However, irresponsible employees who misuse or abuse cards can lead to costly implications – especially for cash-strapped small and mid-sized businesses. Developing a comprehensive oversight strategy for company credit card use will lead to better compliance and accuracy of credit expenses, helping small businesses see spending more clearly and manage it proactively. As a global leader in the travel, expense and invoice management industry, Concur has a wealth of experience and data to help managers keep track of employee credit card use. Here are eight strategies to help businesses reduce the risks associated with issuing employees a company credit card:
Set expectations. Be crystal clear on how the company credit cards should be used. Set out responsibilities and expectations for employees, the types of expenses they can incur and the proof of purchase they need to provide with each item so everyone is aligned.
Limit liabilities. Set spending limits for certain items like hotel rooms and establish overall spending caps to limit your liabilities. Companies should review limits on a regular basis to ensure they are still reasonable, keeping pace with important trends, and not being exploited.
Control card issuing. Businesses should be careful to limit the number of credit cards issued to essential users. Make sure users are aware of their responsibilities and be sure to collect and cancel cards when an employee leaves or no longer requires a corporate card.
Monitor employee spend. It seems obvious but companies should be careful to actually monitor all items of spend and not simply assume that employees will do the right thing. Lookout for items bought for personal use, or items that users may then try to reclaim via expense reclaim. Deploying an automated expense software, such as Concur Expense, offers the transparency to help your finance team quickly analyze and identify any spending abnormalities, ensuring they can be handled appropriately.
Secure details. Businesses should store and record details of all credit cards and their holders securely with encryption while encouraging users to look after the card as if it were their own. Ensure all employees know how to report theft or loss and to do so as soon as possible.
Insist on receipts. While they may not be required for expense reclaim, it’s still good practice to insist on itemized receipts for all purchases. E-receipts can make this process more convenient for employees.
Set alerts. Businesses should utilize all opportunities to flag inconsistencies or errors. Expense management systems should allow companies to set alerts and ensure your credit card provider can send notification of any suspicious activity or attempts to use the card outside of its intended remit.
Approve and control reports. For maximum visibility, put steps in place that require supervisors or approving managers to accept every credit card statement from employees in their teams.
Company credit cards are an excellent way to manage and improve visibility of your expenses spend, while at the same time empowering your people. A thoughtful approach to expense management, leveraging technology to expand visibility is the best way effectively and seamlessly mitigate the associated risk.
Brian Veloso, Director of Small Business, Concur Canada.
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