City of Lee’s Summit Purchasing Card Training
About This Training Session
In this training session the following
information will be provided to you.
• How the City obtained the Purchasing Card.
• The intended use of the card.
• The responsibilities of the Cardholder, Departmental Pcard Administrators, Departmental
Managers/Supervisors and Program Administrator.
• Items authorized for purchase with the P-card.
• Penalties for misuse or fraud.
• Monthly reconciliation with the Accounts Payable Dept.
About This Training Session (cont)
• All information contained in this presentation is in the
Purchasing Card Manual as well as more detailed
information.
• The manual is located on the City’s Intranet and is
available to you at any time.
• If you have a question that is not addressed in the
manual please contact the Purchasing Department for
clarification.
• This is a self pace training program, however it is
expected that you will have the test sheet back to
Purchasing within 5 working days of receipt.
What About the Purchasing Card?
4715 0000 0000 0000
Your Name
Your Department
Brief History of the Purchasing Card (P-card)
Program at the City of Lee’s Summit
• The City has had a P-card Program for ten years. Its daily
operation and control was resident in the Accounts Payable
Department. The program was in a “pilot” state for an extended
period of time.
• It was the recommendation of the 2005 Finance Accounts
Payable Audit and the 2007 Purchasing Audit that the program
be moved to Purchasing.
• In July of 2008 Purchasing Division took charge of the daily
administrative control of the P-card Program. Accounts Payable
retained the accounting and reconciliation aspects of the
program.
• Today all 21 departments of the City use the card and have
purchased more than $1.2 million dollars this fiscal year in goods
and services they need to keep operational.
P-card Program Introduction
• The City is participating in the State of Missouri
Cooperative Contract with UMB for a Visa Purchasing
Card Program Services.
• The intended purpose of the P-card program is to
improve the efficiency in processing small dollar
purchases from any vendor who accepts the Visa
Purchasing Card. This program allows the cardholder
to purchase approved commodities and services
directly from the vendor.
P-card Program Introduction
• The City’s P-card Program is not intended to:
• Avoid or bypass appropriate procurement or payment
procedures. Rather, the P-card complements our
existing purchasing program by reducing the use of
check requests, petty cash, and small dollar purchase
orders .
• Replace the requirements for the travel advance form
as per current travel regulations.
• For personal use. Misuse of card will result in
immediate reimbursement and disciplinary action.
Obtaining a P-Card
• Cards are issued at the request of the Department Director/Division
Manager via the Visa P-Card Cardholder Account Action Request.
• They will establish the daily, monthly, dollar spend and transactional
limits for the cardholder based on need within their department.
• They will sign the form and provide it to the Purchasing Division
where the P-card Administrator will forward it electronically to UMB
for action.
• UMB sends the card to P-card Administrator who will notify the
employee via Email to set up training.
• The employee is required to successfully pass a written test with a
score of 70 or higher and then sign the P-Cardholder Agreement
Form indicating that they understand the rules and requirements of
P-card usage.
•The P-card is then issued to the employee for use by the Purchasing
Division.
Cancelling, Renewal and Lost P-cards
•Cancelling a P-card
• A card
is cancelled when the Cardholder is:
1) transferred from their department;
2) terminates employment with the City or
3) changes in duties that no longer require procurement
to be accomplished.
•Card Renewal
•Each card will be automatically renewed annually by
UMB based on the month of issue. The Card arrive
about 3 weeks prior to the card expiration date.
• P-cards are sent directly to the Purchasing Division.
Cardholders are notified when their card has arrived
and they will be required to turn in their old card to
Purchasing and sign for the new one.
Cancelling, Renewal and Lost P-cards
•Lost or Stolen Cards
•Immediately notify UMB Bank Security at 1-800821-5184 to deactivate the card.
•Next notify the Departmental Manager/Supervisor,
Departmental Administrator and Program
Administrator.
•Tip -you may consider programming the Banks
number into your cell phone.
•Departmental Manager/Supervisor will advise the
Program Administrator to order another P-card.
(cont)
P-card Security
•Only the authorized cardholder may use the card.
•Cards and card numbers must be safeguarded against use by
unauthorized individuals in the same manner you would protect your
personal credit card.
•Never give your card number over the telephone, unless dealing
with a company you know is legitimate.
•Never provide your card number over the internet, to a business
posing as a bank/financial institution, a representative/agent of UMB
requesting to update your card or personal information. Historically,
these have been SCAMS to obtain your card information. Forward
all of these types of requests to the P-card Program Administrator.
•Department Heads may require the P-card to be secured in the
department until it is ready to be used and returned immediate after
use.
P-Card Program Roles, Rules &
Responsibilities
• Cardholder
• Department / Division-Administrator
• Department – Director / Division
Manager
• P-card Program Administrator
(Purchasing Division)
• Finance Department, Accounts Payable
Division
• UMB
Cardholder
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Holds card and makes purchases;
Receives the goods or services;
Make certain sales tax is NOT charged;
Collect and receive itemized sales receipts;
Handle disputed items;
Match receipts to P-card transaction log;
Process all Transaction Logs within dates assigned;
Submits receipts, along with signed P-card transaction log
to the Department/Division Administrator;
• Ensure no one else is using the card;
• Return P-card to Department upon separation from City or
transferred to another city department;
• Signs P-card Transaction Logs.
Department / Division - Administrator
• Timely collection of all Transaction Logs;
• Review monthly statement of each cardholder to ensure inclusion of
necessary itemized receipts;
• Check to make certain sales tax is charged only when appropriate;
• Ensure availability of funds in proper account codes;
• Verify appropriateness of account codes;
• Process all cardholder Transaction Logs;
• Handle disputed items that cardholder is unable to resolve;
• Notify the P-card Program Administrator (Purchasing Division) of
terminated or transferred employees and return cancelled cards to
the P-card Program Administrator;
• Notify the Program Administrator of lost or stolen cards;
• Arrange cardholder training for cardholders with the P-card
Program Administrator.
Department – Director / Division Manager
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Request purchasing cards for designated employees;
Set departmental spending limits within established guidelines;
Designate representatives responsible for authorizing charges;
Evaluate the need to cancel or reissue cards when employees
transfer within the city;
Review each cardholder’s Transaction Log;
Sign P-card transaction logs and forward to Department
Administrator;
Ensure transaction logs and all P-card documents are forwarded to
Finance within the prescribed time;
Comply with all purchasing and P-card policies and procedures.
P-card Program Administrator
(Purchasing Division)
• Coordinate program policy issues;
• Create dollar transaction limits for cardholders and
oversee any necessary and required modifications;
• Process properly authorized card requests and card
strategy changes;
• Assign merchant codes to particular card strategies;
• Block merchant/commodity codes when appropriate;
• Administer training program for all cardholders;
• Coordinate issuance and cancellation of cards;
• Maintain policy and cardholder guides/manuals;
• Evaluate P-card feedback from suppliers and from
departments;
• Coordinate and maintain internal controls.
Finance Division
• Receive Transaction Log and original receipts;
• Balance Transaction Log with UMB Bank
statement for the same time period;
• Journal entries as required;
• File and store statements, receipts, etc.;
• Monitor missing documentation and notify the Pcard Program Administrator;
• Notify the P-card Program Administrator of any
violations or discrepancies;
• Provide training for all cardholders on
Reconciliation Audit as required;
• Coordinate payment to Bank;
• Process into Financial system.
UMB BANK
•Responsibilities include all activities
related to the underwriting, promotion,
issuance and servicing of the card;
•Provide the data processing services
necessary to support authorization, posting,
settlement, billing, mailing, and card
embossing;
•The on-line account maintenance tool, UMB
Commercial Card tool.
Dollar Limits
• Department Director/Division Manager and by
the P-card Program Administrator approve
dollar limits;
• Multiple items may be purchased, but may not
exceed maximum purchase limits;
• Payment for purchases must not be split to stay
within the single purchase limit. Deliberately
splitting a purchase to circumvent these
procedures may result in suspension or
revocation of your P-card.
ALLOWABLE PURCHASES ON P-CARD
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The following is a list of most common items for P-card use:
Building/landscaping materials ;
Catering and food for business use itemized receipts must indicate what the
food was used for and who attended the meeting or function ;
Miscellaneous maintenance and repair requirements;
Office supplies ;
Uniform and clothing purchases ;
Education, such as local registration for local (KC Metro) classes ,
conference, seminars, etc.;
Subscriptions, books, videos ;
Memberships ;
P-Card can be used for meals related to local travel as approved by the
supervisor and in accordance with published guidelines. (Local travel is
considered no overnight stay or air travel.)
Declined Transactions (Purchases)
•If the card transaction is declined contact the Pcard Program Administrator as soon as possible
for an explanation for the decline and action to
resolve the situation.
•Transactions that exceed the singular occurrence,
daily or monthly spending limit amount the
Program Administrator may approve to complete
the purchase. If the amount is substantially above
the cardholder’s limit the Program Administrator
will contact the Department Head for authorization
to proceed with the purchase.
Declined Transactions (Purchases)
Typically P-cards transactions are declined for the following:
•Cardholder failure to activate the card.
•Cardholder has exceeded spend or transaction limits.
•Vendor/supplier is classified under a Merchant Category Code
(MCC) that is blocked from use by the City.
•Vendor/supplier has asked for the billing address and or other
information provided by the cardholder that does not exactly
match that on file with the bank.
•On telephone or internet orders the Vendor or Cardholder has
incorrectly entered the card number, expiration date or security
CVV number.
•The transmission between the Vendor/supplier and the bank is
not working.
Placing Order On and Off the Net
• When making a P-card purchase, be prepared to
provide the following:
• Your name;
• Your card number;
• Card expiration date;
• Tax exempt certificate form;
• Ask the vendor to provide a detailed itemized
receipt/packing list that includes product description,
price, sales tax (when applicable), and freight/delivery
charges.
Placing Order On the Net (cont)
• Read the online vendor’s refund/return and
customer privacy policies. Learn the terms
of business practiced by a particular online
vendor;
• Always print off the confirmation of the order;
• Look for the security alert and the lock icon
when making online purchases;
• Make sure that you are fully informed as to all
of the charges associated with making a
particular online purchase.
Receiving Goods & Services
• Every purchase must be documented with an itemized
receipt which will typically be a standard store receipt;
• Check pricing on receipt before leaving and no sales
tax has been charged;
• If you are having a purchase shipped to you, request an
invoice (marked paid) in addition to the packing slip in
order to have an adequate receipt that includes total
costs;
• You should keep the charge slip attached to the receipt
for each transaction. Keep all receipts for the
Reconciliation Process to be provided to AP.
Returns, Credits and Rejected
Items
• Cardholder is responsible for making all
arrangements associated with P-card returns;
• Follow up until the appropriate credit is issued;
• Notify supplier you are returning items that were
purchased with the P-card;
• Ask for return authorization;
• Credit receipt will need to be turned in to AP;
• Remember the Vendor has already been PAID!
Sales Tax Exemption
• Cardholder must inform vendors that city is tax
exempt before order is processed;
• Tax exempt certificate located on the Intranet
under online Forms located under 1)Purchasing
Division Forms & 2) Policies, Purchasing
Division, P-card Policy and Procedures Manual;
• The city’s tax-exempt number is printed on the
face of the P-card.
Unauthorized Items
• Alcoholic beverages;
• Ammunition;
• Cash advances, cash refunds, cash in addition to
purchase, cash in lieu of credit for the return or
exchange of a purchase;
• Various computer hardware or software items;
• Controlled substances;
• Gasoline;
• Personal or non-business purchases i.e. phone calls;
• Any service involving prevailing wage.
Blocked Merchant Codes
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5598 SNOWMOBILE DEALERS ;
5681 FURRIERS AND FUR SHOPS
7230 BARBER/BEAUTY SHOPS;
7261 FUNERALSERVICE/CREMATORIES ;
7273 DATING & ESCORT SERVICES ;
7278 BUYING/SHOPPING SERVICES ;
7295 BABYSITTING SERVICES ;
7297 MASSAGE PARLORS ;
7911 DANCE HALLS/STUDIOS/SCHOOLS ;
7932 BILLIARD/POOL ESTABLISHMENT ;
7995 BETTING/TRACK/CASINO/LOTTO ;
7996 AMUSEMENT PARKS/CIRCUS ;
8351 CHILD CARE SERVICES ;
9223 BAIL AND BOND PAYMENTS.
Conflict of Interest Purchases
• Purchases from vendors that create
conflicts of interest, such as companies
owned by the city employee or relatives, or
where the employee has or will gain or
benefit directly or indirectly from the
purchase is strictly prohibited.
• Refer to City Personnel Policy Section 411.
Lost of Receipt
• If for some reason the Cardholder does not have
documentation of the transaction to send with the
transaction log, the Cardholder must use the Lost
Receipt Form (located on the Intranet under online
Forms, Purchasing Forms or under P-card Manual)
which will provide all pertinent information regarding that
purchase. Continued incidents of missing documentation
may result in the cancellation of the employee’s P-card;
• Form must be signed by Department Director.
Penalties
•When policy violations by a particular cardholder are
identified by the Administrator or Department
Director/Division Manager they will:
•Notify P-card Program Administrator (Purchasing
Division) and Accounts Payable Division of the violation.
•First offense – written letter of warning;
•Second occurrence – P-card suspended 3 billing cycles
(90 days);
•Third occurrence – P-card withdrawn;
•The P-card may be withdrawn at anytime by written
notification from Departmental / Division Manager.
Penalties (cont)
Departments are responsible to ensure that all Pcard accounting documents are submitted to the
Accounts Payable Division. They will advise the Pcard Administrator of those departments that fail to
provide do so. Departments will be subject to:
First occurrence, a warning will be issued to the
Department Director;
Second occurrence, entire department P-cards
suspended for at least two (2) billing cycles;
Third occurrence, entire department P-cards
suspended for at least one (1) year.
Documentation
• Cardholders must retain:
• Sales slips, cash register itemized receipts,
void receipts, for cardholder transaction
log/statement;
• Order forms packing slips and receiving
documents can be helpful to retain if you are
planning to return the purchase.
Purchasing Card Forms
•P-card Action Request Form;
•Dispute Form;
•Lost Receipt Form;
•Sales Tax Exempt Form;
•Cardholder Agreement Form.
Reconciliation Process
• The Finance Department will electronically forward
your transaction log to you or a department
representative each month;
• Transactions charged to your P-card account must be
reconciled and submitted to Department Administrator;
• Finance will indicate the date on which the signed
paper transaction logs, itemized receipts, and
electronic logs need to be returned to Finance.
Reconciliation Duties
• The assigned personnel will review Transaction
Logs considering the following:
• Signatures;
• Correct general ledger account number coding;
• Description field has been completed;
• Itemized receipts are attached documenting the
detail of items purchased.
Reconciliation Duties (cont)
• Determine that purchases are only for items that
are for the use of the city;
• Review the statement for possible split
transactions. Investigate transactions to
determine if the cardholder was attempting to
circumvent their established limits.
Reconciliation Duties (cont)
• Review the transaction logs for single
transactions that are over the authorized limit of
the cardholder, investigate circumstances;
• Determine that amounts are reasonable for
items purchased and contract pricing was given
when applicable;
• Determine that the City’s tax exemption was
honored. If a receipt is discovered to have tax,
make sure a credit is being processed and note
on the receipt.
Reconciliation Duties (cont)
• Ensure that errors and disputes from the prior
month have been corrected and included on the
monthly transaction log;
• Ensure that the completed electronic
Transaction Logs have been forwarded to
Finance by the due date;
• If you have a receipt or credit that does not
appear on your monthly Transaction Logs,
please hold it until you receive your next
Transaction Logs.
Sample Transaction Log
Merchant Name
City
HY VEE 1380
LEE'S SUMMIT
HY VEE 1380
State
Trant Type
Amount
Account Numbers
Description
MO
SALE
$40.00
001.001.0123.500.100
Breakfast for Chamber for
Commerce Meeting
LEE'S SUMMIT
MO
SALE
$40.00
001.001.0123.600.200
Breakfast for Chamber for
Commerce Meeting
HY VEE 1380
LEE'S SUMMIT
MO
SALE
$40.00
001.001.0123.700.300
Breakfast for Chamber for
Commerce Meeting
HY VEE 1380
LEE'S SUMMIT
MO
SALE
$40.00
001.001.0123.800.400
HY VEE 1380
LEE'S SUMMIT
MO
SALE
$40.00
001.001.0123.900.500
Breakfast for Chamber for
Commerce Meeting
Breakfast for Chamber for
Commerce Meeting
End of P-card Training
About your test.
1)You will received an email with your twenty (20)
question P-card Test and Answer Sheet.
2)You have 5 working days from the date of receipt
to return the answer sheet to the Purchasing Card
Administrator (Bill Ward).
3)A passing score of 70 or better is required to
retain or have your new card issued.
4)You will be notified via email of your score.
Please make arrangements with Des when you will
sign for your new card and return to old one.