Purchasing Cards Internal Guidelines
In general, A-funds are not used as the default for a purchasing card. Rather, a project director (or account manager) uses an unrestricted fund account, such as 1314, as the default and then specifies the appropriate distribution of charges prior to the posting of the purchasing transactions in the financial accounting system (CUFS). Exceptions require the approval of OSR.
HANDLING EXCEPTIONS:
I. Issuance of Purchasing Cards (PCards)
If the project director has just one grant (contract, or other sponsored agreement) to which all charges will be posted and there are no intentions to distribute charges to other accounts, the Grant/Contract Administrator (GCA) in OSR will approve the use of the relevant A-fund as a default on the PCard. Purchasing will e-mail all A-fund PCard requests to a named OSR Grant/Contract Assistant who will forward the e-mail to the appropriate GCA. Approval or disapproval will be returned electronically by the GCA to Purchasing. If PCard use is NOT approved, the GCA will contact the project director’s department of such disapproval.
If the project director intends to charge that one grant much of the time, but also to charge unrestricted fund accounts, OSR will suggest to the project director that two cards be issued: one with the grant account as default, the other with the 1314 account as default. The project director would then use the grant default card only when certain that the charges should be posted to that grant account.
A similar situation could be approved for project directors with more than one grant, as long as the project director uses the PCard which has a grant account as its default only for purchases for that specific grant. That is, the intention must be that the charges belong to that grant.
II. Use of P-Cards with A-Fund Defaults
The GCA should use this opportunity to educate the project director about the acceptable use of PCards and the Related Issues below. The PCard should be used only for the specific grant fund cited as the default, the intention being that when the charges are posted in CUFS, they are allowable and allocable to that grant.
III. Object Codes
In some limited cases, use of object codes affects OSR's ability to properly handle reporting, accounting, and billing requirements imposed by the sponsor. In these cases, it is essential that the correct object code be used at the point of distribution of charges. Normally, the PCard default object code should be a sponsored programs supplies object code (4300-4319) unless otherwise approved by the GCA. The GCA would expect to approve a general purpose or office supply PCard default object code for sponsored programs in units such as the Small Business Development Center or TRIO programs. In all cases, the project director must be reminded to distinguish between general departmental supplies and the supplies needed to conduct the activities of the sponsored project.
IV. Documentation Required
Procedure No. 9, "Card Guide" of the USNH on-line Financial and Administrative Procedures Manual addresses documentation and retention. The required documentation will comprise the official records for audit purposes.
V. Related Issues/Cautions
A. PCard Expiration Date
The PCard expiration date is different from (normally beyond) the grant/contract/agreement end date. OSR’s concern is that the project director would have in hand a card that would enable charges to be initiated against an expired account not yet closed in CUFS. The project director must be cautioned to avoid charges to an expired account.
B. Cost Transfers*
See OSR’s policy and procedures on Cost Transfers, and educate project director to be aware of his/her responsibilities.
C. Sponsored Programs Supplies or Office Supplies*
Educate the project director about A-21 and suggest object codes to be used for distribution of charges. Remember the difference for non-research areas such as TRIO, SBDC, etc.
D. Renewing Grants/Contracts/Sponsored Agreements and Start/End Date:
When a PCard defaults to an account associated with a project that is likely to be renewed under a different grant/contract/sponsored agreement, the cardholder and account manager need to manage the transition carefully. Depending upon when the default account changes to the new default account, there may be closing costs on one account and pre-award costs on the new account that will need to be justified and distributed, not just "defaulted."
E. MBE/WBE, Small Businesses*
If a particular grant or contract has a minority-owned or women-owned business enterprise (MBE/WBE) reporting requirement, or a small business subcontracting plan and reporting requirements, a PCard may be used as the purchasing mechanism for that grant/contract. Notify and remind project directors of this requirement on relevant grant/contract/sponsored agreements, encourage use of small and minority- or women-owned businesses, and direct the project directors to Purchasing for help in identifying businesses to use.
F. Redistribution to A-Funds
If the project director plans to use a PCard with a 1314 or other non-restricted fund default, with the intention of distributing charges to an A-fund, he/she must be educated about the above. Remind the project director that he/she is responsible and held accountable for all charges placed against the account. For example, cost transfers and initiating charges after an agreement end date are still issues, regardless of which default is used on the PCard.
*Relevant to all purchases, regardless of mechanism
Effective November 21, 1997
Revised 3/24/98; 7/18/98; 10/15/98; 10/29/98
