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  • Purchasing Card Policies and Procedures

Business Services

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  • Purchasing Card Policies & Procedure

     

    Authority - MnSCU – Purchasing Cards

    Board Policy 7.1, Authority, delegates to the Chancellor authority to develop procedures and guidelines to implement Board policies.

    http://www.mnscu.edu/board/procedure/703p3.html

    LOST OR STOLEN U.S. BANK CARDS ARE REPORTED TO 1-800-344-5696


     


     

    A. Purpose

    Purchasing cards provide the university with a cost-effective, convenient and streamlined method of purchasing items, thereby reducing the volume of individual payments processed by the university to vendors. In addition, reports on cardholder activity provide the university the information necessary to better manage university purchasing activities.

    B. Definitions

    Minnesota State University Moorhead has an institutional purchasing card. A purchasing card in the name of a university can be issued to a state employee upon approval by the employee’s supervisor and/or budget manager. The university is liable to the purchasing card company for all charges made in connection with the purchasing card issued to the individual. A purchasing card cannot be issued to a contractor, contract employee, or student employee.

    C. Procedures for Obtaining a Purchasing Card

    The purchasing card with U.S. Bank is for official university business use only. Minnesota State University Moorhead has established procedures and forms for implementing and monitoring a purchasing card program that includes, but is not limited to, the following:

    1. A dollar limitation on the purchasing card;
    2. A dollar limitation of purchasing authority assigned to the cardholder per transaction made with the purchasing card;
    3. A dollar limitation of purchasing authority assigned to the cardholder for the total of all charges made during each monthly billing cycle;
    4. Merchant category blocking;
    5. An application form is available on the Business Services web site www.mnstate.edu/business-services
    6. A picture ID may be required when picking up your purchasing card at Business Services.
    7. A delegation of authority form must be completed before a card is issued to an employee.
    8. A cardholder user agreement must be read and signed at card orientation.

    D. Authorized Card Use

    Cardholders are authorized to use the card to purchase merchandise or services required as a function of their duties at the university. Unauthorized and/or inappropriate card use is addressed below.

    A purchase made with a purchasing card may be made in-store, by telephone, fax, internet, or U.S. mail. Please use with extra care on the internet by checking first to make sure that it is a secure web site. When giving your purchasing card number out, please be sure of whom you are giving it to.

    Preapproval, as approved by the college, university, or Office of the Chancellor, is required for each purchase. Please discuss this with your budget manager BEFORE use of the purchasing card.

    Pre-Approval may take place in a number of ways, including, but not limited to:

    1. Standard requisition form developed by the division, college or unit cost center indicating the item to be purchased, the estimated cost, the date of purchase and the authorized signature of the purchasing card holder and budget manager. (See Sample Form attached)
    2. E-mail acknowledgement from the budget manager indicating the item to be purchased, the estimated cost and the date of purchase.
    3. Travel requisition indicating which items are to be charged to the purchasing card, the dates of travel, the time of the event(s) and approval by the budget manager.
    4. A special expense form indicating which items are to be charged to the purchasing card, the date and time of the event(s) and approval by the budget manager. This form must be filed with Business Services prior to the actual event for final approval.
    5. Approval as granted under the authority for local purchase as determined.

    It is the responsibility of the cost center budget manager and cardholder to ensure compliance with Minnesota Statute. The pre-approval documents should be kept with the cost center records of purchasing card use by the employees covered in that cost center. IT, AV/TV or other university service departments making purchases on behalf of another cost center should retain a copy of the document (e-mail, requisition, etc.) requesting and authorizing that purchase. The pre-approval documents need to be kept for seven (7) years.

    E. Unauthorized and/or Inappropriate Card Use

    Unauthorized and/or inappropriate card use includes, but is not limited to:

    1. Items for personal use;
    2. Items for non-university purposes;
    3. Cash or cash advances;
    4. Food and beverages for an individual employee as provided for in the labor agreements and reimbursed on an employee expense report. Authorized cards may allow for food and non-alcoholic beverages for business-related meetings in compliance with system procedures and after obtaining approval for special expenses by completing the form “Special Expense Form”. The names of those that will eat & their title or connection to the university and the reason for the purchase of the food need to be included on the form. The form is on the Business Services web site.
    5. Alcoholic beverages;
    6. Weapons of any kind or explosives;
    7. Relocation expenses;
    8. Travel excursion or group expenses unless an approved business plan is on file with the appropriate Vice-President and/or Dean. Costs charged are for those covered by student credit hours and the instructor’s expenses. Athletic team travel expense is addressed in section (G);
    9. Vehicle rental insurance for vehicles used within the United States;
    10. Equipment – defined as having a value of $10,000.00 or more per unit, not the total order; or deemed “sensitive” such as computers (laptop, desktop, Ipad, netbook, ect.) printers, data projectors, university cell phones or office phones.
    11. Entertainment, movies;
    12. Recreation;
    13. Payment of personal services to an individual;
    14. Travel insurance

    A cardholder who makes an unauthorized purchase with the card or uses the card in an inappropriate manner will be subject to revocation of the purchasing card and disciplinary action including restitution to the university for unauthorized purchases, possible card cancellation, termination of employment at the university and criminal prosecution.

    If any item purchased with a Purchasing card is not acceptable, arrangements must be made for a return for credit or an exchange. A cash refund or check is prohibited unless the vendor insists that a refund must be by cash or check, and then the funds must be deposited immediately with the university. Notification must be made to the Purchasing card administrator in Business Services so the receipt number and a proper notation can be made on the purchasing card statement. The proper cost center and object code must also be credited when deposit is made.

    F. Consequences for Non-Compliance

    Failure by either the cardholder or the approver to comply in a timely manner with established purchasing card policies and procedures results in immediate suspension or revocation of cardholder privileges and possible disciplinary action according to labor agreements.  The MSUM purchasing card allows for one warning per fiscal year for statement submission non-compliance.  Statements and/or approval signatures will need to be submitted to Business Services within 10 days of the warning notification or a suspension will be issued.

    1st Offense-Card will be suspended immediately. Once completed paperwork is submitted, the card will remain suspended for 30 days.

    2nd Offense-Card will be suspended immediately. Once completed paperwork is submitted, the card will remain suspended for 180 days (6 months).

    3rd Offense-Card will be revoked immediately. Card will not be reissued.

    G. Responsibility and Accountability

    It is the responsibility of each individual cardholder to:

    Safeguard the purchasing card and card account number at all times. Lost or stolen Purchasing cards must be reported immediately to U.S. Bank credit card division AND to MSUM Business Services. LOST OR STOLEN CARDS ARE REPORTED TO 1-800-344-5696

    1. Keep purchasing card in a secure location at all times.
    2. Do not allow anyone else to use the purchasing card and/or account number.
    3. Obtain and retain original itemized receipts for goods and services purchased: all forms of cancelled checks, copies of credit card bills, and credit card stubs (total amount only) do not substitute for original itemized receipts. An employee in limited circumstances may be allowed to file an affidavit in lieu of a receipt. An affidavit needs to list the items and prices of all purchased goods and services (NOT just the name of the vendor). Excessive use of affidavits may result in loss of purchasing card privilege;
    4. Review electronic monthly statement in a timely manner. The cardholder has until the 5th day of the month to complete their statement and submit to their Final Approver. If the cardholder does not process their statements in a timely manner and/or turn in the printed statement with proper receipts, their purchasing card will be suspended.
      1. Check statements from U.S. Bank for accuracy to ensure all transactions posted are legitimate transactions made by the cardholder.
      2. Check the default cost center to make sure it is correct. Change if necessary.
      3. Using the drop down list, select the correct object code.
      4. Add a description/purpose of each transaction (NOT the name of the cost center that is paying it). Indicate the name of the employee that the expense is for if it is not the cardholder.
        1. If a transaction is for out of state or international travel, attach a copy of your Travel Authorization with your monthly statement.
        2. Any employee travel expense for out of state or international travel on a purchasing card that does NOT have a Travel Authorization will be assumed to be a personal expense and will need to be reimbursed or will be deducted from their paycheck.
         
      5. Click the “Print Account Activity” and select landscape layout/view.
      6. Original itemized receipts must be attached to the printed statement.
      7. The authorized user of the purchasing card must electronically sign the statement by selecting the transactions to be approved, clicking the “approve ” button and then following the approval screens. By approving the transaction you are also stating that the goods have been received.
      8. Manually sign and submit the printed statement with all documentation/original itemized receipts to Final Approver by the 5th of each month.
      9. If you have a charge on your purchasing card statement that you did not make, or don’t know anything about, please check it out with the vendor if possible. If not possible, or still believed to be fraudulent, contact Business Services and file a dispute online if needed.
       
    5. Inform the cashier before processing a charge that MSUM is tax exempt in MN and ND on all items except: lodging, meals eaten in restaurants, car rental and solid waste collection & disposal. The tax exempt number is printed on the purchasing card. That number is 1746999.
    6. Do not use your MSUM issued Purchasing card at internal departments (i.e., bookstore or food service). Charge to the university department account instead.
    7. Surrender the purchasing card to the Card Administrator in Business Services prior to separation from the university.
    8. Take any other steps necessary to ensure that the purchasing card is used only for authorized purposes.
    9. Notify Business Services if your default cost center changes and/or your supervisor changes.
       

    The university shall conduct periodic reviews for proper card use. Purchasing card records will be audited each month. Each purchasing cardholder has a “Final Approver” who reviews and approves transactions before they are submitted to Business Services for entry to the accounting system. An approver may reject any particular purchase and return the item to the cardholder for payment. Notify Business Services of possible fraud in the use of the purchasing card or suspend/terminate purchasing card use by any particular employee at any time. The university has the right to suspend or terminate the purchasing card program at any time.

    It is the responsibility of the cardholders Approver to:

    1. Review all purchase documentation submitted by the cardholder;
    2. Verify the transactions are consistent with the duties and responsibilities of the cardholder, and compliant with the University’s policies and procedures. The Approver is responsible for returning incomplete documentation to the cardholder.
    3. Approvers must manually sign the statement for approval and submit an electronic approval or denial, using the US Bank website, of monthly transactions by the 15th of each month.

    Failure by either the Cardholder or Approver to comply in a timely manner results in immediate suspension of cardholder privileges.

    H. Special Purchasing Cards Procedure for Athletics

    In addition to the procedures set forth above, these special conditions apply to athletic team and recruiting expenses.

    1. Student Funded Activities Expense
      1. Team Travel. Purchasing cards may be used for any team travel expenses including but not limited to transportation, lodging, meals and entry fees when in travel status
      2. Equipment and Supplies. Purchasing cards may be used when purchasing team uniforms, sport-related equipment costing less than $5,000 per unit and other small supplies.
       
    2. Recruiting. Purchasing cards may be used to incur recruiting expenses as follows:
      1. Off campus recruiting trips (meals , lodging, transportation, registration fee, etc.)
      2. Local Official/Unofficial visit expenses, including meals for the recruit and family, are allowed on a Purchasing Card. In addition, the state employee may also be allowed to charge their meal on the purchasing card, if a Special Expense form has been approved.
      3. When meals with recruits are charges, list the first and last name of the people who ate on the receipt.
       

    Rationale: Efficiency and ease of accountability is the main reason coaches should use purchasing cards for allowable expenses. Using purchasing cards for travel expenses reduce the risk associated with carrying a large amount of cash on the road. One team could be carrying as much as $2000 in cash for meals and related expenses. Using purchasing cards for local Official/Unofficial visits is more efficient because some of the visits occur at the last minute. In addition, a lot of recruiting is done by part-time coaches. It is unreasonable for MSUM to require them to spend their own money up front for legitimate business-related expenses.

    I. Professional Development Travel

    Purchasing cards may be used for transportation, lodging and registration fees when traveling for professional development. No meals are to be charged. Original, itemized receipts and a copy of the approved Travel Authorization(for out of state or international travel) must be turned in with the Purchasing card statement.

     Purchasing Card Purchase Requisition