Subject: UT Procurement Cards: Risks and advantages
From: "Soren P. Sorensen"
Date: Mon, 13 Oct 2008 15:06:48 -0400
To: undisclosed-recipients:;

To UT Physics Procurement Card Holders,

please carefully read the following memo concerning the proper usage of our procurement cards. We have to avoid the type of problems the Knoxville County government recently ran into!

Soren

-------- Original Message --------
Subject: [DDDHLIST] Procurement Cards
Date: Mon, 13 Oct 2008 10:29:45 -0400
From: Lindstrom, Jonee (Jonee Daniels) <danielsj@UTK.EDU>
Reply-To: Lindstrom, Jonee (Jonee Daniels) <danielsj@UTK.EDU>
To: DDDHLIST@LISTSERV.UTK.EDU


 

 

TO:                         Deans, Directors and Department Heads

 

FROM:                  Joneé Daniels-Lindstrom
Associate Vice Chancellor for Finance & Administration

 

DATE:                    October 13, 2008

 

SUBJECT:             Procurement Cards

 

 

Review of recent Procurement Card transactions and a Risk Assessment of the Procurement Card Program indicate the University faces a medium level of risk for procurement cards in the areas of fraud, waste and regulatory violations.  This communication is to serve as a reminder of the advantages of the Procurement Card as well as the areas of risk.

 

The Procurement Card is a VISA credit card that works similarly to a personal credit card except the charges are billed directly to the university.  The card is issued to an employee who is responsible  for university purchases on behalf of their departments . 

 

Some of those purchases which are prohibited as noted in Policy F10530 #4 include:

1)      Personal use

2)      Travel ( including airlines, hotels, registration fees, etc.)

3)      Cash advances

4)      Gift cards

5)      Entertainment costs of $500 or more per function

6)      Sensitive and minor equipment (equipment costing more than $1,000)

7)      Cell phones and services

8)      Purchases from other departments, including the University Book and Supply Store

9)      Multiple purchases of like or unlike items from the same vendor totaling $5,000 or more

 

Advantages of the Procurement Card are:

1)      Eliminate costs associated with processing invoices, generating checks and mailing costs

2)      Payment of vendors on time

3)      Granting departments a better tool for use of funds

 

Areas of repeated risks include:

1)      Splitting transactions to avoid the current $5,000 bid limit

2)      Cardholders not reviewing AND signing the monthly statement

3)      Receipts not matched to the statement

4)      Adequate receipts are not provided ( original, itemized description, vendor name, date and total)

5)      Disallowed transactions ( personal use, travel, gift cards, etc.)

6)      Sales tax charged ( The University is tax exempt)

 

Please take the time to review this information and share with those in your department who have procurement cards and who are verifiers of the transactions. 

 

For information on a Procurement Card request, please contact Gena Wilson at gmwilson@utk.edu

For information on a policy issue, please contact Gena  or myself at danielsj@utk.edu

 

 

 


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Soren P. Sorensen   Department of Physics
Professor and Head  University of Tennessee
(865) 974-7805      Knoxville, TN 37996-1200
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