Corporate card
A payment card issued to employees for business spending, billed to the company rather than paid by the employee.
In short
- Employees stop fronting business costs with their own money.
- Every purchase appears in a feed, but still needs a receipt and a category.
- Liability can sit with the company, the employee or both, depending on the program.
A corporate card is a credit or charge card that a business gives to employees for work spending such as travel, meals, software and supplies. The company receives the statement and pays it. Employees no longer need to pay personally and wait to be reimbursed.
Liability models
- Company liability: the business is responsible for all charges. This is the most common model for small and mid-sized businesses.
- Individual liability: the employee is responsible to the issuer and submits expenses to be reimbursed, often used by large enterprises.
- Joint liability: the employee is responsible for personal charges and the company for business ones.
Cards do not remove paperwork
A card transaction proves that money was paid to a merchant. It does not show what was bought, whether it was allowed or how much tax was included. Each charge still needs a receipt matched to it and a category assigned before it can be posted, and the card program still needs limits and policy rules. What cards change is the direction of the work: instead of employees asking to be paid back, finance chases the receipts for charges that have already happened.
Worked example
One card charge, start to finish
An account manager pays $89.97 for a software subscription with their company card. The charge appears in the feed the next morning. The emailed receipt is matched to it, the $10.35 of HST is split out, and the rest is coded to Software. At month end, the company pays the full card statement in one payment.