Procurement Card PCard Cardholder Training Certification January 2012

1. PCARD ADMINISTRATION pcard.ask@business.gatech.edu Procurement Card (PCard) Cardholder Training & CertificationJanuary 2012 Slide 1 of 73

2.  Agenda Program Overview Program Controls Cardholder Responsibilities Purchases Annual Certification Program Key Points Slide 2 of 73

3. Goals Provide employees with a basic understanding of how to obtain and use the PCard at Georgia Tech Employees must know and comply with the provisions of the PCard Policies & Procedures Manual as set forth in the GT Business & Finance Manual section 5.2.1.8 Slide 3 of 73

4. Slide 4 of 73

5. Program Overview/Non-Catalog Suppliers PCard: tool for supply, material, and service purchases under $5,000; no catalog in BuzzMart PCard: tool for single equipment purchases under $3,000 including freight (non-inventory); no catalog in BuzzMart Use of the PCard for non-catalog suppliers: Simplifies purchasing & payment process Expedites ordering & delivery of goods and services Provides significant cost savings Provides electronic control & accountability Slide 5 of 73

6. Program Overview/Catalog Suppliers BuzzMart �Georgia Tech eBusiness tool �Procure to pay� tool BuzzMart � primary tool for all purchases from catalog suppliers activated in BuzzMart emarketplace Ex: Staples, VWR, Grainger� check BuzzMart for updated catalog vendors listed All catalog suppliers in BuzzMart are contract vendors PCard is appropriate tool for non-catalog suppliers Slide 6 of 73

7. Program Overview FY2011 Volume = $49.0 million FY2011 Transactions = 161,569 FY2011 Cardholders = 1,760 Departments = 130+ Slide 7 of 73

8. Program Overview The PCard Program is subject to applicable state laws, rules, and regulations to include the guidelines issued by the Georgia Department of Administrative Services (DOAS) found in the Georgia Procurement Manual and State Purchasing Card Policy. www.doas.ga.gov (click on Statewide Card Programs, then top left, click on Knowledge Management) Employees assigned PCard responsibilities should familiarize themselves with the provisions of public law governing PCards to include Title 50, Chapter 5, Article 3 of the O.C.G.A. at Slide 8 of 73

9. Program Overview State of Georgia Procurement Card Program Bank of America VISA Card Bank of America online tool called Works PCard Manager (don�t confuse with Techworks) Slide 9 of 73

10. Program Controls Slide 10 of 73

11. Managing the PCard Program Slide 11 of 73

12. Program Controls Maintain integrity of program Program established with built-in oversight controls Doctrine of cardholder accountability No system is 100% risk free Integrity of employees Slide 12 of 73

13. Card Eligibility Permanent, regular-status employees are card eligible No student employees or Tech Temps Cardholders authorized by department Verify business need PCard Request Form Slide 13 of 73

14. Card Issuance New cardholders, including Fed Ex �Ghost� cardholders, must have criminal and consumer credit checks on file Existing cardholders, including Fed Ex �Ghost� cardholders, are required to have a criminal check on file prior to a renewal card being issued � no credit check required Slide 14 of 73

15. How Do I Get A PCard? Slide 15 of 73

16. Employee Agreement Form Cardholders must sign an Employee Agreement Form prior to being issued a PCard acknowledging: Receipt of training Understanding and acceptance of the rules for the use and the protection of the PCard Understanding and acceptance of responsibilities for the reconciliation process and for billing disputes Understanding and acceptance of consequences for PCard violations Slide 16 of 73

17. PCard Spending Limits Slide 17 of 73

18. PCard Spending Limits Department Head or Department PCard Coordinator can modify Single transaction dollar limit Monthly (per cycle) dollar limit Note: Increased limit cards may not be used to circumvent State�s no-bid limit PCard denied by vendor if Purchase exceeds single transaction dollar limit Purchase exceeds monthly (per cycle) dollar limit Slide 18 of 73

19. Vendor Restrictions PCard declined at point of sale Vendors restricted � identified by Merchant Category Code; examples include travel, entertainment Cardholders No purchases from a vendor with whom you have a financial interest No acceptance of any gift or gratuity (when offered or appears to be offered) to influence purchase decision Slide 19 of 73

20. Policy Limitations GT PCard Policy Manual Business & Finance Manual (BFM) Chapter 5 Topic 5.2.1.8 http://www.adminfin.gatech.edu/?page=business Department internal procedures Must be in accordance with GT Policy Can be more restrictive, but not less restrictive Slide 20 of 73

21. Compliance and Audit Reviews PCard transactions reviewed electronically for compliance by: Business Services Department of Administrative Services PCard transactions audited for policy violations by Department of Internal Audit State Department of Audits and Accounts Policy violations evaluated on an individual basis and appropriate action taken, which could include termination of employment and criminal prosecution Slide 21 of 73

22. ETHICS HOTLINE GT employees can confidentially & anonymously report suspected PCard misuse via a �Hotline� 1-866-294-5565 or https://secure.ethicspoint.com/domain/en/report_custom.asp?clientid=7508 or www.ethicspoint.com, click �File Report� Slide 22 of 73

23. Issuing the PCard Slide 23 of 73

24. Issuing the PCard Slide 24 of 73 PCard Administration in Business Services will notify you by e-mail when your PCard has been Approved/issued Ready for pick up

25. Works Welcome email from �Works� with login instructions when issued a PCard Bank posts transactions daily to Works/email notifications of activity sent to you daily Online access to PCard transactions available via Works PCard Manager Department PCard Coordinator will provide instructions on using the system Slide 25 of 73

26. Review Question 1 This is a Program Control: A. GT PCards are only issued to permanent, regular-status employees. B. New PCardholders are required to have criminal and consumer credit checks before issued a PCard. C. A signed Employee Agreement Form is required before the PCard can be issued. D. All of the Above Slide 26 of 73

27. Review Question 2 Georgia Tech is not liable for all purchases made on the PCard. A. True B. False Slide 27 of 73

28. Review Question 3 The Department PCard Coordinator establishes: A. Your default project ID B. Your single transaction limit C. Your monthly purchase limit D. All of the Above Slide 28 of 73

29. CARDHOLDER RESPONSIBILITY Slide 29 of 73

30. You Are Responsible Slide 30 of 73

31. PCard Security Cardholder � Accountable for transactions Protect PCard and PCard Number No card sharing - cardholders may not �lend� their card or card number to anyone Slide 31 of 73

32. Lost or Stolen Cards Cardholder immediately report lost, stolen, or fraudulently used PCards to: Bank of America at 1-888-449-2273 Cardholder - Notify Approver and Department PCard Coordinator Slide 32 of 73

33. Returning PCards Slide 33 of 73

34. Documentation Requirements Accountable document (invoice or receipt) is proof of purchase for transaction Document must contain �line item detail� Line item description Line item pricing Used to reconcile monthly bank statement Purchase must be permissible by funding source used Slide 34 of 73

35. Documentation Requirements Lost or missing receipts: Cardholder is responsible for obtaining duplicate from vendor If duplicate cannot be obtained, cardholder must use PCard Receipt Replacement Form Excessive use of the Receipt Replacement Form (more than 3 in a fiscal year) may result in suspension of card privileges Slide 35 of 73

36. Record Keeping Duties PCard file with accountable documentation (invoices/receipts) and monthly bank statements easily accessible Bank Statements sent monthly Billing cycle ends on the 27th each month Federal, State, and Internal Auditors may request this file for compliance audits at any time Slide 36 of 73

37. Reconcile Monthly Statements Compare bank statements with receipts to verify your purchases Are the charges accurate? Have credits been issued/deducted? Is there any unauthorized activity? Note: VISA�s vendor contract requires billing upon shipping. If you have ordered but have not received the item, make sure it has actually been shipped. Otherwise the charge should be disputed. Slide 37 of 73

38. Reconcile Monthly Statements Reconciled statements must be Signed by the cardholder Counter signed (verified) by the approving official (approver) designated by the Department Head Cardholder and approver must not be the same person for signature purposes Completed PCard monthly reconciliation packages consisting of the signed bank statements and accountable documentation (invoices/receipts) must be retained under the control of the department business office Slide 38 of 73

39. Reconcile Monthly Statements Approvers assigned by the department: Review and verify cardholder�s PCard purchases Ensure appropriateness of purchases to the best of their knowledge Verify completeness of documentation Provide evidence of the review by signature on the bank statement Report on monthly compliance to Department PCard Coordinator Slide 39 of 73

40. Review Question 4 Reconciled bank statements must be signed by the cardholder and the approving official as designated by the Department Head. A. True B. False Slide 40 of 73

41. Review Question 5 If you are missing a receipt or can�t get a duplicate receipt from the vendor then you should A. Make a receipt and insert in your reconciliation B. Circle on your bank statement and do nothing C. Complete the PCard Receipt Replacement Form and include in your reconciliation D. All of the Above Slide 41 of 73

42. Purchases Slide 42 of 73

43. Authorized Uses of PCards Supplies, Materials, and Services under $5,000 Single equipment under $3,000 including freight Business related items within the delegated authority limit Cardholders and approving officials are designated as Institute 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.). Slide 43 of 73

44. Authorized Uses of PCards PCard can be used to make purchases: Over the Counter By Mail By Fax By Telephone By Internet Slide 44 of 73

45. Authorized Uses of PCard Cardholders must follow State (DOAS), BOR, and GT purchasing policies and strive to obtain the maximum value for each dollar of expenditure State (DOAS or Department of Administrative Services), www.doas.ga.gov BOR (Board of Regents), www.usg.edu/business_procedures_manual Georgia Tech purchasing policies, www.procurement.gatech.edu/ Slide 45 of 73

46. Order of Precedence Slide 46 of 73

47. Order of Precedence Any purchase of $5,000 or more must be competitively bid as stated in Section 1.3.4.5. �Open Market Purchases� of the GPM and OCGA 50-5-69. However, effective September 1, 2011, the existing rule was revised to eliminate the non-statutory requirement that the purchases of the state entity as a whole for a single fiscal year be aggregated to determine the state entity�s compliance with this rule. Although state entity spend will not be aggregated throughout the fiscal year to determine compliance, please note that deliberately splitting a purchase for the sole purpose of circumventing this bidding rule is still prohibited. The updated GPM includes a table with examples of permitted and prohibited purchases.* *DOAS Official Announcement # 01-12 Slide 47 of 73

48. Purchasing Tips Item not available on any contract Cardholder should utilize lowest cost based on requirements, quality, and availability to obtain the maximum value for each dollar expended Goods should be shipped only to official Georgia Tech business addresses No home deliveries are authorized Slide 48 of 73

49. Purchasing Tips Slide 49 of 73

50. Review Question 6 The PCard may be used to make Internet purchases. A. True B. False Slide 50 of 73

51. Authorized Purchases on PCard Books Conference registration fees Non-catalog contract items - Examples: temp agencies, cell phone service, copier maintenance (use BuzzMart if catalog is available) Equipment rental (NO Vehicle Rentals except for student groups) Food/catering compliant with BFM 5.2.1.9 Food/Group Meals Policy Freight/shipping charges Non-inventoried equipment: single units under $3,000 including freight. Slide 51 of 73

52. Authorized Purchases on PCard Office furniture/files Office supplies: For statewide contract (use catalog in BuzzMart) Printing Professional memberships Study Abroad Program Expenses (BOR BPM section 21.4) Subscriptions Telecommunications Temp employment agencies Utilities � electricity, gas, water Slide 52 of 73

53. Unauthorized Purchases on PCard PCard should never be used for personal expenditures Unintentional violation requires reimbursement of funds Intentional violation subject to: Loss of employment and/or Criminal penalties Slide 53 of 73

54. Unauthorized Purchases on PCard The following items may not be purchased with the PCard: Alcoholic beverages or tobacco products Cash advances, cash refunds, or �store credit� Employee travel & entertainment expenses Equipment costing $3,000 or more (including freight) Food/catering not in compliance with BFM 5.2.1.9 Food/Group Meals Policy Slide 54 of 73

55. Unauthorized Purchases on PCard The following items may not be purchased with the PCard: Funding of the BuzzCard Gift cards, stored value cards, prepaid cards, calling cards, gift certificates Motor vehicle fuel Personal purchases Purchases from units of the Institute Sales tax paid to Georgia vendors Split purchases to circumvent transaction limits (misuse could result in having your PCard privileges revoked) Slide 55 of 73

56. Sales Tax Slide 56 of 73

57. Split Transactions Georgia Tech received audit deficiencies for split transactions If the cardholder has multiple orders/purchases on the same day and the total of these orders/purchases exceed cardholder�s single transaction limit, then it is a split transaction. Ex. 1 .� You place an order with XYZ Company for $2900 on 10/04/11 and you place another order with XYZ Company for $3000 on 10/04/11.� If your single transaction limit (STL) is $4999.99,� then this is considered a split transaction. Ex. 2: You place an order with XYZ Company for $500 on�10/04/11 and you place another order with XYZ Company for $1500 on 10/04/11.� If� your STL is $1500,� then this is considered a split transaction. In Ex. 1, the appropriate process would be to put the orders in BuzzMart via a requisition. In Ex. 2, the more appropriate process would be to have your PCard Coordinator send a change request to pcard.ask@business.gatech.edu� to increase your STL (the maximum STL is $4999.99, any amount over this requires special state approval). This process only takes a few minutes for PCard administration to make the change. Cardholders who have special approval above the State STL of 4999.99 must also be careful and not split transactions to go above their special STL. Slide 57 of 73

58. Returning Purchases Inform the vendor the item needs to be returned Request a PCard credit be issued Request a vendor return address Request a vendor Return Authorization Number Request a vendor confirmation of the credit Check for the credit on your next monthly bank statement Slide 58 of 73

59. Resolving Disputes With Vendors Attempt to resolve the problem directly with the vendor, documenting all communications If you are unable to resolve the issue with the vendor, complete a PCard Dispute Form found at www.procurement.gatech.edu (go to Procurement Card/PCard Forms) Fax form to the bank at the number listed on the form Notify your Department PCard Coordinator of the dispute and attach a copy of the dispute form to your monthly statement Check the next statement to ensure credit is received *There is a 60 day time limit from the billing close date for disputed items* Slide 59 of 73

60. Review Question 7 A split transaction is the process of placing multiple orders/purchases on the same day with the same vendor and exceeding your single transaction limit. A. True B. False Slide 60 of 73

61. Review Question 8 If you purchase a piece of equipment for $2,975.00 and the freight amount is $50.00, then you can pay for this with your PCard. A. True B. False Slide 61 of 73

62. Review Question 9 How many days from the monthly billing statement do you have to complete a Vendor Dispute Form to Bank of America? A. 45 days B. 60 days C. 90 days D. None of the Above Slide 62 of 73

63. Annual Certification All cardholders are required to re-certify annually, during the month of January, by completing the online Cardholder Training & Certification tutorial Please read the next few pages related to sponsored projects and the employee agreement to review the requirements Slide 63 of 73

64. Georgia Tech Procurement Card Program Annual RecertificationCharges to Sponsored Accounts OMB Circular A-21 �Cost Principles for Educational Institutions� requires that costs applied to sponsored agreements (or projects) meet the following standards: 1. They must be reasonable; 2. They must be allocable to sponsored agreements under the principles and methods herein; 3. They must be given consistent treatment through the application of those generally accepted accounting principles appropriate to the circumstances; and 4. They must conform to any limitations or exclusions set forth (in Circular A-21) or in the sponsored agreement as to types or amounts of cost items. Although the PCard manual sets forth criteria for allowable and unallowable purchases, you must also ensure that purchases, including redistributions and transfers, are allowable per the terms and conditions of OMB Circular A-21 and the sponsored award/project. Items which are typically allowable purchases per the PCard Manual, but, are typically unallowable for sponsored projects include (list not all-inclusive): 1. Non-inventoried equipment, including PCs and printers (if general or multi-purpose) 2. Office filing cabinets and office furniture 3. Office supplies or other general purpose supplies 4. Postage, including stamps Slide 64 of 73

65. Georgia Tech Procurement Card Program Annual RecertificationCharges to Sponsored Accounts It is the responsibility of PD/PIs, unit heads and staff delegated signature authority by unit heads (including PCard holders, Approvers, and Coordinators) to ensure that only allowable charges are posted as direct expenses to sponsored projects.� Unit financial managers are in the most knowledgeable position with up-to-date information regarding the provisions and status of their respective sponsored projects.� As such, local management�s signature approval of a financial transaction indicates: 1. Approval for the action requested 2. Goods or services are directly related to the project scope 3. Charges are allowable according to the approved project budget 4. Charges have been incurred within the project time period 5. Charges have been incurred in accordance with GIT financial and accounting policies and procedures 6. Charges have been incurred in accordance with Terms and Conditions of the sponsored agreement 7. Funds are available in the designated projects Certification Statement: �I have read and I understand the special requirements governing direct charges to sponsored projects and my responsibilities as staff delegated signature authority. I will ensure that, to the best of my knowledge and belief, only allowable direct charges are posted to sponsored projects. Documentation to support all charges based on the above A-21 requirements will be maintained in the local unit/department files for audit purposes.� Slide 65 of 73

66. Employee Agreement for Georgia Tech Procurement Card Program I ____________________, hereby acknowledge receipt of a Georgia Institute of Technology (�the Institute�) Procurement Card (�PCard�), which is a Visa card issued by Bank of America (Card Issuer), that will only be used to acquire materials, supplies, and services for the Institute. I agree to comply with the following terms and conditions relating to my use of the PCard. 1. As an authorized cardholder, I agree to comply with the terms and conditions of this Agreement and with the provisions of the PCard Policies & Procedures Manual (PCard Policy 5.2.1.8 in the Business & Finance Manual). I confirm that I have read and understand its terms and conditions. 2. I understand that the Institute is liable to Card Issuer for all charges I make on the PCard. 3. I agree to use the PCard for authorized official business purchases only and agree not to charge personal purchases. I authorize the Institute to take whatever steps are necessary to collect an amount equal to the total of the improper purchases, including but not limited to declaring such purchases an advance of my wages. In such event, I expressly authorize the Institute to deduct such cost from my wages to the extent allowed by law. 4. I agree to notify the department�s PCard Coordinator if my Institute address changes. 5. If the PCard is lost or stolen, I will immediately notify the Card Issuer at 1-888-449-2273. I will confirm the telephone notification as described in the Manual. I will also provide notice to my department Procurement Card Coordinator. Slide 66 of 73

67. 6. I understand that improper or fraudulent use of the PCard may result in disciplinary action, up to and including termination of my employment. I further understand that the Institute may terminate my right to use the PCard at any time for any reason. 7. I agree to surrender the PCard immediately upon request, transfer to another department, or termination of employment for any reason. 8. I agree, when applicable, to comply with the requirements of OMB Circular A-21 �Cost Principles for Educational Institutions� regarding costs applied to sponsored projects. Agreed and accepted this ______ day of ________________, 201__, ___________________________ _______________________________ Employee�s Signature Department Head Name Printed ___________________________ _______________________________ Department Department Head Signature Slide 67 of 73

68. Certification Slide 68 of 73

69. PCard Program Key Points PROCUREMENT CARD WEBSITE www.procurement.gatech.edu Click on procurement card, then click on forms List includes PCard Forms, Tax Exemption Forms, and PCard Presentations Slide 69 of 73

70. PCard Program Key Points PCard Receipt Replacement Form PCard Change Request Form PCard Gift/Prize Receipt Form Modifications to existing PCard Forms Frequently Asked Questions (FAQ�S) on website PCard Quick Reference Sheet Slide 70 of 73

71. Slide 71 of 73

72. Review Question 10 The best way to contact PCard Administration is through pcard.ask@business.gatech.edu. A. True B. False Slide 72 of 73

73. Tutorial Assessment Let�s see what you have learned by completing the following Assessment You must score 80% or higher to receive credit for completing this tutorial You must complete this Assessment once you begin Click next to begin Slide 73 of 73