How can companies ensure that they get the best out of their procurement card programmes? “By having a good procurement card policy in place,” explains Anita Carolus, Nedbank Corporate Card National Sales Manager.
The greater visibility and control that these programmes offer, as well as regular review and reconciliation of spend on a procurement card, will guarantee early detection of fraud and abuse. However, because of the human factor, this type of programme will not be successful if a good procurement card policy not in place.
In order to be effective, the policy should be comprehensive, transparent and easy to understand. Carolus has found that a good policy should include the following:
• A section on who is eligible for a procurement card.
• A section explaining the application process for the card.
• A section on the training requirements for each cardholder.
• Clear rules on allowable spend.
• The roles and responsibilities of the cardholder, line managers, card programme administrators and other parties involved in the procurement card programme.
• A section on audits and how often they will take place.
• A section explaining the disciplinary action regarding non-compliance with the policy and procedures, for example dismissal for the misuse of cards.
• A cardholder agreement, which the cardholder and the cardholder’s line manager must sign to acknowledge the policy and which will bind them to this policy.
It is not only important to have a good policy in place, but also to ensure that the policy is adhered to and reviewed regularly.
For more information on developing procurement card policies and how a procurement card programme can benefit your company, contact Anita Carolus on AnitaCa@Nedbank.co.za.