A credit card processing management or audit is a useful tool to save money in your business. It will help if you keep an eye on the credit card transactions taking place in the name of business transactions by you or your employees. You need to have sufficient proof that will highlight any discrepancies in the audit process.
There might be some hidden costs associated with these transactions. A credit card processing audit will help you find out such costs and reduce them effectively. Here’s how to ensure a seamless credit card processing audit for your business:
Usage Guidelines and Credit Limit
It would be best if you established some guidelines for credit card usage for business purposes. In such a manner, you’ll be able to keep an eye on the transactions and use of the credit card. The appropriate use of credit cards is necessary to help with transparent view monitoring. You can manage your spending with just small guidelines and tracking of the transactions.
The primary step would be to ensure judicial usage of the credit card. It would help if you wrote up the guidelines for who can use the credit card and how. Also, it would help if you were specific with the rules and left no room for doubts.
It will help if you set a credit limit for the transactions. You can make sure that no transactions exceed the set credit limit. It will also set a barrier towards any unwanted expenditures. If the limit exceeds, the bank will immediately notify you.
Sufficient Documentation for Proof
You must always request the user to provide the receipts after the purchases. It can be an included rule in the stated guidelines for usage. It will help if you have full disclosure about all the expenses taking place in the name of business expenses through a credit card. The user may throw in some additional purchases along with the business purchase and might get away if not checked.
These little expenditures taking place with your credit card can amount to a hefty amount in your pocket. So, make sure that you hold the user accountable for expenditures incurred on your business’s behalf. The documentation will also be necessary to record the expenditures and compare them at the end of the month.
Guidelines for Pre-approval
It is essential to set detailed guidelines for appropriate and inappropriate expenses. You should also set layered security regarding the safety of the credit card. The credit card should not fall into any wrong hands or some unauthorized users. The staff should handle the credit card with full responsibility and should be held accountable for any losses through the credit card.
It would help if you set some pre-approval guidelines for using the credit card by the staff. It’s always better to take control. Any purchases made from the credit card should first be pre-approved. It will make the staffers more conscious about their purchases. Any inappropriate expenditure will immediately be notified to you. Pre-approval will also act as a restrictive measure to any high amount of purchases.
Review Statements for Errors
You should review the credit card statement at the end of each month. The account statements are necessary to spot any discrepancies. You can identify any inappropriate purchases made from the credit card after carefully reviewing your credit card statement. The staffers will also be conscious while spending when they know that their activities are being monitored.
You can reconcile the credit card statements every month. You can take the financial department’s help for this process to keep an eye on credit card purchases and point out any errors, inappropriate expenditure, or unauthorized usage. You can double-check the statements randomly if you think that the numbers are exceedingly more than the usual limit.
A credit card processing audit begins with following all the above steps as a safety measure for a seamless audit.