Travel Accounting Circus - November 2003

A Travel Accounting Circus

CIRCUS TRIVIA It is easier to balance on top of a galloping horse in a circle than in a straight line. Philip Astley, the father of the modern circus realized this, and so, the circus ring was born in 1770.

Everybody loves a circus, even when it encompasses the often-neglected subject of Travel Accounting. Northwestern Travel Management , under the sponsorship of National Car Rental, presented its Travel Accounting Circus on Thursday morning, November 20, and the Radisson South in Bloomington (MN). Our audience included not only travel managers, but also administrators / assistants, accounts payable staff, CFOs, controllers and others. Approximately 43% of the attendees report into an either accounting or purchasing departments, while another 40% reported into "administrative" departments.

ACT I: Juggling
"Ringmaster" Jeff Brand introduced the first presenter, Lisa Buckner, who will take the reins as NTM President starting in January 2004. Since travel accounting is the most-requested forum topic each year, Lisa highlighted some of the industry changes that continue to make travel accounting departments most anxious. These include the continuing drop in commissions; the restructuring of departments from profit centers to cost centers; the emphasis on "procurement purchasing" methods; and the new focus on travel-related abuses ("perks") that will come to a head in 2004 with the ramifications of the Sarbanes Oxley Act of 2002.

Business travel continues to be the second- or third-largest controllable expense for any company, amounting to $170 billion annually. And, since this is currently a buyer's market for airline seats and hotel rooms, this is a perfect time to be discussing traveler purchasing behaviors.

Before discussion the true "accounting" side of the business, Dawn Tomisak, NTM Operations Manager, gave an overview of the Airline Reporting Corporation(ARC). This entity acts as a clearinghouse for amounts due to the airlines and also controls the 4-4-5-week fiscal calendar to which we are somewhat bound in this industry.

Dawn also presented "A Day in the Life of a Ticket", the process of which is important for any travel accounting-related person to grasp. Once a ticket is issued, the ticket can take four courses: either the ticket is utilized "as is" or the ticket is voided, reissued, refunded. Each of these can have a cost-related factor, and those were discussed. It is also important to work with NTM on tracking the use of non-refundable and unused electronic tickets to either capture any remaining value or even to assess the value lost to assist with traveler behavior modification.

ACT II: Balancing
After the intermission, Vicky Delaney, Corporate Account Manager, and Pam Asplund, Senior Accountant, reviewed billing report options that are available to NTM customers. Please consult your corporate account manager if you have questions, especially related to which reports can be emailed in Word, Excel or Adobe Acrobat (.pdf) formats.

Since cost-center allocation was the primary challenge for a third of the group, Vicky presented a report that only a few customers currently receive. It's an Excel template that allows you to "drop in" an invoice total and have the cost-center allocations calculate automatically, either by hierarchy Level 2 or Level 3.

NTM's Credit Card Match (CCM) process leads the way for our current customers in facilitating the ongoing battle with credit card statement reconciliation. Carolyn Braun, Customer Product Support Manager, is NTM's resident expert on the current relationships we have with US Bank Visa, Diners Club and American Express. The weekly process "marries" your downloaded credit card data with airline reservations booked through NTM. Whatever doesn't match is filtered out at the bottom of the report.

Knowing that the reconciliation of upfront handling fees is a concern with certain customers, Julie Barrett, Corporate Account Manager, talked through the current process and how many pieces need to be in place for the upfront fees to be "discernable" on credit card statements. Since we can only control certain aspects of the process, we're still refining the process whereby our "merchant bank" communicates with a clearinghouse and with an "issuing bank" in order to interface with the actual credit card company. (In short, we do send all the necessary information to the merchant bank; unfortunately, not all of the descriptive fields can be accommodated by the downline processes.) We are currently testing new software with our merchant bank to see if that might help as well.

Expense reports were the last item discussed, primarily to point out that all of the necessary expense report information that a traveler would need are printed right on the ticket receipt. This includes the original amount of the ticket and any additional collection from a reissued ticket. It also includes the last four digit of the credit card used for a quick reference.

NTM will introduce a slate of yet-to-be-announced forum topics sometime in early 2004.

Forum Sponsor
The NTM ‘Travel Accounting Circus’ forum sponsor was:

Forum Gallery

Please click on the thumbnails below to view the pictures.