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Purchase CardREG 07.45.5Purchasing DepartmentPrint-friendly version
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A. Overview of the Purchase Card Program
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C. Cardholder Procedures
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D. How
to Use the Purchase Card
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G. Card Reinstatement Policy |
3.1. Overview of the Purchase Card Program
3.1.1. Purpose of the card. The NC State Purchase card is essentially a standard Visa card in which the liability rests with the University instead of the individual cardholder. (This is different from the American Express travel card, in which the liability is solely the cardholder's.) The Purchase card is issued to an employee, empowering this person to purchase goods and services on behalf of the University. This program has been established to allow rapid purchase of low dollar goods and services while simultaneously reducing paperwork and handling costs associated with the small purchase process. Under no circumstance may this Visa card be used for personal purchases.
3.1.2. Benefits and costs/requirements.
3.1.2a. To the cardholder
Benefits
It is easier to make purchases. The Visa card is accepted virtually anywhere, and it eliminates delays associated with asking a vendor to accept a small purchase or purchase order number.
There is less "front end" effort. The requirements to obtain a small purchase number and enter the information in the computer are eliminated.
Materials may be acquired faster. The Purchase card may be used by the cardholder as needed.
Complete transaction reporting is provided on a daily basis. Vendor information becomes easier to research and locate.
Each purchase card has a unique number that is tied to one NC State account (and project number if used). Each vendor is tied to an object code, so that every purchase automatically finds its way back into the proper Project/Grant account.
Ledger 5 and Ledger 8 Project/Grant accounts can not be used at this time.
Costs/requirements
There is currently no fee associated with the program.
The cardholder is responsible for obtaining itemized receipts with pricing for a monthly reconciliation process. Each cardholder's account is also reviewed and approved by a higher authority (normally at the department or college level).
The cardholder is responsible for obtaining tax paid information for all out-of-state vendors at the time of purchase. The department/college approver must complete the tax field information on line during the monthly reconciliation.
3.1.2b. To the University
Benefits
The number of small purchases will decrease, reducing the small purchase process in departments and Accounting. There will be fewer small purchase numbers generated, less computer entries and fewer invoices handled by departments, less matching of invoices to small purchases in Accounting, and fewer checks to write.
There is an opportunity to reduce impress/petty cash accounts.
The University has the ability to block specific categories of vendors (airline reservations, cash advances, liquor purchases, etc.) This provides increased security of purchases over the existing small purchase process.
Improved vendor relations. The bank will pay vendors two to three working days after the vendor processes the purchase.
Costs/requirements
The University was required to program a "door" into our financial system. This required a front-end investment for programming services and enhancements to the program are on going.
The University is committed to providing an on-going audit of purchases to insure a high degree of confidence in the system.
3.1.2c. To the merchant
Benefits
The vendor will be paid by the bank two to three working days after the vendor processes the purchase.
The vendor has a higher comfort level. The strength of the Visa name (and the protection the vendor has when accepting the card) encourages vendors to make sales that would not be made if a small purchase number or purchase order were presented.
The Purchase card process eliminates vendor invoicing and the vendor's accounts receivable process.
Costs/requirements
Every transaction made using the purchase card carries a fee that the vendor must pay to the credit card network. This is what finances the credit card industry, and the process is basically the same for all credit cards.
3.2.1. The Bank
We have an agreement with MBNA for Visa card services. To report a lost or stolen card, billing questions, or any customer service questions in general, call the Program Administrator (Arlene Mabry) first at 513-0221. If after NCSU business hours, call MBNA at 1-888-905-6262 where help is available 24 hours a day. Also, to dispute a transaction on your statement please refer to Section E of this guide.
3.2.2. University names and addresses.
The University provides support and assistance to cardholders and departments in the distribution and processing of new card applications. We process all changes in cardholder information, we schedule training, we update all documentation, we provide on-line monthly statements, and we audit all aspects of the program. Please call whenever you have any questions.
Program Manager:
Mary Ellen Mashburn
Central Stores
Box 7225
(919) 515-7810, fax 515-7332
email: Maryellen_mashburn@ncsu.edu
Card Administrator:
Arlene Mabry
Central Stores
Box 7225
(919) 513-0221, fax (919) 515-7332
3.3.1. Obtaining a card
Purchase cards will be issued to anyone who is authorized by the University to purchase goods and services. The names of the University and the cardholder both appear on the card. The bank currently does not charge for the issuance of a card; however, low usage cards will be reviewed regularly. The purchase card carries corporate liability and does not affect your personal liability in any way.
Purchases from sponsored programs must strictly adhere to all A-21, A-110, and other agency guidelines. These guidelines may restrict the purchase of specific items using sponsored accounts. Individual granting agencies may also be more restrictive and may not allow certain purchases. It is the cardholder's responsibility to be aware of the rules and guidelines applicable to each account.
Enrollment Forms can be found at the Purchasing Department home page under Purchase Card.
3.3.2. Keeping your card secure
Always keep your purchase card in a secure place. Treat it like cash.
3.3.3. Limitations of Transaction Amounts
The following limits have been assigned to your purchase card:
Single purchase limit of $2,500.
Daily purchase limit of $5,000.
Monthly purchase limit of $25,000.
Daily number of transactions is unlimited at this time.
Monthly number of transactions is unlimited at this time.
These are general limitations and may be higher or lower than what you want. If these do not fit your purchasing patterns please contact the program administrator to discuss modification of the limits. The transaction limit cannot be increased; however the daily and monthly limits are negotiable.
3.3.4. Limitations of Vendors
All vendors accepting VISA/MC cards are registered with their bank under a specific Merchant Category Code (MCC) identifying the type of business they are. (Ex. Airlines, music stores, medical services, florist, ABC stores, restaurants, office supplies, etc.) The University has blocked all categories deemed inappropriate for NCSU use such as Travel and Entertainment categories, ABC stores, off-track betting, etc.
Your purchase card cannot be used to purchase from vendors that fall under a blocked category on the MCC list. If your card is not accepted by a particular vendor, please contact Arlene Mabry @ 513-0221 within 48 hours. She will contact the bank to determine why the charge was denied and what can be done to rectify the problem.
3.3.5. Changing card limits and updating cardholder information
To change the daily or monthly limits on your card you must submit a request in writing to the Card Administrator, and it must have department or college level approval. Changes of personal data (address, phone, Project/Grant etc.) may be emailed to the program administrator (arlene_mabry@ncsu.edu).
3.3.6. Additional purchasing guidelines
It is the cardholder's responsibility to insure that purchases are made only from legitimate companies. If you have any questions about the legitimacy of a vendor or individual, please contact the Purchasing Department or DO NOT PROVIDE YOUR CARD NUMBER.
Following procedures are already in place with the small purchase process, the cardholder is responsible for purchases made that commit the University, and is therefore responsible for determining the legitimacy of the purchase and the selection of the vendor.
3.3.6a. Contracts
When a State or University contract is available the contracted supplier must be used. Contracts may be reviewed by visiting the NC Department of Administration Purchase and Contract Home Page, or by viewing the Purchasing Home Page or by calling the Purchasing Department to speak with the appropriate purchasing agent.
3.3.6b. Using the Internet (WWW)
Many companies offer the option of making purchases via the web. If you choose to purchase on the web, you must make sure the vendor site is secured before entering your credit card number.
3.3.7. Automatic renewal of the card
A new purchase card will be issued to you as you enter the program. Once you have the card nothing will be required from you to continue from year to year. Cards have a 2-year expiration date and will be mailed directly to you approximately one month prior to the expiration date.
All vendors that have your card number on file must be contacted with the new expiration date for continued approval of charges. Federal Express is a prime example. If the expiration date expires and you have not contacted them, the bank will deny charges and they will put you on a cash-only basis.
Do not forget that each card is tied to a default Project/Grant account. If that number changes, you must contact the Card Administrator to update the information. If you transfer to another department, your old card must be cancelled and a new enrollment submitted and approved by the new department head. Attending the training class will not be required if you have had a card in your previous position.
3.3.8. Termination of employment
Your card remains the property of North Carolina State University and MBNA. Card must be surrendered immediately upon termination of employment or upon the request of either your supervisor or the Program Administrator. Vendors with your card number on file must be contacted in order to discontinue future charges by the department.
3.3.9. Transfer to Another Department
If the cardholder or reconciler transfers to another department, different financial information will probably be involved. It is the cardholder and/or reconciler's responsibility to ensure that the correct financial information follows the card. Failure to do this will not allow charges to be placed into the correct financial codes, and the card will not successfully reconcile. Card cancellation may result.
3.3.9a. Inactive Accounts
To protect the security of the program, any card that has not been used for six (6) months will be cancelled. Exceptions may be made based on appeal by the cardholder.
3.4. How to Use the Purchase Card
Purchasing with the card does not change the rules and regulations required by the University or by your internal departmental procedures. The card is merely another means of payment versus the small purchase process. You must obtain an itemized receipt with pricing for every purchase made.
Please remember that the cardholder is the only person authorized to make purchases using the card. Giving your card or card number to another person or using someone else's card may result in disciplinary action including but not limited to revocation of purchase card privileges and/or termination of employment. To assist in keeping track of transactions and receipts, a transaction log is provided for your use. This log is to be used only as a manual aide and is not required by the Card Administrator.
3.4.1. Purchases in person
3.4.1a. You should follow the proper internal procedures set up specific to your department for determining that a purchase is required and authorized.
3.4.1b. Determine whether the purchase card is the most appropriate tool to use for the purchase (restricted item, over the $2,500 limit, etc.).
3.4.1c. Determine that the total amount of the purchase including shipping, handling, postage, freight, insurance, etc., does not exceed either the $2,500 limit or the daily/monthly limits listed above. If a limit is exceeded, the bank will automatically refuse the transaction and the vendor will reject the purchase.
3.4.1d. Determine that the price quoted is the best you can obtain.
3.4.1e. Determine at the time of purchase that the vendor has charged sales tax for out-of-state and out-of-country purchases, and record this amount (preferably on the transaction log). Sales tax paid is required as part of the reconciliation process, which is discussed later in this guide.
3.4.1f. Obtain a receipt at the time of purchase or pickup. If an item is shipped the packing slip must be kept. All receipts and other paperwork must be forwarded each month to the Program Administrator as part of the reconciliation process.
3.4.1g. Remember to give the supplier your name, department, phone number, and complete delivery instructions. It is recommended that purchases be shipped directly to your campus address whenever possible. If Central Stores is used as the delivery point please use the following address:
Central Stores
North Carolina State University
3240 Ligon Street
Raleigh, NC 27606
Phone (919) 515-2211
Fax (919) 515-8569
3.4.2. Purchases by phone, fax, or mail
Remember - the cardholder is the only person authorized to place an order. You may, when necessary, have someone else pick up the items; however, this person is not authorized to sign the credit card sales slip.
PHONE - An entry on the transaction log should be made when placing a telephone order. Sales tax information should be recorded for all out-of-state/country purchases since this is a critical part of the monthly reconciliation. The use of the transaction log is optional, and is provided primarily to assist the cardholder.
3.4.2a. When you call, state that you are calling from North Carolina State University and that you will be making your purchase on a Visa purchasing (credit) card.
3.4.2b. Emphasize that the University is not exempt from sales tax, and that we want sales tax added to the purchase. Record the amount of sales tax paid on purchase log.
3.4.2c. Give the supplier your name, delivery address, phone number, and complete delivery instructions.
3.4.2d. Request that an itemized receipt and/or packing slip that shows DOLLAR AMOUNTS be sent with the purchase. Retain this with your transaction log.
FAX - Follow any applicable steps from the above instructions. Retain a copy of the fax, and also the fax confirmation, for your records. Do not mail a copy of the order to the vendor because this increases the chance that the order will be duplicated. If the company requires the original be sure too clearly mark it "CONFIRMATION OF FAX ORDER, DO NOT DUPLICATE".
MAIL - Follow any applicable steps from the above instructions. Retain a copy of the order for your records, and request that a receipt is sent to you for your records.
3.4.3. Other forms to complete
When using the purchase card there is usually no need to submit any additional paperwork to a vendor. If, however, a duplicate shipment is mistakenly made, it is the responsibility of the cardholder to resolve the issue with the vendor.
3.4.4. Returns, damaged goods, credits
Items purchased with the purchase card will periodically need to be returned for one reason or another. Credits listed on the monthly statement should be documented as to when the original charge was made if a credit invoice is not available. A few tips to make the process easier:
3.4.4a. Always retain boxes, containers, special packaging, packing slips, etc., until you are certain that you are going to keep the items. Some items, such as software or fragile pieces, cannot be returned without the original packing materials.
3.4.4b. Read all enclosed instructions carefully. Often a critical phone number and other instructions are included the packing slip and/or receipt.
3.4.4c. In some cases there may be a restocking fee. The purchase card may be used to pay this fee as long as it does not exceed any of the card limits.
3.4.4d. If you need help in packaging goods for return please contact Central Stores at 515-2211.
3.5.1. Dispute of statement items
Purchases appearing on the monthly statement from the bank may be disputed up to thirty days from the date of the statement.
If a charge is not recognized by the cardholder or some other problem arises, the first step is to contact the vendor for information regarding the charge. Contacting the vendor saves time and usually solves most issues.
If you are not satisfied with the outcome from the vendor, complete the on-line dispute form as per the instructions and then contact MBNA's customer service department at 1-888-905-6262. They can research the discrepancy and credit will be issued if, in fact, the charge is not valid. Research by the bank usually takes 3-4 weeks. You will need to notify the Card Administrator to make her aware of the situation.
3.5.2. Dispute with supplier
If you have a supplier dispute and are unable to obtain satisfaction from the vendor please notify MBNA. You will be required to describe the problem and all of the efforts you have made in attempting to resolve it.
MBNA will assist you in every way possible. If you are unsatisfied with the outcome please contact the program administrator.
3.6. Reconciliation Procedures
Reconciliation of purchases by the cardholder is the final step in the purchase card process. It is also one of the most important steps because this is where the cardholder provides itemization and pricing of all items purchased. Statements are available mid-month and will be distributed by the departmental reconciler.
The billing cycle for the purchase card ends on the 10th of each month and the card statements are due to the Card Administrator (Arlene Mabry) on or before the 10th of the next month. If any statement remains open after this date the individual card will be immediately cancelled and the cardholder, reconciler, and dean will be notified of the cancellation. Timely reconciliation and responsible purchasing are the only ways to keep a card.
3.6.1. Documentation provided by the bank
MBNA provides an electronic feed on a daily basis, which transmits all transactions posted for the previous week from Monday - Friday.
3.6.2. Information in NCSU Sybase
The electronic feed from the bank is used for three purposes. Successful receipt of the feed is critical to the continuation of the purchase card program.
3.6.2a. First, the financial data is used to build sybase files that reconcile the overall charges to the University. These charges are checked for accuracy on a daily basis. At the end of each billing cycle, the individual Project/Grant accounts applied to the transactions are debited for the billed amount. Remittance is made to the bank based on these charges.
3.6.2b. Second, all of the data, including information about cardholders, purchases, vendors, etc., populates a Sybase database. Searches by vendor, dates, state, etc., may be made, and data is saved for five years. Access to the database follows the security procedures already in use, and reconcilers will be given access as they request security clearance to the card program.
3.6.2c. Third, the reconciliation procedure, which the reconcilers use to verify all card purchases, is updated via World Wide Web. The Purchase Card Program allows reconcilers to modify Project/Grant accounts, enter out-of-state taxes, verify weekly purchases and balance monthly printouts. Reconcilers approve all purchases on line. Continued failure to reconcile transactions on line will result in revocation of purchase card privileges.
3.6.3. On-line reconciliation via the Web
Specific instructions for navigating through the reconciliation process on the web are provided in a separate document and are available from the Purchase Card Home Page. The primary responsibility for insuring integrity of the purchase card program rests with the cardholder and departmental reconciler.
3.7. Card Reinstatement Policy
3.7.1. All delinquent statements must be turned into Card Administrator before consideration can be given to reinstate the account.
3.7.2. A memo from the department head needs to be submitted explaining the reason for the discrepancy, which caused the cancellation and steps to prevent it from happening in the future.
3.7.3. All accounts, regardless, will be required to wait at least one
week from receipt of statement and memo for the account to be reinstated.
3.7.4. Account closed due to late receipt of statement:
First Offense – Immediate reinstatement after receipt of delinquent statement and memo of explanation.
Second Offense – Four weeks after receipt of delinquent statement and memo of explanation.
Third Offense – Account will not be reinstated.
3.7.5. Through e-mail, phone, and/or fax, every effort is made to give the cardholder opportunity to provide incomplete information (missing receipts, receipts not itemized, food purchase information, etc.). However, if cardholder consistently provides incomplete information, the following will occur:
Account will be put in a hold status. Cardholder (and possibly reconciler) will be required to attend Purchase Card class or have a review of rules and regulations with the Card Administrator. Upon completion of this review, account will be taken off hold status.
Account will be closed. If, after retraining, the cardholder continues to submit statements with incomplete information, account will be closed.
3.7.6. If cardholder makes a purchase well over $2500.00 single transaction amount, account will be closed for a period of two months. Upon receipt of explanation from department head and cardholder attending another Purchase Card class, account will be reinstated.
3.7.7. If cardholder consistently abuses the card (personal purchases, lets others use card, etc.), card will be put on a hold status and a review of the card will be conducted. If deemed necessary, account will be cancelled.
