12-point checklist for a secure, successful p-card program

In an increasingly digital and dispersed workforce, purchasing cards are primed to become more widely used, making a solid p-card program essential.

Especially given the current, chaotic climate, employees need to be able to make essential business expenses and buy last-minute items anytime, anywhere.

And the more p-card usage ticks up, the more effort Finance must make to maintain a controlled, secure p-card program.

The p-card program dozen

There are 12 steps that help create a successful p-card program, says internal auditor Don Holdegraver. Use this checklist to see how your own program stacks up:

1. Define policies and procedures and update them regularly. As your company evolves, your p-card practices should, too.

2. Appoint authority. Who (or what group) has the final say on rules? Who can employees turn to with questions?

3. Designate roles for the transaction reconcilers and monitors. This once again enforces strict procedures and strong internal controls.

4. Design the p-card to minimize the possibility of noncompliant purchases (e.g., restrict certain items or categories).

5. Establish card limits to ensure employees can’t spend more than they should. Consider different levels of limits in your p-card program, too (e.g., a lower amount for employees, a higher amount for department managers).

6. Create a purchasing cardholder agreement that employees must sign, indicating they understand the responsibility of having a p-card.

7. Conduct face-to-face training before administering p-cards, so you know employees are adequately prepared to use them.

8. Require original receipts for every purchase to hold employees accountable and deter misuse.

9. Request electronic transfer data from your card provider. Then your finance team can analyze and report on it.

10. Provide a hotline process for employees to proactively report misuse or bring up concerns. And consider whether there should be an option for anonymity, so there’s no fear of retaliation.

11. Enforce policies for misuse. Clearly spell out what’s wrong, enforce it and do so consistently. When employees see others disciplined for breaking the rules, they’ll be less likely to do so themselves.

12. Institute recurring audit processes to boost continuous compliance and ferret out fraud. If an audit is always possible, employees will be more aware of their actions.

A constant, collective effort

Of course, if your finance team is putting in the work to advance its p-card program, you want those efforts to pay off.

Make sure your team is open with cardholders and managers about what changes have been made and what new controls are in place. The timely tie-in of the coronavirus pandemic coupled with more remote work will help them understand why such measures are being taken.

As your p-card program changes over time, it could also be beneficial for your team to gather feedback from cardholders (seasoned and new) via a quick survey or short meetings. Are there any policies that are unclear and could result in compliance issues? Do they know of other best practices, perhaps that their peers or other companies use, that could benefit your p-card program?

Both communicating your program’s progression and making it a collaborative effort will help foster more companywide compliance.