Top Auditing Tips For P-Card Transactions

Your first line of defense is the manager who approves a transaction, ensuring that all transactions have a clear and justifiable business purpose. Help approving managers understand that simply “rubber-stamping” end of month reports without looking at the details tempts employees and opens the organization for fraud. Managers and approvers are a key control; get them to pay attention:

Look for spend on weekends and around holidays: If the card holder works a normal week, looking at spend on the weekend might help you to identify fraudulent or mistaken charges.

Track and graph the biggest spenders: Maybe the big guns think it’s harder to find a needle in a larger haystack. We recommend you sort on biggest spenders, graphing expenses over time and looking for spikes in spend. Use your data reporting tools to review month-over-month patterns and make sure the spikes make sense.

Review merchant name, including the card issuer: Auditors look every day for suspicious merchants: upscale clothing stores, hardware stores, utility companies, online retailers. Justification is KEY. Encourage approving managers to review the merchant name and make sure the item/service aligns with the merchant.

Sort by MCC category: When looking for exceptions, sort by MCC, taking a look at codes outside the norm. You can do a quick once over, looking through retail and other categories for merchants that are unlikely to be legit.

Require flight receipts: Some travelers wonder why this is mandatory, especially when booking through a company- sanctioned travel company. "We require a flight receipt to make sure the flight is not in someone else’s name—a spouse, for instance. There could be instances where an employee is going on a business trip and they charge the spouse’s ticket to a company card. It’s easy to sneak through if they do a lot of travel.

Look for oddities and duplicate payments using the "same, same, same” test**: P-Card auditors will be familiar with this concept, as they have been looking for duplicate/split transactions that fall just under card transaction limits for years. "In addition to duplicate payments, we’re essentially looking for odd transactions that are happening too often. Like transactions that end in $0.99. Those should be rare as they are common with consumer pricing."

Advice on you internal policies and procedures: 1.Take action immediately if you conclude that fraud has occurred. Follow through on your organization’s policy/consequences for dealing with fraud. Make it known to the organization that fraud has occurred. 2.Remind cardholders (if applicable): This is not a personal card and it can be taken away 3.Make them acknowledge policy: Inappropriate expenses are never allowed on the card and could be grounds for cancellation, without notice. 4.Store reprimands in a human resources file, warning 1… warning 2… so you have a record of steps taken.