Gull Lake Community Schools
Administrative Guidelines
 

6423 - PURCHASING CARD CARDHOLDERS GUIDE

OVERVIEW

The Purchasing Card Program is intended to streamline and simplify the Purchasing and Accounts Payable functions. The Purchasing Card is a tool that reduces transaction costs, facilitates timely acquisition of materials and supplies, automates data flow for accounting purposes and offers flexible controls to help ensure proper usage.

The Purchasing Card Program is designed as an alternative to a variety of processes including petty cash, check requests, and low dollar purchase orders. The Purchasing Card Program is not intended to avoid or bypass current payment procedures. Rather, the Program complements the existing processes. The card is a MasterCard credit card that is issued by Fifth Third Bank. Some minimal record keeping is essential to ensure the successful use of the Purchasing Card. This is not an extraordinary requirement; standard payment policies require retention of receipts, invoices, and other supporting documentation.

This Cardholder Guide provides information about the process, the types of purchases that can and cannot be made, records that must be maintained and reconciled for each cycle and a variety of other program information.

PLEASE REMEMBER THAT THE CARDHOLDER IS COMMITTING DISTRICT FUNDS EACH TIME THE PURCHASING CARD IS USED. Each Cardholder is responsible for all charges made to their assigned card. Intentional misuse or fraudulent abuse may result in disciplinary action up to and including dismissal. The Purchasing Card must never be used to purchase items for personal use or for non-Gull Lake Community Schools purposes, even if the Cardholder intends to reimburse Gull Lake Community Schools.

The card will have no impact on your personal credit. Although the card lists an individual's name, the card is actually issued to the Gull Lake Community Schools (GLCS).

DEFINITIONS
 A.Purchasing Card: A charge card issued to a full-time employee of GLCS for the purpose of making authorized purchases on the District's behalf.
 B.Cardholder: Full-time GLCS employee whose name appears on the Purchasing Card is accountable for all charges made with that card. At this time the cardholders are limited.
 C.Supervisor: GLCS employee within each department responsible for verifying that all charges against the Cardholder's account are backed up by support documentation and that the purchases are legitimate purchases. In Gull Lake this would be the budget manager for the area. When the cards are issued to a budget manager their signature as employee is also valid as the supervisor. If we get to the point where additional cards are issued the budget manager will review charges on those cards. The supervisor must sign the monthly reconciliation form, indicating that the form is complete with documentation and that all purchases have been approved.
 D.Purchasing Card Administrator: GLCS employee responsible for administering the Purchasing Card Program for the District and acting as the main contact between the District and the Bank. This person is presently Lisa Anderson.
 E.Transaction/Charge Limit: A dollar limitation of purchasing authority assigned to the Cardholder for each total charge made with the Purchasing Card. This amount is indicated on the Cardholder Agreement Form, and may differ among employees.
 F.Monthly Spending Limit: A dollar limitation of purchasing authority assigned to the Cardholder for the total of all charges made during each monthly billing cycle. This amount is indicated on the Cardholder Agreement Form, and may differ among employees.
 G.Statement of Account: A listing of all transactions charged to the Cardholder's card account up to the end of the monthly billing cycle. The Bank sends this statement on a monthly basis directly to the Business Office and to the Cardholder.
 H.Support Documentation: A merchant produced or non-district document that records the relevant details for each item purchased including quantities, amounts, and a description of what was purchased, total charge amount and the merchant's name and address (e.g. sales receipt, original invoice, packing slip, credit receipt, etc.).

OBTAINING A CARD

Only full-time employees of GLCS are eligible to receive a Purchasing Card. Contractors or temporary employees are not eligible. Each cardholder is responsible for the security of their own card and all transactions made against the card. Each cardholder will be required to sign a Purchasing Card Cardholder Agreement.

Upon receiving the purchasing card, the cardholders should IMMEDIATELY SIGN the back of the card and always keeps it in a secure place. Although the card is issued in your name, it is the property of GLCS and is only to be used for District purchases as defined in this guide.

PURCHASING CARD RESTRICTIONS

The Purchasing Card IS NOT to be used for personal purchases, cash advances, major projects or major repairs, or meals.

Transactions should not be split into separate receipts to bypass the single transaction dollar limit. A routine review of transactions will be performed. Contact your supervisor if you find that your single purchase limit is set too low. At this time the limits have been set within the ranges approved by the Assistant Superintendent of Finance and Operations and the Board of Education.

USING THE CARD

Purchases, with the necessary approval, are initiated using your assigned card. Be sure your purchases are within your budget, as detailed in the Purchasing Card Cardholder Agreement. You must receive a detailed receipt for each purchase. You may also order by phone, mail, or the Internet using your credit card. When you place your order by phone, ask that a receipt be included with the goods when the product is shipped. This receipt is the only original documentation. Your Purchasing Card number, expiration date and the "ship to" address. It is important that the word "MasterCard" and your name appear on the invoice. Companies that are frequently used by the District already have the GLCS Accounts Payable in their computer and will likely forward the invoice there. Accounts Payable will forward to you – IF YOUR NAME AND MASTERCARD appear on the face of the invoice; if they do not, Accounts Payable will have no idea where to direct the invoice when it arrives.

YOU MUST KEEP ALL RECEIPTS FOR ITEMS YOU PURCHASE

When you are issued a receipt, you should write on the back of the receipt the reason for the purchase and the account number that the purchase should be charged to. This way you will have the information handy when it is time to reconcile your monthly statement and you will not be subject to relying on your memory for the details. Have a special envelope that you retain your receipts in until you reconcile, this way receipts will never get misplaced.

SALES TAX

Sales tax should not be paid on any purchases made with the Purchasing Card. It is the cardholder's obligation to identify the purchase as tax exempt and to verify that sales tax was not charged on the purchases. If sales tax has been charged, the cardholder will be obligated to get an adjustment on the purchase.

RECONCILING YOUR ACCOUNT

Every month, you will receive an itemized statement of your charges from the credit card company. The statement will identify each transcation made against the Purchasing Card during the billing cycle. This statement must be immediately reconciled against your receipts for accuracy. A reconciliation form must be completed and all receipts must be attached. The form must be signed by you and approved by your supervisor. After proper approval, please forward to the Business Office. The Business Office must receive your reconciliation by the 10th day of the month or sooner if applicable.

If you make telephone purchases, it is helpful to keep a transaction log as a tool to help maintain purchase information and to help reconcile your account. If the statement of account arrives before you receive the invoice, you can use the following as evidence of purchase: 1) the packing list to verify receipt of goods and 2) the catalog form to verify purchase price.

RESOLVING ERRORS AND DISPUTES

In case of an error, contact the supplier to reach an agreement. Most disputes can be resolved between you and the merchant directly.

If you are unable to reach an agreement with the merchant, notify the Cardholder Administrator in the Business Office for assistance.

PAYING THE BILL

The Purchasing Card is a corporate pay arrangement. Account balances will be paid in full monthly. Your purchases will be charged to expense accounts based upon the ASN number that you indicate on your reconciliation.

Do not send your statement to Accounts Payable with a request for disbursement! Use the reconciliation forms.

LOST OR STOLEN CARDS

Your Purchasing Card should be secured, just as you would secure your personal credit cards. If your card is lost or stolen, immediately contact Fifth Third Bank at 1-800-782-0279. Also notify the GLCS Purchasing Card Program Administrator, Lisa Anderson at 629-5880 ext. 3002.

REFUSAL OF CARD OR ACCOUNT

If your purchase is declined at the point of sale, the vendor will not know why the sale did not go through. Ask the manager to call the customer service number listed on the back of the card for Fifth Third Bank. The customer service representative will tell you why the sale was declined.

DEPARTMENTAL CHANGES

If you transfer to a new department, resign your position, or are terminated, immediately notify the Purchasing Card Program Administrator, Lisa Anderson at 629-5880. You must return your card to the Purchasing Card Program Administrator.

PURCHASING CARD AUDIT ACTIVITY

Your card activity is subject to random audits by the Business Office or the District auditing firm. The purpose of the audits is to help ensure adherence to the program's policies and procedures.

MERCHANTS THAT DO NOT ACCEPT THE CARD

Merchants are to be encouraged to become involved in the Purchasing Card Program so that you can use the Program most effectively. Merchants may contact their local bank or financial institution to become credit card capable. For those merchants that are unwilling to participate in the Program, alternative sources should be found.

RECONCILIATION FORMS

There is an account reconciliation form available in Excel and is accessible on the GLCS website.

Approved 1/8/07