Claiming back expenses from trips can cost you dearly in time and money. Sara Turner talks to the firms who can make your life easier
Putting in your expenses claim at the end of a trip can be a time-consuming process. Scrabbling around for dog-eared receipts in the bottom of a bag, and trying to remember which client you took out for which dinner, is only the beginning. Once you have taken note of the exchange rates and bundled all your receipts together, they have to be recorded, checked and processed, and it could be some time before you see the money back in your account. But there are systems out there for both large and small companies to make sure travellers and employers don’t lose out.
Expense management firms such as Concur and KDS, and travel management companies such as Hogg Robinson Group (HRG), offer internet-based systems that, in conjunction with a corporate credit card, can record a traveller’s spending for an entire trip. From taking a taxi to hosting a client for a meal, everything is automatically listed and sent to your inbox so you can check it before claiming it back.
This can greatly reduce the amount of time taken to process claims – according to HRG, it takes an average of 55 minutes for a claim to be processed manually, which in most cases can be reduced to nine minutes with an automated process.
Business travellers working for companies that don’t have such a system in place are missing out, says Barry Padgett, senior vice-president and general manager of Concur in Europe. “Systems like these make life so much easier,” he says. “I see people in airports struggling with big piles of spreadsheets and trying to fill in forms – the paper is always stained with coffee and has chewing gum in the corner.”
Until a decade ago, expense management software was exclusively the realm of ERP (enterprise resource planning) systems such as SAP or Oracle. Databases tended to be run by HR departments, with travellers often having to wait until their return before putting in their claim. The advent of a new generation of online systems in the mid-nineties meant they could file accounts remotely and, since then, the scope of online expense management has expanded rapidly, from data analysis to built-in booking tools.
One of the biggest advantages for businesses is that they can check employees are conforming to travel policy, and discourage them from making out-of-policy bookings. Of course, this may not always work in the traveller’s favour – an employer’s chosen airline may have unfavourable flight times, for example, or the designated hotel might be miles from where you have arranged to meet a client. But it does mean you won’t inadvertently break the rules.
KDS’s latest package incorporates an approval process to hone in on employees straying from company policy. According to Dominic O’Regan, pre-sales director at KDS, “the biggest saving in a travel booking tool is from what people refer to as ‘visual guilt’”. For example, if you’re booking a trip to Milan and the system says there are 15 different flights and highlights the cheapest ones, you will be less inclined to pick one of the more expensive options. If you do, it may automatically be brought to the attention of your manager.
To make the most of an expense management system, travellers should be given access to a corporate credit card, as their transactions are then recorded and can be used to fill in claims automatically. This may put off some companies, but there are other benefits to giving staff a card – for example, if there is an emergency, the information collected can be used to locate them quickly.
For travellers who don’t have a corporate card, most systems can deal with other forms of payment. Padgett at Concur says: “We can use personal credit cards, purchasing cards, Oyster cards, debit cards, rail cards, and pre-paid credit cards, plus there is an option for manual cash entries.” For those who prefer to deal in cash, it is now possible to take a picture of a receipt on your mobile phone and send it straight to be logged, rather than having to keep hard copies.
Traditionally, automated expense management has been the preserve of larger corporations, but more and more suppliers are targeting small companies with less expensive options. KDS, for example, has a package for smaller firms and a more powerful tailor-made solution for large multinationals.
While smaller companies might not see as many cost benefits from introducing an automated system, there is still the opportunity to provide a smoother claims process for their frequent travellers. Robert Kirby, chief executive of HRG’s expense management programme Spendvision, says: “This is an area that companies large and small are focusing on. We’re coming out of a global financial crisis, people are trying to get their businesses into shape, and one of the best ways of doing this is streamlining. We take the anxiety factor out of the process and allow people to focus on more productive tasks rather than mundane claims.”
The ultimate goal, Padgett says, is to “make reclaiming expenses so painless that [business travellers] will want to use the package. If it’s easier to write expenses on a cocktail napkin and staple a receipt to it, then they will do that. We want to create a system so easy to use that they would kick and scream if it was taken away.”
So what advances can we expect in the future? O’Regan at KDS says: “The radical step we would like to see is getting rid of paper receipts completely. That could make a huge difference because all of a sudden the whole paper trail disappears and it becomes a much more efficient process.”
Top tips for hassle-free claims
Keep receipts from each business trip together. Even if you’re using an online system, it’s important to keep the originals for your company to process tax and VAT reclaims.
Use any downtime you may have on a trip, such as waiting for a flight or getting a taxi to the airport, to put your receipts in order.
Don’t forget that you can claim back VAT on personal expenses in some countries. As a foreign visitor you can get a VAT or GST (goods and services tax) refund on purchases from Argentina, Croatia, Iceland, South Korea, Lebanon, Liechtenstein, Mexico, Morocco, Norway, Singapore, Switzerland and Turkey. Visit globalrefund.com
The expense of expenses
Last year’s American Express and AT Kearney European Expense Management Study revealed that the processing of expense claims, combined with travel planning, represented 75 per cent of the total indirect costs of business-related travel. Automating the process could reduce the cost per claim by half.
The best-performing companies surveyed had fully automated expense management systems, which were also integrated with HR and finance systems.
The survey questioned 66 European companies from a variety of sectors, with a total annual spend of €2.6 billion on travel and related expenses, of which nearly €85 million was spent on administering these costs.
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