There are many businesses that will provide their employees with a company credit card. There are many reasons behind a company credit card. One example are those who travel on behalf of the company and the credit card is used to cover the traveling expenses. Another common scenario is providing an employee with a gas credit card. When daily transactions occur for the operation of the business, it is common for a business to supply company credit cards. However, many business owners find that some employees may use the company credit card outside the company needs. Company credit cards can easily be abused. Mark Dicus & Company will share a few tips to help prevent company credit card abuse.
How to Manage Employee Credit Cards
As much as a business owner wants to trust their employees and will issue company credit cards, sometime they are abused. There are many benefits of providing company credit cards and sometimes it is needed. However, it is important to have a few management strategies in place to help prevent company credit card misuse. Following are a few tips on managing your company’s issued credit cards.
Setting Expectations with Employees: When you issue out company credit cards you will want to be very clear with those who obtain how the credit card can be used. Make sure to outline what expenses can be used on the company’s credit card. Along with each purchase make sure the user brings back proof of purchase that they provide you.
Set Spending Limit on Credit Card: When issuing out a company credit card, especially for travel place limitations, provide them a budget they can spend on hotel room, food, and transportation. All too often a company will find themselves paying off outrageous travel expenses. If a card is given to an employee to host clients and guests, again put a limitation on how much they can spend to host potential clients. If there is no limitation or boundaries on spending amount you can be paying much more than you bargained for.
Know Who is Issued Credit Cards: It is important for the business owner to know who all has a company credit card. You will need to create a system for tracking who all has a credit card. If an employee quits or gets fired you will need to cancel their card and collect it back. Never lose your company credit cards and always know where they are.
Monitor Each Credit Card: You will want to carefully monitor all of the spending. Do this by requiring receipts for your employees. Also look over bank statements and make sure the receipt matches the expenses. You will want to make sure that employees are not double dipping in hopes you may not notice.
Set Up Credit Card Alerts: As a business owner you can set up notifications or alerts if the credit card is being used outside of its designated regulation. Often banks will help you in monitoring the credit card use.