Many companies view corporate credit cards as a necessity for running a business. Corporate credit cards are designed to offer companies a convenient way to handle business expenses and the ability to easily track expenses incurred by multiple staff members.
In reality, though, despite their benefits, corporate credit cards are often incredibly difficult for companies to manage. The struggles arise largely from the fact that corporate credit card accounts from major banks like Chase, Bank of America, or AmEx involve separate cards and account numbers for each individual employee. Having multiple cards causes headaches when companies try to manage them in popular software like QuickBooks Online.
Managing corporate credit cards in QuickBooks Online requires treating each card as a sub-account. The following workflow will guide you through seamless corporate credit card management in QuickBooks Online, from setting up the Chart of Accounts through reconciling your balances every month to show exactly what you owe.
Step 1: Setting Up Your Chart of Accounts and Banking Feed
In QuickBooks Online, start by creating the main credit card account – AmEx, Chase, or whatever your card issuer is – in the Chart of Accounts. Under that Main Account, you then must create sub-accounts for every individual card issued to each of your employees.
To easily map your individual cards, name each sub-account with the last four digits of the card number and the employee’s name. Once they’re all created, only these sub-accounts should be connected to your Banking Feed.
Step 2: Transfer the Individual Card Balances to the Main Account
For clean reporting, you should zero out the balances for each individual card every month. Even if you don’t, you should still monitor your monthly credit card statements.
The monthly statement you receive from your credit card provider will list your total expenses, broken out by individual card. These figures should match up with the figures you have in QuickBooks Online. Any discrepancies should be immediately addressed. Once you’ve confirmed your numbers, you should transfer the debt from each sub-card back to your main corporate card account in QuickBooks Online.
Step 3: Only Reconcile the Main Account
Once you’ve transferred each card’s debt back to the Main Account, all your sub-card transactions will appear in one place. The totals for this Main Account should be used to reconcile your corporate card with the rest of your financials within QuickBooks Online.
Managing corporate credit cards in QuickBooks Online may seem complex, but it’s not impossible. Following the steps above will ensure that each individual credit card account is properly reconciled within QuickBooks, resulting in accurate bookkeeping for your business.
Businesses have long faced limited choices when it comes to corporate credit cards. Today, though, companies have options for more elegant credit card solutions that offer apps for seamless integration with QuickBooks Online.
One such alternative is Divvy.com. Divvy makes it easy to set up an unlimited number of virtual cards for all your employees, each with its own unique 16-digit card number. You can choose limits and set other controls through an easy application process, and each of your employees will be issued an individual Divvy Smart Card from MasterCard.
Divvy takes the hassle out of managing your corporate cards by integrating with QuickBooks Online through a convenient app. Cardholders can swipe card transactions straight into QuickBooks Online, eliminating the need for expense reports. Thanks to seamless app integration, bookkeepers no longer have to struggle through the complex QuickBooks Online reconciliation steps outlined above if they use Divvy.
Corporate credit cards are crucial to running a business, but they shouldn’t create accounting headaches. By properly setting up your cards in QuickBooks Online or opting for a sophisticated corporate card alternative, you can take the hassle out of managing your credit cards and focus on more important business tasks.