Because all payment methods present certain risks to an organization, establishing and maintaining an effective control environment for each method, including P-Card, is a must. In comparison to a traditional procure-to-pay process (e.g., one based on a requisition, purchase order and invoice paid by accounts payable), the typical P-Card process allows a business unit/department to both initiate and pay for a purchase, resulting in the need for different types of controls. Nevertheless, P-Cards can be just as “safe” as other payment methods, offering certain protections (e.g., liability waiver insurance, chargeback rights, dispute process, etc.) that other payment methods do not.
An end-user organization (“end-user”) should integrate appropriate controls into a P Card program from the beginning, during the design phase. Input from a variety of stakeholders (e.g., procurement, accounts payable, finance/treasury, internal audit) is important for garnering support of the controls that the organization ultimately implements.
A variety of approaches help prevent fraud and misuse, including: