Many churches issue credit cards (In the name of the church) to ministers and other employees.While credit cards provide the benefit of efficiency, they also present quite a few problems to a church.  For example:

• Credit cards can be used to circumvent the budget. 
• Poor judgment can result in a tarnished reputation for the church when credit cards are used in inappropriate establishments or used for improper purposes
• Credit limits may be exceeded
• Poor purchasing decisions are made in order to generate bonus miles/points
• Personal expenses may “slip into” the church’s operations

In our opinion there are only two methods of credit card management.

• Don’t do it! It is not the norm in the business community to issue credit cards in the business’s name to employees.  When cards are issued, the business wants their employee to have some “skin in the game” so the employee’s name is on the account too.  That way, if personal or other non-business expenses are charged, the employee will be required to pay, not the employer.
• But if you insist on issuing credit cards be sure to adopt a clear, concise and written credit card use policy.  Also, it is a good idea to use a uniform plan through your bank or other financial institution.  (This way the bonus points accrue to the church, not employee…

Overlooked danger zone – Accountable reimbursement plan rules apply to credit card expenditures

Occasionally we notice that churches are using the monthly credit card statement as documentation for their accountable reimbursements.  Not a good idea – One of the requirements of establishing the business purpose of an expenditure is the documentation must be “contemporaneous”.  Waiting until the end of the month and reconstructing what happened will not get the job done.  You need to obtain the receipts…