Automation has finally hit critical mass when it comes to expenses, with more than half of the respondents to the 2017 Concur ANZ spend management index stating that they have an automated expense management solution in place and a greater number of companies than ever before agreeing that they are considering automating expenses.
In 2016, only 27 per cent of respondents had an automated expense management solution and the proportion of respondents that had never even thought about automating expenses was nearly one-quarter (24 per cent). This year, that number has gone down to eight per cent, suggesting an automated expense management solution may be on the cards for even more organisations.
Murray Warner, business development director, ANZ, Concur, said, “It’s encouraging to see such a massive increase in the number of companies automating their expenses. A dedicated, cloud-based expense management system reduces the possibility for error and dramatically slashes the amount of time it takes to prepare, review, and approve expense reports. It makes it easier for the business to track expenses and identify unusual or out-of-policy expenditure.”
Capturing that information remains elusive for organisations that remain loyal to outdated methods such as paper-based reports and spreadsheets. In fact, the use of spreadsheets is growing, despite the ready availability of automated, cloud-based systems, and hit 26 per cent in 2017. A further 17 per cent rely on paper-based reports. This creates ample opportunity for errors to creep in, and makes it easier for employees who are so inclined to hide fraudulent activities. It also creates an administrative burden for those required to key in or manually write down their expenses and keep hold of paper receipts.
Murray Warner said, “Of course, simply having an automated expense management system is only the first piece of the puzzle. Integrating information across other systems can help extract insights from the data collected, which helps businesses make smarter decisions. They can understand how expenses are impacting the bottom line and where the business may be able to reduce costs by changing suppliers or negotiating better deals. They can also see where some employees may consistently spend outside of policy or on specific items that could be obtained more cost-effectively.”
Despite these clear benefits and the increased number of businesses adopting automated systems, data analysis is still a way off for many businesses. The index revealed that just over half of this year’s respondents analyse their data. 25 per cent said they analyse data to provide better visibility into cost/spend, 24 per cent said they analyse data to understand how expenses are impacting the bottom line, and three per cent said they analyse data to continuously optimise their business expense policies.
Concur conducts the annual ANZ spend management index to provide insight into how Australian companies manage business expenses and supplier invoicing. For the third year in a row, Concur surveyed 100 senior finance and management decision-makers from a variety of industries, including financial services, retail, food, transport, insurance, utilities, resources, entertainment and other professional services.
Key results of the 2017 Concur ANZ spend management index included:
- While more than three-quarters (77 per cent) of survey respondents have a formal expenses policy in place, only 59 per cent agree that their employees always comply. Just one per cent say their employees never comply but it’s concerning to see that 21 per cent of respondents didn’t even know whether employees were complying or not.
- When it comes to spending, most employees find that transport is their biggest expense, followed by accommodation and meals.
- Of the respondents that do have an expense management system, 27 per cent integrate it across business departments within business operations. 17 per cent have a standalone travel and expense management system.
- 17 per cent of respondents in this year’s survey said employees can create and capture expenses, and submit, review, and approve claims via a mobile app. This is an improvement on last year’s result when just 12 per cent of respondents used a mobile app.
- Just 34 per cent of organisations can pinpoint an employee’s whereabouts any time, and 38 per cent believe organisations should only track travelling employees’ whereabouts.
Murray Warner said, “The most exciting result from this year’s index is the huge increase in the number of companies with an automated expense management solution in place. Manual expense processes should be a thing of the past. The time that is wasted in collecting and submitting receipts, filling out forms, and getting approvals should be spent on other, value adding activities. Automated systems free staff from the burden of expense reporting and make it easier and faster to reimburse employees. The result is happier, more efficient employees and lower costs.”