Purchase Card

Top N Analysis

on February 18, 2014

When analyzing your company’s card spend, it is common to study the areas where the majority of spend is occurring. The top N represent the highest risk areas from a materiality perspective.

Typically top N analysis is done through some type of static report. However, in Oversight Insights On Demand™, this analysis is automatically provided in both the interactive dashboards and the analysis workbench.

Some examples of top N analysis are:

  • Top 10 Merchants by transaction count
  • Top 10 Merchant Categories by transaction count
  • Top 5 Employees by spend amount

Analyzing the top categories is a great way to become familiar with how your employees are utilizing your card program. Some benefits of top N analysis are:

Consolidate with a preferred merchant

  • You can use this type of analysis to identify ways that your company policies can be improved to discover economies. For example, if one of your top MCC categories for purchasing cards is office supplies and they are being purchased from many different merchants, you may want to negotiate a contract at a particular office supply merchant with volume discounts and change your card policy to identify this office supply store as your preferred merchant for office supplies.

Detect a change in the way that your cards are being used

  • When you become familiar with which employees or merchants have the most spend amounts, when a different employee or merchant suddenly shows up in the top 10 that wasn’t there before, it is probably worth a few minutes to review that activity and understand why it is happening.
    • New merchants or categories in the top 10 might just be a seasonal variation of some type, but it could also indicate some type of more permanent shift in your company’s or employees spend patterns which indicate the need for new policies.
    • New employees in the top 10 might indicate some type of fraudulent activity on the card.

When looking for a tool to analyze your transactions, is makes sense to choose a tool like Insights On Demand that includes interactive analysis of the most frequently used categories and merchants. Please stay tuned for the next blog titled "Bottom N Analysis".

Julia Versaci

Julia Versaci is Director of Solutions Development at Oversight Systems.

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