Procurement Card Usage at LCRA

1
Procurement Card Usage at LCRA

• Elizabeth Williams
• Business Systems Supervisor
• September 17, 2002

2
Agenda at a Glance

• LCRAs procurement card program
• How it works
• Uses
• Benefits
• Obstacles
• Controls
• Questions

3
How the Procard Works

• Accepted anywhere MasterCard works
• Visa, American Express and other programs
  available
• Dollar limits assigned per user
• Can exclude types of purchases (cash advances,
  etc.)
• Bank sends automated transaction file for loading
  to the accounting system
• Charges can be accepted or disputed individually

4
LCRA Procard Uses

• Items costing less than 2,500 not covered by a
  long-term agreement
• Out-of-town travel expenses
• Company vehicle fuel
• Petty cash items

• Not for
• Cash
• Services
• Personal items
• Items greater than the dollar limit
• Items already under contract

5
LCRA Procard Usage

• Three-month pilot program began in January 1995
• Since 1997, usage has quadrupled
• Transactions have grown to 83,800 line items for
  FY2002

6
Benefits of the Procard

• Suppliers get paid more quickly
• Streamlined procurement process for low dollar
  purchases
• Less purchasing system maintenance (supplier
  records)

• Streamlined payment process Based on FY 2002,
  more than 83,000 purchase order and invoice lines
  were avoided
• No longer need separate gas cards

7
Obstacles

• Some suppliers dont accept credit cards
• Implementation planning takes time
• Attitude How do we control spending?
• Weekly reviews require change in culture

• Cardholders must sign
• for receipt of card
• ethics policy for procurement personnel
• procard agreement

8
Control factors

• Can set individual monthly and per-charge limits
• Receipts turned in and approved weekly
• Periodic audits and report reviews
• Can exclude types of merchants (cash)

• Default accounting is required
• Segregated duties
• Bank relationship
• Accounts Payable processing of payment
• Supervisory review
• Administrator entry into system

9
Questions?

• Yvonne Davis
• Manager, Corporate Purchasing
• ydavis_at_lcra.org
• Elizabeth Williams
• Business Systems Supervisor
• ewilliam_at_lcra.org
• Dean Cartwright
• Procurement Specialist
• Dcartwri_at_lcra.org
• [phone]