[Policies Home Page]
Editor's notes:
POLICY TITLE: Carnegie Mellon University Purchasing Policy for the Tartan Trust Program
DATE OF ISSUANCE: This policy was approved by the President's Council on May 13, 1997.
ACCOUNTABLE DEPARTMENT/UNIT: Purchasing Services and Supplier Management. For specific questions about using the card, contact the sources listed in the help section at the end of this policy. General questions about this policy should be directed to the university card administrator, x88430. For a list of preferred suppliers, see the Preferred Supplier Directory
ABSTRACT: Document contains information regarding the acquisition and use of the university purchasing card.
FORMS: Card Request Form, Questioned Item Form
At Carnegie Mellon University, authorized cardholders use purchasing cards to acquire goods and services from suppliers. Cardholders are identified within departments and must complete training and sign a cardholder agreement, including a code of ethics and an anti-kickback clause and a conflict of interest statement. The traditional purchase order process is followed for those purchases not included in the purchasing card process.
Cardholders are strongly encouraged to acquire goods and services from preferred suppliers whenever possible. See the remainder of this document for detailed information on acquisition and use of the purchasing card, including cardholders' rights and responsibilities.
Use preferred suppliers to acquire goods or services whenever possible
Reconcile transactions monthly
Prepare allocations as necessary
Maintain security of the purchasing card and its related card number and expiration date, including immediately reporting a lost or stolen card
Notify the university card administrator when an employee's employment with the university is terminated
Other responsibilities are dependent on how the department structures the use of their cards
Provide appropriate training and documentation
Negotiate discounted pricing and quality supplier services
Regularly reevaluate preferred suppliers for performance, price and customer satisfaction
Maintain financial relationship with bank/card provider
Audit selected cardholder transactions
The acquisition of goods and services must be convenient and provide the highest quality products to the end users. In allowing customers the independence of direct purchasing, however, it is necessary to establish responsibilities and to follow consistent procedures and policies. This adherence to policy allows continued process savings, accountability and auditability of purchases.
Using a card to make purchases from a preferred supplier provides: ease of use and best pricing for the cardholder; direct charging/payment for the supplier; and prompt delivery by suppliers directly to the person placing the order.
Using the card with non-preferred suppliers does not always take advantage of better prices and prompt deliveries.
Appointment and Tenure Policy
Capital Equipment Policy
Journal Entry Policy
New Accounting Procedures for "Unallowable Expense Codes" (Jan. 1992)
Policy on Conflict of Interest/Commitment
Purchasing Policy 2.1.1
Relocation Policy
Small and Disadvantaged Businesses Policy
Special Service Payments
Staff Relations Handbook
Student Discipline
Travel Policy 2.4.1
The following definitions apply to listed terms as they are used in this policy:
tartan trust program (TTP)
university purchasing program based on fundamental practices of commodity management in combination with use of the purchasing card (Tartan Trust Card)
purchasing card (also called the Tartan Trust Card or TTC)
an acquisition tool that functions similar to a credit card and for which a specific employee is assigned use and responsibility. Purchasing cards are either individual or departmental.
individual cardholder
employee having the responsibilities for an individual purchasing card
departmental cardholder
employee authorized to use a departmental card for departmental, exception and non-preferred supplier purchases
department TTP coordinator (also called card coordinator)
designated person within each department responsible for handling the department's purchasing cards, including authorizing cardholders, establishing card limits
university card administrator
university administrator responsible for overseeing the Tartan Trust Card program
cardholder agreement form
agreement, signed by a cardholder, between the university and that cardholder stipulating policy and procedural rights and responsibilities of both parties
code of ethics
agreement by a cardholder to honor standard purchasing ethics when executing his/her rights as an authorized purchasing agent of the university
anti-kickback clause
agreement by cardholder not to accept any gifts or gratuities from the supplier in exchange for patronage
conflict of interest statement
agreement by a cardholder to adhere to the university's conflict of interest policy when executing his/her rights as an authorized purchasing agent of the university
negotiated commodity
a particular group of goods and/or services for which preferred suppliers have been contracted
open commodity
a particular group of goods and/or services for which preferred suppliers have not yet been identified but which is expected to become part of the negotiated commodity category in the future
never-to-be-negotiated commodity
a particular group of goods and/or services never to be reviewed and evaluated for preferred and non-preferred supplier status due to the nature of the commodity (e.g., conference registration)
preferred supplier
supplier of a negotiated commodity who has successfully met specific requirements and who has been selected as "preferred" by a commodity team
non-preferred supplier
supplier of a negotiated commodity who has not been selected as a preferred supplier, either due to not participating or not qualifying
commodity team
group of campus representatives with expertise in the purchase of a particular commodity, who work together to determine preferred suppliers
card default center and account code
that university general ledger cost center number and account code combination to which all transactions using a specific card will be charged in the general ledger unless reallocated to another center and/or account code (see TTAS below)
Purchasing Services and Supplier Management (PSSM)
the administrative unit responsible for the process surrounding the acquisition of goods and services
reconcilement
mandatory process whereby a cardholder verifies their monthly cardholder statements have the correct charges or credits, attaching all required supporting documentation and delivering them to the university card administrator in a timely manner
employee
only those full- or part-time employees working in appointments lasting at least four months
Tartan Trust Allocation System (TTAS)
on-line allocation system which allows cardholders to view their card purchases and to allocate them to a center/account other than the card's default center and account code
Using the purchasing card most closely resembles using one's personal credit card, except that use is restricted to business-related purchases. Each cardholder is required to keep the card secure and is encouraged to use it for every possible university-related purchase. The university purchasing card should be used to purchase goods from preferred suppliers. It can also be used for purchases from suppliers in the open and never-to-be-negotiated commodities categories who accept MasterCard. For purchases from non-preferred suppliers, either purchase orders or a departmental purchasing card should be used.
Each purchasing card has been set up to encompass categories for types of suppliers, spending limits, account distribution and transaction information. Two types of cards are available, the individual card and the departmental card. Transactions on each card are charged to a specified center number and account code. Cardholders are responsible for assuring that the transactions are charged correctly during reconcilement (see the section of this policy titled Reconcilements).
Cardholders may use the card to place an order in person at the supplier site, over the phone with the specific supplier or by fax. The cardholder should give the supplier the following specific information:
Carnegie Mellon University is a tax-exempt organization. The university's Pennsylvania tax-exempt identification number has been labeled on each card. The cardholder must give this number to all suppliers at the time of any transaction to exempt payment for Pennsylvania or reciprocal state sales tax. In the event sales tax is billed to the cardholder's account, it should be rectified directly with the supplier or disputed as outlined by the section Disputing a Charge in this policy.
Commodity management is the process of developing "preferred supplier" agreements for university purchases. In this process, a team of campus experts identifies potential suppliers and requests that they submit proposals. Appropriate minority, women and/or disadvantaged suppliers are also included in this request process, as the university has set participation goals for these businesses (see the policy on Small and Disadvantaged Businesses). Responses are analyzed and reviewed and all qualified respondents are contacted to negotiate the best possible agreement with the university. Based on these negotiations, recommended preferred suppliers are evaluated and those best suited are chosen as "preferred" for the particular commodity.
The university does not guarantee a fixed amount of business to a preferred supplier nor that a supplier will keep the "preferred" status for the length of the agreement. Commodity contract lengths may vary; generally, however, supplier status is reevaluated on an annual basis. A preferred supplier must perform to the terms and conditions negotiated. Each preferred supplier is responsible for their own success or failure. Suppliers can be dropped from the "preferred" list if problems develop and persist. In addition, there is no hierarchy of preference; i.e., no one supplier is "preferred" over any other for a particular commodity.
Preferred Supplier Directory
The Preferred Supplier Directory lists preferred suppliers for negotiated commodities. The directory is regularly updated to include information by commodity, as well as pertinent ordering information, such as phone numbers, delivery, pricing and account information, and is available through PSSM.
Each department identifies a department card coordinator who is responsible for determining individual and departmental cardholders. In addition, limits placed on cards can be determined by the department card coordinator at the time the cards are initialized. Limits are specified "per transaction," "per day" and "per cycle." Regular purchasers should be given individual cards. Departmental cards should be issued based on need and appropriateness, at the discretion of the department card coordinator.
Transactions permitted using the Tartan Trust individual card are:
If the cardholder of an individual card desires a negotiated commodity from a non-preferred supplier, the traditional purchase order process must be used. Using an individual card to purchase from a non-preferred supplier constitutes administrative misuse of the card.
Transactions permitted using the Tartan Trust departmental card are:
The accountability and responsibility of a departmental card is equal to that of an individual card. This card, however, is to be used for exceptional circumstances (i.e., if someone purchases on behalf of others or needs to purchase specialty items outside those negotiated through university contracts). Unlike the individual card, purchases from non-preferred suppliers within a negotiated commodity are permitted using a departmental card.
The following table shows allowable uses of the individual and departmental cards:
| Negotiated Commodity | Open Commodity | Never-to-be-negotiated Commodity | |
|---|---|---|---|
| Individual card | preferred supplier only* | currently all | yes |
| Departmental card | yes | yes | yes |
Each department/college has the ability to set dollar and/or transaction limits on each card in their department.
Card limits may be set according to:
Both individual and departmental cards are valid for a minimum of one year from the date of issuance. If, for any reason, a cardholder wishes to cancel their card, the card must be cut in half and forwarded to the university card administrator.
If the card has not been canceled, one year from the original issue date and each year thereafter, a renewal card will be mailed automatically to the cardholder at the address on file with the university card administrator.
The suspension or termination of a cardholder must be reported directly to the university card administrator upon official notification of termination. The card should be returned to the university card administrator and use will be eliminated at the termination date. In the case of termination, the cardholder is responsible for returning the card and for final reconciliation prior to separation. Failure to do so may result in the employee's final paycheck being withheld until this occurs.
The department card coordinator is responsible for deciding who in their department will be permitted to have a purchasing card. Only employees who have completed cardholder training and signed the cardholder agreement form, including the code of ethics and anti-kickback clause and conflict of interest statement , are authorized to use a purchasing card. Department card coordinators may choose to allow new employees to have a card during their six-month provisional period. Using another employee's TTC is not in accordance with the conditions set forth in this policy.
Purchasing cards are not transferable. If someone's card use is to be discontinued, their card number must be given immediately to the university card administrator. Immediately report name changes for a particular cardholder to the university card administrator so files may be updated and an updated card issued.
The following individuals are not permitted to have a card:
University cardholders, upon approval from the university card administrator, may authorize blanket use of their card to any other university employee, including graduate students. This is not a transfer. The card remains in the employee's name, not that of the person delegated; any misuse of the card is the responsibility of the employee. However, the university reserves the right to initiate disciplinary action against a delegated cardholder in the case of misuse, as detailed in the section of this policy on Misuse of the Purchasing Card.
Card delegation must be approved by the university card administrator. Delegation is strictly prohibited without prior approval. In addition, the delegate must attend cardholder training and must submit signed and completed cardholder agreement forms to the university card administrator. Ultimately, the employee who delegates the card is always responsible for all transactions on his or her card and must sign the monthly cardholder statement.
Purchasing card training must be completed prior to issuance of the card to the cardholder. The prospective cardholder must be present at the training and may not send a proxy. A cardholder agreement, including the code of ethics and anti-kickback clause and the conflict of interest statement, must be signed by the cardholder and submitted to the university card administrator prior to card issuance. The cardholder will also receive a cardholder guide and copy of this policy at the time of training.
The cardholder agreement, which includes the code of ethics, anti-kickback clause and conflict of interest statement (see Exhibit A), stipulates that the cardholder:
Only authorized cardholders (including delegated users) may use the card. It is the responsibility of every cardholder to safeguard cards and card numbers against use by unauthorized individuals within or outside the university.
Immediately upon discovering that a card has been lost or stolen, a cardholder must report this by phone directly to First Chicago Bank (1-800-848-2813) and to the university card administrator (x88430). In addition, verbal reports of lost or stolen cards must be followed in writing to the university card administrator using the "Lost or Stolen Card Notification" form (see Exhibit C). In an emergency, a card will be reissued within two days for a minimal fee to the department. Otherwise the card will be replaced within 10 days, at no cost, directly to the cardholder from the bank. The university's liability per cardholder is limited to the established restrictions on that particular card. Any charges against the card before it has been reported lost or stolen are the responsibility of the cardholder's department, which will be appropriately charged.
Liabilities of the card remain with the university, rather than the cardholder, for all transactions made in compliance with this purchasing procedures and policy document.
Competitive bids on individual transactions are not required for any negotiated commodities purchased from a preferred supplier.
In order to comply with federal regulations, each transactions in excess of $2,000 per order purchased from a non-preferred supplier must include proper bidding procedures and documentation with the card reconcilement for that transaction (see university Purchasing Policy). In addition, a Purchasing Checklist/Bid Summary (see Exhibit B) must be completed and attached to the cardholder statement upon reconcilement for the period containing the relevant transaction.
When purchasing using sponsored research funds, cardholders are responsible for fulfilling the requirements and regulations of the specific contract or grant whose funds they are using. Purchasing with sponsored research funds is addressed as part of cardholder training. For specific questions about using sponsored research funds, cardholders should contact the Office of Sponsored Research, x82091.
Using an individual purchasing card, the following transactions are currently prohibited:
With the exception of purchases from non-preferred suppliers within a negotiated commodity, all of the above transactions are also prohibited using a departmental purchasing card.
Within 60 days of the transaction date, a cardholder may dispute a charge that appears on his or her monthly purchasing card statement. If the cardholder does not recognize a charge or it appears to be incorrect, he or she should attempt to work directly with the supplier for resolution. In the event resolution is not made, the cardholder must submit a completed Statement of Questioned Item form, included in the cardholder guide, with a copy of all supporting documentation to First Chicago Bank. Statement of Questioned Item forms are also available by calling First Chicago at 1-800-316-6056 or the TTP Help Desk at x88442.
During the investigation by First Chicago, a credit will automatically be issued to the cardholder's account for the amount questioned. When First Chicago has completed the investigation, the cardholder will be notified of the resolution. If the dispute is not settled in the cardholder's favor, the account will be charged for the disputed transaction amount.
To return an item, the cardholder should contact the supplier of the item for information on how to do a return. Following the supplier's procedures, the item should be returned directly from the cardholder to the supplier and payment adjustment should be agreed upon at that time. Should a discrepancy in charges occur, the cardholder should note the charge as a discrepancy in the reconciliation process and follow proper procedures for disputing a charge, above.
Cardholders with individual cards who are making purchases from non-preferred suppliers must use the traditional purchase order process. Any non-card transactions, including those prohibited from the card process, must, at this time, also continue to use the purchase order process.
Individuals given purchasing card access by their departments are held accountable for all the transactions related to their card(s), including those transactions made with cards they have delegated to another. Consequences for misuse of the purchasing card are serious.
Misuse of the card can be either personal or administrative. Personal misuse includes, but is not limited to: using the purchasing card for personal (i.e., non-university-related) purchases; use of the purchasing card by a suspended or terminated employee; allowing an unauthorized person to use the card (see the section on Card Delegation for the correct procedure to allow another employee to use your card).
Administrative misuse includes, but is not limited to: lack of proper reconciliation of the cardholder account (see the section on Reconcilements below); card use in direct violation of the purchasing card policies and procedures contained in this document (e.g., neglecting to use the card for commodities available through preferred suppliers; neglecting to perform proper cost allocation to correct center and account; using an individual card for purchases from a non-preferred supplier).
When appropriate, supervisors should attempt informal resolution by bringing the misuse, and consequences of further misuse, to the employee's attention.
If informal resolution is inappropriate or ineffective, the supervisor must contact the university card administrator. The following consequences of misuse have been established. Not all consequences will be applied to every violation; there are situations that may lead to disciplinary action, including suspension or termination of employment, without following all these steps. The university card administrator reserves the right to use discretion in applying these guidelines, depending on the type and severity of the specific violation being addressed.
Serious misuse by a faculty member qualifies as a sanctionable violation of standards of faculty conduct under the provisions of the Appointment and Tenure Policy of Carnegie Mellon University and sanctions may be imposed in accordance with the provisions in the section Dismissal for Cause and Other Sanctions of the cited Policy (except that action regarding a faculty member's administrative appointments is at the discretion of the president).
The university may initiate disciplinary action against a graduate student with a delegated card, following the policies and procedures on discipline outlined in the Student Handbook.
In addition, in the case of personal purchases repayment of the purchase by the cardholder to the university is required following resolution of the discrepancy. Repayment may be made by cash or check. Payment for this misuse must be made within 10 days following resolution, or appropriate disciplinary measures will ensue. It is the responsibility of the cardholder to ensure that repayment is made for personal items charged to a delegated card.
Cardholders are individually responsible for monthly reconcilements of their purchasing card statement. This statement details transactions occurring in the current month, including the transaction date, supplier name, supplier address and the amount of the transaction. This information must be reviewed for accuracy and any exceptions must be noted on the transaction statement. Disputed transactions should be noted immediately.
The cardholder is responsible for all charges on his or her monthly statement, including resolution of charges in error. After final review is completed by the cardholder, all necessary original receipts and packing slips are attached to the printed reconciliation form and signed by the cardholder. Depending on the cardholder's internal department processes, reconciliation packages are either forwarded directly to the university card administrator or to the specific department card coordinator for his/her review. In all cases, the original documentation and signed cardholder statement are forwarded ultimately to the university card administrator at PSSM, 6555 Penn Avenue.
The cardholder is responsible for keeping all credit card slips, cash register receipts, packing slips and other sales records related to any purchase using the card until reconciliation is done. This original documentation is then forwarded with the monthly reconciliation unless the cardholder needs it to resolve a disputed charge. Ultimately, all original documentation must be forwarded to the university card administrator, as formal record retention is at the central university level.
Each card is tied to one specific center number/account code combination. Cardholders and/or their department card coordinators are responsible for allocation of transactions to the appropriate centers/accounts. Accounting detail transactions will generally be available in the Tartan Trust Allocation System (TTAS) three days from the date of purchase. TTAS is used for allocation done prior to the transfer of financial transactions in the general ledger. Thirty days after the transaction enters TTAS, it will automatically be placed into the general ledger. All reallocations within the 30-day cycle may be forwarded to the general ledger immediately, at the discretion of the TTAS user. Once transactions appear in the general ledger, reallocations must follow the traditional journal entry process.
It is the responsibility of the cardholder to ensure that proper center number and account code designation is made according to university financial policies. Continued improper designations and/or neglect of proper card transaction allocations is considered an administrative misuse of the card. As such, appropriate action will be taken as detailed in the Misusing the Purchasing Card section of this policy.
The cardholder is responsible for ensuring receipt of materials and services and for resolving with the supplier any delivery problems, discrepancies and damaged goods.
Any packing slips, receipts, net zero invoices, along with the credit card statement, must be kept for reconciliation purposes. For telephone or catalog orders, complete shipping instructions must be given along with cardholder name and the desired delivery location (specific building name, room number, etc.). The cardholder should inform the supplier to include the sales receipt (detailing the exemption of taxes) with the package. Save the credit card receipt and shipping documentation, including packing slips, which will be needed for reconciliation.
Audits by PSSM will be performed in compliance with documented internal audit procedures. In addition to audits conducted by PSSM, the university's Internal Audit Department will periodically and randomly review and audit cardholder activity for compliance with university policy and procedures. Cardholders found not in compliance with these policies and procedures will be subject to those actions contained in the section of this policy on Misusing the Purchasing Card.
Questions concerning this policy or its intent should be directed to:
Aimee Culbertson, university card administrator, x88430
| Carnegie Mellon University | |
|---|---|
| Purchasing Services and Supplier Management (PSSM) | |
| Tartan Trust Card Help Desk x88442 | general guidelines and service for use of the purchasing card; service regarding commodity management |
| University card administrator PSSM 6555 Penn Avenue x88430 | service regarding commodity management or individual card process |
| PSSM e-mail | purchasing@andrew.cmu.edu |
| Department card coordinator | guidance on departmentally placed card restrictions (i.e., card transaction limits, monthly usage limits, etc.) and other departmental procedures |
| First Chicago Bank | general questions regarding accounts, usage, disputing a charge, etc. |
| customer service | hrs.: 7 A.M.-7 P.M. CST 1-800-316-6056 |
| lost/stolen cards | hrs.: 24 1-800-848-2813 |