Use Corporate Cards for Easy Expense Accounting

Wondering how you're going to handle the ever-expanding pile of expense reports and receipts you receive every month? The pile is only going to grow as your company expands and sends more employees out on the road. Do yourself — and your bookkeeper and chief financial officer — a favor and sign up everyone in your company for a corporate credit card now.

The concept behind corporate credit cards goes beyond making sure that your employees have a line of credit in an emergency. The big boon behind corporate credit cards is bill consolidation. Instead of receiving dozens of different hotel, rental car and restaurant bills each month from different employees using various methods of payment, your company will receive one large bill broken down in various ways — by type of charge, by employee name and by date.

With bill consolidation, you will actually be able to watch travel and entertainment expenses and forecast what they might be in the future. Annual budgeting for such expenses will be much easier.

Corporate credit cards also simplify travel and entertainment expense reporting for employees. Thanks to new software, employees who use a corporate credit card don't have to file a paper expense report anymore. Instead, they just scroll down an online computer file of their expenses and check which charges the company should pay (since the card is for business purposes, this is only really a checks and balances system). Your company's accountant or controller then logs on, checks what expenses the employee has approved and pays the bills.

Some employees may balk at the thought of using a corporate credit card over their personal charge card. Those employees are worried about earning miles. Up until a few years ago, miles earned on corporate credit cards were given to the company paying the credit card bill. Times have changed, however, and American Express, Citicorp's Diners Card, Bank of America Visa and others now allow the employee to reap the mile benefits.

A few other benefits of using corporate credit cards:

• Travel insurance. With American Express, you can insure your travelers with up to $200,000 travel accident insurance, and $1,250 in baggage insurance.
• International charges. If you use your corporate card overseas, pay close attention to currency exchange rates and extra transfer fees. You never know when you'll get a credit card call to Berlin routed through Madrid and charged to you in North Carolina.

As small businesses continue to dot the landscape, credit card companies are beginning to offer better corporate credit-card deals to growing businesses. If you hit the right offer at the right time, you might be able to land your company, and your employees, some great deals.

Also read Business Travel and Expense Reporting.