Purchasing & General Services. Procurement Card Manual

Transcription

1 Purchasing & General Services Procurement Card Manual HUB Website Updated 01/06/2011 1

2 Introduction to the Procurement Card Program The purpose of the University of Texas at El Paso Procurement Card (ProCard) Program is to establish a more efficient, cost-effective method of purchasing and paying for small dollar transactions that are low in volume. The program was designed as an alternative to the traditional purchasing process for supplies and some contracted services. Additionally, it provides users with greater flexibility. If used to its potential, the Procurement Card Program will result in a significant reduction in the volume of purchase orders and related documentation including invoices and checks. In addition, corresponding work processes associated with ordering and check writing will be eliminated. This Cardholder User s Guide provides the general guidelines for using the Procurement Card. Please read it carefully. The cardholder s signature on the Cardholder Agreement (see Attachment D ), and the supervisor s signature on the Cardholder Supervisor Agreement (see Attachment E ), shows that both the cardholder and their supervisor understand the intent of the program and agree to follow the established guidelines. Obtaining a Procurement Card Anyone wishing to apply for a Procurement Card must first be approved by a Department Head, Dean or other administrative official who has signature authority. To obtain a Procurement Card, please call or the Program Administrator, Liz Mendez (ext. 5810, jmendez8@utep.edu) to request an application. Upon receipt of the application, the Program Administrator will forward the necessary information to the Bank for processing. It takes approximately 7-10 business days to receive the Procurement Card. Upon receipt of the Procurement Card, the Program Administrator will a notice of receipt with the required forms for signature and an invitation to attend the required training. After completing the required training and turning in the forms, the card will be issued to the designated cardholder. In addition to this initial training, cardholders and their reconcilers will also be required to attend refresher training every (2) years. Duties and Responsibilities PROGRAM ADMINISTRATORS Updated 01/06/2011 2

3 The Program Administrator is responsible for the overall administration of the Procurement Card Program. This person is knowledgeable on all procedures in the user s guide. The Program Administrator will process Procurement Card changes such as credit limits, account information, name changes, etc. All Procurement Card requests must go through the Program Administrator. For problems/questions, please contact the Program Administrator. Liz Mendez, Program Administrator, Phone (915) PROGRAM ACCOUNTANT The Program Accountant is responsible for posting charges to the general ledger. Rene Rayon, Accounts Payable, Financial Services, Phone (915) CARDHOLDER A Cardholder is the person designated by the Department Head to utilize the Procurement Card to purchase items within the Program s controls and limits. RECONCILER It is the Reconciler s responsibility to monitor and reconcile VP7 s and update transaction logs for each of the program cycles. SUPERVISOR Supervisors are responsible for ensuring that each transaction serves a legitimate business purpose and that it is appropriate and necessary for the department. Verify the cardholder obtained receipts and that each of the expenditures is allocated to the appropriate account number. Lastly, at the end of each cycle, the corresponding Transaction Log must be signed and dated by the Supervisor. Program Controls CREDIT LIMITS All procurement cards have a per cycle credit limit. The standard credit limit is $5,000. A cycle begins on the 6 th of each month and ends on the 5 th of the following month. To request limit changes on any card, the cardholder s Dean for academic departments or Department Head/Director for non-academic departments must submit an to the Program Administrator. The Program Administrator will Updated 01/06/2011 3

4 then review the information and if approved, will increase the limit and notify the cardholder and their manager. TRANSACTION LIMITS The standard single transaction limit is $ This is the amount available on the Procurement Card for any single transaction. A transaction includes the purchase price, shipping, handling and any other related charges. Purchases which are greater than the approved single transaction limit will automatically be declined by the bank. If the purchase exceeds the $ single transaction limit, do not ask the vendor to split the order; this is considered an unacceptable practice. Large purchases may not be divided into small lot purchases to avoid the designated dollar limits. A split purchase occurs when the total cost of a single or multiple purchase(s) from one source, is more than $1,000 and the purchase is broken up into multiple transactions with the express purpose of circumventing the $1,000 limit. The daily transaction limit is $ This is the maximum amount that can be spent in one day. RESTRICTED VENDORS The Procurement Card Program excludes merchant classifications within the Travel & Entertainment group. This means that the Procurement Card does not allow purchases for typical business related travel and entertainment expenses (airline tickets, restaurants, car rentals, hotels, etc.). If the cardholder attempts to use the Procurement Card for payment of business related travel and entertainment expenses, the authorization request will be declined. If a purchase is declined due to Merchant Category Code exclusion, and there is reason to believe that it should not have been, please contact the Program Administrator who will contact JPMorgan Chase Customer Service. Merchant Category Code (MCC Codes) can only be added or deleted, by the Program Administrator. SAFEGUARDNG THE CARD The cardholder s name and The University of Texas at El Paso are imprinted on the front of each Procurement Card. Safeguarding the Procurement Card is the sole responsibility of each individual cardholder. Updated 01/06/2011 4

5 The cardholder is the only person authorized to use the Procurement Card. The Procurement Card and/or its account number should not be loaned to any other individual(s). The Procurement Card is to be kept in a safe place, preferably locked up, when not in use. If a cardholder will be absent from the office for a extended period of time, the Department Head should request that a Procurement Card be issued to someone else within the department to act as back-up for the duration of the cardholder s absence. Any suspected abuse of the procurement card should be reported to the Pro Card administrator at extension ACTIVATING THE ACCOUNT Upon receipt of the card, the cardholder should sign the back of the card. Prior to the initial use of the Procurement Card, the cardholder must call Customer Service at (800) in order to activate the account. Although the cardholder s name appears on the card, the card is the property of The University of Texas at El Paso and should be used for legitimate business purposes only. MAKING A PURCHASE To make a business related purchase, contact the merchant in person, by phone, secure internet site, or fax. Give the merchant all of the necessary information to complete the purchase. DO NOT give a purchase order number when ordering with the Procurement Card. This will prevent the merchant from inadvertently sending an invoice to the Accounts Payable Department. If the cardholder s office is located on campus, the order must be shipped to the Central Receiving Dock at 3120 Sun Bowl Drive. The shipping documentation must state this is a PROCARD PURCHASE. It should also reference the cardholder s name, phone number and the Bldg. /Room Number the item is to be delivered to once it has been received at the dock. The cardholder should request that the vendor send a receipt that is to be retained by the cardholder for the monthly Procurement Card reconciliation. This documentation should not be sent to the Accounts Payable Department or Purchasing Office for payment. RECORDS RETENTION Transaction Logs and all Pro Card related documentation, for each purchase made, must be kept for a period of nine (9) years. Documentation for the current Updated 01/06/2011 5

6 and previous fiscal years must be retained in the department for two (2) years, all subsequent files should be archived and stored as ProCard to allow easy accessibility. If there are multiple ProCards and / or ProCard cardholders in a department, the documentation should be consolidated when archived. SALES TAX Use normal procedures to handle sales tax. The cardholder should inform the merchant of our tax-exempt status prior to placing the order. Any sales tax questions should be directed to the Program Administrator. If sales tax is charged on a purchase, the cardholder must contact the merchant for credit of such tax. Retain the credit receipt with along with your Pro Card related documents. A copy of our Texas Sales Tax Exemption Certificate may be obtained from the Program Administrator. ACCEPTABLE PURCHASES Use the Procurement Card for the purchase of any supplies or items that are allowed within purchasing guidelines; they must serve a legitimate business purpose. If unsure whether a purchase is allowed, please contact the Program Administrator for clarification. SUPERVISOR S RESPONSIBILITY The CAO/Director and or cardholder s supervisor will receive notification that the cycle detailed transaction report is available for their review. When reviewed, these detailed transaction reports are a useful tool which help to keep the supervisor aware of all transactions completed on the Procurement Cards from their area. Updated 01/06/2011 6

7 UNACCEPTABLE PURCHASES THE FOLLOWING ARE UNACCEPTABLE PURCHASES: Any single purchase exceeding $ (including shipping, freight & handling and related charges) Alcoholic beverages, Bars, Liquor Stores Ammunition, Weapons Animals Cameras (exceeding $500) No security/surveillance cameras allowed Cash Advances Cellular/ Portable Phone Computer(s) Consulting services Controlled Assets (exceeding $500.00) Fax Machines, Scanners, CD/ Video Records/Players, etc. Controlled substances or prescription drugs Cylinder gases Entertainment (ie..videos, restaurants, fast food, gratuities) Facsimile machines (exceeding $500) *Food/ Catering (see note below), Restaurants, Fast Food Gasoline Wireless Access Points Network Firewalls Oral Medications (ie.. Tylenol, aspirin, antacids, cold medicine etc) Capital Equipment Upgrades Leases or Rentals Liquid nitrogen Personal items (ie..candy, Kleenex, hand lotion) Postage (Federal Express, DHL, UPS is acceptable) Printers (exceeding $500) Purchases from foreign countries Purchases involving equipment trade-in Radioactive purchases Software Stereo systems (exceeding $500) Telephone systems Travel (transportation) and related expenses Video recorder/ player Temporary Services/Labor Agencies *Services (see note below) Any and All Chemicals or Hazardous Materials Network Hubs, Switches and Routers Gift Certificates/Gift Cards Membership Fees Any purchase requiring a signed contract EXCEPTIONS The University may delegate certain exceptions to the purchasing responsibility to the Cardholder in order to meet specific University business requirements. Examples of such delegation are software acquisition, food exceptions for incidentals or small food purchases or raising dollar thresholds enabling the purchase of commodities or services due to unusual circumstances or unexpected emergencies (i.e., weather related). Food and card limit exceptions require the Cardholder to obtain prior written approval from the Dean for academic departments or Department Head/Director for non-academic departments. The request must state the reason and justification for the exception. Request should be submitted to the Asst. Director in charge of the Procurement Card program for final approval. All other exception request require the Cardholder to obtain prior written approval from their Department Chairs or Directors. Updated 01/06/2011 7

8 *Food/ Catering- Departments requiring food for meetings or events on campus must contact Sodexho, our exclusive food service vendor for all food and catering needs. A waiver to utilize an outside source may be obtained if Sodexho can not meet the department s request. State funds may never be used for food purchases as per Texas Constitution, Article III, Section 51. An Entertainment Expense Form must also be completed anytime a function is for UTEP faculty, staff or students. *Services- are to be purchased from Corporations only. NO EXCEPTIONS The following items can not be purchased with State funding NO EXCEPTIONS Alcohol Christmas Cards Deposits to secure performance Food or drinks of any kind contracts Membership fees to Chamber of Paper exceeding 8 1/2 X 11 (certain uses may allow for Commerce larger paper check with Procard Administrator) Plants live or artificial (includes Employee awards exceeding $100 flowers and Christmas trees) DOCUMENTING THE PURCHASE It is mandatory that all merchant receipts be retained and documented to simplify reconciliation for purchases made with the Procurement Card. The cardholder will be asked to provide such documentation if/when the files are audited. Some critical documentation necessary for reconciliation includes: Vendor Sales Receipt Itemized Packing Slip/Receiver Advise (includes price information) MasterCard Charge Slip with itemized description of products/services purchased An Invoice Transaction Logs (see Attachment A) Bank Statement Invoices are the most optimal documentation since they itemize the purchases and show if sales tax was charged. A merchant s entry system usually prints an automatic invoice with the processed order. The cardholder should instruct the merchant to send the invoice to them and not to the Accounts Payable Department. If a purchase is done via mail or phone, ask the merchant to include the receipt with the goods when shipping the product. The receipt is the only original documentation specifying if tax was charged to the purchase. If the cardholder receives a receipt from a vendor that does not have a descriptive Updated 01/06/2011 8

9 itemization of the products purchased, they must list on the receipt a description of all items. If the receipt does not have the space to list the itemization, attach a separate paper with a detailed list of all products. Per the Texas Administrative Code (34 TAC Part 1, Chapter 5, Subchapter E, Rule 5.57), state agencies are not allowed to do business or make payments to entities that are on warrant hold (also called credit hold or vendor hold ) with the State of Texas until the situation is resolved and the hold is lifted. If a cardholder wishes to make a purchase of $ or more from a vendor based in the State of Texas, they are required to research the vendor s hold status beforehand by visiting the State Comptroller s website: TRANSACTION LOGS Included in this user s guide is a Procurement Card Transaction Log (Attachment A). The purpose of this log is to give a simple, easy to use method of keeping track of expenditures made with the Procurement Card. A soft copy of the log is available on our website admin.utep.edu/pgs or by request via , from the Program Administrator. The transaction log is easy to use. Create a log for each new cycle. Record in the log each time a purchase is made. A detailed description of the item(s) and justification for their purchase should be recorded in order for the cardholder, supervisor and the Program Administrator to recognize the purchase(s) as authorized ones. Attach and list all documents related to the purchases to the corresponding log sheet. The transaction log must be signed by the cardholder, reconciler and cardholder s supervisor. When the cardholder and reconciler are the same person the individual must sign in both places. Other uses for the log would be to track the monthly credit limit to ensure that the cardholder did not exceed the approved amount each month and to document signature authorization for changes to the default account number. The log and receipts will be the back up to any Procurement Card charge recorded. THREE STRIKES The Procurement Card normally operates under a three (3) strikes you re out basis, depending on the severity of the policy violation. Strikes normally consist of violations such as failure to approve a VP7 document, failure to maintain a transaction log, failure to obtain signatures on the transaction log, or purchasing an item that should not be purchased using the Procurement Card. The Procurement Card Administrators will notify the cardholder in violation when a strike is issued. Upon receiving three strikes, the Procurement Card Updated 01/06/2011 9

10 Administrator will make the determination to cancel or suspend the Procurement Card. If the card is suspended, the cardholder and reconciler will be required to attend a mandatory refresher training prior to the card being re-activated. RETURNS, CREDITS & DISPUTED CHARGES Should a problem arise with a purchased item, or with billing, every attempt should be made to resolve the issue directly with the merchant. Review of future statements is vital to ensure that the account is properly credited for returns, credits and disputed charges. If an item is returned for any reason, the return must be credited back to the Pro Card. Under no circumstances should a cash refund or gift card be accepted in place of the credit. All returns, credits, or disputes should be noted on the monthly transaction log. If the cardholder is unable to come to an agreement with the merchant regarding a purchase made with the Procurement Card, they should complete the Statement of Disputed Items form (Attachment B ) and fax or the form to JPMorgan Chase within sixty (60) days from the closing date of the statement on which the transaction appeared. NOTE: Failure to take immediate and appropriate action could result in a loss to departmental funds and charging privileges could be revoked. Cardholders have (60) days from the statement billing date to notify the bank in writing of any suspected disputed or fraudulent charges. BILLING, PAYMENT & ACCOUNT DISTRIBUTION JPMorgan Chase will mail one summary billing to Accounts Payable, listing all transactions during that period by cardholder. The summary billing matches the total of all the Procurement Card activity statements which the cardholder receives each month. Accounts Payable will electronically pay the summary billing in full and distribute the charges to the cardholder s account based upon each Procurement Card s pre-assigned unique account number. The vendor is paid by the bank usually between hours of placement of the order. The billing cycle for the procurement card is from the 6 th of the preceding month to the 5 th of the current month (i.e. January 6, 2008 to February 5, 2008). Accounts Payable will initiate the program that generates the VP7 documents upon receipt of the bank statement from JPMorgan Chase. This is usually 5 to 7 days after the end of the billing cycle. Updated 01/06/

11 VP7 documents are created and sent to the individual s YB2 box. Departments are notified by when a VP7 is available for review and a due date is given. At the time a cardholder applies for a card, the cardholder will indicate to which account the charges will be posted. This is the account number which will appear on the VP7 document. When the VP7 is reviewed and reconciled to the transaction log, the account number may be changed. If there are insufficient funds in the account, the VP7 cannot be approved and a new account number must be assigned by the department. Documents with errors are automatically routed to Accounts Payable for corrections. Accounts Payable will contact the proper department as well as the Purchasing Department to address the errors. Departments have 5 working days to review, update, and approve documents. Departments are responsible for changing the temporary object code assigned when the VP7 is created, to the appropriate object code for the expenditure (See Attachment C ). Documents not given final approval by the Division Director within the 5 days are automatically retrieved by Accounts Payable on the 6 th day for final approval. Purchasing receives a listing of cardholders that failed to approve their documents within the due date. Purchasing will contact the departments for an explanation as to why the documents were not approved. If using a grant funded ( 26 ) account, the cardholder must provide copies of the transaction log and receipts to Contracts and Grants within 5 days of reconciliation of the VP7. LOST, STOLEN OR MISPLACED CARDS If the Procurement Card is lost or stolen, immediately contact JPMorgan Chase at , the Program Administrator and the PI or Division Director. Prompt action can reduce the liability for fraudulent activity. WHAT TO DO IF TRANSFERRING OR TERMINATING The cardholder is responsible for returning the Procurement Card to the Program Administrator before transferring or terminating. If transferring to another department, the cardholder will need to re-apply for another card under the new department s management and attend the ProCard orientation again. CARD TERMINATION If it is found that a cardholder has not used the Procurement Card for a lengthy time, the card may be revoked at the discretion of the Program Administrator. Updated 01/06/

12 The Procurement Card Program Administrator will solicit from the cardholder any reasonable explanation for non-use of this privilege prior to revocation. When a cardholder terminates employment with the University, the department/unit has the specific obligation to reclaim the Procurement Card and return it to the Procurement Card Program Administrator prior to the employee s termination date. Failure to do so may result in revocation of all department/unit card privileges. If a terminated employee continues to use this card the department will be liable for all charges. Multiple contacts to a single department/unit for insufficient funds by the Office of Accounting may result in revocation of all department/unit cards. Non-adherence to these procedures will result in revocation of individual cardholder privileges and may result in revocation of all department/unit Procurement Cards. The purchase of unallowable items on any Contract or Grant account will result in the immediate revocation of cardholder privileges. PROCUREMENT CARD TRAINING REQUIREMENTS All Procurement Card holders and reconcilers are required to take the procurement card training upon expiration of the current card. Example: If the Procurement Card was issued in May of 2009, and it expires August 2011, the cardholder and reconciler will be required to take the training in August or September of 2011 in order to receive the new card. PHOTO IDENTIFICATION REQUIREMENT All future cardholders will be required to present current photo identification in order to take ownership of the procurement card. TRANSACTION REVIEW *** NO I.D NO PROCUREMENT CARD *** Every month, a handful of cardholder transactions are selected by the Program Administrator for detailed review. Some are chosen entirely at random; others are chosen because they exhibit higher than average potential for violation of Procurement Card policy; such as Cardholders who are also the authorized approver of the accounts used. If a cardholder s transactions are selected for such a review, they will receive an notification. They will be asked to make available all original receipts and transaction logs for a specific time period. At that time, the cardholder may copy all records. The cardholder will be notified of the time and date all originals will be picked up. Updated 01/06/

13 IMPORTANT FACTS TO REMEMBER The following important points are provided as a review of this training: 1. The Procurement Card is not intended to avoid or bypass appropriate purchasing or payment procedures. Procurement bidding procedure requirements should be utilized as required and appropriate. The Pro Card is intended to complement the existing processes available. 2. If the established purchasing guidelines are not followed when using the Procurement Card, corrective action, including termination may be taken 3. The Procurement Card is issued in the cardholder s name. All purchases made with the Procurement Card must be done by the cardholder. They are responsible for the security of the Procurement Card and the transactions made with it. 4. The Procurement Card may be used at any merchant that accepts MasterCard. 5. The Procurement Card may be used to purchase supplies within the Single Transaction Limit. All requests to change the Single Transaction Limit will be on an exception basis and must be submitted in writing to the Assistant Director in charge of Pro Cards. If approved, the Assistant Director in charge of Pro Cards will authorize such increases in writing. 6. Use must not exceed the credit limit assigned to the Procurement Card in any given month. The Assistant Director in charge of Pro Cards is the only individual that may authorize a credit limit change. 7. The monthly VP7 statement must be reconciled within five (5) days of receipt. Statement reconciliation must be completed to ensure all charges are accurate. The cardholder s supervisor must also sign-off on the monthly reconciliation/transaction log. 8. The Procurement Card cannot be used for personal use. No exceptions. All transactions must have a legitimate business purpose. 9. The Procurement Card must be returned to the Purchasing Office Pro Card Program Administrator upon transfer to another Updated 01/06/

14 department or termination of employment. If transferring to another department, the cardholder will need to re-apply for the card in the new department and attend Pro Card training. 10. The cardholder is committing The University of Texas at El Paso funds each time the Procurement Card is used. This responsibility should not be taken lightly. Updated 01/06/

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