GSA Federal Supply Service

Citibank and MasterCard

Citibank and MasterCard

Citibank® Commercial Cards, Government Services

The Seventh Annual GSA SmartPay Conference

© Copyright 2005 Citigroup Inc. All rights reserved. CITIBANK, CITIDIRECT and CITIGROUP and the Umbrella Device are trademarks and service marks of Citigroup Inc. or its affiliates and are used and registered throughout the world.

Patti Walls, Bill DeGraff, September 1, 2005

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Goal & Objectives

To provide an update from MasterCard on:– Enhanced data– Data reporting

• The Enhanced Merchant Reporting (EMR) Service– On using business intelligence with the data

• MasterCard’s new Aristion solution

Citibank and MasterCardBill DeGraffMasterCard

Citibank® Commercial Cards, Government Services

Citibank and MasterCardMoving Forward with Enhanced Data

GSA SmartPay Conference

Bill DeGraff, VP, Public Sector Business Development

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Today’s Agenda

• Enhanced Data Update

• Data Reporting: The Enhanced Merchant Reporting (EMR) Service

• Using Business Intelligence with the Data: MasterCard’s New Aristion Solution

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Enhanced

Data

Update

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% of Purchase Transactions

Level II/III49%

Level I51%

Enhanced Data Breakdown

T&E14%

Purchases(inc. fuel)

86%

99%95%

90% 82%

% of T&E Transactions(with enhanced data)

Airlines Hotel CarRental

% of all Commercial Card Transactions

Rail

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Benefits of Enhanced Data

• Cost savings

– Price negotiations

– System integration

• Decreased fraud and increased policy compliance

• Improved tax reporting

• Account reconciliation

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Value of Data for Negotiations

• Integrated data offers valuable information on vendor compliance and utilization, as well as buying trends.

• 39% of respondents indicate routine use of travel data as leverage in negotiations with suppliers*

• Average discount obtained in negotiations equates to 9% of the respondent’s travel budget*

– Principally with airlines, hotels, or auto rental agencies

• Companies which use card data are also very likely to have a preferred vendor program in place*

* 2004 Corporate Travel Card Benchmark Survey Results; RPMG Research Corporations

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Value of Data for System Integration

• The use of automated expense reports that integrate into back end accounting systems can provide significant organizational efficiencies.

• Governments lag behind the private sector regarding usage of electronic expense reports either with pre-populated travel data or without*

• The use of expense reports pre-populated with travel card data is associated with a 56% increase in expense report efficiency*

* 2004 Corporate Travel Card Benchmark Survey Results; RPMG Research Corporations

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Improving Compliance and Tax Reporting

• Enhanced data provides a clear audit trail of how organizational funds were utilized.

• 22.1% of a company’s fraudulent activity is related to expense management**

• Misuse also occurs where spending is legitimate but not compliant to policy

• Reporting enhanced data through MIS tools, such as CitiDirect, provide visibility on all aspects of spending

• Accurate data ensures accurate reporting of expenses

** The Association of Certified Fraud Examiners, 2004.

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Account Reconciliation

• For Central Travel Accounts or lodged accounts, transactions for multiple employees and cost centers may be associated with one account number

• Enhanced data (passenger name) and customer reference fields allow administrators to reconcile that account and ensure transactions are allocated to the correct budget units

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Data Providers – Enhanced Airline Data

Global Distribution Systems (GDS)*

*Airline booking and ticketing system that provides travel agents access to inventory, schedule, and pricing information for airlines, car rental companies, hotels, etc.

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Marriott International (April 2005)

Hilton Hotels

Carlson Hotels

Choice Hotels

Current Content Programs-Hotel Folio

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Enhanced Hotel Data Directly from Hotel

• Account number

• Arrival date

• Audio visual charges

• Banquet charges

• Total charges

• Billing adjustment amount – if charges are added after check out

• Business center charges

• Cash disbursement amount – amount of cash received during stay

• Conference room charges

• Toll free numbers

• Customer VAT number

• Departure date

• Early departure charges

• Fire safety act indicator

• Folio number

• Gift shop charges

• Gratuity charges

• Guest name

• Guest number

• Health club charges

• Internet access charges

• Laundry dry cleaning charges

• Lounge bar charges

• Mini bar charges

• Movie charges

• No show indicator

• Other services amount – those not falling into the above

• Prepaid expense amount

• Program code – for special customer consideration

• Property phone number

• Restaurant charge amount

• Room rate amount• Room service charge amount

• Tax exempt indicator

• Telephone charges

• Total amount charged on credit card

• Total authorized charges

• Total charge amount

• Total non room charge amount

• Total non room tax amount

• Total room nights

• Total room tax

• Total tax amount

• Transportation charges

• Valet charges

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Enhanced

Merchant Reporting

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Enhanced Merchant Reporting (EMR) Overview

• Web-based reporting tool launched in Nov. 2000

• Purchasing Card Program –

– Facilitate IRS 1099 reporting

– Track and reporting spending by socio-economic categories

– Identify volume contractors to negotiate discount pricing

• MasterCard provides supplemental merchant information to enhance reporting capability

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Data Flow

New P-Card Merchant

MC Data Warehouse

Austin-Tetra

EMR

Nightly Clearing/ Settlement

Monthly feed

New Merchant Monthly update

Full Quarterly Update

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EMR On-Line Application

http://cps.mastercardbusiness.com

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Criteria / Report Type Selection

Make your hierarchy selection

Choose the type of reports:

Standard or Ad-hoc

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Standard Reports / Exports

Standard PDF Format: Adobe Acrobat Reader

Tab-delimited ASCII format export

Standard Reports

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1099 Ad-Hoc reporting

1099 Ad-Hoc

Choose PDF Report or ASCII export

Filter report by Merchant Classification and Business Type

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Socio-economic reporting

M/WOB Ad-Hoc

Choose PDF Report or ASCII export

Filter report by Merchant Classification and Business Type Filter by socio-

economic status

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Sample Reports

Socio-economic Report

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Of course, it’s more than about enhanced data …

The demand for enhanced fiscal responsibility, accuracy, transparency and accountability will likely increase

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Aristion

and

Enhanced Data

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Business Intelligence with Enhanced Data

Using Aristion…

A Commercial Card Risk Solution…

Developed in conjunction with card issuers around the world

…and tailored to the compliance and regulatory needs of the GSA Smart Pay Program;

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AristionAristion®® Designed for a Large Cross Section Designed for a Large Cross Section of Government Payment Programsof Government Payment Programs

• Aristion® is a general government business intelligence tool.

Key to an agency’s improving the accuracy and integrity of Federal payments

• Aristion® is also a specialized commercial card payment solution

– Key to an agency’s program management plan required by OMB

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Aristion + Enhanced Data

Can provide extensible business information applications for U.S. Government Programs that entail:

LoansLoansFinancial Financial ServicesServices

PaymentsPayments

GrantsGrants

RegulationsRegulations

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• Demonstrate need for consolidated spending

• Identify prospective strategic sourcing partners

• Improve procurement and payment policies

• Determine relative performance of bureaus

• Identify opportunities for bulk purchasing

• Establish monitoring procedures and feedback requirements for compliance, program evaluation identification of savings

AristionAristion®® enables Agency enables Agency Officers to:Officers to:

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Aristion Provides Aristion Provides ““ActionableActionable””Information to Improve PerformanceInformation to Improve Performance

• Aristion® is a management tool that enables data to be turned into actionable information simply and quickly —

– Tactical — Aristion® communicates individual actions where the activity does not match established metrics (program variances).

– Strategic — Aristion® analyses data and creates program profiles based on trends.

– Creates Internal controls — establishes and monitors program compliance as it enhances results

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How Does How Does AristionAristion®® Work?Work?

Step 1:Step 1: Aristion® extracts information from multiple current and/or historical data bases, according to specified circumstances

Step 2:Step 2: Aristion® creates definition of program variances/actions that do not meet required prescribed performance metrics

Step 3Step 3: Aristion® compares extracted data to definition of program variance

Step 4:Step 4: Aristion® identifies all actions that fall outside prescribed performance metrics

Step 5:Step 5: Managers are sent an alert that actions/program variances have been identified

Step 6: Managers have an early alert of potential problems enabling them to take corrective actions and avoid potential negative consequences

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PROGRAM ANALYSIS AND REPORTING

RULES: DETECT POTENTIAL FRAUD, POLICY COMPLIANCE OR OTHER PERFORMANCE METRICS

CASE MANAGEMENT

RESOLUTION AND ACTION

RULES FEEDBACK

ALERTS: ELECTRONIC NOTIFICATION TO SINGLE OR MULTIPLE SOURCES – E-MAIL OR SMS MESSAGING

DATA FROM MULTIPULE SOURCES

MONITORING: CONTINUOUS OR CYCLICAL

The Aristion Cycle

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Your Rules Anchor Aristion

Transactions: Vendor MCC’s

Split transactions

ATM transactions

Travel transactions

Weekend/holiday transactions

Non-mandatorysources of supply

Cardholder to approving official ratio

• Mines data

• Views results

• Analyzes results

• Manages cases

• Derives statistics

• Automated alerts

• Dynamic message

• Multiple Profiles

• Segmentation• User defined

Communicator

Profiler

Data Viewer & Case Manager

Rules Engine

Sample Rules

Internal Data base(s) DataStore/Oracle

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For Agency Procurement Executives with For Agency Procurement Executives with Multiple Contracting OfficesMultiple Contracting Offices……

Aristion® enables Program managers to:

• Reduced cost by identifying the repeat transactions for same product/service with same or multiple end-users where consolidation purchase would be appropriate

• Determine where acquisition lead times (metrics) are not met and the frequency

• Avoid inappropriate contract bundling so small businesses can not compete and generate OPB report

• Compare similar size transactions among contracting offices to determine relative performance

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Citibank SmartPay data

BUREAU A BUREAU B

Accounts PayableFile

ARISTION

Department

BUREAU CAccounts PayableFile Aristion

Strategic Sourcing Completes The Aristion Value Proposition

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Consolidated Spending Data

Strategic Sourcing Plan and Partners

Rules to Monitor Card and Procurement Spend

Control Spend, Optimize Discounts and Rebates

Strategic Sourcing Completes The Aristion Value Proposition

Consolidated view of office supply spend + analysis and identification of strategic partners.

Acme Office Supply = Strategic sourcing partner. All transactions at Acme utilize the MasterCard Purchasing Card.

Office supplies not purchased at Acme and/or not using the MasterCard Purchasing Card are flagged—3 day notification. Cardholder re-educated on spending policy.

Optimize negotiated discounts from Acme and rebates from Issuer.

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Aristion…

…Integrates payment methods:• Supplier diversity requirements• Small Business spend requirements

…Controls purchase card spend:• Purchase card used as card used as a “payment”

method through approved acquisition procedures

• Discounts and rebates will increase …Encourages migration to G2B & procurement systems integration

• Ability to move to Electronic Invoice, Payment and Presentment (EIPP) processes

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CentralizedUp to 10 databases can send full or partial records into Aristion; combine historical and current data; platform independent: Mine data using your rules

SimpleAt your desktop; automates analysis

StrategicEnables a complete view of all transactions−card and procurement payments − to supportnegotiation and compliance of strategic vendor relationships

Aristion Is

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Most Efficient

Less efficient

Program AnalysisProgram Analysis

Program Management: Program Management: Strategic SourcingStrategic Sourcing

Risk Management Risk Management

Identify fraud, misuse, abuse

Compare card spend against spending guidelines

Analyze card spend, identify strategic partners, monitor spending with those partners

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Regulatory Compliance and Control

Aristion Enables Superior Card Program Performance

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Thank You!

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Summary

Enhanced data update

Data reporting– Enhanced Merchant Reporting (EMR) Service

Using business intelligence with the data– MasterCard’s new Aristion solution

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Citibank and MasterCard

Questions?

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Reminders

Thank you for attending this session!

Visit the Citigroup Welcome Center– Hynes Ballroom 306, on the third floor– National Industries for the Blind will have a display of products

Visit the Citigroup Technical Demonstration Center– Hynes Ballroom 305, on the third floor

Citibank hands-on training sessions– Hynes Ballroom B, on the third floor

Please take a moment to complete your GSA survey for this session

© Copyright 2005 Citigroup Inc. All rights reserved. CITIBANK, CITIDIRECT and CITIGROUP and the Umbrella Device are trademarks and service marks of Citigroup Inc. or its affiliates and are used and registered throughout the world.