THOUGHTS

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The Pillars of Effective T&E Expense Management

Visibility

Benchmarking

Control

Processing Cost Mitigation

The Dimensions of T&E Expense Automation Value

Wasteful & Fraudulent Spend Mitigation

Processing Cost Mitigation

Improved Employee Productivity

Improved Working Capital Management

ADDITIONAL RESOURCES

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• 2017 Expense Management Trends Survey Report

• Certify SpendSmartTM Report

• The Key to Smarter Travel & Entertainment Expense Auditing

• Certify Thought Leadership Resources

Q&A

THANK YOU!!!

Ernie Humphrey, CTP

CEO & COO

Ernie@TreasuryCareers.com

https://www.linkedin.com/in/erniehumphrey