Keeping Employees Honest When Using Corporate Credit
Go to: Article Next Article
Don't let the misuse of corporate credit affect your business. While you may need to allow employees to have access to it, you definitely don't want to give them free rein. It is well worth it to hire a few staff people to review the reports that people turn in for business related expenses. This way you can spot any red flags before they have gotten out of control.
Some companies just don't have good policies in place so employees really misuse the corporate credit by default. Those things that fall into a gray area often get turned in when they aren't eligible. For example they may turn in charges for drinks they had at the bar before a business dinner. This isn't a necessity so you may only want to cover the cost of the dinner and the drinks are their responsibility.
There are many reasons whey employees many need to have access to corporate credit. They may need to be able to purchase things for a presentation or to get some important documents shipped out immediately. Others wine and dine potential clients in order to try to get them on board. Others incur expenses relating to travel so they can go to work site and to see other clients out there.
The big thing though is to ensure all that have access to it don't misuse it. They should only be using it for business related expenses. If their spouse travels for business with them then their cost of airfare and meals needs to come out of their personal budget. You should be asking for verification of what they are doing at the time of a given charge. This way there is a good record of all that information.
The type of blatant misuse of corporate credit that you need to protect against won't happen on a regular basis. This is due to some employees charging their personal bills and needs to the business. However, even if they only do it for something small it can really add up over a period of time. Pay close attention to these small expenses as they will affect the amount of profits you end up with.
An effective business can only operate corporate credit with some strict policies in place. You are risking too much if you don't take it seriously. Don't wait until your corporate credit rating has been severely damaged by it. Even if you are able to prosecute the employees that engage in the behavior, you can't change what has taken place.
A great deal of money is lost annually due to employees not being honest with the use of corporate credit. The best way to handle it is to be prepared for it. Make sure you have policies and procedures in place that will prevent it from happening. You want to be very consistent with these practices.
Of course honest mistakes will occur from time to time. Give the employee the chance to explain what took place. For example they may have given the business credit card number instead of their personal one because they are so accustomed to traveling for business. You will have to review these instances on a case by case basis.
Article Source: Articlelogy.com
- Credit Cards A big selection of Cards in all flavors: Bad Credit Cards, Secured Cards, Prepaid Cards, Canada Cards, Low Interest Cards -
Word Count: 552
Reduce Your Debts Without Bankruptcy. See How Much You Can Save. Free Debt Analysis
