Sep 26

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Government Crackdown is a Reminder for Businesses to Examine Credit Card Policies

There has been a lot of press (some of which is discussed in a prior post) about various government agency employees taking extreme liberties with their government issued credit cards.  Back in July 2011, the Senate approved a reform measure for additional controls and stricter penalties that is finally set by signature by President Obama.

While employer issued credit cards are an important tool for efficient procurement of everything from travel to office supplies, this area is ripe for abuse without effective internal controls that are documented and enforced.  Usage must be preemptively controlled (such as through appropriate credit limits) and actively monitored (with appropriate segregation of duties), with best practices put in place to control unnecessary costs (like interest for untimely payments).

The fact that the government is realizing its own need for additional law is a strong reminder for businesses of all sizes to take a look at their own policies and procedures in this area.  As in the case with the recent bill, action in this area is often lamented for not having occurred earlier.

About the author

Renee Howdeshell

Renee Howdeshell is a founding member of Fulcrum Inquiry, an accounting, finance and economic consulting firm that performs damage analyses for commercial litigation, forensic accountings, royalty & distribution audits, financial investigations, and business valuations. Ms. Howdeshell holds a degree in Finance and Marketing from the University of Virginia's McIntire School of Commerce and is a Certified Public Accountant (CPA) and a Certified Fraud Examiner (CFE). She has testified as an expert witness in federal court, CA state court and arbitration regarding the results of her work. She can be reached at (213) 787-4112 and her resume is available at www.fulcrum.com.

Permanent link to this article: http://betweenthenumbers.net/2012/09/government-crackdown-is-a-reminder-for-businesses-to-examine-credit-card-policies/

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