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The Oconomowoc Area School District’s purchasing and payment evolution.

Best Practices &

Efficiencies in

Purchasing and

Accounts Payable

Purchase Orders

• 3-part NCR forms

• Teachers/staff completed by hand

• Signed by Principal/Administrator

• Sent to A/P via school mail

Accounts Payable

• Printed 3 copies on different colored paper

• Mailed to vendor

Teacher/staff reimbursements

• 2-part expense reports

• Signed by Principal/Administrator

• Sent to A/P for payment w/ receipts attached

Purchasing was paper intensive with multi-part

forms

Forms were shuffled from

person to person

Authorizations were

manually

Long timeline from

request to receipt

Purchasing – Remember the day when…

Purchasing process was costly and inefficient: (1) efforts were duplicated by different

staff, (2) forms were often lost/buried, (3) process took a long time, and (4) paper, files,

forms, and storage boxes were costly.

Reduce use of paper and forms

Improve process efficiency

Automate authorization and approval

Provide purchasing timeliness

Expand product selection

Negotiate vendor pricing

Online Requisitions & Preferred Vendors

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Skyward access and clearance must be set up.

Ecommerce or Traditional Requisition

•User must be put into a Purchase Order group.

•User must have an Account Clearance group.

•This grants access to only specific locations or departments, purchase order numbers, and general ledger accounts.

Auto-approval can be set up.

Auto-approval and online approval

•Approvers receive an email when requisitions are waiting for approval.

•AA, Principal, or Directors approve or decline requisitions entered by staff.

•Auto-approval can be set-up with minimum thresholds to ensure timely approval.

Process tracking and notifications are generated.

Email Notifications and

Reports•Status reports can be generated for Work-in-Progress, Waiting-for-Lower-Level-

Approval, and Approved/Declined purchase orders.

•Email notifications are sent to approvers with requisitions needing action.

•Confirmation email is sent to originator upon approval/denial of requisition.

Requisition entered directly into Skyward by AA or teacher

Online approval

Electronic notification and reports

Online Requisition – Process Setup

Account Clearance Groups

Requisition/Purchase Order Groups

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Approvers and Auto-Approval Rules

Teachers enter their own requisitions.

◦ Pick the vendor

◦ Enter a description

Online Requisition Process

◦ Enter the items to be ordered

Online Requisition Process

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Online Requisition Process

◦ Select a mock account code

◦ Submit for approval

Ecommerce Vendors

Amazon

Reliable Vendors w/

Good Communication

Efficient Processes

Accept Pcard

Trusted by

Teachers

Fast and/or

Free Delivery

Designate Preferred Vendors

Options

Try to create as many vendor contracts as possible

Cost Matters

Request special pricing or shipping arrangements deals

Work with sales representatives for price matching

Economy of Scale

Use the power of consortiums and cooperative purchasing groups – TCPN (with Office Depot), V.A.L.U.E., State contracts

Power in Your Vendors

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Skyward Ecommerce Vendors

Ecommerce Vendors in Skyward

Ghost pcard

Consistent User/Approval

Process

• Skyward link

• Log-in, password, punch-out link, order link

• Vendor’s website set up with discounts applied at checkout

• MCC codes are limited

• Account code set up is the same for each entry

• Wire transfer payment is used in Skyward to post to accounts and close the purchase order

• Order process is the same for teachers except they are punched-out to the vendor website

• Approval process is the same

Skyward Ecommerce Vendors

Skyward Ecommerce Vendor Setup

◦ Work with Skyward and Vendor

Obtain necessary login/links

Test the ‘punch-out’ and ‘check-out’ processes

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‘Punch-out’ to Ecommerce Vendor Website

◦ Shop online and fill “shopping cart”

◦ Pricing reflects negotiated discounts / contract pricing

‘Check-out’ into Skyward Purchase Order

◦ Check-out brings purchase into Skyward, including each detailed line item

Email Purchase OrdersSaves time and money (envelopes and postage)

To Setup – Send a form along with faxed copy of purchase order

When purchase orders are updated - include the

vendors that need to have something ordered

Send all the purchase orders that have email

addresses• If there are vendors who don’t have an email in

the system, call and request an email address before sending

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Email Purchase Orders

Email Purchase Orders

◦ Email confirmation and a copy of the purchase order can be sent to a designated person to

ensure it was sent by Skyward

Employee spent personal money for mileage and travel related purchases

Employee completed 2-part NCR expense form, attached receipts, and requested manual signature approval

Form submit to A/P, processed, and paid with check

Expense Reimbursements

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Online Expense Reimbursements –Employee Access

‘Turn-on’ Expense Reimbursement in Employee

Access

Product Setup, Employee Access

Online Expense Reimbursements –System Set-up

Financial Management, Accounts Payable

Online Expense Reimbursements –Configuration

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Online Expense Reimbursements –Reimbursement Entry Option

Online Expense Reimbursements –Automated Notifications

Online Expense Reimbursements –Approval Options

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Codes can be specific

◦ In-district mileage set to specific # of miles between sites

Codes can be general

◦ Meals, types of travel, mileage out-of-district

Expense Reimbursement Codes

A code

can’t be

deleted

once

used!

Fields can be altered to give end-user rights to modify quantity or amount OR limited to allow no changes

Expense Reimbursement Codes

Limit employee groups for reimbursement codes

Expense Reimbursement Code Set-up

◦ By adding or limiting employee groups to reimbursement codes, you limit who has access to use the codes

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Expense Reimbursement Code Set-up

◦ Employee groups default to see account codes they have access to OR you can limit access to specific account codes

Input similar to requisitions – Documentation scanned or sent to A/P

Paid with normal weekly ach run

AP reviews documentation for accuracy and compliance with travel policy

Online Expense Reimbursements

Online Expense Reimbursements

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Complete and accurate

information

Better use of staff time

Prompt Estimate

Fillable Form didn’t work

Improve Efficiency and

Timeliness

Teachers completed a paper form that went through manual approvals

Forms were often inaccurate and incomplete

An employee couriered the forms to the bus company

Bus company would check for availability

Field Trip Transportation Purchase Orders-Historical

Created a generic ‘bus company’ Skyward account with limited access

User name and password provided to bus company personnel approving and booking the transportation for field trips

Put the bus company in the organization chart so that requisitions could be sent to them in the approval process

Online Field Trip Transportation Purchase Orders – Set-up

Online Field Trip Transportation Purchase Orders – Process

Bus company invoices district

Purchase order number is included on the invoice to facilitate matching / reconciliation

Requisition goes through online approval process

Bus company is set up as an approver

Teacher enters an online requisition

Select bus company as the vendor

Enter info for the field trip: Date, # of students, Place,

Pick-up location

Enter a generic dollar amount

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Online Field Trip Transportation Purchase Orders – Process

Who? ◦ Employee, Vendors, Athletic officials/referees

What?◦ Change payment method from check to ach

Why?◦ Check payments are costly Personnel time to print, fold, and mail checks

Check stock

Envelopes

Postage

Lost in mail

Reconciliation issues – outstanding checks

A/P ACH Payments

ACH Payments – Employee Set-up

When setting up employee as a vendor, there is

a checkbox to use direct deposit info

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ACH Payments – Vendor Set-up

Co

nta

ct

Ve

nd

or • Sent form w/

paper check requesting change to ACH

• Verify banking and contact information collected B

en

efits

of

AC

H • Faster payment

• Reduced errors

• Paperless processing

• Bank information is more secure U

pd

ate

Skyw

ard • Input data

collected from vendor response

• Process a payment to ensure accurate banking info

ACH Payments – Officials and Referees

District Benefit

Set-up process similar to other vendor ach’s

Reduce # of small dollar checks

Improve efficiency - Incorrect addresses resulted in lost or returned checks

Streamlined bank reconciliation – fewer outstanding checks

Better control over cash flow

Officials Benefit

ACH paid weekly, paper checks for officials cut only 1x per month

No issues or delay with mail

Money is in account – no need to cash check

ACH Payments – Process

ACH ‘check’ run is almost the same as a paper check run Use a separate batch number when entering ACH

invoices ACH vendors will automatically populate check type with

ACH when entering an invoice Check updating process is the same as a paper check,

except the last step – Need to click ‘UPDATE’

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Pcard Program

• Implemented in 2007-08

• A/P card and small pilot program group

• Good internal controlsProgram

• 100+ cardholders

• Administrators, teachers, custodians, administrative assistants, club advisors, coaches

• Department cards

Cardholders

Pcard Program Set-up

Know upfront that the set-up will be time-

consuming and challenging

Start small with a pilot program to identify and

resolve the glitches

Think through the entire process

Get key player buy-in – Board, B&G, A/P, Administrative Assistants, etc.

Do it right the 1st time – it will be hard to change the program once established

Pcard Program – Internal Controls

• Monthly transaction limit

• Per transaction limit

Card Spend Limits

• Restrict where/how card is used

• Exclude: jewelers, liquor stores, art galleries, medical facilities

• Different groups for different cards

MCC Code Limits

• Wisconsin Seller’s exemption # put on cardSales Tax

Exemption

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Pcard Program – Internal Controls

• Each card audited twice per year

• Spend volume or merchant types

• Non-compliance or Types of useAudit

Accidental Personal Use

• Excel report of monthly transaction detailed

• Finance committee reviews – just like check register

Board Approval

Pcard Program – Month End Process

Cardholder -statement

•Print and Reviewstatement against purchase receipts

•Staple receipts to statement, sign and date

•Store in monthly accordion folder

Cardholder -online

•Log into online system (Smartdata)

•Enter a detailed description of the purchase

•Select a GL account code.

•Click ‘Cardholder Reviewed’

Business Office

•2X per month download reconciled transactions

•Modify for Skyward format

•Upload transactions via a journal entry into Skyward

Transaction Detail

Pcard Program – Smartdata (online)

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General ledger codes are limited to user’s

authority

Pcard Program – Smartdata (online)

Why?

• Limit Cash Requests

• Alleviate AA Work

What?

• Pilot Department Cards

• Athletics, Summer School, 1 Elementary School

Where next?

• Grants

• Drama Department

• Robotics

• OHS Clubs, including Student Council, Art

And Why?

• Improved record-keeping

• Consolidated documentation

• Limit cash purchases by employees and parents

Pcard Program – Department Cards

Cash Flow Management /

Prediction

Bank Reconciliation

Ease

Payment Process

Efficiency

Risk of Fraud Reduced

Internal Control Improvement

More Meaningful Work – Job Satisfaction

Time Efficiency Pcard Rebate

End-user Empowerment

Cost reduction

Benefits of Pcard Program

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Evolving Payment Types

100.00%

89.49%

80.68%83.56% 82.44% 82.17%

66.31%

57.82%

43.44%

33.03% 32.93%

0.00%

10.51%

19.32%16.14% 17.21% 17.44% 19.22% 20.48% 21.85%

19.68%22.49%

0.00% 0.00% 0.00% 0.30% 0.35% 0.38%

14.47%

21.71%

34.70%

47.30%44.58%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

06-07 07-08 08-09 09-10 10-11 11-12 12-13 13-14 14-15 15-16 16-17

Percent of Total $

Checks Pcard ACH

Payment Method Change-Checks & ACH

6,7

99

5,0

72

3,8

85

3,0

98

2,8

55

2,8

27

2,5

96

2,0

68

1,8

25

1,6

57

73

0

0

0

0

44

1

51

8

57

7

1,1

04

1,5

11

1,7

08

1,7

56

1,0

60

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

06-07 07-08 08-09 09-10 10-11 11-12 12-13 13-14 14-15 15-16 16-17

Total Quantity

Checks ACH

Annual Payments ($) by Payment Type

$20,

747,

786

$18,

854,

653

$17,

343,

837

$18,

717,

037

$20

,188

,36

0

$20,

061,

253

$15,

798,

409

$14,

609,

247

$9,3

17,

997

$7,2

05,

926

$3,

626,

754

$0 $0 $0 $66

,540

$85

,664

$93

,232

$3,

447,

556

$5,

484,

798

$7,4

43,7

19

$10,

320

,398

$4,

910,

335

$0 $2,

215,

011

$4,

152,

658

$3,

615,

318

$4,

214,

392

$4,

258,

643

$4,

578,

998

$5,

173,

934

$4,

687,

715

$4,

292,

970

$2,

477,

481

$-

$5,000,000

$10,000,000

$15,000,000

$20,000,000

$25,000,000

06-07 07-08 08-09 09-10 10-11 11-12 12-13 13-14 14-15 15-16 16-17

Yearly Total Dollars

AP Checks ACH Pcard

2006-07 $20,747,786 2011-12 $24,413,1282007-08 $21,069,664 2012-13 $23,824,9632008-09 $21,496,495 2013-14 $25,267,9792009-10 $22,398,895 2014-15 $21,449,431

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Pcard Rebate: 2007 through 2016

$4,727

$72,244

$58,762$63,866 $66,386

$77,914

$93,308

$84,833$79,261

MAR 07 TO FEB 08

MAR 08 TO FEB 09

MAR 09 TO FEB 10

MAR 10 TO FEB 11

MAR 11 TO FEB 12

MAR 12 TO FEB 13

MAR 13 TO FEB 14

MAR 14 TO FEB 15

MAR 15 TO FEB 16

Am

ou

nt Ea

rne

d

Year Earned

Rebates Earned $