What can happen if the transaction limit is exceeded?

When a transaction limit is exceeded, the potential consequences can be significant for cardholders. If cardholders go beyond the established limits, they may face penalties or disciplinary action, which serves as a mechanism to enforce compliance with organizational policies and funding guidelines. Exceeding the transaction limit can indicate a lack of control or oversight, which organizations need to manage effectively to prevent misuse of funds or irregularities in accounting practices.

The importance of adhering to transaction limits is rooted in maintaining financial integrity and accountability within an organization. Therefore, the risk of facing penalties reinforces the necessity for cardholders to monitor their transactions closely and stay within the established spending parameters to avoid negative repercussions on their professional standing or operational responsibilities.

The other choices do not accurately represent the potential impacts of exceeding transaction limits. Transactions being automatically approved would undermine the control measures designed to regulate spending, and simply having guidelines without consequences would also fail to encourage responsible usage. Additionally, needing retroactive approval implies that the organization has some means of correcting missteps, but it doesn’t address the immediate accountability that comes with exceeding limits. Thus, facing penalties or disciplinary action is the correct outcome when transaction limits are not respected.