Reconciliation and Corporate Cards

What is reconciliation for corporate cards?

Corporate card reconciliation is the process of matching the transactions on a corporate credit card statement to the corresponding entries in the company’s GL. This is a critical accounting process that helps to ensure the accuracy of the company’s financial records.

Why is corporate card reconciliation important?

There are several reasons why corporate card reconciliation is important:

• To ensure the accuracy of the company’s financial records: Corporate credit cards are often used to make a wide range of purchases, from office supplies to travel expenses. It is important to reconcile these transactions to ensure that they are all accurately recorded in the company’s books.
• To identify and prevent fraud: Corporate credit cards are a target for fraudsters. By reconciling corporate card statements regularly, accountants can identify and investigate any suspicious activity.
• To comply with financial regulations: Many businesses are required to comply with financial regulations that mandate regular reconciliation of corporate credit card statements.

How to reconcile corporate credit cards.

The process of reconciling corporate credit cards can be done manually or automatically.

Manual corporate card reconciliation:

To manually reconcile corporate credit cards, accountants will typically follow these steps:

• Gather the necessary documentation, including the corporate credit card statement and the company’s general ledger.
• Review the credit card statement and identify all transactions.
• Match each transaction on the credit card statement to the corresponding entry in the general ledger.
• Investigate any discrepancies and make necessary adjustments to the general ledger.
• Once all transactions have been matched and reconciled, the accountant will sign and date the credit card statement.

Automated corporate card reconciliation:

• Automated corporate card reconciliation can be done using a variety of software solutions. These solutions typically work by integrating with the company’s accounting system and automatically matching transactions on the credit card statement to the corresponding entries in the general ledger. This can save accountants a significant amount of time and effort.

Tips for corporate card reconciliation.

• Reconcile corporate credit card statements on a regular basis: This will help identify and resolve any discrepancies early on. An automated system will help with this.
• Use a standardized reconciliation process: This will help ensure that all reconciliations are performed consistently and accurately.
• Document all reconciliations: This will help create a record of the reconciliation process and make it easier to troubleshoot any problems that may arise.
• Review reconciled statements with the cardholder: This will help ensure that all transactions have been accurately recorded and that there are no unauthorized charges.
• Use software-enabled cards: These cards automatically capture and book all transaction details for syncing to the GL.
• Review the credit card statement for any unusual or suspicious activity: This includes looking for transactions that are larger than expected, made in unusual locations, or made by unauthorized users.
• If you identify any discrepancies, investigate them immediately: This may involve contacting the cardholder, the merchant, or the credit card company.
• Document all of your findings and keep a record of all communications: This will help support your findings in case of an audit.

How Airbase helps with card reconciliation.

Airbase eliminates the need for reconciliations of card statements. It does this for its own cards, and for SVB and AMEX cards, with whom it has partnerships. Since all transaction data including approvals for all card spend are automatically updated in Airbase as the spend happens, these records are synced to the general ledger so that there is no need for reconciliation.