Business Procedures Manual

Essential business procedural components for University System of Georgia institutions.

(Last Modified on October 8, 2010)

The Purchasing Card (P-Card) Program is designed for the cost-effective purchase of supplies, goods, and services subject to applicable state laws, rules, and regulations to include those guidelines issued by the Georgia Department of Administrative Services (DOAS). DOAS guidelines are applicable to USG institutions, and these DOAS guidelines supersede the BPM (except where noted in the BPM) and institution-level policies and procedures. Refer to the DOAS website under the category of State Purchasing and the sub-category of Purchasing Card Program for more information. Additionally, institutional officials and employees assigned P-Card responsibilities should familiarize themselves with the provisions of public law governing P-Cards to include Title 50, Chapter 5, Article 3 of the O.C.G.A.

A P-Card means a charge card issued by a credit card company, bank, or other financial institution and provided by the State of Georgia or any of its departments or agencies under the State of Georgia Purchasing Card Program to state employees for the purpose of making small dollar purchases on behalf of such departments or agencies of the state. USG institutions are only authorized to use the P-Card Program as currently administered by DOAS. USG institutions are not authorized to obtain any other credit card or debit card issued in the name of the institution or any other State of Georgia entity.

3.3.1 Authorized Uses of Purchasing Cards

(Last Modified on February 9, 2015)

All purchases made with a P-Card must be for official State of Georgia business. Cardholders and approving officials are designated as State purchasing agents and are subject to the provisions of O.C.G.A. § 45-10-1 et.seq. (State Employee Code of Ethics, Conflicts of Interest, etc.).

The P-Card may be used for:

  1. Equipment. Single units under $3,000.

  2. Supplies, Materials, and Services Not on Statewide or Agency Contract. Supplies, materials, and services (with the exception of Professional Services as listed in BPM Section 3.1.2) may be purchased for less than $5,000. Institutions should monitor activity for purchases for the same supplies, materials, or services from the same vendor so as not to exceed $5,000 per year unless competitively procured as detailed in DOAS regulations and BOR policies and procedures. Supplies and materials purchased may also include items purchased for resale.

  3. Purchases from Statewide and Agency Contracts. Purchases made using a properly established Statewide or Agency Contract are permitted.

  4. Employee Travel Expenses. Purchases may be made for state personnel on official state business for the following expenses:

    • Airline tickets purchased in accordance with BPM Section 4.7.
    • State contract car rentals purchased in accordance with BPM Section 4.7.
    • Conference registration fees charged to account 7271xx may be paid with the requirement that employees not request reimbursement for meals paid with conference registration fees as required in BPM Section 4.4.1.

    Institutions must ensure that travel expenses for employees paid pursuant to this section are recorded as required by the State Travel Regulations. Institutions shall require employees to capture the aforementioned travel expenses on the employee’s travel expense statement. Institutions shall ensure that travel expenses paid with the P-Card and captured on the employee travel expense statement are NOT subsequently reimbursed to the employee.

  5. Student Food, Student Travel, Instructional Uses, and Approved Research. Student food, student travel, and food for instructional uses is permitted as outlined in BPM Sections 19.8 and 21.4, subject to the documentation requirements outlined in this policy.

    Note: Food purchased for official research use as approved by an Institutional Review Board (IRB), or food that is integral to or subject of research, is permitted. Please note that this is currently an exception to DOAS policy.

    Employee food may be purchased with a P-Card only when an employee is participating in a Group Meal as described in BPM Section 19.7 or an on-campus academic program/on-campus sanctioned student event as described in BPM Section 19.8. Employees participating in off-campus events or in a travel status must request reimbursement (or use a cash advance) as outlined in BPM Sections 4.4, 4.10 and 19.8.

    Additionally, the institution president or the president’s designee must approve cardholders authorized to make food purchases. Such approval should take place only after the cardholder has been adequately trained on what food purchases are allowable.

  6. Motor Vehicle Repairs and Maintenance for State-Owned Fleet Vehicles. Repairs and maintenance are authorized for state vehicles. All costs associated with state vehicle repair and maintenance must be reported in accordance with DOAS fleet management regulations using the Maximo system. Additionally, institutions must carefully monitor these expenditures to ensure that these purchases are made only for state vehicles.

    Note: Personal vehicle costs may only be reimbursed on a mileage basis as outlined in BPM Section 4.6 and may not be paid with a P-Card. Please note that this is currently an exception to DOAS policy.

3.3.2 Prohibited Uses of Purchasing Cards

(Last Modified on February 9, 2015)

The purchasing card may not be used for:

  1. Personal items. The use of the P-Card for personal expenditures is strictly prohibited. Cardholders who violate this rule must reimburse these funds and may be subject to both loss of employment and criminal penalties.

  2. Lodging, Transportation, and Meals for employees except as authorized in BPM Section 3.3.1, item 4.

  3. Entertainment expenses.

  4. Alcohol or tobacco products.

  5. Professional services as listed in BPM Section 3.1.2 and O.C.G.A. § 14-7-2.

  6. Gift cards, gift certificates, or other cash equivalent items.

  7. Food except as authorized under BPM Section 3.3.1.

  8. Cash advances, cash refunds, or “store credit.”

  9. Agency (funds held on deposit) or affiliated organization expenditures except as permitted for agency funds as detailed in BPM Section 21.4.

  10. Purchases made from units of the institution. Purchases made from units within the institution should be handled using a cost transfer or other payment method. Use of the P-Card subjects the selling unit to the merchant fees associated with credit card sales and is not a cost-effective means of making intra-institution purchases. For example, an institution should not permit use of the P-Card for purchases made from the institution-managed bookstore.

  11. Split purchases. Split purchases designed to circumvent the single transaction limits and procurement requirements previously enumerated are not allowed.

  12. Sales tax. Sales tax should not be paid for purchases made from vendors within the State of Georgia using institutional funds. Institutional funds used to further institutional business purposes are not subject to sales tax as outlined in O.C.G.A. § 48-8-3 (8). Sales tax may be paid when required for vendors out of state.

3.3.3 Program Administration

(Last Modified on October 8, 2010)

The Purchasing Card program is operated through a contract with the Bank of America, which issues Bank of America VISA® purchasing cards free of charge. There is no administrative fee associated with the purchasing card. The Bank of America P-Card program as administered by DOAS is the only authorized purchasing card program at USG institutions.

Billing settlement options include ACH debit or credit, or federal wire. Most institutions elect to use the ACH method.

Lost, stolen, or fraudulently used P-Cards must be reported to the Bank of America (1-888-449-2273) and DOAS (email to ProcessImprovement@DOAS.GA.GOV) within 24 hours of discovering the loss, theft, or fraudulent use. The cardholder’s approving official and the P-Card Coordinator must also be notified. Evidence of fraudulent use may be requested to include transaction detail. Lost or stolen cards require card cancellation. Failure to report the loss, theft, or fraudulent use of the P-Card may result in increased financial loss to the institution.

3.3.4 Purchasing Card Account Code

(Last Modified on October 8, 2010)

A limited number of merchants feed “item description” into the reports, but a large portion of the transactions do not have an “item description”. This means that it is actually very difficult to categorize the expenditures into the exact expenditure account. For this reason, the USG is authorized to utilize Account Code “714900-Purchase Card Expense” for all transactions reported from the purchasing card system, except as follows:

  1. Purchase of equipment items.

  2. Purchases normally required for input into “Continuous Audit.”

  3. Purchases that must be tracked pursuant to a federal, state, or private grant or contract award.

  4. Other purchases that must be tracked in a specific accounting code in accordance with legal, regulatory, or contractual requirements.

Nothing in this section is intended to prohibit institutions from electing to manually track all purchasing card procurements to allow accurate categorization into expenditure accounts.

3.3.5 Purchasing Card Reports

(Last Modified on January 4, 2011)

Reports are available from the Bank of America, in printed form and also in electronic format. *

* Note: Institutions using the GeorgiaFIRST model of the PeopleSoft Financials software should refer to Business Process GL.040.006 – Running the Purchasing Card Interface for more information on loading the Bank of America purchasing card information into PeopleSoft from WORKS.

3.3.6 Purchasing Card Program Objectives and Internal Controls

(Last Modified on October 8, 2010)

Each USG institution is responsible for establishing proper internal controls over the P-Card program. The objectives of proper internal controls include:

  1. Ensure compliance with applicable laws, rules, regulations, and policies.

  2. Safeguard the assets of the institution from fraud, waste, and abuse.

  3. Provide for the effective and efficient administration of the P-Card program so as to support the educational objectives of the institution.

The responsibility for effective internal controls ultimately rests with institution leadership. However, it is expected that institution leadership will delegate aspects of P-Card program management and assessment to various offices and employees on campus to include the Purchasing office, P-Card program administrators, internal audit, P-Card approving officials, P-Card cardholders, supervisors, etc. Responsibility for individual purchases rests with the individual cardholder making the purchase and the approving official who approves the purchase.

The University System is requiring institutions using the P-Card program to establish controls designed to meet the objectives listed above. The following Sections 3.3.7 through 3.3.9 provide a list of specific policies, procedures, and other requirements that each institution must incorporate as controls in its institutional policies. Additionally, each institution shall implement additional controls as needed to ensure compliance with the P-Card program objectives.

3.3.7 Purchasing Card Program Compliance

(Last Modified on October 8, 2010)

Each institution is responsible for ensuring compliance with applicable laws, rules, regulations, and policies governing P-Cards. Ensuring compliance shall, at a minimum, include the following controls:

  1. Develop and maintain institutional P-Card policies and procedures that fully incorporate current DOAS and USG policies and procedures.

  2. Ensure that P-Cards are issued only to permanent employees of the institution.

  3. Ensure that P-Cards are not issued to employees of Foundations and other affiliated organizations associated with the institution.

  4. Ensure that a P-Card is issued only to a named individual and not to a department or office.

  5. Ensure that cardholders do not share the P-Card or P-Card number for use by other employees.

  6. Develop a statement of ethical values pertaining to P-Card usage for signature by all cardholders and approving officials. The statement of ethical values should incorporate DOAS and USG policies and procedures as well as the provisions of O.C.G.A. § 45-10-1 et.seq. (State Employee Code of Ethics, Conflicts of Interest, etc.). Cardholders must sign the statement of ethical values in order to have a P-Card. Individuals assigned approving official responsibilities must also sign the statement of ethical values prior to being assigned as a P-Card approving official.

  7. Establish penalties for misuse of the P-Card to include a written system that documents warnings, suspensions, terminations, and permanent P-Card revocation.

  8. Require cardholders to obtain receipts for all purchases made on the P-Card. The receipt should include:

    • Vendor name
    • Transaction amount
    • Date
    • Itemized list of items purchased

    Copies or facsimiles of the original receipt may be acceptable if the original is not available. A screen-print or order confirmation e-mail is required when making Internet purchases, or a copy of an order-form that was mailed to a vendor to request an item. The screen print/order confirmation must include the shipping date and be signed as received.

    The institution shall centrally maintain receipts and supporting documentation for P-Card purchases or may assign this responsibility to approving officials, departments, etc. Receipts and supporting documentation shall be maintained for a period of five (5) years and shall be made available as needed for audit or review. It is recommended that institutions centrally maintain the receipts and supporting documentation.

  9. Require cardholders to maintain a log in the cardholder’s name showing:

    • Each P-Card purchase
    • Relevant vendor’s name
    • Item(s) purchased
    • Date of the purchase
    • Amount of the purchase
    • Name of the employee for whom the purchase was made
    • Intended business use
    • Grant or project to which the purchase is applicable
    • Other information as required

    The cardholder shall be required to maintain copies of this log for five (5) years or the institution may centrally maintain copies of the log. The log shall be made available as needed for audit or review.

  10. Require approving officials to review assigned cardholder P-Card purchases on at least a monthly basis. The approving official should provide evidence of his or her review through a signature on the P-Card purchasing log and/or the monthly Bank of America statement. It is recommended that the approving official monitor P-Card purchases on a more frequent basis using the WORKStm program.

  11. Follow all federal laws applicable to the reporting of spending with 1099 vendors. Vendors that must be reported on 1099s are captured in the VISA® Information Management System, which is available to all institutions through the P-Card provider. Institution P-Card administrators must contact the P-Card provider for access to the web-based VISA® Information Management System.

    It is the responsibility of each institution participating in the P-Card program to put in place procedures to comply with any federal tax laws regarding 1099 reporting. Please note that the P-Card may not be used for professional services as outlined in BPM Section 3.3.2, item 5.

  12. Ensure that P-Card purchasing records are retained for at least five (5) years.

  13. Report any misuse of P-Cards in compliance with the provisions as outlined in BPM Section 16.4, Fraud, Waste, and Abuse.

3.3.8 Purchasing Card Program Safeguarding of Assets

(Last Modified on October 8, 2010)

Each institution is responsible for ensuring that the institution’s assets are safeguarded from fraud, waste, and abuse. Ensuring the safeguarding of assets shall, at a minimum, include the following controls:

  1. Ensure that rebates or refunds from vendors shall be the property of the institution and shall be paid promptly into the institution’s accounts.

  2. Perform criminal and consumer background checks in accordance with O.C.G.A. § 50-5-83. The institution shall ensure that the results of a criminal background check and consumer credit check are provided the privacy protections required by law. Institutions shall comply with the provisions of the Human Resources Administrative Policy Manual in implementing a background check requirement.

  3. Require cardholders to personally reimburse the institutions for purchases made that are not appropriately documented. Approving officials also may be required to reimburse the institution if the approving official approved the purchase.

    Note: Habitual loss of receipts/documentation may require personal reimbursement by the cardholder and/or approver, and may also result in termination of the P-Card.

  4. Ensure that any items of value purchased for distribution to students be allowed only in support of the educational objectives of the institution. Additionally, ensure that the cardholder maintains sufficient documentation so as to identify the individual receiving an item.

    Note: The requirement to track individual recipients does not apply to items of de minimis value.

  5. Ensure that P-Cards are promptly cancelled upon employee transfer or termination.

3.3.9 Purchasing Card Program Effectiveness and Efficiency

(Last Modified on October 8, 2010)

Each institution is responsible for providing effective and efficient administration of the P-Card program in support of the institution’s educational objectives. Ensuring effective and efficient administration shall, at a minimum, include the following controls:

  1. Formally designate P-Card roles and responsibilities to include P-Card program administration, approving officials, and cardholders.

  2. Formally identify job positions within the institution that would require the use of a P-Card.

  3. Develop a training manual on the use of P-Cards that shall instruct cardholders and approving officials on the maximum value utilization of P-Cards, applicable policies and procedures, and purchasing rules that may impact P-Card usage.

  4. Require initial and refresher training for both cardholders and approving officials. Failure to participate in initial training shall result in non-issuance of the P-Card, and failure to participate in refresher training shall result in card suspension until the training is completed.

  5. Review not less than annually all P-Cards issued to employees, and eliminate P-Cards for employees who demonstrate consistently low usage of P-Cards or no longer have a demonstrated business need for the P-Card.

  6. Limit the number of cardholders for which an approving official may be responsible to a reasonable number over which the approving official may exercise sufficient oversight. It is recommended that the number of cardholders for which an approving official is responsible not exceed ten (10) cardholders.

  7. Ensure that a sample of P-Card purchases are independently reviewed by the P-Card program administrator, campus internal auditor, or other trained personnel independent of the approving official and cardholder under review at least annually.

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