Amy Langfelder

CPA | CK Principal

Corporate credit cards are a valuable tool for businesses. They simplify purchasing, make expense tracking easier, and give employees flexibility to do their jobs. However, with this convenience comes the responsibility to ensure that these cards are used wisely and ethically.

That’s where a clear credit card policy and the right technology come in. Together, they help protect company resources, reduce fraud and build trust across the organization.

Why a Credit Card Policy Matters

A strong credit card policy serves as both a safeguard and a roadmap. It clearly sets expectations for appropriate usage and explains the reasons behind the rules. When paired with expense management platforms such as Bill.com, Expensify and Ramp, to name a few, it can provide solutions to track transactions in real time, flag suspicious activity automatically, and simplify reporting and receipt collection. This combination of policy and technology gives finance teams the ability to detect irregularities before they escalate into larger issues, along with fostering  transparency, accountability, and trust, ensuring that employees understand not only how to use their cards, but also the rationale behind the guidelines.

To create an effective policy, organizations should begin by considering both the operational needs of their teams and the inherent risks associated with credit card programs. This thoughtful approach lays the foundation for a culture of fiscal responsibility. 

Key Elements of an Effective Credit Card Policy

• Identify the Purpose
  The policy must state clearly why the company issues the credit cards. Personal use should be prohibited, with misuse potentially leading to termination.
• Eligibility and Issuance
  Only employees who need a credit card for their role should have one. Require them to sign the company’s credit card policy to acknowledge responsibility.
• Allowed vs. Prohibited Expenses
  Define what’s acceptable, such as flights, hotels, or vendor purchases, and what isn’t, such as personal expenses like groceries, entertainment, and fuel for personal use.
• Spending Limits and Control
  Set limits according to an employee’s role and add transaction or daily caps. Require approval for larger purchases to control spending and align with company resource policies. Technology solutions can support this by offering workflows that establish vendor limits and define business categories.   
• Monitoring and Reporting
  Require employees to submit receipts promptly (weekly or monthly) with a clear business purpose. Reconcile credit card statements monthly against the general ledger and address any discrepancies immediately. Expense tools can capture and upload receipts as expenses occur for efficient record-keeping.
• Consequences of Misuse
  The policy should clearly outline the consequences for non-compliance. These may include reimbursement for accidental personal charges, suspension of card privileges, and, in cases of repeated misuse, termination of employment and possible legal action.

The Role of Technology

Technology makes monitoring and enforcement easier. Sometimes, business applications may require specific credit cards, so app selection should align with company policies. The right tools give firms both flexibility and control over purchase and expense management.  

Bottom Line

A clear, well-communicated policy, supported by the right technology, protects companies while giving the employees the resources they need to succeed. For more information on strengthening your credit card policies and integrating technology into your accounting systems, please contact Cray Kaiser.