UK Business Loosens Its Belt, Spending Over £1billion Extra on Expenses, says Concur ‘Little and Often’ Replaces the Long, Expensive Lunch but £350million is Still Leaking Out of UK Business Due to Exaggerated Expenses Business Wire LONDON -- May 21, 2013 A report by Concur, the leading provider of integrated travel and expense management solutions, has analysed expense claims made by more than 200,000 employees and reveals that – despite a tough economic climate – UK business spent an additional £1.2 billion on expenses in 2012 compared with 2011. The statistics are a surprise considering the on-going concern about the impact of austerity in the country and in Europe more broadly. However, UK employees are being much more diligent in claiming for smaller expenses, such as food and beverage, in today’s austere environment and are taking a ‘little and often’ approach to spending. On average, expense-claiming employees received 10 per cent less in expenses (in real terms) than they did in 2010 despite making 7.5 per cent more claims. The report estimates that on average employees made 36 claims and received just over £2,054 each in expenses during 2012. Perhaps unsurprisingly considering the instability of consumer spending, UK retailers have demonstrated the biggest commitment to recognising cost savings by reducing the amount of cash spent on expenses. Between 2010 and 2012, retail companies reduced their average expense claim by approximately 30 per cent (adjusted for inflation). David Vine, Managing Director, UK SMB at Concur comments: “In a tough economic environment we see a culture shift in spending on expenses. For example, the average bill for client entertainment dropped by 20 per cent^1, in real terms over the last two years, implying that employees are aware that they may be frowned upon if they act extravagantly. However, a recent study by Concur^2 revealed that the good old fashioned breakfast, lunch or dinner, has the biggest impact on landing a sale, so organisations must balance spend against potential sales to grow their business. While we’re not sounding the death knell for the decadent business lunch, there’s clearly been a trend towards smaller but more frequent expense claim submissions in the last couple of years.” However, there is still much work to be done as managers do not provide a robust enough challenge towards “out-of-policy” expense claims. A negligible amount of expense claims are rejected by managers as the report reveals that over 99 per cent of all employee expense claims are approved, regardless of whether they meet the business’s expenses policy or not. Indeed, managers query less than one per cent of all expense claims – hence 94 per cent of claims are approved regardless of expenses policy compliance. There is certainly a disconnect between manager and employee behaviour, as the findings show that almost £350 million in exaggerated expense claims were made in the UK, in 2012. According to a recent survey conducted by YouGov,^3 over one in ten employees (11 per cent) admitted to exaggerating expenses claims in 2012 – a 3 per cent increase compared to 2011. Additionally, 20 per cent of workers surveyed judged it acceptable to exaggerate expenses (again a 3 per cent increase compared to 2011), and this rose to 28 per cent in the private sector. Vine continues: “There is a big black hole in financial visibility that is costing UK business dear, especially in a business environment where every penny counts. It’s hardly a surprising situation though when a recent survey by ^4Amadeus revealed that 51 per cent say they don’t understand their company’s travel policy fully. Much is still to be done by businesses to enforce their travel policies and educate their employees about expenses.” For more information view the: *Full Report *UK Blog ENDS About Concur Concur is a leading provider of integrated travel and expense management solutions. Through Concur’s open platform, the entire travel and expense ecosystem of customers, suppliers, and developers can access and extend Concur’s T&E cloud. Concur’s systems adapt to individual employee preferences and scale to meet the needs of companies from small to large. Learn more at www.concur.co.uk or the Concur blog. # # # NOTES TO EDITORS Concur Benchmark Report - Survey statistics: ABOUT THE METHODOLOGY Now in its seventh year, the Concur Employee Expenses Benchmark Report is the definitive analysis of employee expenses in the UK. Our 2013 report analyses £725 million of expenses paid by UK - based organisations over the past 3 years. This huge sum comprises over 12 million individual expense claims, made by around 200,000 UK-based employees, from a very wide range of organisations in the private and public sectors. Our analysis is based on actual claims made by employees between November 2009 and October 2012 that were subsequently approved (or rejected) and paid by employers using Concur’s expense management system. This data was collated in association with ASQ Analytics and independently analysed by Kelso Consulting to give a definitive overview of employee expense behaviour in the UK. It also provides an accurate picture of how much was actually paid out in expenses to employees by their employers. In the report we use the term “claim” to refer to an individual line item on an expense report. For example, a meal for five people with drinks will count as one “claim” if listed on one receipt. We also refer to the effect of inflation in the text and, where we have adjusted for inflation’s impact, we have used the CPI (Consumer Prices Index). Numbers in the reports have been rounded. Due to this, sometimes rows will not quite sum to 100% in some cases. Average value of expense claims and number of claims approved Average Average number of Average approved approved claims (by amount Year expense expense-claimers, per received in claim value year) expenses (per year) 2012 £56.30 36.49 £2,054.34 2011 £62.19 32.76 £2,037.31 2010 £62.01 33.93 £2,104.15 Average number and value of expense claims per employee by sector Average Total Average % number of amount value change claims received of an 2010 per in expense to (expense expenses claim 2012 claiming) by employee average employee 2012 Financial £78.97 -6.6% 41.9 £3,310.39 services IT & telecoms £60.57 13.0% 59.3 £3,593.75 Legal £55.60 -7.9% 39.1 £2,172.69 Manufacturing £54.81 2.1% 57.4 £3,145.31 Media, creative & £56.49 9.6% 45.4 £2,564.97 publishing Motor industry £51.41 -1.8% 21.7 £1,117.14 Retail & FMCG £48.29 -22.8% 25 £1,205.91 Average £56.30 -9.2% 36.49 £ 2,054.34 Average value of expense claims and number of claims approved by expense type Average Average What the number amount average of received employee % claims % in % spends change (from change expenses change Expense Type Year -average 2010 people 2010 (from 2010 approved to claiming to people to claim 2012 this 2012 claiming 2012 value expense this type) expense type) Entertaining 2012 £85.61 -8.5% 10.05 -8.1% £860.82 -15.9% Entertaining 2011 £91.18 10.45 £952.90 Entertaining 2010 £93.55 10.95 £1,024.00 Expense claims (by value) and whether they receive approval or are rejected Approved Rejected, Year and Approved, but Rejected and but within “out-of-policy” “out-of-policy” within policy policy 2010 85.8% 13.2% 0.4% 0.6% 2011 86.9% 12.3% 0.3% 0.5% 2012 87.6% 11.6% 0.4% 0.4% Calculations: Amount of expenses paid out by companies *£8.2 billion (2012) - £7billion (2011) = £1.2 billion Note: £8.2 billion is an approximation based on the survey sample. ^1 Spend on client entertainment from 2010 to 2012 dropped by 15.9 per cent in monetary terms, and 20 per cent in real terms when adjusted for inflation. ^2 Based on research conducted by Vanson Bourne, March 2013 ^3 Based on research conducted by YouGov Plc., December 2012 ^4 Based on research conducted by Amadeus, January 2013 Contact: Weber Shandwick for Concur Alexia Da Silva +44 (0)207 067 0639 ConcurUKPR@webershandwick.com
UK Business Loosens Its Belt, Spending Over £1billion Extra on Expenses, says Concur
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