UVa Seal

Policy: Use of the University Purchasing Card 


Date: 03/13/12 Policy ID: FIN-044 Status: Final

Policy Type: University
   
Contact Office: Procurement and Supplier Diversity Services
   
Oversight Executive: Vice President for Management and Budget
   
Applies To: Academic Division, the College at Wise, and University-related Foundations.
   
Table of Contents:  Policy Statement
  1. Eligibility for the University Purchasing Card
  2. Obtaining a University Purchasing Card
  3. Training Requirements
  4. Types of Purchases
  5. Spending Limits and Restrictions
    1. Spending Limits
    2. Spending Restrictions
  6. Merchandise Returns
  7. Purchasing Card Security
  8. Card Reconciliation and Documentation
  9. Exemption from Virgnia Sales Tax

Procedures

   
Reason for Policy: 

The University Purchasing Card provides a means for authorized individuals to make official University purchases of small dollar goods and services with a credit card.  This policy establishes the guidelines for the use of the University Purchasing Card.

   
Policy Summary: 
   
Definition of Terms in Statement: 

Approver: The employee who has the authority and knowledge to approve the expenditures on the account.

Authorizer: An individual assigned to approve purchasing card applications and changes to purchasing card limits and restrictions. This individual is the applicant's or cardholder's supervisor or sponsor (for students and other approved individuals).  A supervisor can designate someone else to approve on his/her behalf.  The individual should not be the cardholder and, in general, should not be asked to approve for an individual to whom they report.

Cardholder: For the purpose of this policy, an individual who holds the University Purchasing Card (Visa or MasterCard).

eVA: The Commonwealth of Virginia's electronic purchasing system.

Local Funds: Local funds are primarily composed of gifts, endowments, and endowment income.  Some exceptions to State and Sponsored Program limits can be processed using these funds.

Local Purchasing Card Program (Purchasing Card Program, Card Program): A card program managed locally by the University's Purchasing Card Administrator with oversight by the University.  Purchases should be made with local funds.  

Non-Contract Vendor: A vendor that has not been awarded a term agreement.  A purchase of $5,000 or more from a non-contract vendor requires competition.

Purchasing Card Administrator (Program Administrator): A University employee registered with the Card Provider and the Virginia Department of Accounts (DOA) as the only person authorized to make changes (e.g., add or cancel cards, change card controls, etc.) to the purchasing card program.

Preparer: The employee who performs the monthly detailed reconciliation and prepares documentation for approval.

Recon@UVa System: A system that provides an electronic solution for the documentation of reconciliations for all organizational units at the University of Virginia (including all academic schools and departments).

Sponsored Programs: Programs funded by revenue derived from grants and contracts. Most of the state limits apply to payments and reimbursements made from these sources. Exceptions are noted in the text of this policy or may be included in the terms of the grant or contract in question.

State Funds: Include tuition and fee revenues, F&A recoveries, funding from state tax dollars, sales and services activities, grants, and auxiliaries.  State limits apply to payments and reimbursements from these sources.

State Purchasing Card Program: A card program managed locally by the University's Purchasing Card Administrator with oversight from DOA.  Purchases may be made with local or state funds.

Student Organization: For the purpose of this policy, student organization is used as a general term that refers to all Contracted Independent Organizations (CIOs), Fraternal Operating Agreement Organizations (FOAs), and Special Status and Agency groups.

University Purchasing Card: A credit card issued to an authorized individual to make official purchases of small dollar goods and services (that do not require competitive bidding) quickly and directly.  (Also referred to as the “P-Card,” the “Purchasing Card.”)  This includes the local and state program.

UVa Market Place: The University’s primary purchasing system for entering electronic catalog and non-catalog orders and creating requisitions for purchase by Procurement and Supplier Diversity Services (PSDS).

Visiting Faculty and Staff: For the purpose of this policy, an individual working on a temporary basis at the University and not receiving compensation from the University's academic division.  (Examples of visiting faculty and staff include, but are not limited to: visiting research assistants, visiting scholars and ROTC.)
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Policy Statement: 

The University Purchasing Card may be used only for purchases related to the conduct of official University of Virginia business. The University Purchasing Card may not be used for personal expenditures, cash advances, or to obtain store credit. All items purchased with University funds remain the property of the institution.

The University offers two types of cards dependent on the source of funds used for payment:  (1) A MasterCard that uses local funds as the source of payment; and (2) a Visa card that uses state funds as the source of payment. Cardholders are responsible for following all rules governing the use of the University's Purchasing Card. These rules apply to both the State and Local Purchasing Card Programs unless otherwise specified in Section 5a.

Employees who violate University Purchasing Card policy and procedures may have their cardholder privileges suspended or permanently revoked, and may face additional disciplinary action, which could include termination of employment.

Students and non-employees (e.g., visiting faculty and staff, ROTC) who violate University Purchasing Card policy and procedures may have their cardholder privileges suspended or permanently revoked, and may face additional disciplinary action.

The University Purchasing Card Program is managed by Procurement and Supplier Diversity Services.
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  1. Eligibility for the University Purchasing Card:
    To obtain a purchasing card:
    • an Academic Division employee must secure his/her supervisor's or Authorized Approver's (as documented and filed with Procurement and Supplier Diversity Services) approval;
    • a Student Resident Assistant must acquire approval from the University's Housing and Residence Life Office;
    • A Medical Center employee, University student acting on behalf of a student organization, a University-related Foundation employee, and a non-University employee must be sponsored by a University department.
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  2. Obtaining a University Purchasing Card:
    All entities noted in Section 1 above, except Student Resident Assistants, must submit a purchasing card application with the required approval. Student Resident Assistants should see the Housing and Residence Life Program Administrator to obtain a P-Card.
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  3. Training Requirements:
    New cardholders must complete training and agree to the program’s terms and conditions before receiving a purchasing card.  Cardholder training is required annually to retain the purchasing card.

The Authorized Approver for the P-card is required to certify annually that he/she understands and commits to follow the University's policies and procedures that govern the purchasing card. 

The Preparer is required to attend training before access is granted to the Recon@UVa system and certify annually that he/she has reviewed the University's purchasing card policies and procedures. The Approver  is required to certify annually that he/she understands and commits to follow the University's purchasing card policies and procedures.
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  1. Types of Purchases:
    In general, the purchasing card should be used only for eVA-excluded purchases. [See list of eVA exclusions.]
     
    The purchasing card may be used for purchases that are not eVA-excluded under either of the following two conditions (department will incur the full eVA fee):

    • The purchase is necessary to the mission of the department, and there is no other reasonable way in which the purchase can be made.
    • After comparison shopping with UVa Marketplace vendors and taking into account all costs (eVA fees, shipping costs, etc.), the purchasing card is the least expensive way to purchase.

(See the Procurement and Supplier Diversity Services' website for purchases that require payment by the purchasing card and other allowable and restricted purchases.)

The P-Card may NOT be used to buy goods or services from a non-contract vendor that total $5,000 or more annually (excludes commodities that do not require competition). This type of purchase requires the submission of a Purchase Requisition. A list of contract vendors may be found on the Procurement and Supplier Diversity Services' Contracts website.
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  1. Spending Limits and Restrictions:
    Cardholders must comply with the University procurement and payment regulations.
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    1. Spending Limits:
      The University has established standard limits of $4,999 per transaction and $7,500 per month for the P-card for both the state and local program. 

    Each card has individually established limits on how much can be spent per transaction and how much can be spent per month.  All cardholders will not have the same spending limits. Limits are established on a case-by-case basis by the cardholder's Authorized Approver and the University's Purchasing Card Administrator.

    State Purchasing Card Program spending limits cannot exceed $50,000 per transaction and $250,000 per month without the University's Purchasing Card Administrator obtaining approval from the State’s Department of Accounts. (This does not apply to the Local Purchasing Card Program.)

    A cardholder may NOT make purchases that exceed the established transaction and monthly spending limit for their card. Splitting orders among multiple smaller orders for the purpose of circumventing transaction limits is NOT allowed.

    The cardholder may request that the monthly spending limit be increased. This request must be approved by the Authorized Approver and should be made by completing the "Change per Transaction/ Monthly Limit" form.

    A cardholder may request in advance a special waiver when the cost of mass transit (air, rail, bus) tickets exceeds the cardholder's established spending limit.  This procedure is described on the Procurement and Supplier Diversity Services' website.

    Purchasing cards with limits set higher than the standard limits will be reviewed annually by the Program Administrator to ensure the set limits are appropriate.  Authorized Approvers must continuously monitor card use to ensure appropriate limits and restrictions are in place.
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    1. Spending Restrictions:
      The P-Card has certain restrictions which are based on:
      • Specific types of goods and services that may be purchased with the card;
      • the vendor with whom the card can be used; and
      • the funds that can be used to purchase with the card.

      A detail of the above purchase restrictions can be found at University Purchasing Card -- Restricted Purchases.

    Requirements for competition prior to purchasing with the University Purchasing Card are generally based on the dollar value of the order, and all purchases are subject to the Guidelines for Competition (see the Procurement and Supplier Diversity Services website). Regardless of competition requirements, it is expected that cardholders will make prudent and necessary purchases.

    Additional restrictions may be placed on the P-Card depending on the cardholder's status. For example, additional restrictions may be established at the departmental level or as part of the terms of a grant. Resident Assistants are subject to additional restrictions established by the University's Housing and Residence Life Office.
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  2. Merchandise Returns:
    When a cardholder returns merchandise, the original receipt must be provided and the vendor requested to credit the return to the purchasing card.  "Store credit" must not be accepted for returned items. If a vendor refuses to credit the purchasing card for returned items, the cardholder must notify the University's Purchasing Card Administrator.
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  3. Purchasing Card Security:
    The purchasing card may only be used by the person to whom the card has been assigned. A cardholder may not lend his/her card to another person.

    A Cardholder must not:

    • fax or e-mail the complete card number (more than the last 4 digits), or include it in an email or email attachment; and
    • place orders over the Internet unless the security of the vendor's website can be verified. [See Responsible Computing at the University.]

    Cardholders should consult Procurement and Supplier Diversity Services' website for guidance.
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  4. Card Reconciliation and Documentation:
    Purchasing card transactions must be documented and reconciled monthly according to the "Card Reconciliation and Documentation" procedures, accessible on the Procurement and Supplier Diversity Services' website.
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  5. Exemption from Virginia Sales Tax:
    As a non-profit institution, the University of Virginia is exempt from Virginia sales tax on all goods and services (except prepared foods and mass transit tickets), and communications sales and use tax on all communications services (e.g., wireless and cellular phone services). If a vendor requires proof of exemption, the cardholder may obtain the Commonwealth of Virginia Sales and Use Tax Exemption Form from the Procurement and Supplier Diversity Services' website.  For tax exceptions with other states, see the State Tax Exemption Certificates website to determine exemption status.  The cardholder is responsible for claiming an exemption when using the P-Card.
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Procedures: 

Purchasing Card Basics
Using the Purchasing Card
Departmental Purchasing Card Responsibilities

Forms:
Purchasing Card Application
Change per Transaction/ Monthly Limit
Commonwealth of Virginia Certificate of Exemption Forms

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Related Information: 

eVA Allowed Purchasing Card Use

FIN-004, Payment or Reimbursement of Business Meals

FIN-030, Payment or Reimbursement of Travel Expenses

The Guidelines for Competition (to determine if the purchase requires competition, other processing by Procurement and Supplier Diversity Services, or may be ordered directly.)

Recon@UVa, the University's on-line financial reconciliation system

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Policy Background: 
   
Major Category: Finance and Business Operations
   
Category Cross Reference: 
   
   
Process: 
   
Next Scheduled Review: 03/13/15
   
Approved By, Date: Policy Review Committee, 03/13/12
   
Revision History: 
   
Supersedes (previous policy):  VII.C.3, Use of the University Purchasing Card