AppZen has released a report, The State of AI in Business Spend, which shows that enterprise companies are only auditing 10 percent of employee expenses in expense reports submitted, which makes it very unlikely they will catch mistakes or even outright fraud.
The report, which used anonymized data from hundreds of companies, found that companies were missing fraudulent expenses related to strip clubs, escorts, tattoos, gambling, and much more.
AppZen offers a solution that processes data crawled from the internet through their AI-powered algorithm to automatically identify the type of business being expensed and flagging it for human auditors.
Anant Kale, CEO of AppZen, discusses in an interview on Fox Business, how AppZen helps companies use AI to audit 100 percent of reimbursable employee expenses in order to avoid getting ripped off:
Companies Using AI to Identify Expense Report Fraud
AppZen has released its Business Spend Report where we have compiled private and anonymized data from hundreds of companies across a variety of industries. The results are very surprising. What we found are that companies who are relying on human auditors are auditing less than ten percent of their expenses. This means that if you are an employee of one of these companies the chances of ever getting caught is close to zero.
Companies that are using artificial intelligence are auditing 100 percent of their expenses within minutes. They are finding lots of surprising things. One of them is concerning duplicates. You would be surprised to find how many employees are getting paid for the same expense. This means that some employees are submitting the same expense with different descriptions and different amounts which is very difficult for auditors to catch.
AI Makes it Harder for Employees to Lie on Reports
Another expense is where employees or a group of employees are submitting dinner meals with customers with what seems to be a restaurant when in reality when the artificial intelligence technology goes out and scours the web for that data we found that sometimes those or strip clubs and sometimes even escorts. That is happening far more often that you would like to believe.
These were going through the companies systems before AI came in. The reason why they are very difficult for human auditors is that they just don’t have the time necessary and the number of expenses being reviewed is much less with humans.
AI Software Looks at 100% of Reimbursable Expenses
When AI does it, it looks at each and every expense. It doesn’t just use the data on the expense report but also uses things like social data and reviews from websites and then puts the doc together. So it’s very difficult to escape from what the AI technology can find out versus what a human auditor can.
What the AI technology does is unravel what’s going on with the expenses. This lets the company determine what the best way to deal with information is. Often, it includes better communication with employees. We are seeing all kinds of things including mistakes, fraud, and non-compliance with company policies and sometimes government regulations.
These are on all kinds of expenses around travel, hotel, and airfare, which you would believe are far more controlled in companies today.