Why expense fraud is a problem that's not going away anytime soon
Learn how Serko Incharge can help you get a handle on the issue.
Over the past few weeks our friends at Oversight Systems in the US have been doing some detective work, analysing the expense claims of 160,000 business travellers over a three-month period. They found that about one percent of transactions (out of 10 million in total) ultimately proved to be fraudulent, costing the businesses involved an incredible USD13.7 million.
Oversight's findings are both surprising and shocking.
82% of fraudulent activities were committed by 5% of employees
Purchases outside of airfare, hotels and car rentals are the hardest to control
20% of travellers had at least one purchase on their expense claim that was non-compliant with company policy
10% of travellers had at least one duplicate expense on their report
The research suggests that although the majority of employees want to do the right thing, a hard-core few are intent on abusing the system for their own personal gain. Of course, that's not to say that every fraudulent claim was a deliberate attempt at fraud, as anyone that's every completed an expense claim knows only too well, mistakes happen.
So, the goal for CFOs is to make it harder for employees to get fraudulent claims approved and reduce the number of errors introduced into the system by well-meaning employees, which is where Online Expense Management Systems can create a lot of value.
With Serko Incharge, for example, employees are easily able to check the rules that apply them before they incur an expense and ensure they spend within policy. As the information is online, any updates to company policy are immediately available to all staff.
Any submitted claims that fall outside company policy automatically trigger an alert mechanism, helping approvers identify claims that may need further investigation.
With historical claim data available at click of a mouse, and reports that can analyse individual user activity, online expense solutions provide a level of transparency that will deter all but the most determined ‘maverick spender. And for the 5% of employees that continue to bend the rules for their own gain, using Serko Incharge can help organisations identify the habitual offenders.
For the really deep dive, Serko Incharge can export data straight to Oversight Systems who will crunch the information and provide insights into errors, policy violations and fraud. To learn more about Oversight or Incharge use the contact us form at the top of the page.