Purchasing
Policies
Policy 1 - Purchase Authorizations
BUDGETARY HEAD
The University operates on the principle of budgetary allotments to various offices, divisions, departments, colleges and other operating units. All funds including special, Federal, local, gifts, bequests, receipts, fees and State appropriated funds that are used for the purchase of equipment, materials, supplies and services shall be handled under the provisions of North Carolina General Statutes, Chapter 143, Article 3 (“Purchases and Contracts”). The administrative head of each area is responsible for expenditures from funds in that area.
The authority to make purchases from the allotted departmental budgets for services or materials is furnished to the University Purchasing Office in writing by an authorized administrator, as budgetary head, on a Procurement Request.
Spending of budgeted funds from grants, contracts and other extramural sources must be authorized by the Assistant Controller for Special Funds.
The administrative head of an operating unit is accountable to the University's Chancellor for all supplies, materials, equipment, and services purchased in the University's name regardless of the source of funds. The administrative head is responsible for taking adequate precautions to protect such materials from theft and abuse and maintaining adequate records on movable equipment necessary for proper identification and location.
In addition to the administrative head of any operating unit and the principal investigator on any grant received by the University, each employee whose duties include a purchasing function is responsible for compliance with State and federal law and regulations governing purchases and these policies. Each such employee may be subject to criminal prosecution in addition to employment discipline for failure to do so. North Carolina General Statutes, § 133-32 makes unlawful the willful receipt of a gift or favor by
any officer or employee of a governmental agency who is charged with the duty of:
(1) Preparing plans, specifications, or estimates for public contracts; or
(2) Awarding or administering public contracts; or
(3) Inspecting or supervising construction.
North Carolina General Statutes, § 143-58.1 generally prohibits the use of the State's purchasing “powers, policies or procedures … to purchase, attempt to purchase, procure or attempt to procure any property or services for private use or benefit.”
North Carolina General Statutes, § 14-234 generally prohibits any State employee from gaining personal benefit from a State agency or institutional contract. Specifically, it states, in part:
(a) (1) No public officer or employee who is involved in making or administering a contract on behalf of a public agency may derive a direct benefit from the contract except as provided in this section, or as otherwise allowed by law.
(2) A public officer or employee who will derive a direct benefit from a contract with the public agency he or she serves, but who is not involved in making or administering the contract, shall not attempt to influence any other person who is involved in making or administering the contract.
(3) No public officer or employee may solicit or receive any gift, reward, or promise of reward in exchange for recommending, influencing, or attempting to influence the award of a contract by the public agency he or she serves.
(a1) For purposes of this section:
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(2) A public officer or employee is involved in administering a contract if he or she oversees the performance of the contract or has authority to make decisions regarding the contract or to interpret the contract.
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(4) A public officer or employee derives a direct benefit from a contract if the person or his or her spouse: (i) has more than a ten percent (10%) ownership or other interest in an entity that is a party to the contract; (ii) derives any income or commission directly from the contract; or (iii) acquires property under the contract.
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Copies of the statutes cited above may be obtained from the Office of the University Attorney upon request.
Policy 2 - Solicitation by Salesmen
All interaction between Appalachian State University employees and salespeople is regulated by North Carolina General Statutes, sections 14-234 and 133-32. Basically, it is unlawful for salespeople to provide gifts or favors to university employees and it is unlawful for university employees to accept gifts or favors from a vendor if they have any responsibility for making or administering a contract with that vendor. Violation of State law or university policies governing the purchasing function may be cause for disciplinary action up to and including termination of employment and criminal prosecution.
Sales Agreement - State policy requires that supplies and materials be obtained from State contracts or by competitive bidding (except for certain small order requests). Only the University Purchasing Office has the authority to enter into a sales agreement on behalf of the university.
Salespeople are encouraged to visit departments to keep them informed of new items being introduced and to assist departments by providing information on various technical aspects of the products.
No Consignment Agreements - It is not permissible for a department to receive materials on consignment pending issuance of a confirming purchase order. Receipt of equipment for demonstration purposes is permissible provided no obligation is made to the vendor to purchase the equipment.
Insurance - All insurance for the safety of equipment on demonstration must be borne by the vendor. Shipping charges, both to and from the University, are the vendor's responsibility.
Policy 3 - Product and Service Demonstrations by Vendors
REQUEST BY VENDORS
Clearance and Arrangements - Vendors wishing to demonstrate their product or service to the University are to direct any requests for demonstrations to the Purchasing Office. If the Purchasing Office approves of the demonstration, Purchasing will make arrangements for the demonstration, the time, advise those departments which might have an interest in the demonstration, and confirm with the vendor the arrangements that have been made.
Expenses - The vendor will be responsible for all expenses incurred in the demonstration. The University will not accept any responsibility for the safety of the equipment of the vendor beyond normal care and safety.
REQUEST BY DEPARTMENT
Arrangements - A more common type of demonstration is that requested by a department from a vendor of a particular piece of equipment. In these instances, the arrangements are worked out between the University department and the vendor.
Expenses - All expenses incurred from these demonstrations are the responsibility of the vendor. The University will not accept any responsibility for the safety of the equipment beyond normal care and safety.
PURCHASE AFTER DEMONSTRATION
Obligation to Purchase - The demonstration of equipment to a department or to an individual in no way obligates the University to purchase or lease the equipment or service. Any purchase requests issued as a result of demonstrations will be handled in accordance with the normal purchasing regulations of the University and State.
Policy 4 - State Purchase Contracts
Many Contracts - The State Purchase and Contract Division enters into contracts with outside vendors to acquire favorable rates for many commonly used items. The State has contracts with several hundred suppliers, covering several thousand individual items.
Purchase Items on Contract - All State agencies, including the University, are required to purchase needed items included in State contracts from the contracting vendors. It is not permissible to purchase items similar to those on contract and designed to perform the same function without special approval from the State Purchase and Contract Division.
Some broad classifications of the items on contract are:
- Cleaning supplies and equipment
- Closed circuit video equipment
- Furniture: office chairs and desks; lounge and classroom furniture
- Household electrical appliances
- Laboratory apparatus and equipment: type sold by distributors, such as Fisher Scientific Company
- Office machines: typewriters, adding machines, and calculators
- Paper products, both fine and coarse
- Uniforms and some textiles.
More Information - The University Purchasing Office has information on all State contracts and will be glad to discuss details about the many contract items with any department. Departments having need for a particular contract may obtain information by contacting the Purchasing Department (262-2080).
Policy 5 - Solicitation of Bids and Quotations
COMPETITION THRESHOLDS
When the total cost of a purchase is $150, 000 or more, the North Carolina General Statutes require that the purchase be bid through the State Purchase and Contract Division. Solicitation of bids and quotations on orders for less than $150,000 and certain specified items and services has been delegated to the University. Within that delegation, the following thresholds apply:
Written competition must be solicited by the Purchasing Department for purchases over $5, 000. Even in the case of an approved sole source purchase, a written quote or bid will be obtained.
Departments may not divide direct purchases into smaller orders of $5, 000 or less to avoid seeking competition, nor into multiple orders under $150, 000 to avoid the necessity of sending the requirement to Purchase and Contract Division.
The North Carolina Administrative Code defines small purchases as those purchases of commodities or services for which the expenditure is $5, 000 or less and that are not covered by a term contract. The code also delegates to the University the authority to establish procedures for making small purchase transactions. See PUR Policy 24, Small Purchase Policy .
In accordance with the Chancellor's University Small Purchase Policy, competitive bidding is not required for those purchases of equipment, supplies, materials, and services which meet the definition of small purchases as defined in the Administrative Code. However, it is the responsibility and obligation of all University employees to seek the best possible value when making purchases with University funds. Accordingly, where appreciable value can be gained without undue sacrifice of convenience and/or necessity, the Purchasing Department may seek competition for certain purchases under $5, 000. Note: This small purchase policy in no way changes the requirement to obtain valid documentation (purchase order, check request, etc) through the Purchasing Department or the Controller's Office as applicable prior to committing any University funds for the procurement of commodities and services.
OFFICIAL BIDS
Solicitation of competitive quotations is the responsibility of the Purchasing Department. Any quotations requested by departments cannot be considered official and are to be used only as information for the department. Any information obtained by the department which might be useful to the Purchasing Office in processing the order should be included with the procurement request.
SPECIFICATIONS
Accurate preparation of specifications for non-contract items and equipment is a critical part of the purchasing cycle. For items and equipment which must be formally bid ($150,000 or more) by North Carolina Purchasing and Contract Division, it is important that adequate specifications be provided by the requesting department for forwarding to Purchase and Contract Division. The duty to establish and enforce specifications is assigned to the Purchase and Contract Division and to the Standardization Committee by statute. These agencies work with the University in developing specifications for the particular requirement. Cooperation and communication between the requesting department, the University Purchasing Department, and the North Carolina Purchasing and Contract Division is imperative for development and assurance of satisfactory specifications.
LIMITED COMPETITION
The Purchasing Office, following University policy, solicits quotations even though competition is nonexistent or limited on certain items being purchased. The action is necessary in order to officially determine the price, terms, and conditions of the vendor whose product is being sought.
RESULTS OF BIDS
Information submitted in a successful bid is used by the Purchasing Office as a basis for preparing the purchase order. The University purchase order form contains instructions to vendors that prohibit a vendor from accepting an order for shipment unless the vendor meets the printed conditions obtained through the quotation.
If competition is received from the formal bid solicitation amounting to $150,000 or more, the requesting department will be consulted before the order is placed. Justification will be required from the user if the low bid is not selected .
TIME ALLOWANCE NEEDED
When issuing procurement requests, departments should allow sufficient lead time to solicit bids, evaluate the bids, place the order, and effect delivery. Twelve to fourteen days are generally required to solicit quotations and place a purchase order. Formal bids solicited by the State Purchase and Contract Division in Raleigh require approximately four to six weeks. An additional two weeks will be required to evaluate the bids and place the order.
Policy 6 - Single Source Purchases
Justification
On some highly technical items, there will be only one known source. Justification for a purchase of this type of item without competitive bidding must accompany the procurement request. The justification memorandum should be forwarded to the Director of Purchasing for approval and should give the following information:
- Name and address of the suggested supplier.
- Technical specifications which make the equipment unique.
- Names and addresses of other vendors which make similar equipment, and details of the ways such equipment fails to meet required specifications.
Supporting Documents
Copies of all correspondence including any vendor quotations received in the selection of the special equipment should also accompany the procurement request.
Approval
If the request exceeds $150,000.00 in cost, the request will be forwarded to the State Purchase and Contract Division for processing. If the State Purchase and Contract Division concurs in the justification for the uniqueness of the item, the request will be presented to the State Board of Awards with the recommendation that the item be certified as "Single Source" and purchased after the Purchase and Contract Division has obtained prices in accordance with prescribed procedures.
Limited Use
This process is infrequently used since there is generally competition for almost any type of equipment or supplies used at the University.
Policy 7 - Purchases from Commercial Vendors
Necessary Form - All requests for materials and services from commercial vendors must be submitted by requesting departments on either the standard procurement request form or by using FRS On-Line Requisitioning procedures as discussed in Procedure Statement 1, Purchasing from Commercial Vendors.
Budgetary Approval -
- Hard copy procurement request. After removing the departmental copy, the completed procurement request is submitted to the Controller's Office for budget approval. If sufficient unobligated funds remain in the general ledger account, the request is approved and forwarded to the Purchasing Office. If sufficient funds are not available, or if the request does not have the appropriate authorizing signature, the procurement request will be returned to the department.
- On-Line Requisition. It is the responsibility of the requesting department to ensure that the general ledger account has adequate budget balance available (BBA) in the appropriate budget pool prior to submitting an on-line procurement request. On-Line requisitions must be submitted in accordance with the detailed instructions in the FRS On-Line Requisitioning Manual. Once submitted, the requisition will be transmitted on-line to the established approving authority which has administrative responsibility for the account. If approved, the requisition will then be transmitted on-line to the Purchasing Department.
Purchase Orders - The Purchasing Office processes the procurement request to issue a purchase order. If bids are necessary, the Purchasing Office will request bids or arrange for the State Purchase and Contract Division to request bids. All other necessary approvals will be coordinated by the Purchasing Office.
After a purchase order has been processed, a copy is returned to the requesting department indicating that the materials have been ordered. The departmental receiver copy of the purchase order is forwarded to the Central Warehouse.
Goods Received - Most goods bought on purchase order will be received by the Central Warehouse and delivered to the department. The department should check the shipment for correctness and for damage as soon as possible, but no later than 5 days after receipt. If the shipment is correct and undamaged, no further action is required. The Receiving Section at Central Warehouse will automatically electronically receive the purchase 5 working days after delivery to allow payment by the Controller Office. If the shipment is incorrect or damaged, the Central Warehouse must be notified immediately (prior to the 5th day after receipt).
Purchased goods which are delivered directly to the department by the vendor have not been processed through the Central Warehouse. Therefore, it is essential that the department notify the Central Warehouse of satisfactory receipt as soon as possible, so the receiving report can be processed to allow payment.
All invoices should be forwarded to the Purchasing Office by the vendor. If an invoice should be received by a department, it should immediately be forwarded to the Purchasing Office. Prompt payment for supplies and equipment insures Appalachian's good credit rating and services rendered by vendors.
All purchases from commercial vendors must be made in accordance with the policies and procedures detailed in this Manual.
Policy 8 - Changes to Purchase Orders
Purchase Order Is Binding - When a purchase order is written to a vendor by the Purchasing Office in response to an offer by the vendor and is based on acceptable terms and conditions, it becomes a binding contract and cannot be broken by either party so long as both parties live up to the terms and conditions of the agreement. To break or cancel the contract requires the consent of the other party.
Written Acceptance - When a purchase order is written to a vendor but is not in accordance with the terms and conditions which were previously offered by the vendor, it does not become a binding contract until the purchase order is acknowledged and accepted by the vendor in writing.
Changes to Purchase Orders - Changes to purchase orders already accepted by vendors must be requested by the Purchasing Office. Most vendors are willing to make reasonable changes to an order without penalty to the purchaser. Generally, only when a vendor may have expended funds for fabricating special equipment will a charge be made for changing or canceling an order.
Change Order - Any department desiring to make a change to a purchase order should advise the Purchasing Office in writing. Any changes to a purchase order, such as: terms and conditions, price, account number, cancellations, quantities, or substitutions must be requested through the Purchasing Office. A request for a change must include:
- The purchase order number, and
- A detailed description of the change to be made.
If the change request is acceptable to all parties, an official Change Order, will be issued. Copies of the completed change order are distributed to all areas which receive copies of the purchase order.
Policy 9 - Correspondence with Vendors
Purchasing Office - Following the transmittal of a purchase order to a vendor, all correspondence in connection with the fulfillment of the order or contract is to be handled by the Purchasing Office.
Changes to Purchase Orders - Authorization for a vendor to make any change to a purchase order must be given by the Purchasing Office. Departments are to communicate with the Purchasing Office if a purchase order change is desired. The Purchasing Office will request the changes on the official University change order.
It must be understood that in direct correspondence between department and vendor, no terms and conditions of the order, including destination of shipment, can be changed. Additionally, items cannot be added to the order nor can any part of the order be canceled. Any changes in an issued purchase order must be made by the Purchasing Department, through the use of a change order.
Policy 10 - Return of Merchandise to Vendors
Vendor's Permission - No supplies or equipment should be returned to a vendor for any reason without first obtaining the vendor's permission and shipping instructions.
Requesting Permission - Departments desiring to return materials to a vendor should contact the Purchasing Office, by telephone (262-2080) or in writing, explaining the reason for the desired return. The Purchasing Office will try to secure permission from the vendor for return of the materials and will obtain shipping instructions.
Authorized Returns - When Purchasing receives authorization to return and shipping instructions from the vendor, they will forward a copy to the department. The department should then prepare the item for shipment and contact the Central Warehouse to arrange to have the package picked up. The vendor's authorization to return must accompany the package to the Central Warehouse.
Policy 11 - Purchases from University Facilities
CENTRAL WAREHOUSE PURCHASES
All purchases of supplies and equipment from the Central Warehouse are requested by completing a warehouse requisition. For more specific information about what is available and how to obtain items from the Central Warehouse, refer to the Central Warehouse section in this manual.
Departments are required to purchase stock items from the Central Warehouse in lieu of seeking item(s) on the open market.
PRINTING PURCHASES
All requests for printing from the University Printing and Publications are made by completing a procurement request as described in the printing section of this manual. In addition, all printing requirements that will be printed off campus must be coordinated through the Director of Publications in the Department of Technology.
PURCHASES FROM PHYSICAL PLANT DEPARTMENTS
All requests for services from the Physical Plant are made by completing and submitting a Request for Physical Plant Services to the Physical Plant Cost Control Center as descri bed in the Physical Plant section of this manual.
PURCHASES FROM THE UNIVERSITY BOOKSTORE
All purchases by departments from the University Bookstore are processed on a three part procurement request. The procurement request should include a description of the items to be purchased, the appropriate twelve digit budget code and an authorized signature. The request is then routed through the Controller's Office for budget approval. The procurement request should be presented to the Bookstore cashier at the point of sale. Small purchases may be made through the Central Petty Disbursing Fund, if not available on State Contract or from the Central Warehouse.
PURCHASES FROM OTHER UNIVERSITY DEPARTMENTS
The general situation where one department provides a service to another and must be reimbursed requires the use of the intra campus Auxiliary Billing System. The department providing the service will complete a University invoice and send copies to the department receiving the service and to the Controller's Office which will transfer funds to pay for the services provided.
Policy 12 - Emergency Purchases
Waiver of Competition - Current purchasing rules of the State of North Carolina permit waiver of competition in cases where emergency of pressing need is indicated. Although competition may be waived for proper cause, its use is required wherever practicable. When emergency or pressing need action is necessary, and the expenditure is over the University's benchmark of $150,000, prior approval must be obtained from Purchase and Contract Division if time permits.
Definition - Emergincies are defined by Purchase and Contract Division as situations which endanger lives, property or the continuation of a vital program and which can be rectified only by immediate on-the-spot purchases or rental of commodities, printing or services.
Pressing needs is one arising from unforeseen causes, including but not limited to, delay by contractors, delay in transportation, breakdown in machinery, or unanticipated volume of work.
When to Use - When emergency or pressing needs conditions exist that necessitate a purchase that cannot be handled by the routine procurement procedures, Procedure Statement 1 , then the University's emergency purchasing procedures may be used.
HAND CARRY PROCUREMENT REQUEST
If possible, a procurement request should be prepared and signed by the individual authorized to expend funds from the applicable budget account. The request may then be hand carried to the Controller's Office for budgetary approval. If approved, it should then be taken to the Purchasing Office to have a purchase order issued. If the purchase is a legitimate emergency or pressing need, the Purchasing Office will:
- Solicit quotations by telephone, if appropriate, and/or verify quote (s) provided by department.
- Obtain the approval of the State Purchase and Contract Division, if over the University delegation.
- Prepare a purchase order and give the vendor copy to the department representative to make the purchase.
An invoice for the purchase should be delivered or mailed to the Controllers Office.
In cases where competition would normally be required, but is waived, the department will be asked to provide written justification explaining the urgency of the need which precludes seeking competition.
TELEPHONE EMERGENCY PURCHASE REQUEST
When a purchase must be made in an emergency situation and there is not enough time to hand carry a procurement request to Purchasing, approval should be obtained over the telephone. The Purchasing Agent will give the department a purchase order number to use in making the necessary purchase. After the purchase has been made, the department must prepare a confirming procurement request, including the emergency purchase order number, and send it through the normal channels to the Purchasing Office, along with the vendor's invoice.
Depending on the circumstances and the dollar amount of the purchase, the department may be required to follow-up with written justification explaining the urgency of the need which precludes seeking competition.
Limited Use - This emergency procedure will not be authorized except in those instances where it is impossible or impractical for a department to bring a procurement request to the Purchasing Office prior to the placing of an order.
Policy 13 - Blanket Purchase Orders
Definition - A blanket purchase order is one which has been issued to a vendor for a specific type of item for small purchases over a specified period of time.
Necessary Form - A department or office within the University having a recurring need for miscellaneous supplies of a minor nature which are not available under existing contracts or from the Central Warehouse may submit a procurement request to the Purchasing Office specifying the category of materials needed and the names of the individuals who would be authorized to place orders. If the request is approved, the Purchasing Office will solicit various sources in the area to obtain the most favorable discounts or net prices, and then issue a blanket purchase order to the supplier(s) containing the following information:
Information Specified
- The period of time covered by the order, e.g., quarterly, semiannually, annually, etc.
- The commodities covered, e.g., plumbing supplies, automotive parts, photographic supplies, etc.
- The total dollar value which can be encumbered under the blanket order and the monetary limitation applicable to each individual transaction.
- Data required on delivery tickets or invoices.
- Invoicing and billing instructions.
- A list of persons authorized to make purchases against the blanket purchase order.
Types of Items - Blanket purchase orders are issued for supply and service type items only. Each purchase of equipment must be requested on a procurement request as the need arises. Approval and Justification - Requests for blanket purchase orders are approved by the Director of Purchasing. The procurement request should contain a description of the blanket order, stated in a manner similar to Purchasing, Policy 24 .
Sample Description - This is to establish a blanket order for furnishing miscellaneous (type of commodity, i.e. automotive parts) as authorized and called for by (name of authorized person) of the (requesting department name) during the fiscal year ending June 30, (year) in the amount of ($).
Budgetary Action - When the purchase order is issued, the requesting department's budget will be encumbered in the amount of the estimated total cost as indicated on the procurement request. If a blanket order is canceled, the outstanding balance on the order will be liquidated, thus making the funds available for other purchases. Since the total estimated cost for the period covered is encumbered when the purchase order is written, only sufficient funds to cover the anticipated purchases should be requested on the procurement request.
PURCHASES MADE ON BLANKET ORDERS
If service needs require having more than one supplier available to furnish similar items at the same price, business between them should be based on the availability at the time of the needed item from the suppliers' stock or ability to make prompt delivery.
Before purchasing items against a blanket purchase order, a check should be made to determine whether the items required may be obtained either from some University stock or under an established contract.
When a purchase is made against a blanket purchase order, the person making the purchase should ensure that the following information is included on the delivery ticket or invoice:
Invoice Information
- Number of the blanket purchase order
- Name of person calling or making the pickup
- Itemized list of supplies furnished
- Quantity, unit price(s) and extension(s)
- Date of delivery or pickup
Billing Action - Receipt of the supplies must be acknowledged on the delivery ticket/invoice by a person authorized to sign for such purchases. Tickets should be forwarded to the appropriate officer for review and filing until the end of the supplier's billing period. At the end of the billing period, all tickets for that period should be forwarded to the Purchasing Office. Statements will be reconciled with delivery tickets/invoices prior to being processed for payment.
Policy 14 - Rental and Lease of Equipment
Necessary Bidding and Approval - The purchase of equipment is encouraged, in lieu of leasing or rental when feasible. Departmental requests to lease equipment are submitted to the Purchasing Office on a procurement request. The request should be accompanied by a memorandum explaining the need for leasing rather than purchasing, a copy of the leasing agreement, and any other communication available concerning the request. The Purchasing office will forward the procurement request and other material to the State Purchase and Contract Division for review.
Lease/Purchase Agreements - Lease agreements are for a definite period of time, usually one to three years, and cannot be canceled during the life of the lease. However, a lease may be entered into with the option to purchase the equipment during the life of the leased or at the end of the lease period. If it is determined that the leased equipment will be needed on a continuing basis, it is usually more economical to exercise the option to purchase, provided funds are available to make the purchase.
Rental Agreements - Rental requests should be submitted to the Purchasing Department on a procurement request with an explanation justifying the need for the rental, a copy of the rental agreement, and any other communication concerning the request. The Purchasing Office will forward this material to the State Purchase and Contract Division for review and action.
Reasons for Renting - It may be desirable to rent equipment for a short duration for a specific requirement. Rental agreements are similar to lease agreements, except that rental agreements are normally for an indefinite period and can be terminated by the rentee after giving notice, usually thirty days in advance. The initial cost of some equipment, such as computers, is so great that when this type of equipment is required, it may be more economical to rent on a continuing but indefinite basis. Also, new, updated versions of this type of equipment are constantly placed on the market, making it unwise to invest large sums in equipment which may soon be obsolete.
Policy 15 - Purchase and Rental of Office Machines
State Contract - Most office machines must be purchased through the State Purchase and Contract Division. The State Purchase and Contract Division has entered into annual contracts for this purpose. Machines covered by the contracts are calculators, dictating machines, and copiers.
Available Machines - Information on available state contract machines may be obtained from the University Purchasing Office.
Non-Contract Machines - Orders for non-contract machines cannot be placed until after they are justified and approved by the State Purchase and Contract Division.
Disposition of Old Machines - Replaced machines are traded in (only if determined to be to the State's advantage), put in surplus for return t another University department, or sold as surplus.
Copy Machines - A number of copiers are available through State contracts for purchase or lease. Every effort is made to obtain the copier that best meets the needs of the requesting department, keeping in mind the cost per copy, service available, cost of the machine, quality of the copy, etc. A justification questionnaire is required to be submitted to the North Carolina Purchase and Contract Division for all non-contract copiers.
Mimeograph machines, spirit duplicators, and other machines for long run copying must also meet certain need requirements before being purchased. Requests for this type of equipment is reviewed and evaluated by the Purchasing Office.
Policy 16 - Service Contracts/Maintenance Agreements
Most equipment generally requires some service to continue in operating condition. Therefore, it is often most economical to arrange for a service or maintenance contract with the manufacturer or service agency. The costs of service on the equipment must be borne by the using department and usually involves a service call charge, labor, and parts charges each time repair or maintenance is required. While parts and supplies are usually not covered in the service contract, the savings on service call and labor charges can make the lump sum payment for a service contract very reasonable.
Contract Initiation - A service or maintenance contract is initiated by submitting a procurement request to the Purchasing Office. Expendable parts are not usually covered under a maintenance agreement; therefore, a separate confirming procurement request must be issued and submitted to the Purchasing Office for charges not covered on the contract after service is performed.
Policy 17 - Purchase or Rental of EDP and Computer Related Equipment
Data processing equipment (both software and hardware) must be approved by the University Computer Policy and Advisory Council and the State Department of Administration in Raleigh before a purchase or rental agreement can be made.
NOTE: In addition, General Statute 143B.426.39 requires the approval of the State Controller's Office prior to the installation of new, or the revising of existing, accounting systems and related automated data processing equipment.
The Management Systems Division of the State Department of Administration assists in the planning stage for the installation of new systems or major additions to present systems before a formal request is made to secure equipment. The Management Systems Division also assists the State Purchase and Contract division in reviewing the request and in formulating specifications.
The Purchase and Contract Division of the State Department of Administration advertises for bids from all responsible suppliers. Bids are requested for equipment whether a purchase or rental is desired.
Recommendations and justifications made by the requesting University department are presented by the State Purchase and Contract Division to the Board of Awards for certification.
In rare instances, the State Purchase and Contract Officer may waive competitive bidding when the requesting department can demonstrate that the particular equipment being requested is the only type that will satisfactorily perform the desired function. (See Policy Statement 6, Single Source Purchases) .
North Carolina Purchase and Contract Division acquires an annual State contract for microcomputer requirements. A variety of approved microcomputers are available for the State's requirements from this contract. For compatibility and local on-campus service, assistance should be requested from the Academic Computing Service Office when purchasing microcomputers and peripheral requirements.
Policy 18 - Excise and Sales Tax
EXEMPTION FROM FEDERAL EXCISE TAX
Appalachian State University, being an agency of the State of North Carolina, is exempt from the Federal Excise Tax. The Purchasing Office must furnish the State of North Carolina Exemption Number under which the University is authorized to purchase tax free, to vendors of items subject to the Federal Excise Tax:
FEDERAL TAX EXEMPTION
CHAPTER 32, INTERNAL REVENUE CODE
REGISTRY NO. 56 70 0047 K
FOR EXCLUSIVE USE OF NORTH CAROLINA
STATE GOVERNMENT AND PUBLIC SCHOOLS
STATE SALES TAXES - RATES AND EXEMPTIONS
Other than for those categories of items exempt by law, all purchases of supplies and materials are subject to the inclusion of a 4% (or other applicable rate) State and a 2% Watauga County sales tax as part of the cost. All sales taxes are figured on the total cost of taxable items included. Refer to the following section on items exempt from sales tax for more details.
Where items are being traded in as part of the payment, the sales tax is figured on original sales cost rather than on the net cost.
Include on Procurement Request - Applicable sales taxes are to be included on the procurement request when requisitioning materials and supplies.
ITEMS EXEMPTED FROM SALES TAX
- Items purchased for resale by the University are exempted at the point of purchase. The sales tax is collected and paid at the point of sale. Procurement requests covering such items must bear the notation, "Tax Exempt - Purchase for Resale." Vendors whose major sales are to a University agency or department which is exempt from the tax must have on file an Exemption Certificate. When appropriate, the Purchasing Office will furnish the vendors with the exemption certificates.
- Purchases of seed, fertilizers, insecticides, and herbicides.
- Labor portion of charges for repairs to equipment when labor can be identified as a separate charge.
- Repairs and alterations, such as painting, masonry work, electrical work, plumbing where the order is for the vendor to furnish both labor and material. The vendor pays the tax on the materials that are used and figures the tax in the total cost. If the University buys the materials for a repair vendor to use, then the purchase of the materials is subject to sales tax.
ITEMS TAXABLE AT SPECIAL RATES
- Highway motor vehicles are taxed at a 2% rate with a maximum of $300.00 per vehicle.
- Purchase of supplies or equipment which are used in the manufacture of a product, such as water and electrical power, or used in a laundry operation are taxed at a 1% rate with a maximum of $80.00 per item.
Policy 19 - Surplus Property
Occasionally, departments have in their possession equipment or furnishings which are no longer of use to them, and therefore, may be termed "surplus property." Rather than permitting such surplus items to set idle and occupy needed space, they should be disposed of in one of the following ways:
- Transfer the items to another University department or office where they will be used. A department may sell to a department by budget transfer, but cannot sell directly to individuals.
- Sell the items through the North Carolina State Surplus Property Office.
Disposal of all state owned property must be coordinated through the Surplus Property Officer in the Purchasing Office. TRANSFER OR DISPOSAL OF ITEMS BEARING A FIXED ASSET INVENTORY DECAL
Appalachian State University form, Moveable Equipment - Notice of Disposal or Change of Location, must be completed and forwarded to the Fixed Asset Office whenever a department wishes to:
- transfer property to another department.
- move property to another location.
- dispose of surplus property by sale
if the property bears a fixed asset inventory decal.
TRANSFER OR DISPOSAL OF ITEMS NOT ON THE FIXED ASSET SYSTEM
Whenever a department wishes to dispose of, transfer, or change the location of an item not on the fixed asset system, the Moveable Equipment - Notice of Disposal or Change of Location form, or a memo should be forwarded to the Surplus Property Officer giving the following information:
- Item name and description
- Condition (good, fair, poor, operable, inoperable, etc.).
University employees are not permitted to bid on surplus items from their department or work area. They are permitted to bid on property from other areas of the University. Anyone failing to adhere to this policy may be subject to dismissal.
Internal Auditors will audit surplus property records in the North Carolina Surplus Property Office and in the University Fixed Asset System Office to insure that this policy is being followed. (All of these records are subject to the public records law.)
Policy 20 - Fixed Asset System
General - The responsibility for equipment control, or the Fixed Asset System, has been assigned to the Purchasing Department. The telephone number for assistance and information is 2636.
Function - The Fixed Asset System (FAS) was implemented at Appalachian State University July 1, 1979, in order to more effectively control those assets owned by the University. The function of this system is to:
- Account for lost or damaged property due to fire, flood or other disaster. This kind of information may be essential in obtaining replacement funds or collecting insurance coverage.
- Comply with requirements of the State of North Carolina that tangible, long lived assets be accounted for through an inventory control system.
- Deter theft and aid in tracking property which has disappeared.
- Facilitate transfer of equipment to fill a requirement on campus in lieu of procuring new equipment.
- Provide data to departments which will aid in better utilization of equipment.
- Determine the rate of depreciation on equipment for the purpose of calculating the University's overhead rate to Federal Agencies.
Definition - Fixed assets are defined as those tangible items generally costing $5,000 or more including taxes, shipping and other costs to make the equipment operative and having an estimated useful life of more than one year.
New Equipment - The Purchasing Office routes all purchase orders of applicable assets to the Fixed Assets System Office, where an equipment control record is prepared and sent along with a numbered decal to the Central Warehouse. Warehouse personnel applies the decal before forwarding the equipment to the department which placed the order.
Yearly Inventory - Each year, the Fixed Asset System Office will send to each department a listing of all assets for which that department is responsible. The department will be required to make a physical count of those assets, noting any differences. Also, in case of any disposition of assets; i.e., transferred, traded, stolen, or destroyed, the proper procedures should be followed in notifying the Fixed Asset System Office. (See PURCHASING Procedure 5.)
Department Head Changes - Inventory listings are available to incoming and outgoing department heads so there can be a physical inventory taken and signed by both persons indicating a transfer of responsibility for State property.
Policy 21 - Borrowing Computer Equipment
Authorized Personnel - The University will allow faculty and staff to borrow personal computers and related equipment in order to fulfill their responsibility to the University.
The equipment can be borrowed only upon the written authorization of the Chairperson, or the department head of the department from which the equipment is being borrowed. An "Equipment Check-out Permission Form" may be obtained from the Warehouse.
Responsibility - It is the responsibility of the lending department to maintain a record of the equipment which has been loaned to a faculty or staff member. Students are not permitted to borrow computer equipment.
The University auditors and the State auditors will expect each department to provide copies of authorizations for any equipment which has been loaned and not returned. The borrower may be asked to temporarily return the equipment for verification.
References See also PURCHASING Procedure Statement 7.
Policy 22 - Personal Service Contracts
Personal - Personal services are those performed by a professional individual on a temporary or occasional basis, including (by way of illustration, not limitation) those provided by a doctor, dentist, attorney, architect, professional engineer, scientist, or performer of the fine arts and similar professions.
Contracts - Personal service contracts are not reviewed by the Purchasing Office unless the services are consulting in nature, in which case they will be forwarded to Raleigh for review and approval by the Department of Administration. Care must be taken to ensure that personal service contracts are not used to circumvent personnel procedures and that the appearance of an employer/employee relationship is not created. It is the policy of Appalachian State University that goods or services will not be purchased from Appalachian State University employees or State employees. Prior to initiating a personal service contract, the responsible individual should contact the Controller to verify that the person performing the service can legally be paid for contracted services and is not classified as an Appalachian State University employee.
The contract is to include the following information:
- The name, address, and social security number of the person with whom the contract has been made.
- The services to be performed by the individual contracted with and the dates the services begin and end.
- The total amount of compensation for the services performed (an all inclusive amount, unless otherwise approved by the Controller).
- Signatures by: The person contracted with, the chairperson of the department for which the services are performed, the dean of the appropriate college, and the applicable vice chancellor. The vice chancellor, if he or she desires, may delegate his or her signature authority.
Such delegation must be in writing (to the Controller), and it may not be delegated below Assistant Vice Chancellor level.
Payment for Services - Persons paid for services performed will be paid from the contract.
Policy 23 - Indefinite Quality Contracts
General - An indefinite quantity contract will be established by the Purchasing Department for requests for repetitive purchases of specific types of supplies from a single vendor over a specified period of time where the total amount exceeds $5000.
Competition will be solicited where available and a contract established with the lowest responsive bidder.
An indefinite quantity contract must not exceed the $150,000 university benchmark in total expenditures over a one year period. The contract will end when the benchmark is reached. A request for an indefinite quantity contract which exceeds, or is likely to exceed, $150,000 will be forwarded to Purchases and Contract Division for processing.
Information Required - With the exception of the dollar amount, a request for an indefinite quantity contract is very similar to a blanket purchase order, and it requires the same type of information (see PURCHASING Policy 14) .
Budgetary Action - Budgeting, invoicing and billing actions are also essentially the same as for a blanket purchase order ( PURCHASING Policy 14) .
Policy 24 - Small Purchase Policy
Definition
The North Carolina Agency Purchasing Manual, Section V-2, effective November 15, 1998, defines small purchases as those purchases of commodities, services or printing, not covered by a term contract, involving an expenditure of public funds of five thousand dollars ($5,000) or less.
COMPETITION
Competition is not required by statute for those purchases of equipment, supplies, materials, and services which meet the definition of small purchases. However, it is the responsibility and obligation of all University employees to seek the best possible value when making purchases with University funds. Accordingly, where appreciable value can be gained without undue sacrifice of convenience and/or necessity, the Purchasing Department may seek competition for certain purchases under $5000.
DOCUMENTATION
This small purchase policy in no way changes the requirement to obtain proper authorization documentation through the Purchasing Department or the Controller's Office prior to committing any University funds for the procurement of commodities or services. Normal purchases processed through the Purchasing Department require a purchase order. Certain small purchases as indicated below may be accomplished without a purchase order and documented as specified in the Accounting Section of this manual.
PETTY CASH PURCHASES
As a result of the increasing costs of issuing procurement requests, purchase orders, and checks, petty disbursing funds have been established for small purchases and emergency purchases.
Petty disbursing funds are available through the Controller's Office for use by University departments and areas under University control.
This procedure does not replace the routine purchasing procedures. However, if the purchase meets the criteria outlined below, this procedure may be used in lieu of the regular purchasing procedures.
The Central Petty Disbursing Fund may be used when:
- There is a need for items that can be purchased locally at an economical price.
- The University Warehouse does not have the items in stock.
- The reimbursement amount is within the limits established in Accounting, Policy 16.
- The budget account to which the purchase is being charged is maintained by the ASU Controller's Office.
- State Term Contract items must be purchased from contract vendors.
- The purchase of first aid supplies must be approved by the Safety Officer before reimbursement will be made by the Controller's Office.
If there is any question about a purchase being legitimate, the Petty Disbursing Officer in the Controller's Office should be asked for clarification prior to making the purchase.
The University cannot be responsible for the purchase if it does not meet the established purchasing regulations and criteria listed in items 1 through 6 above.
For details on this procedure, see Accounting, Policy #16 and Accounting, Procedure #5 .
CHECK REQUEST PURCHASES
Certain small purchases totaling less than $1,500 including taxes, delivery and costs to place item into operation may be made using a Check request in lieu of following the normal purchase procedure.
The following restrictions must be strictly adhered to by all personnel making procurements under this procedure:
- Total value of the purchase (including taxes, delivery, and costs to place item into operation) must be less than $1,500. Orders may not be split to avoid this threshold.
- Contracted personal services.
- Items listed on State Term Contracts must be purchased from a State Contract Vendor.
- Items stocked in the Central Warehouse stores. These items must be purchased through the warehouse.
- Purchases from overseas vendors.
- Purchases requiring prepayment.
- First aid supplies should be approved by the Safety Officer prior to purchase.
- Purchases unauthorized for State Fund expenditure, such as: items for personal use, alcoholic beverages, and entertainment expenses (to include food).
The Controller's Office has the responsibility for management and oversight of this procurement procedure. For details on this procurement method, see Accounting, Policy #15 and Accounting, Procedure #4.
Policy 25 - Procurement Card Program
TABLE OF CONTENTS
1.0 Overview of the Procurement Card Program
1.1 Purpose of the Card
1.2 Benefits and costs/requirements
2.0 Where to Get Help
2.1 Card Provider
2.2 University Names and Addresses
3.0 Cardholder Policies and Procedures
3.1 Obtaining a Procurement Card
3.2 Keeping the Procurement Card Secure
3.3 Limitations of Transaction Amounts
3.4 Limitations of Vendors
3.5 Changing Card Limits and Updating Cardholder Information
3.6 Additional Procurement Guidelines
3.7 Automatic Renewal of the Procurement Card
3.8 Termination of Employment
3.9 Transfer to Another Department
3.10 Inactive Accounts
4.0 How to Use the Procurement Card
4.1 Applicable Rules and Regulations
4.2 Cardholder Only Persons Authorized
4.3 Purchases in Person
4.4 Purchases by Phone, Fax, or Mail
4.5 Other Forms to Complete
4.6 Returns, Damaged Goods, and Credits
5.0 Disputed Transactions
5.1 Dispute of Statement Items
5.2 Dispute with Vendor
6.0 Reconciliation Procedures
6.1 Importance
6.2 Billing Cycle/Statements
6.3 Documentation provided by Card Provider
6.4 Information in Appalachian State University FRS
6.5 On-line Reconciliation via the Web
7.0 Procurement Card Reinstatement Policy
7.1 All Delinquent Statements must be Turned In
7.2 Memo from Department Head
7.3 Privileges Cleared for Reinstatement
7.4 Schedule for Reinstatement of Privileges
7.5 Opportunity for Cardholder to Provide Incomplete Information
7.6 Revocation of Privileges for Purchase Over $1,499 Limit
7.7 Revocation of Privileges for Cardholder Abuse
8.0 Responsible Authority
PROCUREMENT CARD PROGRAM
1.0 Overview of the Procurement Card Program
1.1 Purpose of the Procurement Card
The Appalachian State University Procurement Card is essentially a standard Visa Card. The Procurement Card is issued to an employee, empowering this person to purchase goods on behalf of the University. This program has been established to allow rapid purchase of low dollar goods while simultaneously reducing paperwork and handling costs associated with the small purchase process. Under no circumstance may this Visa Card be used for personal purchases.
1.2 Benefits and Costs/Requirements.
1.2.1 To the Cardholder
1.2.1.1 Benefits
It is easier to make purchases. The Visa Card is accepted virtually anywhere, and it eliminates delays associated with asking a vendor to accept a small check request or purchase order number. Materials may be acquired faster. Complete transaction reporting is provided on a weekly basis. Vendor information becomes easier to research and locate. Each Procurement Card has a unique number that is tied to departmental FRS accounts.
1.2.1.2 Costs/Requirements
There is currently no fee associated with the program. The Cardholder is responsible for obtaining itemized receipts with pricing for a monthly reconciliation process. Each Cardholder's account is also reviewed and approved by a higher authority (normally at the Department or College level). The Cardholder is responsible for obtaining tax collected from the Vendor at the time of purchase. The cardholder is responsible for reporting tax information to the Department Reconciler. The Department Reconciler must complete the tax information field on line during the monthly reconciliation.
1.2.2 To the University.
1.2.2.1 Benefits
The number of procurements and check requests will decrease, thereby reducing the amount of paperwork and time associated with the small purchase process. There is an opportunity to reduce imprest/petty cash accounts. The University has the ability to block specific categories of Vendors (airline reservations, cash advances, liquor purchases, etc.) This provides increased security of purchases over the existing small purchase process. Fewer payment errors will improve Vendor relations. Transactions and payments will match each Card. Vendors will receive payment within two-to-three working days after the Vendor processes the purchase.
1.2.2.2 Costs/Requirements
The University has purchased an accounting system to handle Procurement Card transactions. The reconciliation process then feeds transactions into FRS. The University is committed to providing an on-going audit.
1.2.3 To the Merchant.
1.2.3.1 Benefits
The Card Provider will pay the Vendor two to three working days after the Vendor processes the purchase. The Vendor will have a higher comfort level. The strength of the Visa name (and the protection the Vendor has when accepting the card) encourages Vendors to make sales that would not be made if a small purchase number or purchase order were presented. The Procurement Card process eliminates Vendor invoicing and the Vendor's accounts receivable process.
1.2.3.2 Costs/requirements
Every transaction made with the Procurement Card carries a fee that the Vendor must pay to the credit card network. This is what finances the credit card industry, and the process is basically the same for all credit cards.
2.0 Where to Get Help
2.1 The Card Provider
We have an agreement with a credit card provider (Card Provider) for Visa card services. Card Provider will provide monthly statements on-line. To report a lost or stolen card, call Card Provider at 1-888-905-6262 (where help is available 24 hours a day) and notify Appalachian's Procurement Card Administrator of this action. For billing questions, or any customer service questions in general, call Judy Ball, Procurement Card Program Administrator, first at 262-2082. After Appalachian's business hours, call Card at 1-888-905-6262 where help is available 24 hours a day. Also, to dispute a transaction on your statement, please refer to Section 5 of this guide.
2.2 University Names and Addresses
The University provides support and assistance to Cardholders and Departments in the distribution and processing of new Card applications. The Procurement Office processes all changes in Cardholder information, schedules training, updates all documentation, and audits all aspects of the program. Follow-up audits by Internal Audits will be made. Please call whenever you have any questions.
Procurement Card Program Administrator:
Judy B. Ball, CPPB
Procurement Services Office
Procurement Services Building
828/262-2082, fax 828/262-2510
email: balljb@appstate.edu
Procurement Card Expeditor:
Becky McInturff
Procurement Services Office
Procurement Services Building
828/262-4004, fax 828/262-2510
email: mciinturffbm@appstate.edu
3.0 Cardholder Policies and Procedures
3.1 Obtaining a Procurement Card
3.1.1 Procurement Cards will be issued to those authorized by the University to purchase goods. Training will be required for each Cardholder, Reconciler and Approver. The Procurement Card will be issued only to permanent personnel. The names of the University and the Cardholder both appear on the card. Card Provider currently does not charge for the issuance of a Card; however, low usage Cards will be reviewed regularly. See section 3.10.
3.1.2 Purchases from sponsored programs must strictly adhere to all contracts, grants and other agency guidelines. These guidelines may restrict the purchase of specific items through sponsored accounts. Individual granting agencies also may be more restrictive and may not allow certain purchases. It is the Cardholder's responsibility to be aware of the rules and guidelines applicable to each account.
3.1.3 Enrollment Forms can be found at the Procurement Office home page under Procurement Card.
3.2 Keeping the Procurement Card Secure
Always keep the Procurement Card in a secure place. Treat it like cash.
3.3 Limitations of Transaction Amounts
3.3.1 The following limits have been assigned to the Procurement Card:
Single purchase limit of $1,499 (Including tax and shipping)
Daily purchase limit of $3,000
Monthly purchase limit of $10,000
Daily number of transactions is unlimited at this time
Monthly number of transactions is unlimited at this time
3.3.2 These are general limitations. If these do not fit your purchasing patterns please contact the Procurement Program Administrator to discuss modification of the limits. A limit modification request form must be completely filled out, signed by the Departmental Approver and submitted to the Program Administrator for consideration.
3.3.3 Cardholders are reminded that splitting transactions in order to remain within the established purchase limit per transaction is prohibited and doing so may result in loss of Procurement Card privileges and/or disciplinary action up to and including termination of employment.
3.4 Limitations of Vendors
3.4.1 Each Vendor accepting VISA cards is registered with a financial institution under a specific Merchant Category Code (MCC) identifying its type of business. (e.g.. Airlines, music stores, medical services, florist, ABC stores, restaurants, office supplies, etc.) The University has blocked all categories deemed inappropriate for Appalachian State University use (e.g. Travel and Entertainment categories, ABC stores, off-track betting, etc).
3.4.2. A Procurement Card cannot be used to purchase from Vendors in a blocked category on the MCC list. If a particular Vendor does not accept the card, please contact Judy Ball at 828/262-2082 within 48 hours. She will contact the Card Provider to determine why the charge was denied and what can be done to rectify the problem.
3.5 Changing Card Limits and Updating Cardholder Information
To request a change in the monetary limits on the Card, you must submit a request on the appropriate form in writing to the Procurement Card Program Administrator, and it must have Department or College level approval (Section 3.3 ). Changes of personal data (address, phone, FRS etc.) may be e-mailed to the Procurement Card Program Administrator (balljb@appstate.edu).
3.6 Additional Procurement Guidelines
3.6.1 It is the Cardholder's responsibility to insure that purchases are made only from legitimate companies. If you have any questions about the legitimacy of a Vendor or individual, please contact the Procurement Services Office and DO NOT PROVIDE THE CARD NUMBER.
3.6.2 Follow procedures that are already in place with the small purchase process. The Cardholder is responsible for purchases that commit University resources, and is therefore responsible for determining the legitimacy of the purchase and the selection of the Vendor.
3.6.3 The Procurement Card is strictly for University business. Purchases must be for the use and benefit of the University. No personal purchases are allowed. Intentional misuse or abuse of the Procurement Card will result in the immediate revocation of privileges, and may be cause for disciplinary action up to and including termination of employment.
3.6.4 North Carolina Term Contracts and University Contracts
When a State or University contract is available the contracted supplier must be used. Contracts may be reviewed by visiting the NC Department of Administration Purchase and Contract Home Page, by viewing the Procurement Home Page or by calling the Procurement Services Office to speak with the appropriate purchasing agent.
3.6.5 Using the Internet (WWW)
Many companies offer the option of making purchases via the web. If you choose to purchase on the web, you must make sure the vendor site is secured before entering the credit card number. Look for the padlock icon located on the vendor's order form.
3.7 Automatic Renewal of the Card
3.7.1 A Procurement Card will be issued to you as you enter the program. Once you have the Card, nothing will be required from you to continue from year to year. Cards have a 2-year expiration date and will be mailed directly to you approximately one month prior to the expiration date. Return the expired card to the Procurement Card Program Administrator.
3.7.2 All Vendors that have the Procurement Card number on file must be contacted with the new expiration date for continued approval of charges. Federal Express is a prime example. If the expiration date expires and you have not contacted them, the bank will deny charges and they will put you on a cash-only basis.
3.7.3 Do not forget that each Procurement Card is tied to a default FRS account. If that account number changes, you must contact the Procurement Card Program Administrator to update the information.
3.8 Termination of Employment
The Procurement Card remains the property of Appalachian State University and/or Card Provider. The Procurement Card must be surrendered immediately upon termination of employment or upon the request of either your supervisor or the Procurement Card Program Administrator. Vendors with the Procurement Card number on file must be contacted in order to discontinue future charges in your name by the department.
3.9 Transfer to Another Department
If the Cardholder, Reconciler or Approver transfers to another department, different University financial account information will be involved. It is the Cardholder's, Reconciler's and Approver's responsibility to provide the correct financial information for a new card. If you transfer to another Department, the current Card issued to you must be cancelled and returned to the Procurement Card Program Administrator. A new enrollment form will need to be submitted and approved by the appropriate Department head. Attending the training class will not be required if you have had a Procurement Card in your previous position.
3.10 Inactive Accounts
To protect the security of the Procurement Card Program, any Procurement Card that has not been used for six (6) months will be cancelled. Exceptions may be appealed to the Procurement Card Program Administrator.
4.0 How to Use the Procurement Card
4.1 University Rules and Regulations
Procurement with the Card does not change the rules and regulations of the University or your internal Departmental procedures. The Procurement Card is merely another means of payment for small purchases. You must obtain an itemized receipt with pricing for every purchase.
4.2 Authorized Cardholder
Please remember that the Cardholder is the only person authorized to make purchases with the Procurement Card. Giving the Card or Card number to another person or using someone else's Card may result in revocation of Procurement Card privileges and/or disciplinary action up to and including termination of employment. To assist in keeping track of transactions and receipts, a transaction log is provided for your use. The Procurement Card Program Administrator requires this log.
4.3 Purchases in Person
4.3.1 You should follow the proper internal procedures set up specific to your Department for determining that a purchase is required and authorized.
4.3.2 Determine whether the Procurement Card is the most appropriate tool to use for the purchase (Example: not if purchasing a restricted item or if the total purchase is over the $1,499 limit, etc.).
4.3.3 Determine that the total amount of the purchase including shipping, handling, postage, freight, insurance, etc., does not exceed either the $1,499 limit or the daily/monthly limits listed above. If a limit is exceeded, the bank will automatically refuse the transaction and the vendor will reject the purchase.
4.3.4 Determine that the price quoted is the best you can obtain.
4.3.5 Determine at the time of purchase that the vendor has charged sales tax for out-of-state and out-of-country purchases, and record this amount (preferably on the transaction log). Sales tax paid is required as part of the reconciliation process, which is discussed later in this guide.
4.3.6 Obtain a receipt at the time of purchase or pickup. If ordered on the World Wide Web, print a copy of the final order/acknowledgment/receipt. If an item is shipped the packing slip must be kept. All receipts and other paperwork must be forwarded each month to the Card Administrator as part of the reconciliation process.
4.3.7 Remember to give the supplier your name, department, phone number, and complete delivery instructions. It is recommended that purchases be shipped directly to your campus address whenever possible. If Central Receiving is used as the delivery point (due to weight, size or need for loading dock), please use the following address:
<Department Name>
ASU Central Receiving
Appalachian State University
1039 State Farm Road
Boone, NC 28608
4.4 Purchases by Phone, Fax, or Mail
4.4.1 Remember - the Cardholder is the only person authorized to place an order. You may, when necessary, have someone else pick up the items; however, this person is not authorized to sign the credit card sales slip.
4.4.2 PHONE - An entry on the transaction log should be made when placing a telephone order. Sales tax information should be recorded for all out-of-state/country purchases, since this is a critical part of the monthly reconciliation.
4.4.2.1 When you call, state that you are calling from Appalachian State University and that you will be making your purchase on a Visa Procurement (credit) Card.
4.4.2.2 Emphasize that the University is not exempt from sales tax, and that we want sales tax added to the purchase. Record the amount of sales tax paid on the purchase log.
4.4.2.3 Give the supplier your name, delivery address, phone number, and complete delivery instructions.
4.4.2.4 Request that an itemized receipt and/or packing slip that shows DOLLAR AMOUNTS be sent with the purchase. Retain this with your transaction log.
4.4.3 FAX - Follow all applicable steps from the instructions for phone orders. Retain a copy of the fax, and also the fax confirmation, for your records. Do not mail a copy of the order to the vendor, because this increases the chance that the order will be duplicated. If the vendor requires the original, be sure to clearly mark it “CONFIRMATION OF FAX ORDER, DO NOT DUPLICATE. “
4.4.4 MAIL - Follow all applicable steps from the instructions for phone orders. Retain a copy of the order for your records, and request a receipt for your records.
4.5 Other Forms to Complete
When using the Procurement Card there is usually no need to submit any additional paperwork to a Vendor. If, however, a duplicate shipment is mistakenly made, it is the responsibility of the Cardholder to resolve the issue with the Vendor. If unable to resolve in a timely manner, contact the Procurement Card Expeditor, Becky McInturff, at 262-4004 or e-mail: mcinturffbm@appstate.edu .
4.6 Returns, Damaged Goods, and Credits
4.6.1 Items purchased with the Procurement Card will periodically need to be returned for one reason or another. Credits should be listed on the transaction log. Credit receipts/memos should be received and turned in with the monthly statement. Credits listed on the monthly statement should be documented as to when the original charge was made if a credit invoice is not available.
4.6.2 Always retain boxes, containers, special packaging, packing slips, etc.; until you are certain that you are going to keep the items. Some items, such as software or fragile pieces, cannot be returned without the original packing materials.
4.6.3 Read all enclosed instructions carefully. Often a critical phone number and other instructions are included the packing slip and/or receipt.
4.6.4 In some cases there may be a restocking fee. The Procurement Card may be used to pay this fee as long as it does not exceed any of the Card limits.
4.6.5 If you need help in packaging goods for return please contact Warehouse at 262-3060.
5.0 Disputed Transactions
5.1 Dispute of Statement Items
5.1.1 Purchases appearing on the monthly statement from the Bank may be disputed up to thirty days from the date of the statement.
5.1.2 If the Cardholder does not recognize a charge or some other problem arises, the first step is to contact the Vendor for information regarding the charge. Contacting the Vendor saves time and usually solves most issues.
5.1.3 If you are not satisfied with the outcome of communications with the Vendor, complete the on-line dispute form and review it with the Procurement Card Expeditor. The Procurement Card Expeditor will then determine the next step. You also should notify the Procurement Card Program Administrator about the situation.
5.1.4 A copy of the dispute form should be submitted with the monthly statement.
5.2 Dispute with Vendor
If you have a Vendor dispute and are unable to obtain satisfaction from the Vendor, contact the Procurement Card Expeditor. You will be required to describe the problem and all of the efforts you have made in attempting to resolve it. The Procurement Card Expeditor will advise you on the next step. If you are unsatisfied with the outcome, please contact the Procurement Card Program Administrator.
6.0 Reconciliation Procedures
6.1 Importance
Reconciliation of purchases by the Cardholder is the final step in the Procurement Card process. It is also one of the most important steps, because this is where the Cardholder provides itemization and pricing of all items purchased. Statements are available mid-month and will be distributed by the Departmental Reconciler.
6.2 Billing Cycle/Statements
The billing cycle for the Procurement Card ends on the 10th of each month and the statements are due to the Procurement Card Program Administrator on or before 10 working days after the 10th of that same month. If any statement remains open after this date the Card will be immediately cancelled and the Cardholder, Reconciler, and Dean (or other division head) will be notified of the cancellation. Timely reconciliation and responsible purchasing are the only ways to keep a card.
6.3 Documentation provided by the Card Provider
The Card Provider provides an electronic feed, which transmits all transactions posted for the previous week from Monday-Friday on a daily basis.
6.4 Information in Appalachian State University FRS
Successful receipt of the feed is critical to the continuation of the Procurement Card Program. The electronic feed from the Card Provider is used for three purposes:
a. First, the financial data is used to reconcile the overall charges to the University. These charges are checked for accuracy on a daily basis. At the end of each billing cycle, the departmental FRS accounts to which the Procurement Card transactions apply are debited for the billed amount. Remittance is made to the Card Provider on the basis of these charges.
b. Second, all of the data, including information about Cardholders, purchases, Vendors, etc. are in the reconciliation database. Searches by Vendor, dates, state, etc., may be made, and data is saved for five years. Access to the database follows security procedures already in use by FRS, and Reconcilers will be given access upon approval of request for security clearance to the Procurement Card Program.
c. Third, the reconciliation procedure, which the Reconcilers use to verify all Card purchases, is updated via World Wide Web. The Procurement Card Program allows Reconcilers to modify FRS account numbers and object codes, enter out-of-state taxes, verify weekly purchases and balance monthly printouts. Reconcilers approve all purchases on-line. Continued failure to reconcile transactions on-line will result in revocation of Procurement Card privileges.
6.5 On-line Reconciliation Via the Web
Specific instructions for navigating through the reconciliation process on the web are provided in a separate document and are available from the Procurement Card Home Page. The primary responsibility for insuring integrity of the Procurement Card Program rests with the Cardholder and Departmental Reconciler.
7.0 Procurement Card Privileges Reinstatement Policy
7.1 Delinquent Statements
All delinquent statements must be turned in to the Procurement Card Program Administrator before consideration can be given to reinstatement of privileges.
7.2 Memorandum
A memorandum from the Department Head and next level supervisor must be submitted to explain the reason for the discrepancy which caused the cancellation and steps that will be taken to prevent it from happening in the future.
7.3 Account Privileges
Procurement Card privileges may be reinstated no earlier than one week following completion of the steps described in sections 7.1 and 7.2, above.
7.4 Schedule for reinstatement of privileges:
First Offense – Reinstatement will occur one week after receipt of delinquent statement and memo with sufficient explanation.
Second Offense – Four weeks after receipt of delinquent statement and memo with sufficient explanation.
Third Offense – Privileges will not be reinstated.
7.5 Incomplete Documentation
Every effort will be made to give the Cardholder opportunity to provide the incomplete information (missing receipts, receipts not itemized, etc.) by using, email, fax, campus mail, and /or phone. However, if Cardholder consistently provides incomplete information, the following will occur:
7.5.1 Account will be put in a hold status. Cardholder (and possibly Reconciler and Approver) will be required to attend another Procurement Card class or have a review of rules and regulations with the Procurement Card Program Administrator. Upon satisfactory completion of this review, account will be taken off hold status.
7.5.2 Account will be closed. If, after retraining, the Cardholder continues to submit statements with incomplete information, account will be closed.
7.6 Penality for Purchase Over Limit
If Cardholder makes a purchase over the transaction limits as detailed in section 3.3 the account will be revoked for a period of two months. Written explanation from the Department Head and Cardholder and attendance by both at another Procurement Card class, is required before privileges will be reinstated.
7.7 Abuse of Procurement Card Privileges
If Cardholder abuses the Procurement Card privileges (personal purchases, lets others use card, etc.), privileges will be suspended and a review will be conducted. If deemed necessary, privileges will be revoked.
8.0 Responsible Authority
The authority to enforce this policy lies within the Procurement Services Office. Any questions may be directed to 828/262-2082 or balljb@appstate.edu.
Authority: G.S. 143-49(8)
1NCAC 5B.1522
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