Corporate Credit Cards

Credit unions can issue corporate credit cards to officials and employees for business-related expenses. The board establishes controls to prevent the use of these cards for unauthorized or personal charges by officials or employees.

Examiners review corporate credit card operations to determine if controls are in place to prevent misuse of corporate credit cards.

To review corporate credit card controls, examiners perform the following activities.

• Review the corporate credit card policy and/or procedures. Determine if credit union policy and/or procedures include:

  • Authorized users—This includes respective transactions and card limits

  • Authorized transactions—Use of the card is for credit union business purposes only

    • Ideally, the policy prohibits the use of cards for personal use and cash advances

    • If a card is accidentally used for personal reasons, the policy requires the user to promptly pay the corporate credit card or reimburse the credit union for the charge

  • Documentation requirements—The user provides receipts and documents the specific business purpose for the transaction in a timely manner—for example, if the transaction was a lunch, the documentation indicates the purpose of the lunch, the attendees, and a description of business discussed

    • Further, the policy defines a procedure for documentation in the case of missing or lost receipts

  • Approval requirements—A reviewer verifies the validity and necessity of each transaction. For example:

    • A supervisor reviews and approve subordinate employee credit card charges

    • The treasurer or other designated official reviews and approves the manager/CEO’s credit card charges

    • A designated individual, employee, or committee reviews and approves any official’s credit card charges

• Compare approved user list per policy with the cardholder journal

  • Verify users and limits agree in these documents.

• Select a sample of corporate credit card statements for the examination period and determine the following:

  • Are the charges supported by receipts and is the business purpose documented? If the user accidentally used the card for a personal transaction, did the user immediately pay for the charge?

  • Is interest or a late fee applied?

  • Did the appropriate supervisor/official approve the charges?

• Review accounts payable to determine if any other credit cards exist—for example, Lowe’s, Best Buy

• Review general ledger expense accounts to confirm expenses are not recorded twice—for example, charging a lunch on the corporate credit card and then submitting the receipt for reimbursement by check

• Determine if the supervisory committee or internal auditor—if applicable—performs a documented review of corporate credit cards

• Identify and follow-up on red flags

Last Updated on October 14, 2021