purchasing card reviewer training. purchasing card benefits convenience convenience faster receipt...
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Purchasing Card Reviewer Training
Purchasing Card Benefits
Convenience Faster receipt of needed supplies Reducing purchase orders More vendors to choose from Reducing the number of checks
issued Cost savings; * the cost of traditional
purchase order is $89.11, the cost of using purchasing cards is $21.83
*2007 Purchasing Card Benchmark Survey Results-RPMG Research Corporation
We will cover:
Cardholder Responsibilities Restrictions Purchases Requiring Approval Changes to Cardholder Information Reviewer’s Responsibilities Establishing the Review Process Leaving the Department Location of Forms Purchasing Card Fraud Contact Information
Cardholder’s Responsibilities
Making only authorized purchases Obtaining a detailed receipt for each
purchase Completing the transaction log with
a brief description justifying the purchase
Reconciling the monthly Visa statement
Resolving any discrepancies
Cardholder’s Responsibilities (con’t)
Ensuring credits are received Signing the log Passing the paperwork to assigned
Reviewer for approval in a timely manner
Note: Reallocation of charges may be the responsibility of the cardholder. However, budget management is the responsibility of the department head.
Reconcile Monthly VISA Statement
Compare VISA statement to transaction log and resolve any discrepancies prior to the end of the following billing cycle.
Keep all receipts and related paperwork (VISA statement, signed transaction log) for (5) five years.
Forward entire package to reviewer within 3 days of completion
Restrictions
Restrictions at Point of SaleThese transactions will be declined by
the bank: Purchases exceeding the single
purchase limit or monthly credit limit Cash advances Restrictions by merchant category Travel (Hotels, Airfare, Car Rentals) Restaurants, liquor stores Entertainment, recreational services Personal services such as
photographic studios, funeral services, salons, spas
State and University Restrictions
These transactions may not automatically decline, but are not allowed. They will be monitored for compliance through the review policy
Personal purchases Cash Equivalents (ex. Gift Cards) Gifts, contributions, and donations (such
as alcohol and flowers) Alcohol for any purpose Allowing someone else to use the card
State and University Restrictions (con’t)
Personally accepting kickbacks or incentives
Entertainment (costs of social activities and related incidental costs such as meals, beverages, lodging, transportation, and gratuities)
Splitting purchases to avoid limit of delegated authority ($2,500) is prohibited
State and University Restrictions (con’t)
Office supplies purchased from vendors other than the mandatory state contract with Office Depot
Mandated state contract Food purchases Tires Computers
Purchases Requiring Additional Approval
Licenses, contracts, and agreements must be sent to Purchasing Department for approval. Cardholders are not authorized signatories for the University
Telecommunications equipment (antenna, satellite installations, 2-way radios)
Modifications to building
Changes to Cardholder Information
Request changes by contacting the Purchasing Department
Cardholder Name or Address Change Default Account Change Cancel Card Single Purchase or Monthly Credit Limit
Change (as a minimum, requires department head and purchasing department approval)
Reviewer’s Responsibilities
Reviewer’s Responsibilities
Reviewer is the cardholder’s immediate supervisor or someone within the cardholder’s chain of command
Reviewers are required to ensure that charges are valid, authorized, are within ASU Beebe Purchasing Card policy and procedures, and are appropriately documented
A Reviewer may not review his/her own transactions
Reviewer’s Responsibilities (con’t)
At the end of each billing period, the Reviewer is required to: Review the transaction log to ensure all
entries are authorized Ensure detailed receipt matches the
transaction and description of purchase Confirm each transaction is authorized
and in compliance with ASU Beebe Purchasing policies and procedures
Confirm that no one other than the cardholder gained access to the card information
Reviewer’s Responsibilities (con’t)
Sign the monthly transaction log for all cardholders for whom they review, certifying all transactions are authorized and that policy and procedures have been followed
Forward to the Purchasing Department
Reviewer’s Responsibilities (con’t)
Retain the records in chronological order in the department’s office, and securely maintain the files for a minimum of 5 years.
Establishing the Review Process
Establishing the Review Process
At the discretion of the Reviewer, departments may require pre-authorization prior to cardholder making a purchase
Establishing the Review Process (con’t)
You may have an administrative person perform initial review of records: Ensure a detailed receipt is in the file,
and that the receipt matches the description on the log
Reconcile credit card statement to the transaction log
Place receipts in same order as listed on the statement
Establishing the Review Process (con’t)
Ask Questions – have a clear understanding of why the purchase was made and who authorized it.
Only the Reviewer (supervisor) can: Certify that transactions are authorized
(have you reviewed the receipt?) Sign the actual transaction log
Leaving the Department?
Leaving the Department?
If the cardholder leaves the department Cardholder or Reviewer Notifies the
Purchasing Department Brings the card to the Purchasing
Department Reviewer performs complete
assessment of all transactions
Leaving the Department? (con’t)
Reviewer to conduct an exit review of departing cardholder’s transactions
Ensure sensitive equipment (computers, digital cameras, etc.) are accounted for
Take another look at all records Trust everyone – review anyway
Leaving the Department? (con’t)
If the Reviewer leaves the department Another reviewer must be assigned to
each cardholder
Forms
All forms associated with the Purchasing Card are available online at
www.asub.eduFaculty StaffPurchasing
Purchasing Card Fraud
What is Fraud?
A deception deliberately practiced in order to secure unfair or unlawful personal gain
What Fraud is NotMisuse Negligence
Misuse Restricted purchases made for the
institution - not for personal gain Examples of misuse include:
Purchasing restricted goods and services (ie. Travel Computers, Office Supplies, Food)
Intentionally splitting a purchase to circumvent delegated authority (either by the initiative of cardholder or departmental authority)
Paying unfair and unreasonable prices, not making good business decisions
Allowing someone else to use the card
Negligence
Sloppy recordkeeping - not for personal gain
Unsecured record retention Lack of any receipt Missing statements Lack of additionally required
documentation
Consequences of Misuse and Negligence
Report misuse and negligence to the Purchasing Department
Suspend card until cardholder attends another training
Institute the “3 strikes, you’re out” rule
Cancel the card
Back to Fraud
Why does fraud occur?
How does fraud occur?
Why Does Fraud Occur? Inattentive Reviewers - cardholders
won’t take the risk if they know their transactions are carefully reviewed
Fraud is a premeditated, calculated act to defraud institution
Crime of necessity (personal financial need)
Crime of passion (desperation) Incident of bad judgment Program Weaknesses
Program Weaknesses
Department unnecessarily has too many cardholders
Reviewers responsible for too many cardholders
Insufficient training Faltering Reviewer (very dangerous
as this is the first line of defense) We must have proper mechanisms
installed to detect and halt fraud
How Does Fraud Occur?
Services paid for, but not received by the University (usually involves two individuals)
Personal purchases made, and removed from institution’s property or shipped to another location
Personal purchases made in combination with authorized goods/services
Consequences of Fraud
Restitution Termination of Employment Fines Criminal Prosecution
Review, Review, Review
Reviewers are the University’s first line of defense against purchasing card
fraud.
Purchasing card fraud is often a symptom of a bigger personnel issue.
If you suspect purchasing card fraud, contact the Purchasing Department
