PURCHASING CARD (P-CARD) PROCEDURES

 

The Purchasing Card (P-Card) system provides a convenient way to purchase University business-related items, while containing costs associated with the procurement of these items.

Most P-Card approvals and control features occur after the purchase has taken place. Examples of after-the-purchase controls include:

  • Support Documents for each P-Card transaction. Transactions reported on monthly statements provide very little information about purchases. The name of the vendor is listed, but what was purchased is not. Support documents such as itemized receipts, however, provide detailed information about the purchase, including what was bought, how many items were purchased, and the total amount charged.

  • Reconciling P-Card Statements. Reconciling itemized receipts to transactions reported on monthly statements allows the Cardholder to make sure that all purchases have been reported, that any credits have been received, and provides the opportunity to resolve any discrepancies.

  • Administrative Review. Supervisors indicate approval of purchases by reviewing and then signing and dating reconciled Cardholder statements. It is the supervisor’s responsibility to address Cardholders about questionable transactions.

  • US Bank Controls. Certain merchant codes are blocked so that P-Card transactions are automatically declined. US Bank provides access to all transaction data generated by Cardholders to the P-Card Program Administrators. Administrators review declined transaction reports for review on a weekly basis. Administrators also review transactions on a regular basis for unusual or irregular transactions.


1.0 Definitions

Purchasing Card (P-Card): A Visa credit card issued to a Cardholder for the purpose of making authorized purchases on the University’s behalf. P-Cards have a set three year life, but they can be renewed (reissued). The University pays the monthly US Bank statement and charges the assigned index number for P-card purchases.

Cardholder: The individual whose name appears on the P-Card and who is responsible for all charges made with the card. Cardholders must attend a Cardholder Training Session when applying for a new P-Card or when renewing an existing P-Card.

Delegated Card User: This is a person who has been selected by a Cardholder to use the Cardholder’s P-Card. Cardholders are responsible and accountable for all charges whether made by themselves or by their delegated users. Cardholders ensure that delegated users are aware of P-Card procedures by sending delegated card users to a Cardholder Training Session or by personally training them. A completed Delegated Card User Form must be on file in the department listing each delegated card user by P-Card.

P-Card Transaction Statements: Transactions occur when Cardholders use their P-Card to make authorized purchases. Transactions are also known as “credit card charges” or “charges.” They are reported on a monthly basis to the Cardholder in two separate statements.

  • Off-Campus Transactions: Reported monthly on the P-Card Statement.

    • P-Card Statement: A statement sent directly to the Cardholder by US Bank listing all off-campus transactions charged to the Cardholder’s P-Card through the end of a monthly billing cycle.

  • On-Campus Transactions: Reported monthly on the OCC Monthly Statement.

    • OCC Monthly Statement: A statement sent directly by e-mail to the designated Card Manager listing all on-campus transactions. Features of the monthly statement include the OCC number, the index number, the Cardholder name, the amount of each transaction, and the date, time and location where the card was used. This statement will only be sent if on-campus purchases have occurred during the previous month.

On Campus Charges: Each P-Card is issued with a unique on campus charge (OCC) number. This number allows Cardholders to use their P-Cards to make purchases from on campus vendors, such as the Bookstore, without the University incurring transaction fees from US Bank. On campus vendors are required to view the P-Card when purchases are being made, so be sure to take your card with you. (Note: There may be USU departments that do not use OCC numbers, but they do accept P-Cards for purchases. Transactions involving the these departments will be reported on the US Bank statement rather than the OCC Monthly Statement.)

P-Card Reconciler: The Cardholder or a person designated by the Cardholder to perform the monthly P-Card reconciliation.

P-Card Statement Reconciliation: The Cardholder is responsible to:

Reconciliation may be delegated (see P-Card Reconciler), but the Cardholder acknowledges responsibility for all transactions by reviewing and signing the monthly statements.

Support Documents: These are documents that “support” and provide information about P-Card transactions. Since monthly statements provide very little information about purchases, support documentation is required. Examples of support documents include itemized receipts, itemized invoices, packing slips, and the use of the Additional Information Form.

All transactions are required to have support documentation that provides the following information about the purchase:

    a) Description of what was purchased,

    b) Price per item and quantities of items purchased,

    c) The total amount charged,

    d) The date,

    e) The name of the company.

Record Retention Period: Record Retention for P-Card statements and related support documents depends on the funding source for the P-Card's index. P-Cards that are paid by an index that is funded by an awarded contract or grant are required to keep P-Card statements and related support documents for a period of three years from the date of submission of the final expenditure report. For all other indexes, P-Card statements and related support documents should be retained for a minimum of 5 years from the statement date. Statements and support documents should be shredded for disposal.

Missing Receipt Form: If support documentation is not available, the Missing Receipt Form may be used in substitution. (Note: Use of the form more than twice a year will cause violation points to be assessed.)

Administrative Reviewer: This is the Cardholder’s supervisor. Your supervisor may delegate the review to a delegated administrative reviewer. That person would then complete the administrative review of the Cardholder’s statements. It is the responsibility of the supervisor to address Cardholders about questionable transactions. After the review is completed and any questions have been answered, your supervisor is required to sign and date the statements indicating approval of the reported transactions.

Delegated Administrative Reviewer: A Cardholder’s supervisor may delegate the process of administrative review to another person, such as a staff assistant or business manager. That person cannot report directly to the Cardholder. The reviewer may contact the Cardholder, however, for additional information about particular transactions. It is the responsibility of the delegated reviewer to report any concerns about transactions to the Cardholder’s supervisor.

Administrative Review: The Cardholder’ supervisor or designee reviews the reconciled statements and support documents. Only the supervisor signs and dates the reviewed statements indicating approval of all reported transactions.

Card Manager: Departments may choose an employee to act as Card Manager. Often times this employee is the business manager. If departments do not select a Card Manager, then the Cardholder assumes Card Manager Responsibilities.

  • Card Managers are responsible to make sure that P-card transactions have been charged to the assigned default index number and are posted to the correct expense categories in Banner.
  • These employee(s) are responsible to relay information back and forth between departments and P-Card Program Administrators. For example, Card Managers notify P-Card Program Administrators of any assigned index number changes or closures for P-Cards.
  • Department Card Managers must notify P-Card Program Administrators if an employee has transferred to another department or has ended employment with the University.

P-Card Program Administrators: The Purchasing Services’ employees who administer the P-Card program for the University and act as the main contact between the University and US Bank. P-Card Program Administrators are authorized to sample, test, and question P-Card transactions to verify that they are appropriate and have support documents.

Cardholder Training Session: Employees must attend Cardholder training before new P-Cards can be issued or reissued. Click on the following link for Training Session dates:

http://www.usu.edu/purchasing/training/index.cfm

Transaction Limit: The highest dollar amount allowed per single P-Card transaction is $2,000. Departments may establish lower limits for a given P-Card. (Note: Splitting orders to remain under the single transaction limit is not allowed.)

Monthly Spending Limit: The highest dollar amount for all transactions made during a monthly billing cycle per P-Card cannot exceed $15,000. Departments may set lower limits.

Assigned Default Index Number: The index number assigned to a P-Card by the department’s Card Manager or Cardholder. Only one index can be assigned to a P-Card. All charges made by that P-Card are then posted to the assigned index by “default.” However, charges can be reallocated from the default index to other indexes within Banner.

Reallocation Period: Each week, 4 working days are available when P-Card charges can be reallocated from the assigned default index to other indexes within Banner. P-Card charges are initially loaded to a temporary holding file where they reside until they are posted into Banner Finance. When charges are in the temporary file, they can be reallocated to other indexes. If this period of time is missed, reallocation can be done via journal entry. A monthly workshop is available to train Card Managers in the reallocation process. Click on the following link for dates and time: http://it.usu.edu/

Sales Tax Exemption: Purchases made within the State of Utah are tax-exempt. The University’s Sales Tax Exemption number is imprinted on each P-Card.

P-Card Procedure Review: Card usage will be reviewed by Internal Audit Services and P-Card Program Administrators. Any misuse of the card may result in card cancellation, disciplinary action, termination of employment and legal action by the University.

University Business-Related Expenses: These are expenditures (purchases) made that support the mission of the University. All P-Card transactions must qualify as University business-related expenses. If a P-Card transaction could be viewed as a personal purchase to someone not directly involved, a brief explanation should be written on the itemized receipt or the Additional Information Form should be completed and attached to the P-Card statement.

 

P-Card Renewals: P-Cards expire three years from the month the original application was processed. Renewal cards are automatically generated for active accounts and are sent to the P-Card Administrator for distribution. Cardholders are required to attend a P-Card training session every three years. Cardholders are notified by e-mail whether they need to attend training before they can pick up their renewal cards.

2.0 P-Card Procedures

2.1 Obtaining a P-Card

  • Complete and submit a P-Card Application Form to Purchasing Services. (Plan on 10 business days after you submit your application before your card is available.)
  • Attend a Cardholder Training Session.
  • You will be notified after training when your card is available for pick up from Purchasing Services.
  • Complete and submit a Cardholder’s Agreement Form to Purchasing Services after you have picked up your card.

2.2 Cardholder Responsibilities

  • Be familiar with allowable transactions;
  • Remember that all transactions must be University business-related;
  • The Cardholder is responsible for all charges made on their card;
  • Ensure that Utah Sales Tax is not charged on purchases;
  • Reconcile your statements monthly (P-Card Statement Reconciliation);
  • Inform delegated users about P-Card procedures including USU's sales tax exemption, prohibited purchases and the importance of retaining Support Documentation. Be sure that a completed Delegated Card User Form (pdf) is on file.
  • Notify Purchasing Services if you change departments or end employment with the University.

2.3 Reporting Changes on a P-Card

If you need to report a change on an existing P-Card, please e-mail the P-Card Program Administrators to inform them of the change(s). Please include ONLY the last 4 digits of the card’s account number. Changes can include:

  • New Index
  • Address Change
  • Name Change
  • Single Transaction Limit
  • Monthly Spending Limit
  • Card Closure

Copies of the e-mail must be cc’d to the Department Head, the Card Manager and the Card Holder to indicate authorization before changes will be made by the Program Administrators.

P-Card Program Administrator e-mail addresses:

Karlene.combs@usu.edu

Joyce.howell@usu.edu

2.4 Lost Cards

All P-Cards are the property of Utah State University. If a card is lost or stolen, please do the following:

US Bank will block additional use of a lost/stolen card upon telephone notification. Prompt action in these circumstances can reduce the University’s liability for fraudulent charges.

2.5 Examples of Authorized Purchases

  • Office and lab supplies
  • Seminar/workshop registrations
  • University Inn for non-University employees (i.e., prospective employees coming to interview, visiting scholars, or guest speakers)
  • Printing off campus (contact Public Relations @ 797-1351)
  • Tools and Equipment. Contact Equipment Inventory at 7-1999 for additional requirements. Remember that laptops and computers are equipment.
  • Meals and entertainment (in accordance with Policy 516)
  • Employee gifts and awards (in accordance with Policy 505)
  • Gift Cards. Additional record keeping is required. Please include the following and attach it to the P-Card statement:
o The business purpose of the gift cards.
o Names of the recipients of the gift cards.
o Copies of the Taxable Gifts and Awards Form for those recipients who are USU employees.
o Please refer to Policy 505 “Employee Gifts and Awards for additional information.

2.6 Prohibited Purchases

  • Personal purchases, even if the Cardholder intends to reimburse the University
  • Employee travel expenses
  • Alcoholic beverages
  • Gasoline and diesel fuel
  • Independent contractors, performers, consultants, speakers, and temporary employee services
  • Medical visits and legal fees
  • Open orders
  • Construction and remodeling
  • Live animals
  • Radioactive isotopes

 

2.7 Improper Use of a P-Card

If you have a question regarding whether a P-Card can be used for a type of purchase, please contact a P-Card Program Administrator for assistance (797-1788 or 797-1037).

The following table lists possible violations and their related point value per transaction.

Violation Types Point Value
Personal Purchase  150
Splitting of Transaction 125
Purchase of Prohibited Item 100
Monthly statement not reconciled and signed and dated by Cardholder 100
Monthly statement not reviewed and signed and dated by Administrator 100
No Itemized Receipt or Missing Receipt Form 50
3rd or more use of Missing Receipt Form* 30
Policy or Procedure Violation 10


Cardholders who are assessed 150 points or more at the close of a review will be required to attend additional training. Cardholders may have their card(s) revoked by the University’s Controller.

*A Missing Receipt Form may be used twice during a year (fiscal). Use of the form three or more times will result in 30 violation points per use.

3.0 Additional P-Card Information

3.1 Shipping and Receiving

Cardholders are encouraged to receive their own shipments. Regardless of who receives the shipment, the Cardholder remains responsible for obtaining all documentation (packing slips, mail order form copies, etc.) related to the purchase and verifying that the documentation complies with the requirements for support documents.

Address for Central Receiving:

Utah State University
Receiving Department
1295 East 700 North
9200 Old Main Hill
Logan, Utah 84322-9200

3.2 Merchandise Returns and Exchanges

The Cardholder is responsible for contacting the vendor when merchandise is not acceptable (incorrect, damaged, defective, etc.). Be aware that some vendors may assess a restocking fee.

  • Merchandise Returned for Credit: If merchandise is returned for credit, the Cardholder is responsible to obtain a credit receipt from the vendor and keep it as support documentation for that purchase. Receiving cash or checks to resolve a credit is prohibited.

  • Merchandise Exchanged: If merchandise is exchanged, the Cardholder will return the merchandise to the vendor and keep documentation supporting the transaction

3.3 Disputes

If the Cardholder disputes a charge, document the dispute and the final resolution so that it can be retained with the Statement on which the disputed charge appears.

  • Vendor Resolution: Whenever possible, the Cardholder should try to resolve disputed charges directly with the vendor. Most vendors prefer to resolve the dispute themselves and are willing to provide help. If the vendor agrees that an error has been made, the vendor will process a credit to the P-Card account. Make sure that credits due are posted to the P-Card account.

  • US Bank Resolution: If the dispute cannot be resolved with the vendor, the Cardholder should contact US Bank at 1-800-344-5696 to complete and turn in a Cardholder Dispute Form. A charge cannot be disputed after 60 days past the statement date. The next statement will be reduced by the amount of the disputed item until the transaction in question is resolved.

·4.0 P-Card Forms

P-Card Application Form (pdf)

A completed P-Card Application Form is required when requesting a new P-Card.

Cardholder Agreement Form (pdf)

The completed Cardholder Agreement Form is required for every card issued. The form is given out at the end of cardholder training. It must be turned into Purchasing Services within 10 working days after the card has been picked up or the account will be closed.

Delegated Card User Form (pdf)

This form is required if a Cardholder delegates the use of his/her card to someone else.

Missing Receipt Form (pdf)

The Missing Receipt Form is to be used only in exceptional circumstances when the Cardholder cannot obtain a replacement receipt from the vendor. Using the form more than twice in any fiscal year may result in violation points.

Meals and Entertainment Form (pdf)

A required form when a P-Card is used to purchase meals and entertainment related to the conduct of University business. Please refer to Policy 516 “Meals and Entertainment” for additional information.

Taxable Gifts and Awards Form (pdf)

A required form when a P-Card is used to purchase gift cards for employees. Please refer to Policy 505 “Employee Gifts and Awards” for additional information.

P-Card Transaction Form (pdf)

The use of the Transaction Form is optional. It can assist Cardholders and Card Managers track P-Card transactions and assist in reconciling both the US Bank and University monthly statements.

Additional Information Form (pdf)

The Additional Information Form is not required, but it may be used as support documentation for P-Card transactions that could be viewed as personal purchases, but were made for official University business purposes. (This form may not be used for Meals or Entertainment – see Policy 516.)

5.0 Related University Policies

Review these policies to ensure compliance when using P-Cards to pay for employee gifts and awards (including flowers and plants), and meals and entertainment.

Policy 505 – Employee Gifts and Awards (pdf)

Policy 516 – Meals and Entertainment (pdf)

Helpful Links