procurement card training refresher procurement services: kathy bordenski, assistant director...

Procurement Card Training Refresher Procurement Services: Kathy Bordenski, Assistant Director Business Development Programs Management Advisory Services (MAS): Michele Evans, Director Alexandra Zouras-Wieneke, Manager Jennifer Thompson, Management Analyst Elaine Portnoy, Management Analyst

Training Objectives Review Requirements and Responsibilities of Cardholder Authorized Reviewer Verification Reviewer Current Monitoring Trends MAS reviews Audit Implications Various reviews and audits of pcard transactions 2

Introduction Procurement Card Program is managed by Comptrollers Office for State of MD Procurement law mandates that all purchases over $5,000 be made through Procurement Services to ensure appropriate purchasing method used Example competitive bids or sole source justifications obtained Consult Procurement Services regarding any order expected to exceed $5,000 Cards are: A benefit To be treated with the same level of scrutiny as a purchase order Any purchase not permitted by purchase order is not permitted by procurement card 3

Cardholder Responsibilities

Cardholder Responsibilities Understand and comply with all policies and procedures in the User's Guide which include:User's Guide Card security Secure the card, card number, expiration date, and security code at all times Do not share the card/sensitive details Promptly escalate inappropriate use or a lost or stolen card Make only allowable purchases - consult Procurement Services or MAS when uncertain Reimbursement from Foundation or other source for unallowable purchases not acceptable Promptly record each transaction (purchase or refund) on the log as they occur; include a clear description to justify business purpose for each purchasethe log Maintain a detailed receipt for each purchase (items purchased, quantities, itemized pricing, shipping charges, sales taxes, fees); ensure total on receipt matches the final purchase total 5

Cardholder Responsibilities (Continued) Document delivery of relevant purchases (packing slips, delivery date column of log, etc.) Promptly notify Inventory Custodian of non-capital and sensitive equipment purchases to ensure appropriate tagging and recording (e.g., document asset tag numbers on log or purchase documentation) Policy new policy coming!Policy Reconcile monthly transaction log to Visa statement within 7 days of rec eipt Complete Reconciled to Bank Statement column of log for each transaction Sign and date both log and Visa statement Promptly hand-off log, statement, and supporting documents to authorized reviewer Quickly address discrepancies or disputes, including sales taxes charged inappropriately; remember to log and monitor the status of expected refunds Accept no vendor incentives (gift cards, free games or other free items with purchase ) 6

Cardholder Responsibilities (Continued) Maintain records at least 3 years beyond fiscal year-end (may be longer for grant- related purchases) or until audited by Legislative Auditors whichever is later Effectively respond to all compliance and/or audit inquiries Promptly notify Procurement Services of any status changes Change in role Change in name/contact details Change of reviewer(s) Card no longer needed Separation of employment Surrender card immediately upon separation of employment or change in role/department 7

Reviewer Responsibilities

Authorized Reviewer Responsibilities Understand and monitor cardholder activity for compliance with all policies and procedures in the User's Guide.User's Guide Confirm the following for each cardholder: All transactions including any not posted to Visa statement were accurately recorded in the transaction log with clear descriptions regarding business purpose Visa statement was effectively reconciled to transaction log within 7 days of receipt Receipts and other relevant documents are included, and sufficiently detailed, to demonstrate every transactions compliance Cardholder has appropriately: Completed all relevant columns appearing on the transaction log Signed and dated both the log and Visa statement Sign and date both the log and Visa statement acknowledging compliance with the above requirements 9

Authorized Reviewer Responsibilities (Continued) Document concerns shared with each cardholder, including follow-up actions that need to be addressed by cardholder Subsequently confirm that each item has been addressed by the cardholder Escalate issues not addressed through appropriate departmental channel(s) and/or Procurement Services Forward completed transaction logs, Visa statements, and supporting documents to the verification reviewer, allowing sufficient time for the verification review to be completed by first business day of the following month If cardholder had no card activity for the month, obtain written acknowledgement (e-mail, blank/signed log stating this point, etc.) 10

Authorized Reviewer Responsibilities (Continued) Points to Remember You are the Universitys primary line of defense against non-compliant and potentially fraudulent purchases Authorized Reviewer is the only one who assesses the reasonableness of each cardholder transaction to ensure compliance Joe Evans requires that you promptly report the following to him each month - before his monthly affirmation to the State: Non-compliant cardholder transactions Scenarios in which all cardholder transactions have not been reconciled to the Visa statement Scenarios in which the authorized reviewer has not approved all transactions for the billing cycle Any gift card purchases A non-response to Joe Evans monthly e-mail by the authorized reviewer certifies that all charges for the billing cycle have been reviewed and are compliant, and reviewers have signed and dated the transaction log and Visa statement, as appropriate. 11

Verification Reviewer Responsibilities Receive monthly emails from Procurement Services showing cardholder activity for the most recent billing cycle By the first business day of the month following the cardholders reconciliation, confirm that: All relevant cardholders and authorized reviewers have signed and dated both their transaction logs and Visa statements timely The authorized reviewer signing is the reviewer on record with Procurement Services Note: the cardholders reconciliation is to be completed within 7 days of receipt of the Visa statement Sign and date the transaction logs, acknowledging the above points Promptly escalate instances of cardholder and/or authorized reviewer non- compliance to Procurement Services 12

Compliance Trends

Compliance Monitoring Trends What is currently happening Missing and incomplete transaction logs (completed log example)completed log example Transactions not logged as they occur/inadequate reconciliation to VISA statement Inappropriate charges not identified by cardholder or authorized reviewer Compromised card Duplicate vendor payments Personal purchases Incomplete and delayed reviews and/or verifications Incorrect reviewer of record Non-capital and sensitive equipment purchases not recorded on departments inventory register or inventory register not maintained by department at all 14

Compliance Monitoring Trends (Continued) Documentation concerns Clear business purpose Item descriptions, quantities, and prices on vendor documentation Vendor documentation present for all purchases (put back if removed for copies) Evidence that goods were received (packing slip, email, date on log) Logging and monitoring of returns/expected refunds Documented explanations for all off-campus shipments Sales tax paid and recovery not pursued Security of card and sensitive card details Maintained on filed documentation or in a safe with unrestricted access 15

Compliance Monitoring Trends (Continued) Vendor incentives Ex., gift cards, coupon vouchers, food items, tote bags/gift items Travel costs (taxi, parking, limo, lodging, etc.) Furniture purchases without MCE waivers Unauthorized food and accessory purchases Revised Policy effective 2/1/2014: New Food PolicyNew Food Policy Fellows and residents are not students! Gifts and awards Foundation expenses paid using state-issued VISA and subsequently reimbursed 16

Compliance Monitoring Trends (Continued) Split purchases what, why and how! Purchases exceeding $4,999 and split into multiple transactions to circumvent the thresholds Problem arises when Daily Purchases with same vendor exceed $4,999 (Example)Example What did you know and When did you know it? At the time of purchase/order, if you know the order will exceed $4,999 - do not use the pcard and contact procurement services for further assistance At the time of purchase/order, the amount does not exceed $4,999 pcard used to place order. Later that same day, another order was requested/placed with the same vendor and the combined orders exceeded $4,999.you must: Document the time/date of each request and order placement to show the orders were requested and made independent of the one another Requests should be from separate individuals and/or for separate projects Payment of multiple invoices from same vendor on same day exceed $4,999 Document invoices are for separate orders made on separate days order date important 17

Reviews and Audits General Accounting Division, Comptroller of Maryland Sends list of questionable transactions monthly GAD Questionable Vendors GAD Questionable Vendors Level 3 Data examples Level 3 Data examples Office of Legislative Audits Recently completed a Statewide Audit of the Procurement Card Program OLA State CPC Audit Report 2014 OLA State CPC Audit Report 2014 University System of Maryland Routinely sends lists of questionable transactions based on level 3 descriptions Management Advisory Services Performs routine pcard reviews of Departments Reviews questionable transactions 18

Contacts Procurement Services: Kathy Bordenski, Asst Director Business Development Programs (410) 706-5122; [email protected] Website: www.umaryland.edu/procurement/ Management Advisory Services (MAS): Michele Evans, Director (410) 706-5584; [email protected] Alexandra Zouras-Wieneke, Manager (410) 706-6848; [email protected] Jennifer Thompson, Management Analyst (410) 706-5996; [email protected] Website: www.umaryland.edu/mas/ 20

Helpful Links Procurement Card website for general pcard information: http://www.umaryland.edu/procurement/corporate-purchasing-card/ http://www.umaryland.edu/procurement/corporate-purchasing-card/ Procurement Card Users Guide: http://www.umaryland.edu/media/umb/af/procurement/UserGuide.pdf http://www.umaryland.edu/media/umb/af/procurement/UserGuide.pdf Pcard Program Forms (for changes to cardholder acct, reviewers, etc): http://www.umaryland.edu/procurement/forms/ http://www.umaryland.edu/procurement/forms/ Financial Services Policies/Procedures: http://www.umaryland.edu/financialservices/policies-and-procedures/ http://www.umaryland.edu/financialservices/policies-and-procedures/ Non Capital Equipment (including sensitive) Policy: http://www.umaryland.edu/media/umb/af/fs/policies/Non-CapitalEquipment.pdf http://www.umaryland.edu/media/umb/af/fs/policies/Non-CapitalEquipment.pdf Food and Business Meals Expense Policy: http://www.umaryland.edu/media/umb/af/fs/policies/FoodBusinessMealsExpens e.pdf http://www.umaryland.edu/media/umb/af/fs/policies/FoodBusinessMealsExpens e.pdf Office of Legislative Audits - Statewide Purchasing Card Audit 2014: http://www.ola.state.md.us/Reports/Performance/CPC14.pdf http://www.ola.state.md.us/Reports/Performance/CPC14.pdf 21

procurement card training refresher procurement services: kathy bordenski, assistant director...

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