2012 Annual PERT Workshop

1. 2012 Annual PERT Workshop Best Practice Briefing The LANS P-CARD Program February 8, 2012

2. 2012 Annual PERT Workshop Excerpt from PERT Independent Review Team Report, February 18, 2011: “P-card Program The LANS P-Card Program is considered a complex-wide best practice. There are strong centralized controls in place for cardholders and approving officials with continuous monitoring and reporting. The P-card Program Administrator is intimately involved in the training, monitoring, enforcement, and oversight while driving efficiencies through the program.”

3. 2012 Annual PERT Workshop LANS P-CARD PROGRAM: General Information • Spend / Transaction Data • Staffing • Program Administrator • P-Card Agents – 3 • Help Desk Support -- 2 • Cardholders -- 691 • ASM: 49 • Other: 642

4. 2012 Annual PERT Workshop LANS P-CARD PROGRAM: SPEND LIMITS • $5K per single transaction limit and $50K per month. • $10K per single transaction limit and $100K per month. • “Super DPR” $25K per single transaction and $250K per month

5. 2012 Annual PERT Workshop LANS P-CARD PROGRAM: INTERNAL CONTROLS • Identification of prohibited or unauthorized purchases. • Requires invoices, packing lists, or other documentation identifying the goods or services received. • Documentation reviewed by the cardholder’s approving official in order to confirm appropriate billing and actual receipt. • 10:1 cardholder to approver ratio. • Track and resolve delinquent reconciliations of monthly cardholder statements. • Track and resolve disputed transactions.

6. 2012 Annual PERT Workshop LANS P-CARD PROGRAM: INTERNAL CONTROLS (cont.) • 100% desktop review of all purchase card transactions. • Issue sanctions for noncompliance. • On-line reconciliation. • Annual refresher training. • Prohibit delivery of products to a home address. • Mandatory business purpose field. • Restrict supplier access/MCC codes. • SME system for identifying/or confirming authorized purchases.

7. 2012 Annual PERT Workshop LANS P-CARD PROGRAM: ASSESSMENTS • ACL Continuous Controls Monitoring (CCM) Solution for Purchase Card: • Software application used to check and validate all (100%) purchase card transaction data against control parameters and business rules to identify exceptions for further data mining and analysis, and to ensure internal controls and compliance is maintained. • Audit process initiated automatically by the ACL CCM Application on a scheduled basis; usually the seventh of the month after the bank statement has been loaded into the Purchase Card System (PCS).

8. 2012 Annual PERT Workshop LANS P-CARD PROGRAM: ASSESSMENTS (cont’d) • Continuous Control Monitoring System – Control Parameters and Business Rules • Unauthorized purchases • Foreign Buys • Split Transactions • Changes to cardholder accounts • Exceed single or monthly limit • Transactions with a description of numbers • Decline due to MCC code • Any order > $5K for items requiring property tagging

9. 2012 Annual PERT Workshop LANS P-CARD PROGRAM: ASSESSMENTS (cont’d) • Monthly Desktop Audit - Reviews all (100%) purchases for appropriateness of the transaction; sufficiency of purchase descriptions and transaction amounts; potential unallowable costs; unauthorized items; split transactions; or potential fraud, waste, and abuse; documentation. • Property Review - Subset of the 100% Monthly Desktop Audit. Ensures property items purchased by Purchase Card were in accordance with the Purchase Card Program policies and procedures. • Disputes Review - Subset of the 100% Monthly Desktop Audit. Ensures that disputed transactions are properly identified and processed, and determines if credits were obtained on a timely basis in accordance with the Purchase Card Program policies and procedures.

10. 2012 Annual PERT Workshop LANS P-CARD PROGRAM: EXCEPTION PROCESS • For one time approvals or permanent approvals. • Limit increase • MCC issue • Policy exception • Email PHDHELP@lanl.gov with request for approval. • Supplier • Description • Dollar amount • Business purpose • Justification • PHD forwards to P-Card Staff. • P-Card reviews request, contacts SME and/or Purchasing Manager for approval, enters into database, notifies DPR.

11. 2012 Annual PERT Workshop LANS P-CARD PROGRAM: SANCTION POLICY Documented corrective actions may include: • Notification – An infraction addressed in memo form. (ex. unauthorized buy, missing documentation or failure to acquire preapproval) • Retraining – An infraction addressed by attending previously completed training and/or one-on-one training. • Warning – An infraction when multiple notifications or retraining corrective actions appear on the DPR’s record. • Suspension – An infraction with multiple recorded warnings, notifications and or retraining that result in limiting or suspending the DPR’s delegation of authority. • Rescission – An infraction that results in revocation of the DPR’s delegation of authority because of actions which relate to: • Intentional disregard of policy • Intentional acts of fraud, waste or abuse • Acts that otherwise pose a safety, security, and/or quality risk resulting in the rescission of the DPRs delegation of authority • Acts which compromise the integrity of LANS’s approved procurement system • Pattern of continuous disregard of policy and procedures

12. 2012 Annual PERT Workshop LANS P-CARD PROGRAM: TRAINING

13. 2012 Annual PERT Workshop LANS P-CARD PROGRAM: DPR TOOLS • DPR News Bulletin - Notifies cardholders of program changes - Includes reminders of policies and procedures - Summarizes internal audit findings • DPR Web-Page • Purchase Card Web-Page • Procurement Help Desk • Approximately 600 calls / week