ADMINISTRATIVE POLICY

Using the University Procurement Card
Responsible University Officer: Vice President and Chief Financial Officer/Treasurer
Policy Owner: Director of Purchasing Services
Policy Contact: See Contacts Section

POLICY STATEMENT

The University provides a procurement card program for business-related purchases where the good or service is not available in U Market, or where the nature of the purchase does not require use of an official University purchase order. 

The Chief Financial Manager (CFM) is responsible for monitoring for violations and may set additional restrictions for use by those within their college or administrative unit and may designate another individual in their unit to manage PCard activity and approve card applications (including what type of cards may be issued), and suspend and cancel cards. 

Individuals who fail to comply with this policy and all associated procedures may result in card suspension, cancellation, and disciplinary action up to and including termination of employment.

General Requirements

  • Cardholders must be current employees (on payroll) who have purchasing responsibilities.
  • Cardholders must complete the online training: PCard Cardholder Training: Using the University PCard before a card is issued.
  • Cardholders must submit a signed “PCard Cardholder Agreement” with application.
    • A signed agreement is required every three years, before a renewal card will be reissued.
  • Cards are issued to an employee who assumes all responsibility for use of the card.
  • Supervisors/units must cancel the procurement card when a cardholder is terminated, transfers to a new RRC (Resource Responsibility Center), or no longer performs purchasing duties.
    • Cardholders who transfer to a new RRC may complete an application for a new card if applicable to their new duties.
  • All transactions must be verified and approved within 30 days of the transaction becoming available in the financial system.
    • Administrative Procedure: Verification and Approval of PCard Activity

Cardholders must

  • Use the card only for business related purchases of goods and standard (not professional) services up to $2,500 per individual transaction ($10,000 monthly).
  • Not split a purchase to avoid $2,500 transaction limit.
  • Not use the card for personal purchases.
  • Not use the card for purchase of alcoholic beverages.
  • Charge the purchase to non-sponsored and sponsored ChartField strings and must comply with sponsor and University policies.

Individual and Departmental Cards

  • The individual submitting the card application must identify the need for either an individual card or a departmental card.
    • Individual cards are used by employees for purchases that are necessary to do their job, or for a program or project over which they have primary or individual purchasing responsibility.
    • Departmental cards are used for purchases that are necessary for departmental operations, or that are essential for the functioning or advancement of a University program or project. Departmental Cards may be used by someone other than the cardholder and may be issued in order to reduce the number of cards within a department or unit.
      • The employee who is responsible for the card must set up internal processes to safeguard the card and ensure that transactions can be identified to the individuals who use the card.
        • Anyone who uses a PCard should read and sign the “PCard Cardholder Agreement”. A copy of the agreement should be kept on file with the employee who is responsible for the card.
        • It is recommended that a tracking log be used to keep track of the card and purchases made with the card. 
      • The employee who is responsible for the card should reconcile the PCard activity on a weekly basis.

Sales Tax

Violations

CFMs have been delegated responsibility for monitoring for violations and may set additional restrictions for use by those within their college or administrative unit.  Violation of University or unit policies, or the cardholder agreement, may result in loss of card privileges.

At a minimum, these are violations of policy:

  • Split purchases to avoid the $2,500 transaction limit
  • Personal purchases
  • Purchase of alcoholic beverages

REASON FOR POLICYRETURN TO TOP

The purpose of this policy is to provide guidelines for the issuance and use of the PCard and ensure that sufficient controls are in place to mitigate risk. Responsibility for financial control of the use of the procurement cards rests with each college or administrative unit.

Subject Contact Phone Fax/Email
Policy & Procedure Questions
Financial System Inquiries
University Financial Helpline 612-624-1617 finsys@umn.edu
Card Application University Financial Helpline 612-624-1617 finsys@umn.edu
Provider Bank US Bank 1-800-344-5696
Sales Tax Exemption Tax Director 612-624-1053 612-626-0876
Other Purchasing Options Purchasing Services 612-624-2828 purchase@umn.edu
Hotel/Conference Space Rental Real Estate Office 612-626-3445 mazone@umn.edu
Sponsored Projects Sponsored Financial Reporting 612-624-5007 npilman@umn.edu

DEFINITIONSRETURN TO TOP

Capital Equipment
An item with an acquisition cost of $5,000 or more, that is moveable and has a useful life of at least one year. Contact Inventory Services for details.
Cardholder
An employee who has been delegated purchasing authority and has been authorized by the Chief Financial Manager or designate within their unit to have a Procurement Card for the purposes of making business purchases on behalf of the department or unit.
Certified Approver
A department or collegiate staff person who has been given authority by the Vice President for Research and who has been appointed by the Collegiate Research Associate Dean to review and approve high risk financial transactions involving sponsored funds.
Chief Financial Manager (CFM)
The person who has the primary accountability for the financial activities in a Resource Responsibility Center. The CFM has a dotted-line reporting relationship to the University’s Chief Financial Officer (CFO), and is the primary point of contact at the Resource Responsibility Center level on financial matters for the CFO (and the offices reporting directly to the CFO).
Contract Vendors
Vendors that have a contract with the University that generally include preferred pricing/rates and service levels.
Department Card Administrator (DCA)
A person who acts as coordinator for procurement card activity in their department. This individual typically will be designated by the Chief Financial Manager (CFM) or designee.
Departmental PCard
Used for purchases that are necessary for departmental operations, or that are essential for the functioning or advancement of a University program or project. Departmental Cards may be used by someone other than the cardholder and may be issued in order to reduce the number of cards within a department or unit.
DeptID Approver
Individual assigned by department who is responsible for approving, or returning (denying) a transaction. The approver ensures transactions are in compliance with department, unit, and University policies and procedures, and are accurate and properly accounted for.
Individual PCard
Used by employees for purchases that are necessary to their job, or for a program or project over which they have primary or individual purchasing responsibility.
PCard Program Administrator
An employee of Purchasing Services who has overall responsibility for the University's Procurement Card Program.
Provider Bank
The bank selected by the University to provide banking services required for the program.
Procurement Card (PCard)
A University approved charge card used by employees to pay for authorized purchases that are directly charged to the University.
Reconciler
Enterprise Financial System (EFS) role (EX Preparer).
Individual assigned by department who is responsible for verifing procurement card transactions, notifying approver, and ensuring purchases are consistent with department, unit, and University policies and procedures. The cardholder may be the reconciler.
Sponsored Projects
A sponsored project is an externally funded activity that is governed by specific terms and conditions. Sponsored projects must be separately budgeted and accounted for and are subject to terms of the sponsoring organization. Sponsored projects may include grants, contracts, and cooperative agreements for research, training, and other public service activities.
Verification
Cardholder review of procurement card activity to: ensure that charges are legitimate, assign appropriate ChartField string distributions, add justifications for each purchase to explain why and how the item will be used, process a dispute or contact a merchant directly regarding unidentified items, provide required signatures, and submit receipts. Note: Full documentation must be included for hospitality expenses to include; business purpose, names of attendees and business relationships.

RESPONSIBILITIESRETURN TO TOP

Approver
Approvers are determined by the DeptID used on the ChartField string of a transaction, based on EFS department approval delegation. (A cardholder may NOT be their own approver.)
  • Review and take appropriate action on procurement card activity (Expense Report).
  • Ensure documents are consistent with department and University policy and procedures.
  • Determine the transactions' propriety, accuracy, and compliance.
  • Ensure transactions are distributed to the appropriate ChartField string.
Cardholder
  • Must complete online training and PCard application.
  • Activate and maintain the card in a secure manner.
  • Must use the appropriate purchasing method for the goods/services being purchased.
  • Ensure purchases are allowable according to University policies and procedures, department policies and procedures and if on sponsored funds, sponsoring agency guidelines.
  • Make appropriate use of the University’s sales tax exemption.
  • Obtain detailed receipt from merchant/vendor, retain and submit original/image with reconciliation.
  • On an exceptional basis only, provide a separate signed statement for transactions with missing receipts using the Statement in Lieu of Receipt.
  • Take action to resolve disputed items (within 60 days of transaction date) or returns in a timely manner. Ensure that credit or resolution has occurred.
  • Report immediately any lost or stolen cards to the bank (1-800-344-5696) and PCard Program (pcard@umn.edu).
  • Return procurement card to DCA upon termination of employment or transfer to a new RRC.
Certified Approver
Review and take appropriate action on procurement card activity charged to a sponsored ChartField string. http://www.research.umn.edu/regulations/sproles.html (select Certified Approver)
Chief Financial Manager
The Chief Financial Manager (CFM) for each college or administrative unit has been delegated oversight responsibility and may delegate responsibility for: managing PCard activity and approving card applications (including what type of cards may be issued), and suspending and canceling cards.
CFMs have been delegated responsibility for monitoring for violations and may set additional restrictions for use by those within their college or administrative unit. Violation of University or unit policies, or the cardholder agreement, may result in loss of card privileges.
Department Card Administrator (DCA)
  • Develop department procedures regarding card program and provide assistance within department.
  • Act as liaison between Program Administrator and cardholder.
    • Receive and distribute replacement cards.
    • Serve as primary contact for communications from the PCard office regarding missing Expense Reports, audit compliance memos, etc.
    • Request changes to transaction limits (changing limits is very restricted, as a result, all requests will not necessarily be approved).
  • Notify Program Administrator in writing or e-mail of employee name or address changes, card cancelations, and lost or stolen cards.
  • Maintain current knowledge of University of Minnesota Procurement Card policies and procedures.
PCard Program Administrator
  • Manage the procurement card program for the University of Minnesota.
  • Act as program liaison between provider bank and University units and departments.
  • Represent the program to University community and outside agencies.
  • Have detailed knowledge about associated University financial policies and procedures.
  • Promote procurement card program awareness and appropriate utilization.
  • Develop and maintain University-wide procurement card policy and procedures.
  • Ensure cardholders complete training before cards are issued.
  • Ensure monitoring and follow through of reconciled statements and supporting documentation.
  • Reconcile and submit monthly payment to provider bank.
Provider Bank / Card Company
  • Produce procurement cards.
  • Generate University billing.
  • Replace lost/stolen cards.
  • Monitor and follow up on activity for fraud.
Reconciler
  • Assigned by the department based on the job function. (The cardholder may be the reconciler.) 
  • Assign the appropriate ChartField string and provide the description/justification for each transaction.
  • Ensure transactions are consistent with department, unit, and University policy and procedures.
  • Submit the Expense Report in EFS for approval.

RELATED INFORMATIONRETURN TO TOP

Amended:
October 2016 - Comprehensive Review, Minor Revision. Procedure update, clarifying the triggering events for suspension or cancellation of a PCard.
Amended:
May 2014 - Minor revisions due to Procurement Card Provider change.
Amended:
June 2009 - Minor language improvements and updates.
Amended:
July 2008 - Updates made to address Enterprise Financial System rollout. Significant revisions in Definitions, Responsibilities, Procedures and Appendices. Title changed from Using the University Purchasing Card to Using the University Procurement Card. All references to Purchasing Card changed to Procurement Card.
Amended:
April 2007 - "Ensure the credit or resolution has occurred" added to cardholder responsibilities.
Amended:
April 2005 - Responsibilities section clarified to make it explicit that the Cardholder cannot also serve as approver or authorized signer, and that cardholder can also serve as preparer.
Amended:
September 2004 - In contacts section, the "Filming & Record Retention" changed to "Imaging/Document Retrieval" and phone number updated. Added additional material to FAQ.
Amended:
April 2004 - Purchasing Card procedures can now be found as a part of the Purchase & Pay for Goods & Services process within the Financial One Stop. Financial Onestop also added to related information.
Amended:
January 2004 - Added FFN Approvers Tutorial to Related Information
Amended:
October 2003 - Responsibilities section updated for Cardholder and Authorized Signer.
Amended:
June 2003 - Added new form - Statement in Lieu of Receipt.
Amended:
April 2003 - Transaction limit for both sponsored and non-sponsored accounts is now $2,499.99. Updated Certified Approver role and responsibilities.
Amended:
January 2003 - Procedures updated to use the Financial Onestop. Link in Related Information changed from ECAR Processing Calendar to ECAR/CAR Processing Calendar
Amended:
July 2002 - Updated new IX policy information. All purchasing card activity must be moved out of the default object code 7370 to appropriate object code by cardholder department. (Previously this was done by Disbursement Services). Language clarified in policy statement and reason. Updated definitions, responsibilites, FAQ, procedures and appendix B: Examples of possible card purchases.
Amended:
March 2002 - Added Appendix E: Purchasing Card Activity Reports ECAR (electronic) and CAR (paper) Processing Job Aid.
Amended:
September 2001 - Added link to ECAR Processing Calender in related information and appendices.
Amended:
July 2001 - Airfare can now be charged to purchasing card. Billing period changed. Clarified CAR and ECAR reconciliation procedures.
Amended:
July 2000 - Updated limit for nonsponsored purchases from $2000.00 to $2,499.00 per item.
Amended:
April 2000 - Policy amended to accommodate program enhancement, (on-line) Electronic Card Activity Report. Updated transaction limit on sponsored accounts to $999.
Amended:
May 1999 - Clarified FAQ section and updated Related Information.
Amended:
February 1999 - Updated Dispute/Resolution and Lost/Stolen card forms so they are interactive.
Amended:
January 1999 - Updated references to transaction limit in policy statement, definitions, FAQ, Procedure 3.7.2.2 and Online Purchasing Card Application/Update Form. The transaction limit was increased to $2,000 for non-sponsored funds.
Amended:
June 1997 - Updated phone numbers in Contacts section. Clarified Rates, Definitions, Responsibilities, and Frequently Asked Questions sections. Clarified all procedures. Updated Purchasing Card Application, Dispute/ Resolution, and Lost Card forms.
Amended:
February 1997
Effective:
March 1996
Document Feedback
Date Revised
November 2016
Date Effective
March 1996