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Valuable Tips on How to Reduce Expense Fraud

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As a company, if you’re not worried about expense fraud–then you should be. In fact, according to a study conducted by the Association of Certified Fraud Examiners, expense reimbursement fraud makes up 15 percent of business fraud. Because of this, businesses suffer an average loss of $26,000 every year.

 

To make things worse, it takes around 24 months for any of the fraud to be detected. Therefore, before the problem and perpetrator are pinpointed, much of the company’s money has been used up for fraudulent purposes already.

Employees who commit expense fraud often say that they add additional expenses in their reports as a way to “even out” their previous reports. They may have forgotten to input some expenses previously and are making up for them now. It becomes a guessing game of inaccuracies and unaccounted adjustments. In the long run, this can unnecessarily cost the company a lot.

So how do you remedy this?

Remedy Expense Report Fraud by Taking These Steps

Let’s take a look at how companies can reduce expense fraud.

  1. Track expenses much easier by requiring your employees to create one expense report per trip. Require them also to submit it as soon as they get back.
  2. Make the most of every transaction and even get perks by getting your frequent travelers corporate credit cards. These can also allow you to more transparency for every transaction and get immediate credit for canceled ones.
  3. Charge future-dated travel to a corporate charge card.
  4. Establish a policy that requires most senior employees at a meal to pay the check. This helps avoid fraud, redundancy, and duplicate transactions.
  5. Employees who submit hard-copy receipts and manually filled spreadsheets are more likely to commit fraud. Avoid this by creating steps to automate the expense reporting process.
  6. Centralize travel expense processes for better management and visibility.
  7. Validate expenses against corporate policy. This helps deter and prevent employees from entering a non-compliant expense. At the least, it creates a system that allows them to explain the charge for quick review and approval
  8. Implement a solution that can automatically identify and flag different kinds of expense fraud.

Don’t Rely on Band-Aid Solutions for Expense Fraud

Remedying expense fraud doesn’t have to be tedious and time-consuming. Worrying about compliance should not give finance such a hard time that inefficiencies happen. Trying to police each and every expense item should not be done at the expense of company productivity. That’s why many automated solutions should be in place.

Gorilla Expense provides a comprehensive expense reporting solution that allows you to automate expense reports.

Gorilla Expense, for example, will identify any duplicate transaction the user may have entered by searching for similar transactions across the system. With our Receipt Scan solution, we also flag transactions on which the amount does not match the amount shown on the receipt automatically. The screenshot below shows how the system flags duplicates and transactions where receipt amount does not match the amount entered by the user.

 

Expense Report Violation

In addition, our “Expense Policy Violation Reports” section will show you the top expense policy violaters in the company and also detail each violation.

With Gorilla Expense in place, you can be on top of all your expenses with better visibility, better compliance, significantly less fraudulent expenses, and much more peace of mind. At the same time, employees can find it easier to comply and submit expense reports. This helps get all the pain and hassle out of the way.

Find out how you can get Gorilla Expense for your company by contacting us today.

 

 

The Grand Vision: 100% AP Automation

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The recent economic downturn, difficult credit situation, and increasing costs have all arrived together. For many companies, this has forced them to take a closer look at their internal processes as they seek ways to cut costs, improve efficiencies and increase bottom lines.

One area we are seeing a lot of interest in is Accounts Payable (AP) automation, with many companies striving to make it 100% automation.

100%-AP-Automation

For these companies, cutting costs associated with the AP process, automating it, making it less time consuming and providing panoramic visibility to decision makers in Finance is a no-brainer. Take the example of Zappos – restructuring their financial processes reduced their month-end closing process by 10 days. For a $1Billion company, that is huge!

So what are some of the key areas that CFOs, Controllers, AP Managers, Purchasing Managers are looking to improve their internal processes with relative ease while contributing to the organization’s overall mission to streamline costs?

Automation is the key to efficiency (and success)

Consider the inefficiencies in a non-automated, manual, paper-based process:

  • An Aberdeen Group study found that it can take anywhere from 3.5 to 15 days to process a single invoice. (The industry average for 50% of companies is 11 days to process a single invoice. Yikes!). The cost of processing can range from $5 to $25 for a single invoice
  • On the T&E expense report side of things, another Aberdeen report found that it can take anywhere from 3 to 22 days to reconcile and reimburse a expense report. The cost of processing an expense report manually is $35.28 versus $10.75 for companies that have an automated process
  • This includes the costs associated with manual processing, shuffling paper between individuals and departments, exceptions processing, missing data/receipts, accrual delays, failed audits, duplicates, and late payment fees

On the other hand, the efficiencies gained by automating these AP processes produce results that are definitely dramatic. These include a:

  • 92-96% reduction in paperwork
  • Greater than 29% improvement in labor productivity

Another way to look at this comparison is even if you have dedicated data entry staff and devices to help with managing the manual process, you can typically process 1,000 documents (invoices & expense reports) a month per full-time employee (FTE). By contrast, automated and rules-based matching increases that number to 6,500-9,000 documents a month per FTE.

Conclusion: Automation not only brings significant efficiencies to the AP process, but also helps grow the business with existing staff. Basically, you can do more with less.

Control – at your fingertips

By automating as much of the AP process as possible, you get greater control and better visibility into spend. And this applies to invoices and expenses. While rules, routing, policies can be configured to unique company configurations, the biggest advantage is being able to review spend on an expense report or invoice in a timely manner. Not having to review every single transaction means there is more time to focus on important violations that require attention.

Automating the process also captures the document and additional data so that AP Managers have full visibility into the process. No more expense receipts or invoices hiding on individual desks. AP and Finance can now maintain a more real-time view of their corporate spend at any point in time, thereby providing more control.

Conclusion: Automation results in greater, not less, control over your internal Accounts Payable process.

But what if this is too expensive

There are many solutions that offer end-to-end AP automation using the Software-as-a-Service (SaaS) model that require no upfront purchases. Choosing an AP solution that is offered as a service allows the company to truly pay-as-they-go! And with a typical SaaS model, the company can expect periodic upgrades and new features that add more value. This means companies can now reach their ROI much faster than before.

Conclusion: Automating the Accounts Payable process is more than ever available to a wider range of budgets.

Does company size matter?

Cloud-based solutions coupled with a SaaS business model offer a very low marginal cost to get started. With economies of scale and best practices, everyone benefits from automation. And, as discussed earlier, automation enables AP to focus on more strategic activities, such as, sourcing, reporting, spend analytics and vendor management.

Conclusion: Even small companies can save significant $$. Some research reports suggest annual savings can range from 4 to 17% of annual spend. Even for a small company, that can be big bucks!

How can analytics help?

Imagine now, you have all of this automation and data at your fingertips. How about a quick report on outstanding invoices for vendor ABC, LLC? How about a ‘spend to-date’ report on the AMEX corp. card for T&E expenses? Being able to massage the data and use it to arrive at meaningful conclusions is the key aspect of Analytics and Reporting modules. Providing such data to decision makers like AP Managers or CFOs provides tremendous value for the company to plan better, conserve money and be very strategic about growth. Several cloud-based solutions for Invoices & Expenses provide out of the box reporting and analytics that companies should definitely consider and incorporate.

Conclusion: With the amount of data churned out today, intelligent analytics is really a no-brainer. Smart companies utilize this data, make sense out of it and provide it to decision makers to really boost growth or drastically cut costs for companies. By paying attention to this, companies can put money back in their pockets.

Summary

It is very obvious to see that the benefits of AP automation are huge and cannot be ignored for the typical 21st century company. Let’s take a quick look at them again:

  • Huge labor savings across the company
  • Efficiency boost while processing Invoices & Expenses
  • Reduced delays
  • Improved transparency
  • Panoramic visibility for decision makers

Whether the architecture is cloud-based and delivered as SaaS or an On-Premise Hosted solution, the move will get a company closer to becoming paperless. Automating and streamlining Invoices & Expenses will also provide a secure and serviceable archive for data.

Finally, process improvements can be realized in days, rather than months, resulting in a rapid ROI. This will leave the company with an end-to-end 100% automated AP solution that increases compliance, cuts costs, and reduces cycle times.

Now that’s a grand vision. But very much achievable!

Import Credit Card Data into Dynamics NAV Through Automation

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Gorilla Expense offers a robust and fully automated integration of credit card data into Dynamics NAV. This is available for all versions of NAV. Using our proprietary Gorilla Expense Integration App, the AP Manager can import credit card transactions (or the App can do it 100% automatically), auto-categorize the transactions to specific expense types/cost categories using our mapping algorithm and then send the data to Navision with a click of a button!

Typically the data is sent to the Purchase Journals in NAV (video of integrating expenses to Purchase Journals) so that an invoice is created to pay the credit card company. But we can also send the data to the General Journals (video of integrating expenses to General Journals) as well as Purchase Invoice screen (Visit our main Expense Reporting for Dynamics NAV page for more details). Any relevant information supplied by the credit card company in the data file can also be referenced in the ‘Description’ field within the Journals or Purchase Invoice Lines in NAV.

The advantages that the Gorilla Integration App offers are:

* Send credit card data to NAV through automation

* Complete visibility of credit card expenses in NAV

* Prevent duplicate expenses in NAV

* Improve the reconciliation process through reporting and analytics within Gorilla Expense

* Eliminate time consuming manual work of keying in data

Gorilla Expense supports integration with all the major credit card companies – AMEX, VISA and MasterCard and their various file formats. The flavors of credit cards that we support range from the standard Corporate Credit Card for T&E Expenses to Purchase Cards or P-Cards for making purchases on behalf of the employer.

Here is how the process works:

Step 1> The AP Manager opens the Gorilla Integration App and logs in as the Admin. Here we have selected NAV as the system to send the data to. The Integration App is typically accessed by the Admin user (belongs to Accounting/AP/IT etc.) in a company.

Logging into Integration App as Admin

Step 2> Once logged in we want to select and import the credit card file supplied by the card provider that is typically downloaded by the Admin on a weekly or monthly basis. In this example, we are using a file supplied by our AMEX corporate card on a monthly basis. The following screenshot shows how the Admin can select the respective card and its format.

Selecting the card and format

 

 

**Note: Depending on how the credit card program is setup and services offered by the card provider, Step 2 can be fully automated with no human intervention. In that case, the Gorilla Integration App will automatically ‘pick up’ and import the latest file supplied by the card provider from an FTP site. AMEX typically enables this offering by default for all their corporate card and P-card programs and Gorilla Expense supports this approach**

In the screenshot below, the admin has selected the AMEX file – ‘Transactions.csv’ for import. The file was downloaded from our online AMEX account.

Selecting the file downloaded from the AMEX website

Step 3> Once the file is selected, the Integration App automatically associates the expense type and vendor using our mapping algorithm as shown in the screenshot below. This makes the transactions complete and no manual work is need to categorize the transactions.

Auto-allocation of expense type and vendor

Step 4> The Admin can now select all transactions or select specific transactions to import into the system and send to NAV. The screenshot below shows that two transactions were selected to send to NAV. Out of the two, only the one shaded in Green was sent. The transaction shaded in Yellow was already submitted earlier and is highlighted as a duplicate transaction.

The Gorilla Integration App prevents duplicate transactions from being sent to NAV by using the ‘Unique Identifier’ number supplied by the credit card as part of their file. This a is a powerful feature that saves AP Managers lots of time in checking for duplicates and also makes the reconciliation process easier.

Import transactions and prevent duplicates

 

Step 5> Once all the transactions are imported into the Gorilla application, they are dragged and dropped into a batch and send to NAV through automation using the same Integration App. The transactions show up as invoices within a batch called ‘GORILLA’. Depending on the payment method defined in the Gorilla application, the invoices are created to pay the employee or the corporate credit card.

In this example, our AMEX card has the payment method defined as AMEX which is tied to the ‘American Express’ Vendor ID defined in NAV. Here is a screenshot that show the expense data in Purchase Journals in NAV.

Expenses in Purchase Journals

All the details from the credit card transaction, namely the vendor and the report number are also made available to provide additional visibility for the CFO / accounting manager and to make it easier to search for expense data in NAV.

This explains how credit card data can be integrated into NAV using the Gorilla Expense Integration App. The App is very flexible in allowing credit card data from multiple cards and various formats to be imported into the system. If you would like to see a live demo of the App or have any additional questions, please contact us at info@gorillaexpense.com

Dynamics GP Credit Card Integration

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Gorilla Expense offers a robust and fully automated integration of credit card data into Dynamics GP. This is available for all versions of GP (GP10 and above). Using our proprietary Gorilla Expense Integration App, the AP Manager can import credit card transactions (or the App can do it automatically), auto-categorize the transactions to specific expense types/cost categories using our mapping algorithm and then send the data to GP with a click of a button. Any relevant information supplied by the credit card company in the data file can also be referenced in the ‘Memo’ field in GP, within Payables > Distributions.

The advantages that the Gorilla Integration App offers are:

* Send credit card data to GP through automation

* Complete visibility of credit card expenses in GP

* Prevent duplicate expenses in GP

* Improve the reconciliation process through reporting and analytics within Gorilla Expense

* Eliminate time consuming manual work of keying in data

Gorilla Expense supports integration with all the major credit card companies – AMEX, VISA and MasterCard and their various file formats. The flavors of credit cards that we support range from the standard Corporate Credit Card for T&E Expenses to Purchase Cards or P-Cards for making purchases on behalf of the employer.

Here is how the process works:

Step 1> The AP Manager opens the Gorilla Integration App and logs in as the Admin. Here we have selected GP2013 as the system to send the data to. The Integration App is typically accessed by the Admin user (belongs to Accounting/AP/IT etc.) in a company.

Logging into Integration App as Admin

Step 2> Once logged in we want to select and import the credit card file supplied by the card provider that is typically downloaded by the Admin on a weekly or monthly basis. In this example, we are using a file supplied by our AMEX corporate card on a monthly basis. The following screenshot shows how the Admin can select the respective card and its format.

Selecting the card and format

**Note: Depending on how the credit card program is setup and services offered by the card provider, Step 2 can be fully automated with no human intervention. In that case, the Gorilla Integration App will automatically ‘pick up’ and import the latest file supplied by the card provider from an FTP site. AMEX typically enables this offering by default for all their corporate card and P-card programs and Gorilla Expense supports this approach**

In the screenshot below, the admin has selected the AMEX file – ‘Transactions.csv’ for import. The file was downloaded from our online AMEX account.

Selecting the file downloaded from the AMEX website

Step 3> Once the file is selected, the Integration App automatically associates the expense type and vendor using our mapping algorithm as shown in the screenshot below. This makes the transactions complete and no manual work is need to categorize the transactions.

Auto-allocation of expense type and vendor

Step 4> The Admin can now select all transactions or select specific transactions to import into the system and send to GP. The screenshot below shows that two transactions were selected to send to GP. Out of the two, only the one shaded in Green was sent. The transaction shaded in Yellow was already submitted earlier and is highlighted as a duplicate transaction. The Gorilla Integration App prevents duplicate transactions from being sent to GP by using the ‘Unique Identifier’  number supplied by the credit card as part of their file. This a is a powerful feature that saves AP Managers lots of time in checking for duplicates and also makes the reconciliation process easier.

Import transactions and prevent duplicates

Step 5> Once all the transactions are imported into the Gorilla application, they are dragged and dropped into a batch and send to GP through automation using the same Integration App. The transactions show up as invoices within a batch called ‘GORILLA’. Depending on the payment method defined in the Gorilla application, the invoices are created to pay the employee or the corporate credit card.

In this example, our AMEX card has the payment method defined as AMEX which is tied to the ‘AMEX’ Vendor ID defined in GP. Here are a couple of screenshots that show the expense data in GP > Payables.

Invoice in Payables

When Distributions is opened, the details from the transactions, namely the vendor and the report number are also made available to provide additional visibility for the CFO / accounting manager and to make it easier to search for expense data in GP.

Distributions in GP

This explains how credit card data can be integrated into GP using the Gorilla Expense Integration App. The App is very flexible in allowing credit card data from multiple cards and various formats to be imported into the system. If you would like to see a live demo of the App or have any additional questions, please contact us at info@gorillaexpense.com

Corporate Cards for T&E Expenses – See How Your Peers Use Them

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The GBTA did a survey of more than 200 travel managers in the US on which expense types they mandate the usage of corporate card

No surprises that Airfare was the top at 67%. This is mainly to better manage the spend related to airfare and utilize programs and partnership with air travel vendors. Plus, in some cases, if tickets are canceled or modified, corporate cards have discounted change-fees for being part of the air travel vendor program. Closely following the Airfare expense type are Lodging and Rentals both of which maintain a similar philosophy.

Charging meals to the corporate card provides greater visibility from a compliance perspective. This is especially true if meals are related to Entertainment type expenses. Companies are also increasingly asking employees to charge misc. business expenses like internet, phone calls, faxes etc. to the corporate card to prevent potential frauds. For sales people on the road all the time, the corporate card is a big convenience for mileage and gas related expenses as well.

So, how do your company stack up compared to this? Which expense types do you mandate your users to use the corporate card for? Let us know in the comments below.

Reference: GBTA April 2014 survey. Chart provided by Travel Procurement, part of BTN Newsletter