Shifting business-to-business payments from paper invoices to commercial cards streamlines certain processes, but many companies still cling to time-sapping policies of checking transactions manually for mistakes and abuse.
That is changing as more commercial-card issuers offer card-auditing programs designed to catch errors and variations from corporate spending policies automatically.
The latest to join the movement is U.S. Bancorp, which recently conducted a successful pilot of a new Web-based payment-analytics tool it plans to offer this year to its commercial card users.
The tool enables commercial card program managers to react quickly when unexpected developments call for a change in policies, such as switching to a new preferred vendor or allowing a one-time rule exception, says Becky Fell, accounts payable manager at the Fargo, N.D.-based hotel chain TMI Hospitality Inc.
Adopting the tool "revolutionized" the 200-unit hotel chain's monthly card-auditing processes, which encompass 450 different cards employees use each month to pay a variety of recurring and unexpected expenses for its franchised hotels, Fell says.
Before implementing the auditing tool, eight TMI Hospitality accounting-department employees each spent hours poring over each commercial card's monthly statement to make sure purchases were appropriate, she says.
"It was extremely time-consuming, and when there were exceptions to rules, even if they were approved, it would slow things down while we checked on whole chain of approvals," she says.
Because of the lag time in receiving and checking card statements under the old system, it sometimes could take up to 90 days to reconcile a mistake or an approved exception, Fell says. "Now that can happen in just a day or two," she says.
U.S. Bank's new tool also enables the company to monitor unusual spending patterns and exceptions "on the fly so we can see them as they come through," Fell says.
Card managers can use the tool to note planned exceptions to rules in a desktop program visible to other managers, with ample space to explain the variation or new rule.
The program flags other suspicious transactions automatically, enabling managers to investigate them within the desktop program and add notes for others to see.
"It catches everything and gives us an easy way to explain what happened so the next manager can easily follow the audit trail," Fell says.
Other banks besides U.S. bank are offering such audit tools.
Citigroup Inc. in November introduced the Citi Global Program Audit Tool, which enables corporations using its commercial cards in more than 40 countries to ensure that purchases conform to corporate policies automatically, the New York company says.
American Express Co.'s corporate card program for the past several years has included reporting features that enable companies to flag irregular spending patterns, errors, deviations from corporate policies and to receive customized alerts on unusual purchases or amounts automatically, the New York card brand says.
Amex offers additional card-monitoring services through third-party partners such as Concur Technologies Inc.