welcome to the purchasing card policy changes webinar the meeting will begin promptly at 10:00 am

Department of Administrative Services

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Welcome to the Purchasing Card Policy Changes WebinarThe meeting will begin promptly at 10:00 AM

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July 21, 2008

Purchasing Card Policy Changes

An Overview of Statewide Purchasing Card Policyand HB 1113

State of GeorgiaDepartment of Administrative Services


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Webinar Guidelines

Questions

Responses to Questions

Follow Up

Use the Question and Answer or Chat messaging feature on the Webinar Panel

Questions will be answered at the end of the presentation

A recording of the Webinar will be posted on the State Purchasing Division website

Additional Questions

You can mail additional questions through the [email protected] email address


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Your Presenter

Title: State Cards Program Manager

Accomplishments: Over 16 years of bankcard experience

Contact: [email protected]: 404.656.5344

Paul Kurtz


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Agenda

• Overview of HB 1113• Statewide Purchasing Card Policy• Local Program Roles and Responsibilities• About the P-Card• Links and Resources• Questions


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Overview of HB 1113


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State Code: §50-5-83

• What the new law does:▪ Defines unlawful use of the purchasing card and

other forms of payment“so as to prohibit the use of state funds by purchase orders, government contracts, credits cards, charge cards, or debit cards, or other such payment vehicles for personal benefit or gain”

▪ Provides requirements for the State Purchasing Card Program

▪ Defines penalties for violators▪ Authorizes the communication of rules and

regulations


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State Code: §50-5-83 (Continued)

• What the new law doesn’t do:▪ Make it harder or less beneficial to use the

purchasing card

▪ Change the intended use of the card

▪ Present a reason not to use the card in a proper and legal manner


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• Use of the Purchasing Card for unauthorized or personal purchases is prohibited▪ Any person who obtains goods or services in an

amount less than $500 will be guilty of a misdemeanor of a high and aggravated nature

▪ Purchases equal to or greater than $500 shall constitute a felony

• In addition to criminal consequences, there are also employment and restitution repercussions▪ Immediate termination of state employment▪ Restitution of the purchase amount plus interest

• Any person (including supervisors or other approving officials) who knowingly or through willful neglect assists are subject to the same penalties


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State Code: §50-5-83

• O.C.G.A. §50-5-83(b)(12) requires criminal background checks on all employees hired for positions that are eligible for purchasing card▪ Existing Cardholders as of July 1, 2008

• Background checks required prior to the next renewal date of the individual P-card

• Discovery of “any misdemeanors or felonies related to financial wrongdoing, theft, or other act of dishonesty” requires cardholder’s privileges immediately terminated and notification of State Cards Program Manager

▪ New cardholders after July 1, 2008• Criminal background check require prior to issuing card• Discovery of “any misdemeanors or felonies related to

financial wrongdoing, theft, or other act of dishonesty” eliminates employees eligibility to have a card


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• O.C.G.A. §50-5-83(b)(12) also requires credit checks on all employees issued a purchasing card after July 1, 2008 prior to issue▪ Obtaining and interpreting the credit checks has

been left to the discretion of the agency or institution

▪ DOAS can not advise on the law requiring the credit check

▪ Agencies and institutions should work internally and with their HR departments to create internal policies regarding credit checks


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Statewide Purchasing Card Policy


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Overview of Policy Changes

• Use of the purchasing card for personal purchases prohibited

▪ Misdemeanor and Felony violations defined▪ Consequences for Cardholder and Approver

• Revision of statewide program administration

– two sections

▪ Statewide Program▪ Local Program roles and responsibilities

• Use of Card• Program Compliance• Legal Issues


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State Policy Update

• DOAS administers the contract• SPD personnel are resources regarding policy

and implementation• State Purchasing Card Policy establishes

minimum standards of usage • Official Policy is posted on the State Purchasing

websitehttp://statepurchasing.doas.georgia.gov/vgn/images/portal/cit_1210/9/51/116137225P-

cardPolicyNews.pdf


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State Cards Program Manager

Duties and responsibilities:▪ Develop the State Purchasing Card Policy▪ Review Policy at least annually▪ Communicate policy changes to program users▪ Serve as the central point of contact on all issues of

policy and procedures▪ Official liaison between the Bank and all program users▪ Review all requests for exceptions to the Policy▪ Work with program users to determine new ways to use

the p-card within legal and policy requirements▪ Develop & maintain statewide training materials and

manuals


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DOAS Process Improvement & Audits

Duties and responsibilities:▪ Conduct periodic reviews of the programs at

entities under the authority of SPD purchasing

▪ Issue reports providing an assessment of the program making recommendations for improvement when warranted

▪ Require policy improvements and/or place other restrictions on card programs in cases where it is determined that internal controls are not adequate


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Local Program Roles & Responsibilities


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Card Program Administration

• Agency Procurement Officer (APO) or College/University Procurement Officer (CUPO)▪ Serves as official liaison between entity and State

Cards Program Manager• Roles and responsibilities (can be delegated):

▪ Card Program Administrator• Program Administration• Program Compliance• Set appropriate limits on program in order to ensure

adequate review• Develop training• Establish procedures, monitor use• Manage account requirements


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Card Program Administration (continued)

• Roles and responsibilities (continued):▪ Supervisors/Approving Officials

• Maintain knowledge of State Purchasing Card Policy as well as internal policies and procedures

• Request p-cards for users• Notify Program Administrator when a cardholder

resigns, is terminated or reassigned• Monitor transactions and card activity• Review all documentation• All signatures must be original signatures – rubber

stamps are prohibited


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Card Program Administration (continued)

• Roles and responsibilities (continued):▪ Cardholder

• Maintain security of card and all related information• Maintain knowledge of State Purchasing Card Policy• Ensure all purchases are allowable under State and

internal policies• Ensure all purchases comply with Georgia Procurement

Manual• Obtain “best value” for State• Maintain all required documentation• Sign transaction log and monthly billing statement• Ensure timely payment


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Internal Controls

• Each entity must have their own policy that ensures compliance with State laws, rules and policies

• Internal policies may be stricter, but can not be less strict than State policy

• Internal controls must include:▪ Separation of duties▪ Weekly independent review▪ Appropriate hierarchical review and approval of purchases▪ Prevention of self-approval▪ Appropriate limits on the number of cardholders under one

supervisor▪ Provision for an annual independent audit


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About the P-card


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Use of the P-card

• General Policies

▪ Purchases must be for official State business▪ Only the employee whose name appears on the card is

authorized to use that card▪ Use of the card for personal purchases is strictly

prohibited


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Allowed Purchases

• Can be used for small value purchases not otherwise prohibited or restricted

▪ Supplies▪ Materials▪ Equipment▪ Services

• Must be within cardholder assigned spending limits

• Card Program Administrators can manage spending limits up to $5,000

• Transactions ≥$5,000 for Open Market Purchases must receive prior written approval from State Cards Program Manager

▪ Special Approval Request Form SPD-PC003


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Allowed Purchases (continued)

• Allowable Purchases▪ Equipment

• Single units under $1,000 for State Agencies, Commissions or Boards• Single units under $3,000 for colleges and universities under the

authority of the Board of Regents▪ Supplies or materials up to the cardholder’s Single Transaction Limit

(STL) and/or approved cycle limit▪ Single purchases of supplies and materials over $5,000 provided:

• Open-Market Purchases have been competitively bid using eQuote, the Georgia Procurement Registry or other electronic solicitation tools: and

• Prior, written approval is obtained from the local Program Administrator, the purchaser’s supervisor and the SCPM

– Use Form SPD-PC003, Purchasing Card Special Approval Request• Documentation must include solicitation number

▪ No prior approval is needed for purchases exceeding $5,000 from statewide contracts, agency contracts, or mandatory sources

▪ Documentation must include reference to Statewide Contract or agency contract number


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Allowed Purchases (continued)

• Allowable Purchases (continued)▪ Airline tickets and vehicle rentals for State personnel (refer

to State Travel Regulations)▪ For colleges, universities and technical schools:

• No special approval needed for:– Food and lodging for student activities (see Policy for

conditions)– Food for research, laboratory animals or instructional use


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Prohibited Purchases

x Personal purchases of any kindx Cash advancesx Gift Cardsx Employee travel expenses (except those listed in Allowed

Purchases)x Entertainmentx Alcoholx Tobacco productsx Fuel, repair and maintenance of State-owned or rental vehicles

(exceptions with proof of Maximo utilization)x Professional services [as defined by O.C.G.A. §14-7-2(2)]x Food (except for “group meals” according to State Accounting

Office Group Meal Policy and allowed purchases for schools)


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Emergency Purchases

• In emergencies, Program Administrators are allowed to obtain after-the-fact approval

• “Emergencies” defined as:▪ Cases involving welfare of the general public▪ Extreme weather conditions▪ Official declared emergencies

• Program Administrators must submit Form SPD-PC003, Special Approval Request within 72 hours

• Must follow guidelines for emergency purchases in Georgia Procurement Manual

▪ Include Form SPD-NI005, Emergency Justification Form available on SPD website


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Sole Source/Sole Brand Purchases

• Guidelines found in Georgia Procurement Manual• Any request for a Single Transaction Limit of $5,000 or more

qualifying as a Sole Source and/or Sole Brand must include From SPD-NI003a (Sole Brand Justification) or Form SPD-NI003b (Sole Source Justification) or both

• Forms must be attached to the transaction log and/or monthly billing statement


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Links & Resources


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Link to State Code (HB 1113)http://www.legis.ga.gov/legis/2007_08/sum/hb1113.htm

DOAS Websitehttp://doas.georgia.gov/02/doas/home/0,2451,21917123,00.html

State Purchasing Websitehttp://statepurchasing.doas.georgia.gov/02/doas/osp/home/0,2469,35226973,00.html

State Purchasing Card Policyhttp://statepurchasing.doas.georgia.gov/vgn/images/portal/cit_1210/9/51/116137225P-

cardPolicyNews.pdf

SPD Official Forms Websitehttp://statepurchasing.doas.georgia.gov/00/channel_title/

0,2094,35226973_76322813,00.html


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Questions?


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Thank you!

welcome to the purchasing card policy changes webinar the meeting will begin promptly at 10:00 am

Documents

state code

state of georgiadepartment

use of state funds

purchasing cardchange

credits cards

charge cards

debit cards

intended use