PURCHASING CARD TRAINING & REVIEW

 I:  Overview of Purchasing Card Program
II:  Card Features
III: Making a Purchase
IV: Monthly Statements
V:  Audits
VI: Card Manager/Supervisor Training

I: OVERVIEW OF THE PURCHASING CARD PROGRAM

Who can have a University Visa Card?

Keeping Your Card Secure

Keep the card in a secure, preferably locked, location.  If you keep the card on your person, keep it separate from your personal credit cards.¨Don’t give your card number to a company or sales rep to “keep on file” for future use.

Lost or Stolen Cards

If your card has been lost or stolen, notify the bank immediately.  The issuing bank is US Bank and you should contact the customer service department at 1-800-344-5696. You should also notify Purchasing Services as soon as possible to ensure that the card is also closed for any on campus expenditures..

Violation Record

Along with the benefits of being a University Visa cardholder there are also responsibilities.  Purchasing Services monitors the usage of your P-Card for possible inappropriate use.  Inappropriate use may count as a “violation” of card policy and the cardholder/user will be assigned points based on the inappropriate action.  Please refer to the following chart for the types of violations and points that can be assigned.

If a total of 150 violation points is accumulated during an audit, the Cardholder needs to attend either the audit closing conference or a training session provided by Purchasing Services.  To schedule a P-Card Training session, contact Joyce Howell at 797-1788 or email to: joyce.howell@usu.edu.  The Cardholder’s Card(s) may be revoked if the Cardholder does not attend either the audit closing conference or a training session.

If the Cardholder attends training, provided by Purchasing Services, they do not have to attend another training session for 6 months afterwards, even if their card is set to expire during that timeframe.  If card expiration occurs outside of the 6 month period, the Cardholder must attend a training session to keep their card active.

The six month period is only available if Cardholders attend training through Purchasing Services.  If a Cardholder attends an audit closing conference, they must still attend a training session provided by Purchasing when their card is set to expire.

If a violation or inappropriate transaction occurs you will receive notification, either verbally or by memo, from the Purchasing Card Administrator as to the nature of any violation and the associated points accumulated.

Who do you contact for help?

If you have questions and cannot find the answer on the Purchasing Services website please contact us:

Purchasing Card Administrators:             
Joyce Howell
Phone:  435-797-1788
FAX:  435-797-1089
e-mail:  joyce.howell@usu.edu

Karlene Combs
Phone:  435-797-1037
FAX:  435-797-1089
e-mail:  karlene.combs@usu.edu

US Bank: Report a lost or stolen card: 1- 800-344-5696
Customer Service: For general assistance, information, and to activate your card: 1- 800-344-5696.

Review Questions - Program Overview

1- When making purchases for my department, it’s okay to give my card or card number to someone else if:
A) They are in my department and are a full-time employee.
B) They are a delegated user that has completed P-Card training and has an approved delegation form on file.                                     
C) They are my supervisor.   
D) They are my P-Card Administrator or Manager
E) They are a trusted vendor/supplier

Correct Answer: B - Only the cardholder or a trained delegated user may use the card

Correct Answer: A - The cardholder, needs to contact the bank IMMEDIATELY

3- Which of the following WOULD NOT be a violation on your purchasing record?
A) Sales tax charged on a transaction
B) Buying a new refrigerator for your home
C) Losing your card                                
D) Splitting a transaction to avoid exceeding your single transaction dollar limit
E) Missing documentation on a purchase
F) Purchasing a restricted item

Correct Answer: C - You won’t get penalized for losing your card

II: Card Features

Sales Tax Exemption:  Purchases made on your University VISA Card are exempt from Utah State Sales Tax.  Utah State University’s tax number is 11895815-002-STC and is imprinted on your card.  It is your responsibility to make sure that sales tax is not charged when making a purchase from any supplier located in Utah. 

If you find that you have been charged tax in error, request a credit from the supplier as soon as possible.  If any vendor insists on charging you tax, let us know immediately.  Some vendors may request a “Certificate of Exemption” form, which proves the sales tax exemption status of the University.  Please forward those requests to Purchasing Services and we will provide vendor with the requested documentation

Your University VISA Card has two limits: a single transaction limit and a monthly expenditure limit.  Daily limits do not exist.

A single transaction limit is the maximum total amount for each purchase and is determined by your department, but cannot exceed $2,000.  If you don’t know your single dollar transaction limit, contact us. You may not split a transaction into smaller amounts in order to avoid the single purchase limit.

The monthly transaction limit is the maximum total amount for purchases you can make each month/billing cycle and is determined by your department, but cannot exceed $15,000.  Our monthly billing cycle is from the 26th day of the month thru the 25th day for the following month.  If you don’t know your monthly transaction limit, contact us. 

If it becomes necessary to increase your single or monthly purchase limits, the requested increase must be made, in writing, by your card manager. The request can be made by using the P-Card Application/Change form found on the Purchasing website.

Restricted Items

Your USU Purchasing Card must never be used for personal items.  This is a violation that could result in your cards being canceled and the account closed.  There are other items that are restricted as well.

Types of transactions or items that are restricted on the P-Card:
Travel

• Airline, bus, or railroad tickets
• Lodging (University Inn is allowed when paying for guests of the University)
• Rental Cars
• Deposits or holds for any of the above.
• Individual meals when traveling

Food & Beverages

• Alcoholic Beverages
• Individual meals – business related functions including meals are allowed as long as they are approved and the Meals and Entertainment form is completed.

Employee Related Expenses

• Employee Benefits; personal services such as doctor or hospital visits and attorney fees
• Fines, late fees, penalties (including parking tickets)
• Individual, employee, On-Campus Parking permits

Other Items Not Allowed

• Construction or remodeling
• Controlled substances; DEA items, Radioactive isotopes and materials
• Live animals
• Special Services: Independent contractors, performers, consultants, and speakers
• Unapproved printing or imprinting (includes T-shirts, hats, key chains, etc.)
• Cash advances or awards, including honorariums
• Fuels; Gasoline and diesel fuel for operating licensed vehicles
  
• Capital equipment or inventoried items

Review Questions - Card Features

1- Sales tax may be charged on purchases with my University Purchasing Card under the following circumstances:
A) The vendor is NOT on the State Contract List
B) The purchase amount is over $250.
C) Sales tax should NEVER be charged for any instate University Purchase.           
D) Only purchases made over the Internet according to the Federal Commission on Internet Commerce Statute of 1999.

Correct Answer: C - Sales tax should never be charged on an instate purchase.  Purchasing Services will provide a vendor with a “Certificate of Tax Exemption” whenever necessary.

2- It is important that you know your single purchase and monthly transaction dollar limits. Do you know your limits?
A) My single purchase dollar limit is:  $         
B) My monthly transaction limit is:  $
C) I don’t know my limit, but I will find out from my department before I use my card.

Any of the above may be correct - make sure you know your expenditure limits!

3- If I need to increase my single or monthly dollar limit, I should:
A) Request that my card manager apply for the needed increase by completing the Application/Change form
B) Split any large purchases into separate transactions
C) Contact my card manager for approval on the purchase.

Correct Answer: A - The completed and approved form is forwarded to the P-Card Administrators so the requested increase to your expenditure limit can be processed.

4- Of the following items, which are restricted or allowed on your Purchasing Card?
A) Conference registrations
B) Airline tickets
C) A new computer for department
D) Flowers for an employee who just had a baby
E) Treating a vendor to a beer downtown
F) Food and non-alcoholic beverages at University meetings
G) Rental cars
H) Picking up the tab for a lunch interview with a potential employee
I) A wedding gift form our department for one of our employees who just got married.

Answers:
A) Allowed
B) Restricted
C) Restricted
D) Restricted
E) Restricted
F) Allowed
G) Restricted
H) Allowed - with signed approval and completed Meals and Entertainment Form
I) Restsricted

III: Making a Purchase

Making a purchase is easy with your card.  Just follow these guidelines and make sure you keep documentation of the transaction.

• Follow any internal procedures that may be required by your department to obtain authorization to make the purchase
• Verify the purchase is not on the restricted list
• Check that the price quoted is the best you can obtain.  Many items have University or State Contract prices available for great savings to us.  Contact Purchasing Services or check the State of Utah’s website for special pricing contracts
• Make certain that the total amount of the transaction (include shipping and handling charges) will not exceed your single dollar purchase limit.  Do not split a transaction into smaller amounts to avoid the dollar limits placed on your card
• Ensure that no sales tax is charged on any instate purchase
• Keep the required documentation

Using the Internet to make a purchase

You can use your card to make a purchase over the internet, but here are a few recommendations:

• Use a company with whom you have used traditional purchasing methods in the past.
• Secure sites have a url that starts with https:// and a locked or closed paddlelock on the screen..  Look for them.
• If you are not comfortable giving your card number over the Internet, most companies have the option of placing your order order on the Internet and following up with the card number via telephone.
• If supplying your card number via the Internet, make sure that the site handles secure transactions.  Most sites will have a statement about how and why their site is secure.  You should always see a “secure server” message before proceeding your purchase.

As with any purchase, the cardholder is ultimately responsible for the purchases made with their card and is therefore responsible for determining whether a website is the most appropriate method for any given purchase.

Shipping or Pick-up Instructions

If you are not picking up the goods in person, whenever possible have the goods shipped directly to your campus address .  Give the vendor complete delivery instructions, including your building name and room number.

If shipping to the University Receiving Department use a complete attention line:

Utah State University
Receiving Department
Attn:  YOUR NAME & DEPARTMENT
1295 East 700 North
Logan, UT  84322-9200

You are responsible for inspecting the goods upon arrival.  Please retain all packaging until you are certain you will not need to return the goods.

Returns, Credits, Damaged Goods

If any goods purchased with a University Purchasing Card need to returned, you should work directly with the vendor:

• Obtain a “Return Authorization Number” from the vendor if required
• There may be a restocking fee assessed by the vendor.  In many cases you can negotiate this fee, ask.
• As you verify and reconcile your monthly statement, make sure the credit appears on you card for the return.

Handling a Dispute

If you believe you have been charged erroneously for a purchase, you should first contact the vendor directly.  Most vendors would prefer to resolve the problem themselves and are willing to provide credits.  If the vendor is not willing to resolve the problem, you should contact the bank promptly. 

Review Questions - Making a Purchase

1- Which of the following is NOT true about the documentation required for a purchase made with your card?
A) The documentation needs the name of the vendor, date of purchase, a brief item description, and the total dollar amount.
B) You must keep the documentation for 5 years after the statement date, for audit purposes.
C) If you place an order over the phone, a completed “Missing Receipt Form” may be used as documentation.
D) Documentation is not required as long as I approve the purchase on the monthly statement.
E) Receipt at the time of purchase is preferred.

Correct Answer:  D – An itemized receipt is always required.

2- If I feel I have been charged incorrectly for a purchase, I should do the following:
A) Contact the vendor directly as soon as possible.  If I can’t resolve it with the vendor, then I should contact the US Bank customer service department at 1-800-344-5696.
B) Identify it on the monthly statement.  My card manager will resolve incorrect charges for me.
C) Contact Purchasing Services and provide them with the appropriate documentation so they can resolve it with the vendor.

Correct Answer:  A – Try to correct the problem with the vendor, if that is not possible contact US Bank ASAP.

3- If for some reason you do not a get a receipt from the vendor or if you lose a receipt, you should do the following:
A) Send a e-mail to Purchasing and your card manager explaining how the receipt was lost.
B) Contact the Vendor and request a duplicate or replacement receipt.
C) Complete the Missing Receipt Form

Correct Answer:  B & C – But, the “Missing Receipt Form” should only be used after attempting to obtain a duplicate receipt from the vendor and can only be used twice during a calendar year without violation points being assessed.

IV: Monthly Statements

You will receive monthly statements from both US Bank and the Controller’s Office. You and your card manager will use the statements to review and verify charges, make sure they are posted to correct university index, and check that there is appropriate documentation for each transaction.

The monthly statement from the bank will be issued on the 26th day of the month. (Note: if you do not have any transactions for the month, you will not receive a statement)  The monthly expenditure statement from the Controller’s Office is issued, via an email message, on the 1st day of the following month.

Reconciling your statements

Step 1: Each month you need to review and approve your Purchasing Card statements.
A) Check each listed transaction for errors: Do you have an itemized invoice/receipt? Did you buy this? Is the amount billed correct?
B) If you detect suspicious activity or find incorrect information, contact US Bank immediately. (To dispute an error on your statement, you must contact the bank within 60 days or two billing cycles of the statement date.)

Step 2: Organize the documentation
A) Attach the supporting documentation and itemized invoice for each transaction on the statement.
B) If the receipt is missing, try to obtain a duplicate from the vendor and if this is not possible, attach a completed and approved "Missing Receipt Form".

Step 3: Sign the statement
Your dated signature certifies that the statement is true and accurate - and that you have corrected any errors.

Step 4: Submit the statement for approval
A) Have your department head, director, or card manager sign and date the statements
B) If you are the card manager, or have a manager that reconciles the statements for the cardholders in your office, the dated signature of the cardholders supervisor is required and there will be three (3) dated approvals on your statements.

Review Questions - Monthly Statements

1- Your signature on the Monthly Statement indicates the following:
A) This is a trick question - I am not required to sign the monthly bank statement.
B) You did not purchase any restricted items.
C) You did not exceed your single purchase limit on any item.
D) You approve and can document all of the charges on your statements

Correct Answer: D- Your signature indicates approval of the charges on the monthly statement.

2- You have _____ days to dispute, with US Bank, any questioned item appearing on your monthly statement,
A) 7
B) 60
C) 90
D) 30

Correct Answer: B- You have 60 days or two billing cycles to dispute any charges with the bank.

V: Audits

The University requires your records to be available to an auditor at least on a yearly basis. This auditing process is required and monitored by the University's Internal Audit department and also the State of Utah Auditor's Office.

The auditor will make an appointment with the cardholder and/or manager in advance of the actual audit. Any supervisor(s) are encouraged and welcome to participate in the audit process. When the auditor arrives, the cardholder or manager will be asked to present each cardholder's signed monthly statement with the itemized receipts and support documentation attached. The records will be audited for compliance in all areas of procedure pertaining to the card. Violations points may be assessed and added to the card holder's record if any problems are found.

Review Questions - Audits

For the yearly audit, my card manager and I should be prepared:
A) To review my violation record with the auditor
B) To provide copies of all signed and approved monthly statements with the required supporting documentation.
C) To run like the wind because I never kept one receipt for anythin I purchased!

Correct Answer: B - You need to provide signed copies of the statement with all supporting documentation attached, i.e. itemized invoice/receipts, packing slips, etc..

VI:  Supervisor / Card Manager Training Overview

Remember – YOU Are Accountable

Who is responsible if cardholders abuse Purchasing Card privileges?    The cardholder of course but, as their manager or supervisor, so are you.
Improper spending harms the University’s financial well-being, integrity, and reputation.  Managers and supervisors have a duty to review and ensure that ALL purchases are made for a business related purpose and in a reasonable and prudent manner.  These responsibilities apply to all types of procurement made for the University.

Question
If an auditor or news reporter discovers one of your cardholders has charged a mountain of bagels each week using their Purchasing Card, who will be held responsible?
A) The person who charged the bagels
B) Utah State University
C) You
D) All of the above

Correct Answer:  D – ALL will be held responsible for “Bagel Gate”!

Understand Your Duties
Before you can effectively manage your cards and supervise purchases, you need to understand your duties.  You have a responsibility to:
1-Know the Purchasing Card policies, procedures, and guidelines.
2- Enforce Purchasing Card rules
3- Conduct a monthly review of all procurement and expenditures
4- Investigate questionable transactions before signing off on them
5- Sign and date the monthly statements to indicate your review and approval

Question:
Which excuse can you successfully use during an audit?
A) I wasn’t aware the cardholders were buying personal items with the card.
B) Other departments buy pizza for weekly team meetings without completing the Meals & Entertainment form
C) I, myself, always use the Purchasing Card responsibly
D) I don’t really understand the monthly statements.
C) None of the above

Correct Answer:  C – None of these excuses will fly.  The buck stops with YOU!

Check for Problems
Each month, you should closely examine every purchase made using the USU Purchasing Card.  In preparation for your review, the cardholders should have supplied you with the required documentation for each transaction ( itemized receipts, e-mail confirmations, packing slips, etc.).  If the documentation is incomplete or missing, the cardholder should resolve any transaction discrepancies by filing a dispute with the supplier/vendor or the bank.

During your review, you should verify that each purchase is for a valid and appropriate business purpose.  Your signature on the Purchasing Card statement is required and it certifies that such a review has taken place.

Question:
Imagine you’re reviewing the charges.  Which two charges most warrant further investigation?
A) Office Depot (supplies) $28.58
B) Target (supplies) $50.00
C) Tito’s Imports (Car parts)  $148.96
D) Answers A & B
E) Answers B & C

Correct Answer:  E – Target & Tito’s are unusual vendors for the University.  You should investigate further.

Investigate Red Flags
Next scan for anything out of the ordinary.  Extensive auditing experience has shown it worthwhile to watch for “red flags” such as:
1- Questionable purchases (possible personal items)
2- Unusual suppliers
3- Even dollar amounts (possible gifts or gift certificates – support documentation is required for these transactions)
4- Dates or dollar amounts from receipts and statements that don’t match
5- Excessive ordering of supplies (i.e. toner, office supplies, etc.)

Know the answers to these questions:
1- Why did we need this item?
2- Why did we order this quantity?
3- Where are the items now?
4- Where is the original documentation?

If you have questions or need additional information, please call the Purchasing Card Administrators

Question:
Why should you question orders that involve unusual quantities?
A) Extra items might be ordered for personal use.
B) It’s very easy to mistype numbers when filling out order forms.
C) The University does not allow stockpiling of supplies.
D) Departments are required to order items one at a time.

Correct Answer:  A – The cardholder may have ordered extra items for personal use.

Avoid “Lunch Gate”
Remember, all USU purchases must be for a legitimate business use and adhere to University policies, procedures, and guidelines.
A good test for this is that each purchase should be prudent, responsible, and have a legitimate business purpose that supports the mission of the University.

In considering food charges, you should consider the business purpose and how often the expense occurs. For instance, food for your annual retreat or social might be appropriate, but more frequent treats (such as lunch for weekly staff meetings) may be considered excessive.  You want to avoid unreasonable business refreshment purchases.  Please, review and make sure you understand University Policy # 516:  Meals and Entertainment.

Question:
Which of these transactions would be considered a prudent, responsible business purchase?
A) Birthday cards for employees
B) Software purchase for faculty personal home use
C) Printing costs for a marketing brochure
D) Bi-weekly business lunch for two co-workers?

Correct Answer:  C – Printing costs are a legitimate business expense.