Does a corporate credit card make expense management easier?
Expense management can be one of the most time-consuming parts of running a business.
Find out how corporate cards can make the process a little less painful.
How do corporate cards make expense management easier?
Proper expense management is crucial for companies of all sizes. It allows them to analyze spending and overhead, and prepare for tax filings. Companies can also identify unauthorized transactions, fraudulent activity, and employee theft in the process. But it can be very time-consuming — and frustrating.
Thankfully, corporate credit cards can take the hassle out of receipt tracking. Here are some of the ways that a corporate credit card can make expense management so much simpler.
They save you time and money
A corporate credit card effectively offers you a centralized expense management system. One single credit card statement featuring all employee purchases can take the stress out of reconciling all your expenses.
Integrated features also make expense tracking straightforward. These can include rich transaction details that accurately match receipts to credit card transactions and systems augmented by machine learning. All these improvements reduce any potential delays in the reconciliation process.
Many of these corporate credit card features also connect seamlessly to existing accounting software like QuickBooks, Netsuite , and others. This allows businesses to cut down the time spent on expense report management and accounting.
They allow you to manage multiple employees
Corporate credit cards can make cash and expense claim forms redundant. Instead, companies can issue a corporate credit card to every employee who is authorized to make business-related purchases, funding them all from one central account.
Every employee still has different responsibilities. Some will need to make lower-cost purchases, such as restocking stationary. Others might require access to higher credit limits for business travel.
Companies be selective in who they issue corporate credit cards to and manage each employee’s card use. They can adjust credit limits and spending restrictions for each cardholder. This way, companies can make sure that employees are using their card for its intended purpose.
You can restrict spending to certain products
Various corporate credit cards also cater to companies that need to go one step further and restrict employees to specific types of purchases. The most obvious example is corporate gas or fleet credit cards.
These credit cards are only valid for purchases on fuel, vehicle-related services, and products at participating businesses. By issuing these corporate cards, companies can ensure that essential purchases are readily funded while limiting the risk of unauthorized transactions.
It’s easy to keep personal and business expenses separate
While it may sometimes be tempting to put business expenses on a personal credit account (like employees trying to capture rewards points) and vice versa, it’s best avoided. Muddying the waters between personal and professional spending can overcomplicate accounting, make it harder to understand the company’s financial position, and even affect future credit applications.
Sometimes there may be some benefit to using a business card for personal expenses, such as to take advantage of reward programs. If this is the case, companies should always separate those purchases from their business ledger to avoid confusion.