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Travel & Expense Artificial Intelligence

Artificial Intelligence has arrived – and will improve your expense report audit process

on November 08, 2017

Businesses from every industry are in a frenzy about how Artificial Intelligence (AI) is transforming how we work, and where we apply our human reasoning to solve problems. In travel expense management, we’re already seeing the impact. AI is changing the role of business travel managers and how they operate both on the front-end and back-end of the business. Better informed booking tools leverage natural language bots and past travel habits to generate travel search suggestions. Smartphone apps let travelers take photos of their receipts and automatically categorize them in an expense report for submission.

While AI-based innovations are making business travel more pleasant for employees, the back-end processes are where we’ll see the real impact of AI on travel expense management.

Today, T&E managers typically spend 80% of their time trying to find policy compliance issues—the equivalent to searching for a needle in a haystack—and 20% dealing with them. However, it is nearly impossible for travel managers to review every transaction. They rely on reviewing a 20% to 25% subset of transactions to hopefully catch potential misuse, waste, and fraud.

AI changes this. Oversight Insights On Demand is an AI tool that users of TEM software, such as Certify, Chrome River, Concur and Workday, are using today to automate the detection of T&E and purchase card policy violations, errors, and fraud. Oversight expands the scope of expense report audit to 100% of transactions across travelers and across time. It is more efficient and accurate than traditional monitoring efforts used in auditing corporate travel programs.

Before AI-based expense report audit tools like Oversight, automated audits relied on rules and policies established through black and white logic creating large numbers of alerts primarily from false positives. Oversight uses pre-built AI-based analytics that can learn any risk strategy through human input, judgement, and remediation. Through this back-and-forth interaction, the AI learns over time to improve the current processes and its own internal processes.

This means travel managers can avoid false alarms and spend the bulk of their time correcting real issues, instead of finding them. They can focus on the things that bots can’t do—the human element.

Let’s look at a scenario where Oversight makes a difference:

Business traveler Anne goes on a trip. Her company uses TEM software so it is really easy for Anne to book her travel and submit her expenses. She snaps photos of her receipts on her smartphone and her app adds them automatically to her expense report. The TEM software automatically checks for policy violations before Anne’s expense report is submitted and finds that Anne’s transactions look good—she hasn’t exceeded per diem, she has receipts for everything over $25 and the merchants don’t raise any flags. Before Anne has even landed back at her home base, she’s submitted her expense report and it is routed to her boss for manager approval. Her manager clicks through and skims over the report. Everything looks fine, so with a simple click of a button the manager approves Anne’s expense report. Anne’s account is credited for her expenses and she is happy.

Anne’s expense report then goes through her company’s new tool for expense report audit, Oversight Insights On Demand. Oversight looks at this particular expense report and ALL of Anne’s prior expense reports automatically. Oversight’s AI bot finds something peculiar—Anne has been submitting a high number of out-of-pocket expenses just shy of the threshold requiring a receipt. Oversight triggers an exception alert to the T&E manager, who talks to Anne. Anne has no evidence that these purchases actually happened, and ultimately, admits she didn’t think they would be approved expenses so she “forgot” to get receipts. The T&E manager uses this opportunity to educate Anne on proper expense report protocol and reviews what transactions are considered in policy. Anne knows she is being watched and corrects her behavior moving forward.

If Anne’s company only audited a random sample of reports or solely looked at individual transactions without visibility into a historical analysis of behavior, it would be nearly impossible to uncover Anne’s mistake. These types of audits wouldn’t uncover patterns over time.

This is why AI is needed to extend further into the travel expense management process, all the way through post-reimbursement. AI has the ability to analyze huge amounts of data and spot patterns that the human eye can’t see. And, unlike humans, bots don’t inherently trust all travelers to do the right thing. 

It’s time to look beyond the front-end and let AI technology do the heavy lifting in the expense report audit process on the back-end too. Companies like American Bureau of Shipping and Autodesk use TEM software coupled with Oversight’s AI technology to automate expense report audit, learn from customer data and provide the root-cause visibility needed to affect change. Companies that transform their expense process with Oversight see a 70% reduction in out-of-compliance activity.

Want to learn more? Schedule a demo.

Rachel Ware

Rachel Ware is Business Development Manager at Oversight Systems.

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