UO PROCUREMENT CARD POLICY AND PROCEDURES CUSTODIAN TRAINING

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UO PROCUREMENT CARD POLICY AND PROCEDURES
CUSTODIAN TRAINING
Office of Business Affairs Purchasing and
Contracting Services
Updated June 2009
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Overview

• Program Background
• Program Advantages
• Terms and Definitions
• Applying for a Procurement Card
• Making a Purchase using the Procurement Card
• Authorized Procurement Card Uses
• Non-Chargeable Account Codes/Purchases
• Purchase Documentation
• Reconciliation of Charge Receipts

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Overview (cont.)

• Termination/Separation -PCard User, Custodian or
  BA
• Adding/Changing- PCard User,Custodian or BA
• Account Information Update
• Problems with your Procurement Card
• Billing Errors
• Transaction Disputes
• Procurement Card Control and Security
• Monthly Transaction Review
• Procurement Card Violations/Sanctions
• Current Contacts for Procurement Card Inquires

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Program Background

• OUS (Oregon University System) has established a
  procurement card program.
• The procurement card program is administered by
  the OUS and is implemented at the institution
  level.
• U.S. Bank issues procurement cards to UO campus
  departments. Each card is assigned to a
  department Custodian.
• The procurement cards may be used to purchase
  goods and non-tax reportable services for the
  institution.
• Procurement card purchases shall be made in
  accordance with established purchasing rules and
  policies.
• New Policy OUS 2/1/08, UO 7/1/08

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Program Advantages

• This program provides for the rapid acquisition
  of primarily low dollar items, (less than 5k)
• Is designed to promote purchasing efficiency,
  flexibility, and convenience.
• Reduced time, paperwork and handling costs along
  with a more rapid and efficient receipt of goods.
• Traditional requisition payment cycle is greatly
  reduced.

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Terms and Definitions
Card User

• Card User An individual authorized to procure
  goods and/or services with a P-Card of a
  department or division of an institution.
  Specific P-Card Program responsibilities include
  but not limited to
• Specific Procurement Card Program
  responsibilities
• Checks P-Card in and out via written
  documentation. (Not required for PCards with a
  single authorized Card User.)
• Secures the P-Card and account number when in
  Card Users possession.
• Makes P-Card purchases in compliance with Program
  Policy and Procedures.

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Terms and Definitions (cont.)
Card User

• Specific Card User Program responsibilities
  cont.
• Informs Card Custodian of transaction disputes
  and P-Card administrative changes (i.e. when they
  will no longer act as an authorized Card User for
  the department).
• Informs Card Custodian, Program Administrator and
  US Bank immediately (within 24 hours) regarding
  lost/stolen P-Cards.
• Resolves purchase returns and problem purchases.
• Personal responsibility for non-business charges.
• Collects and submits to Card Custodian
  appropriate purchase documentation for each
  P-Card transaction.

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Terms and Definitions (cont.)
Card Custodian

• Card Custodian The individual who is
  responsible for training department staff,
  safeguarding the P-Card of a department or
  division of an institution, maintaining complete
  and accurate records of P-Card use, and preparing
  reconciliations between the documents supporting
  charges on the P-Card and the statement of
  charges received from the P-Card vendor in
  compliance with institution and OUS policies.
• Specific Procurement Card Program
  responsibilities
• Manages physical custody and security of the
  P-Card and account number.
• Ensures cards with multiple Card Users are
  checked in and out via Multiple User Log.
• Maintains complete transaction records.
• Reconciles monthly statement of P-Card
  transactions.
• Provides signature on monthly statement
  indicating final approval of monthly
  reconciliation.

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Terms and Definitions(cont.)
Card Custodian

• Specific Card Custodian Card Program
  responsibilities cont
• Trains all authorized Card Users.
• Maintain records of department training.
• Notifies Program Administrator of any changes to
  Signature Authorization.
• Resolves problem purchases/disputes.
• Communicates all necessary information with Card
  Users including violations.
• Ensures compliance with UO P-Card Policy and
  Procedures.
• Monitor department P-Card transactions for
  appropriate use and potential fraudulent
  activity.
• Journal Voucher all expenditures quarterly
  (recommend monthly) to appropriate account from
  28995.

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Terms and Definitions (cont.)
Budget Authority

• Budget Authority (BA) A UO dean, director,
  division or department head who is responsible
  for the budget of the department or division of
  UO that has authorized one or more P-Cards for
  the purchase of appropriate goods and/or
  services. Budget Authorities are accountable for
  the following
• Specific Procurement Card Program
  responsibilities
• Making sound business decisions based on
  financial resources allocated to the unit.
• Ensuring that financial matters are conducted in
  accordance with sound business practice,
  generally accepted accounting principles, and in
  compliance with applicable laws, regulations and
  procedures.

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Terms and Definitions (cont.)
Budget Authority

• Specific Budget Authority Card Program
  responsibilities cont
• Maintaining and reviewing adequate records that
  document decision making, in accordance with
  Program requirements and good judgment.
• Ensuring that any delegation of authority, if
  allowed, is judiciously made, formally documented
  and communicated to the appropriate offices at
  the UO.
• Specific Program responsibilities include but not
  limited to
• a. Authorizes by signature initial P-Card
  application.
• b. Identifies Card Custodian and Card Users.
• c. Reviews Card Custodian P-Card transactions
  (unless delegated).
• d. Reviews monthly reconciliation and monthly
  statement and signs the monthly statement.
• e. Ensures overall compliance with Program policy
  and procedures.

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Terms and Definitions (cont.)
Procurement Card Program Administrator

• Procurement Card Program Administrator The
  individual who is responsible for the
  administration of the Program of an OUS
  institution/the Chancellors office. Program
  Administrator is responsible for ensuring that
  the institution P-Card policies are compliant
  with the OUS policy, that the policies
  established by the institution are implemented,
  and that the P-Card procedures are being
  followed. Delegates Program duties as necessary.

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Terms and Definitions (cont.)
Procurement Card Program Administrator

• Specific Procurement Card Program Administrator
  Program responsibilities
• Act as primary liaison with US Bank and UO
  administration.
• Approves initial P-Card application.
• Requests P-Cards from US Bank via US Bank
  application.
• Disseminates P-Cards to Card Custodians.
• Trains Card Custodians.
• Provides P-Card training materials to
  departments.
• Processes Lost/Stolen P-Cards and updates
• Performs transaction reviews and follow-up.
• Communicates review results to Card Custodians,
  Budget Authorities and other UO staff as
  appropriate
• Address potential fraudulent transactions,
  including reporting, analysis, determinations,
  resolution and follow-up.

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Terms and Definitions (cont.)
Procurement Card Program Administrator

• Specific Procurement Card Program Administrator
  Program responsibilities cont.
• Revokes, suspends or cancels P-Cards.
• Maintains records of
• a. P-Card requests.
• b. Credit Limits.
• c. Signature Authorizations.
• d. P-Card Training.
• e. Budget Authorities, Card Custodians and Card
  Users including
• changes/additions/deletions.
• f. Lost/Stolen/Destroyed P-Cards.
• g. Onsite and Monthly Reviews.

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Terms and Definitions (cont.)
Statement of Account Single Purchase Limit Credit
Limit

• Statement of Account This is the monthly
  listing of all account transactions, issued by
  the bank directly to the procurement card
  Custodian.
• Single Purchase Limit A dollar limitation for
  an individual purchasing transaction,(5K
  currently). Transactions cannot be split to avoid
  this limit.
• Credit Limit A dollar limit on credit card
  charges per billing cycle established for each
  procurement card. This dollar limit may vary
  from card to card.
• Vendor A company from which a cardholder is
  purchasing material(s) and/or minor equipment.

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Applying For A Procurement Card

• A VISA Card application must be obtained from
  Purchasing and Contracting Services in the
  Business Affairs Office.
• The application is completed, read, and signed by
  the Custodian.
• The Budget Authority (department head or
  designee) approves the application via signature.

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Applying For A Procurement Card (cont.)

• The application is then sent to Purchasing and
  Contracting Services (PCS). PCS submits the
  application to U.S. Bank requesting a procurement
  card.
• Procurement Card Program Administrator will
  notify you when your card arrives, usually seven
  business days.
• The Custodian will personally pick up the card
  and sign to verify that they received the card.

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Applying For A Procurement Card (Cont)

• Authorized Card Users
• The Budget Authority designates the procurement
  card Custodian and authorized Card Users.
• A UO Procurement Card Signature
  Authorization/Agreement form must be completed,
  read and signed by employees authorized to use
  the procurement card, the Custodian, and the
  Budget Authority.
• The form must then be filed with PCS for review
  and signature by the Procurement Card Program
  Administrator.

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Making a Purchase Using The Procurement Card

• Used for purchases of goods less than 5,000.
• NOTE Although the purchase amount will not
  mandate the solicitation of competitive quotes,
  it is campus policy to seek competition for the
  lowest price and best value when ever you make a
  purchase.
• Backordering of Goods
• Backordering is allowed as long as charges for
  items do not occur until the goods are shipped.
• Goods may be charged to the procurement card
  except as prohibited by current UO Purchasing and
  Contracting OARs, OUS and UO Procurement Card
  Policy and Procedures.

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Authorized Procurement Card Uses

• The following is a partial listing of typical
  uses
• Reference materials such as books, particularly
  those purchased from another country due to
  exchange considerations
• Software (not software lease costs)
• Common Carrier travel fares
• Conference hotel lodging (deposits only)
• Car rental reservations (not payments)

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Authorized Procurement Card Uses (cont.)

• Office supplies
• Teaching and research supplies
• Materials for minor repairs (Not the
  servicing/repairing itself)
• Non capitalized furniture/equipment
• Conference registration (not entertainment or
  food)
• Allowable dues and memberships
• Subscriptions to newspapers, journals and
  periodicals

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Non-Chargeable Account CodesTravel

• Use of the procurement card is PROHIBITED for
  travel costs (39000 account codes) with the
  exception of conference hotel lodging (deposits
  only), rental car reservations and common carrier
  charges, such as airline, bus and train fares
  (does not include taxis and airport shuttles).
• Prohibited Account Codes
• 393xx-398xx Travel
• 28612 Hosting Groups and Guests
• 28610 Entertainment
• The procurement card may not be used for food
  purchases or at restaurants. In addition, food
  purchased unrelated to travel are not allowed.
• The procurement card may not be used to purchase
  gas if it is associated with travel however, it
  MAY be used to purchase gas for operating
  equipment.

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Non-Chargeable Account CodesCapital Outlay

• For other than library purchases (account code
  40190), use of a procurement card is PROHIBITED
  for capital outlay (40xxx account codes) due to
  fixed asset inventory recording requirements.
• High Risk items must be reported to Property
  Control.

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Non-Chargeable Account Codes - 1099 Reportable

• Use of a procurement card is PROHIBITED for the
  following account codes due to 1099 and W-2 tax
  reporting requirements.
• These account codes are for tax reportable
  services that are performed by an outside vendor.
  These services are made up of labor cost and/or
  labor and material cost.
• Incorporated Vendor Exception List

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Non-Chargeable Account Codes - 1099 Reportable
(cont.)

• Moving Costs (of new employees)
• Maintenance and repairs (23501, 23502, 23503,
  23504, 23510, 23511, 23512, 23530 and 23531)
• Fees and Services performed by others
  (245XX-25199 account codes)(1099 reportable)
• Purchases involving the following account codes
• 20168 and 20169 Awards and Prizes Guest speakers
  or employee recognition (reportable)

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Non-Chargeable Account Codes - 1099 Reportable
(cont.)

• 21008 Animal Care
• 21070 Agricultural Services
• 23080 Utilities/Maintenance - Non-Employee
• 24001and 24002 Equipment - Rental and Leases -
  Includes tables at conferences and exhibition
  displays
• 24050 Land - Rental and Leases
• 24051 Building - Rental and Leases
• 24052 Housing Rentals - Non-Employee

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Non-Chargeable Account Codes - 1099 Reportable
(cont.)

• 24053 Storage Rentals/Fees - Non-Employee
• 28544 Storage of Household Goods - Non-Employee
• 24602 Duplicating and Copying
• 24606 Printing and Publishing
• 24604 Developing Film
• 24052 Housing Rentals - Non-Employee

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Non-Chargeable Prohibited Items/Other

• Flower Purchases
• 28610 Entertainment
• 28612 Hosting Groups and Guests (this includes
  hotels or food)
• Gifts (Gift Certificates)
• Personal Purchases
• Alcohol
• Unsure or Special Circumstance?
• If you are unsure about whether you should charge
  a certain item on your card or you have a special
  circumstance, please call the Procurement Card
  Program Administrator before you make the
  purchase.

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Purchase Documentation -General

• The Custodian secures and retains documentation
  to support procurement card purchases and
  business purpose (if not clear).
• Examples of documentation
• Sales slips Order forms Receiving reports
• Reconciliation records Invoices Cash register
  receipts
• Minimum Information
• Date of Purchase Vendor Name
• Item Description Amount
• Shipping Address Name of Card User
• Charge slips that do not itemize are inadequate
  documentation. You may write in the items on a
  non-itemized receipt.

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Purchase Documentation - No Supporting
Documentation

• When no other documentation exists, such as when
  making a telephone purchase, the following
  information shall be maintained on a purchasing
  log to support the transaction
• Date of purchase
• Vendor name
• Item description
• Amount
• Name of purchaser/authorized Card User
• A purchasing log, although not required to record
  all procurement card transactions, may be a
  method for organizing departmental procurement
  card activity.

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Purchase Documentation -Multiple User Log

• Procurement cards with multiple authorized Card
  Users (more than one) must be signed in and out
  via written documentation identified as a
  Multiple User Log.
• Each time the card is checked out to make a
  purchase information collected must include at a
  minimum, the date and their name and the vendor.
• After purchases are made and the procurement card
  returned, the return date must be entered on the
  log.
• The log may be kept in an electronic format. If
  electronic it must only be accessible by the Card
  Custodian.
• Card Users shall not store a copy of the P-Card
  .
• Card Users may not check the card out longer than
  24hr. A special exception to this requirement
  can be given by the Budget Authority, for a
  specific transaction and must be documented in
  writing.

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Reconciliation of Charge Receipts

• Reconciliation must be prepared monthly, at a
  minimum.
• The Custodian is responsible for ensuring monthly
  card statement reconciliation for all occurring
  charges.
• After completing the reconciliation, the
  Custodian must sign the monthly statement
  attesting to the fact that all charges are valid
  and were initiated by an authorized Card User.
• The Budget Authority must attest to the
  reconciliation by signing and dating the monthly
  statements.

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Reconciliation of Charge Receipts (cont.)

• In NO case may a Card User review his/her own
  charges.
• If a statement contains charges made by a
  Custodian, then the Budget Authority or designee
  must review, sign and date the Custodians
  charges.
• The reviewer must not be supervised by the person
  whose charges are being reviewed.
• Custodian responsible to JV all expenditures
  quarterly (recommend monthly) to appropriate
  accounts from 28995.

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Termination/Separation of aPCard User, Custodian
or Budget Authority (BA)
1. Call Program
Administrator!
2. Update!

• The Budget Authority or Custodian shall
  immediately (within 24 hours) contact the
  Procurement Card Program Administrator regarding
  termination or separation of a Card User or
  Custodian.
• A UO Procurement Card Signature
  Authorization/Agreement form reflecting the
  change, must be filed with the Procurement Card
  Program Administrator in PCS within 1 week (or
  card will be suspended.)
• When a Budget Authority or Custodian
  terminates/separates from a department, all
  procurement card activity shall stop until
• A new signature authorization is submitted
• A new P-Card with a new account is issued

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Adding/ChangingCard User or Custodian
Update!

• When adding or changing a Card User or Custodian,
  enter the additions or changes on a copy of the
  departments UO Procurement Card Signature
  Authorization/Agreement form and file with the
  Procurement Card Program Administrator in PCS.
  PCard Custodian and BA must initial changes.
• If the Budget Authority changes a complete new
  form must be filed with PCS.

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Account Information Update
Update!

• An update form available on the web may be used
  to change the following procurement card account
  information
• Index
• Address
• Credit Limit
• Department Name
• Request procurement card cancellation

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Problems With Your Procurement Card

• Incorrect data on the card itself (new cards)
• Contact the Program Administrator
• Card rejected at the point of sale
• Try to resolve by first contacting the U.S. Bank
• Check if your department is over its card limit
• Give the name of the vendor, amount of intended
  purchase, the date, and your card limits (per
  transaction, monthly limit).
• Call the Program Administrator if the above fails
• DOCUMENT ANY/ALL PROBLEMS!

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Problems With Your Procurement Card (Cont)

• Poor customer service from U.S. Bank
• Phone calls not returned
• Rude visa customer service representatives
• Incorrect information
• No resolution to your issue
• Contact the Program Administrator

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Billing Errors

• Credits to the wrong account
• Double billings
• Incorrect charge amounts
• Try to resolve first by contacting U.S. Bank or
  the Vendor
• If resolution is reached with U.S. Bank or the
  Vendor, make sure corrections are reflected on
  your account within 30 days
• Contact the Program Administrator if the above
  fails within 30 days of discovery.

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Transaction Disputes

• Transaction disputes include
• Overcharges for items
• Charges the Custodian/Card User did not make
• Items charged to account, but not received
• Contact the Program Administrator about any
  dispute
• within 30 days of the discovery
• The department along with PCS will contact U.S.
  Bank and/or the Vendor about the disputed
  transaction within 60 days of your monthly
  statement reflecting the disputed charge
• If resolved, Custodian should ensure their
  accounts reflect any agreed changes in a timely
  manner (within two billing cycles)
• Maintain documentation of all disputes

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Procurement Card Control and Security

• Custodian is responsible for control and security
  of the card, and the account number
• The card must be secured in a locked space when
  not in use.
• Make sure the statement is received in a sccure
  location.
• Turn in inactive or unwanted cards to Program
  Administrator.
• Document new cards and all purchases
• Ensure See UO Staff ID is on the back of your
  card(s)

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Procurement Card Control and Security (cont)

• Do not let another department or unauthorized
  user make purchases with your visa card (Know
  your designees)
• Report lost or stolen cards immediately to US
  Bank and the Program Administrator in PCS
• Ensure proper security is used when purchasing
  online

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Monthly Transaction Review

• PCS reviews all UO procurement card transactions
  monthly.
• PCS Identifies questioned transactions and
  requests original documentation from departments
  via email.
• PCS determines if the questioned transaction is a
  violation of applicable policy and procedures,
  including PC01 UO Procurement Card Policy and
  Procedure.
• If the transaction is identified as a violation
  then PCS applies Sanctions for Violations of
  Procurement Card Policy.

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Onsite Review

• Notification of review to Custodian and Budget
  Authority.
• Standard Checklist.
• Immediate Feedback.
• Written report of review results.

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Purchase Violations/Sanctions

• A violation is any action that is not in
  accordance with one or more of the following OUS
  and UO procurement card policies, state law,
  Oregon Administrative Rules, and/or reasonable
  business expenditures. Violations can differ in
  nature and degree of risk and seriousness.
  Violations will be evaluated on a case by case
  basis.
• Sanctions are actions that may be taken in
  response to violations of policy and procedures.

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Procurement Card Violations/ Sanctions

• Fall into 3 categories
• Minor
• Intermediate
• Major
• Open, transparent process of what is not allowed
• All reviews will be documented and copies
  provided to Budget Authority Card Custodian

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Sanctions

• Actions taken in response to P-Card Violations
  fall into 3 categories
• Minor
• Intermediate
• Major
• Violations are applied to the P-Card account not
  to individuals
• Appeal Rights

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Procurement Card Violations/ Sanctions

• Examples of considerations in evaluating
  procurement card purchase violations and applying
  sanctions are
• Chronic violations in any category outlined in
  the OUS Procurement Card UO Policy and
  Procedures.
• Intentionally using the card for personal
  purchases
• Letting unauthorized cardholders use the dept.
  card
• As a Custodian, a history of not ensuring Card
  Users adhere to the policies and standards for
  using the procurement card

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Procurement Card Violations/Sanctions

• Possible Disciplinary Actions or Sanctions
• E-mail or written notification to the Custodian
  identifying the violation and providing an
  explanation or clarification of the policy. If
  the Program Administrator has knowledge that
  violations have occurred in the past, the e-mail
  should reflect that information.
• A copy of the email to the Custodians Budget
  Authority.
• A copy of the email to the authorized Card User
  or purchaser.
• Invitation to attend a new training session
  (optional).
• Requirement to attend a new training session.
• Removal as Custodian
• Remove or restricting authorized Card Users.
• Revoking or suspending the departmental
  procurement card.
• Notification to appropriate University
  authorities regarding violations relating to OAR
  571-040-0240 which may result in disciplinary
  action.

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Procurement Card Violations/Sanctions

• In general Sanctions provide program managers an
  approved framework to address program violations.
  Sanctions also clarify for program participants
  what actions they may be subject to if they
  violate program policy and procedure.
• Overall sanctions provide clarification
  encouraging appropriate program use and
  accountable program management.

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Current Contacts For Procurement Card Inquiries

• Procurement Card Program Administrator
• Deanne Lahaie-Noll
• Email deanneln_at_uoregon.edu
• Phone [phone] Fax [phone]
• Procurement Card Research Analyst
• Lynne Harrell
• Email lharrell_at_uoregon.edu
• Phone [phone] Fax [phone]
• Travel Coordinator
• Carolyn Wooley
• Email cwooley_at_uoregon.edu
• Phone [phone] Fax [phone]

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THANK YOU