expenses

Expensing in a crisis, part 2: Companies rethink expense policies as COVID-19 disrupts office life

by Uri Kogan March 25, 2020

We hope our last blog helped your organization consider its response to the current global health crisis. As the situation surrounding COVID-19 has progressed, more travel restrictions and social distancing practices are being implemented every day. More and more companies are implementing work-from-home policies to adapt to the changing situation.

We’ve been tracking the data since the beginning of the crisis to help your company ensure employee health and safety and make important decisions around expenses. We hope these insights can help you craft a flexible expense policy that works best for your company.

Here are a few of the most significant changes we’ve seen.

COVID-19 expenses haven’t shown any sign of slowing down

In our last blog, which included data through March 7, we noted that COVID-19 expenses skyrocketed, and we expected them to fall as trip cancellations began to taper off. However, these expenses have shown no sign of slowing down – COVID-19-related expenses have actually doubled from the week ending March 7 to the week ending March 14, with trip cancellation and work-from-home expenses being the primary causes.

Number of COVID-19 related 3-14

Submitted expenses vary by industry

Although changes to travel plans and cancellations still make up over half of all COVID-19-related expense claims overall, the trends change when you look at specific industries.

In the finance and software industries, half of the expenses are related to travel cancellations, and the other half are work-from-home expenses.

In the consumer goods, manufacturing, and pharmaceutical industries, masks still make up 15 to 20% of expenses, but are otherwise in the low single digits in other industries.

Which categories stand out in different industries COVID-19 coronavirus

Work-from-home expenses have increased dramatically; mask expenses have fallen

Work-from-home expenses have grown the most, increasing 3.5x since last week. These charges are mainly related to “remote office setup” or “supplies for remote work,” and include accessories like printers, ink, headphones, and HDMI cables.

In our own workforce, we’ve noticed everyone has a different set-up at home. It ranges greatly from home offices, sitting with their family at the dining room table, or even sitting in bed with their laptops. It’s important for employee productivity and ergonomics to help everyone make the best of the space they have.

What employees are expensing over time COVID-19 coronavirus

Overall, mask expenses have fallen – however, We noticed a peak in mid-February, then followed by a second peak at the end of February. The peaks are attributed to large purchases of masks by a global manufacturing company that donated them to China.

How categories of expense are growing over time COVID-19 coronairus

What does this data mean for my company’s expense policy?

We hope this data can help you consider the appropriate response to COVID-19 in your organization and how you can best support your employees. It’s clear from the above data that work-from-home expenses are increasingly common, and will likely continue to increase over the next few weeks as more companies continue to temporarily close their offices. We’ve also noticed that several companies have created specific expense types to track COVID-19 spending more closely. Others have created expense categories for their accounts payable departments to make purchases more quickly in times of uncertainty.

If you’re unsure of what you should allow in your expense policy in response to the current climate, we’ve outlined some best practices on work-from-home expense policies from our peers and customers. In the meantime, we hope you and your company are taking the necessary precautions to ensure the health and safety of your employees during this unsettling time.

We will continue to monitor the situation and publish new findings to keep the community informed.

If you’re an AppZen customer, we have information like the above we can share with you directly — please contact your Customer Success Manager.

We’d love to hear from you about how your company’s expense policies and practices are changing in this unprecedented time. Please reach out to us at communications@appzen.com

Uri Kogan
VP of Product Marketing

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