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Procurement Cards

 
  Arthur F. Rothberg, Managing Director, CFO Edge, LLC  
   
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  Article Summary  
A procurement card - or P-card - is essentially a corporate credit card employees can use to buy designated products and services without going through the company’s purchasing department to meet pre-approval procedures and paperwork requirements.

This article looks at how procurement cards work to control misuse through setting of parameters on types, amounts, locations and frequencies of purchases.

Procurement card benefits - efficiencies, convenience and rebates - are addressed. P-card statements and levels of detail are reviewed along with a look at how electronically-provided statements can be imported into General Ledgers to promote efficiencies and accuracy. The discussion includes potential drawbacks such as required controls, level of detail, as well as tax and compliance considerations.

While they involve some upfront expense and may require review and adjustment of internal policy and/or procedural methods, procurement cards offer significant savings in terms of efficiency and convenience. These benefits far outweigh the costs and risks incurred with such a program.

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