When it comes to reporting and analytics in the world of expense management, it’s easy to feel overwhelmed with messy expense data, especially when you have so many sources of data to consider. When we say messy expense data, you may have an image in your head of what we mean. Messy expense data is data that is accessible to you, but not particularly useful in its current form. It may be too disorganized, not presented in a visual way, or filled with policy violations that don’t jump out immediately. And it’s not an easy fix, either. Otherwise organizations wouldn’t be letting violations regularly slip through their fingers. According to the Association of Certified Fraud Examiners (ACFE)’s 2024 Report to the Nations, it takes at least 12 months on average to detect occupational fraud.
Messy expense data
Oftentimes, organizations don’t have trouble gathering expense data, it’s more about getting the proper use out of it. One organization may have to juggle expenses from a myriad of different payment methods and transaction types, like:
- Commercial credit cards (P-Cards, purchasing cards, One Card, etc.)
- Invoice data
- Travel expenses, whether they are on card, out-of-pocket, etc.
- Procurement data
- Documentation data (e.g., properly validated receipts)
Not to mention all of the different sources you may have to consider, such as:
- Bank data
- ERP system data
- Outside system data
On top of organizing all of this data, it needs to be properly cleansed, checked for duplicates, benchmarked, checked for policy compliance, and more. It’s a big ask, especially as departments tasked with directing procurement initiatives frequently wrangle with budget restraints and staffing shortages. Allow us to paint a bit of a picture here: oftentimes, you may feel like a ship captain directing your department through a dark, foggy night. You can make out the stars, and you have your trusty compass, so you have a general inkling of what direction you’re going… but wouldn’t it be nice to have a little more clarity?
Proper data configuration is like introducing GPS to a 17th century ship captain
Manually keeping track of all of this expense data made sense at one time. Maybe if your organization is on the smaller end (i.e., you don’t have many issued company cards being actively used), someone can comfortably monitor and track expense data as part of their regular job duties. But in many cases, we find that getting through this murky, messy expense data requires more time than one person can reasonably handle. Hence the “messy expense data” referenced in the title. Yes, all the data’s there… but first of all, is it accurate? Have you checked for duplicates across Accounts Payable, credit card transactions, etc? Duplicate payments do make up an average of 1.5% of an organization’s annual spend, according to the American Productivity and Quality Center.
Not only that, is it actionable and insightful? You can have all the data present and stored on a shared drive somewhere, but if it isn’t cleansed and organized into something you (and often, just as importantly, decision makers at your company) can understand and visualize easily, is it fully serving its purpose?
Are you learning anything about trends with this data? How are your benchmarks looking? Are you easily able to break down the data by cardholder, by department, etc? If you’re accurately capturing the data, you can do all of this yourself. But you may find yourself feeling much like ship captain circa 1600 or so. Tools and resources are available to you that make the process much easier: it’s like introducing a GPS to a 17th century ship captain.
Analyzing trends and benchmarks
Tracking this data is a lot of work, but there are some best practices to employ to ensure that you aggregate and report on your data in a way that is easy to present and understand. For example:
- Track spend across different departments. This gives you a bigger picture of where specific improvements can be made within your entire organizational spend.
- Visualize the data in a way that is easy to understand. This way you can easily share key insights with stakeholders and management.
- Define benchmarks and compare running data against them. Whether your benchmarks are defined internally or mandated outside your organization, customize your reporting to show if you are meeting those goals, and where you can improve.
- Visualize spend trends month-over-month to show how your spend ebbs and flows throughout the year.
- Breakout specific details of your spend, for example what percentage of your spend is through diverse suppliers. This can help you make sure you’re hitting any additional benchmarks for supplier diversity, rebates, and other important considerations.
Pirates, ye be warned…
And much like a modern GPS alerts you to speed traps, foreign objects on the road, and upcoming accidents and traffic jams as you’re driving, customized alerts can alert you to the presence of “pirates” (those who would handle funds dishonestly, in other words) as you’re navigating through those murky waters.
To illustrate how messy expense data can cover up piratical schemes, let’s take a look at a common “split transaction”. This is an intentional method of circumventing poor internal controls to get around transaction limits on a credit card. It can be done in several ways: using two or more payment methods (like a paper check and a credit card), dividing the transaction into different categories, and more. There are many ways to achieve a split transaction—some craftier than others. Even basic internal controls can catch the laziest versions, but split transactions are known to get around weak internal controls when a little more forethought is used. For more information, check out the video we’ve prepared below.
And while we’ve playfully described non-compliant employees as pirates in this nautically-themed article, it’s worth it to note that vendors are just as capable of plundering. Duplicate payments, as mentioned before, happen frequently. If missed communication leads to an invoice being paid twice—more on how that happens here—, it’s possible that vendors may look the other way, whether on purpose or accident.
A bird’s eye view versus a lookout’s spyglass
For some organizations, the broader issue isn’t so much needing to take a closer look at individual data points (the lookout’s spyglass), but seeing the broader picture with trends and insights. At large-sized companies, upper management is often looking at a broader view of all expense data to back up new ideas and drive innovation and decisions. If compiling data from multiple sources effectively is a struggle for your organization, you may want to look at outside help to get better visibility over messy expense data. Card Integrity offers scalable solutions that are tailored to what your organization needs most.
Learn how Card Integrity helps businesses configure and aggregate data from multiple sources
In the case study linked below, Fort Osage R-1 School District in Independence, Missouri (near Kansas City) was faced with a “good problem to have”. The school district had grown significantly, but growth brings opportunity and challenges. The Business Services Coordinator in charge of the ‘P-Card’ (procurement card/corporate card) program was tasked with doing P-Card reconciliation work in addition to Accounts Payable functions. It got to a point where he needed to consider alternate solutions, including but not limited to bringing in some extra help.
Fort Osage R-1 School District was able to outsource Expense Monitoring and Receipt Validation services through Card Integrity. To get the inside scoop on the full story, download the free case study below.
Card Integrity helps organizations and businesses of all sizes
Organizations large and small can get serious value out of outsourcing expense monitoring. Advance Publications, a media company based in New York and parent company to the publisher of magazines like Vogue, Vanity Fair, and GQ uses expense monitoring to audit its finances across multiple business units. To learn more about how a large corporation uses this service, check out the case study below.
