Understanding Contracts and Authorized Signatures at OSU

1. Student Affairs Buying 101 Topic 5 Buying Considerations and Requirements Contracts Students First 5-01

2. Student Affairs Buying 101 Contracts Topic Objectives Have an understanding of who is authorized to sign contracts at OSU Students First 5-02

3. Student Affairs Buying 101 Contracts What is a contract? A contract is any kind of an agreement between the university (or any of its operations) and any “outside of OSU” individual, business, operation, etc. The contract generally involves an agreement to provide/receive goods or services at a specified time and place, and at an agreed upon price. Generally, a contract does not have to be in writing, but written contracts are preferred. Students First 5-03

4. Student Affairs Buying 101 Contracts What are some of the contracts that we deal with in Student Affairs? • Housing and meals contracts with our students • Room rental contracts with individuals and businesses at the Blackwell, Fawcett, Recreational Sports, or Ohio Union • Performance contracts at the Schott (e.g., when the Eagles performed) • Purchase Order to vendors • Others? Students First 5-04

5. Student Affairs Buying 101 Contracts Who is authorized to sign the contracts? With only a few exceptions (listed below), only the following personnel at OSU are authorized to sign a contract. It is critical that all agreements/contracts be in writing. Authorized Signors by name (per Board of Trustees): • Senior Vice President for Business and Finance (Bill Shkurti) • Associate Vice President – Business and Finance (Helen DeSantis) • Director of Purchasing (Bob Quinn – Acting Director) The only exceptions to required signatures from above are for long-term situations where university legal has reviewed the contracts and approved their use, which include (only) • Housing and meals contracts • Room rental/conference contracts with individuals and businesses at the Blackwell, • Fawcett, Recreational Sports, Ohio Union, or etc. Students First 5-05

6. Student Affairs Buying 101 Contracts Situation: If you give a vendor the impression that you want them to deliver two pieces of furniture to your location, and that you are willing to pay $200 for the furniture. Is this a contract? Students First 5-06

7. Student Affairs Buying 101 Contracts Verbal Commitments: We should never give the impression that we are entering into a verbal contract or commitment. This is especially important when obtaining quotes for goods or services. The OSU individual may be held personally responsible for the item(s). It is best to obtain written quotes and to let the vendor know that you are obtaining quotes from other vendors for possible selection of the desired goods and services. Students First 5-07

8. Student Affairs Buying 101 Contracts “After-the-Fact” Purchase Orders: Commitments should not be made and then purchase orders created for these commitments “after-the-fact”. Again, the only individuals authorized to commit (sign contracts for) the University are • Senior Vice President for Business and Finance (Bill Shkurti) • Associate Vice President – Business and Finance (Helen DeSantis) • Director of Purchasing (Bob Quinn – Acting Director) Students First 5-08

9. Student Affairs Buying 101 Contracts • Actual Student Affairs Situation: One Student Affairs operation UNINTENTIONALLY signed a contract directly with a musical productions company for performance on December 31st. No requisition or purchase order was created/approved by Purchasing. • August 20th - contract signed by the Student Affairs operations management. • December 29th - Business Office was contacted that vendor needed immediate payment. • December 30th – • Contract had to be reviewed by Director of Purchasing. • Business Office had to explain why an operation inappropriately signed a contract. • Requisition had to be created by the Student Affairs operation and reviewed & approved by its management. • Business Office could not approve the requisition until University Purchasing had reviewed and approved the requisition. • Business Office contacted the University Purchasing buyer and requested a rush review and approval and to rush the creation of a purchase order (PO). • Once the PO was created, the Student Affairs operation provided a copy (not original as required) of the invoice to Business Office. • Business Office entered the voucher and had to request from Accounts Payable to create an “off cycle check.” • December 31st – • Accounts Payable had to manually run the check process to create an off-cycle check and then contacted Business Office that the check was ready for pick-up. • The check was then picked up from Accounts Payable by Business Office. Students First 5-09

10. Student Affairs Buying 101 Contracts • Lessons Learned: • The Student Affairs operation unintentionally committed the University to the terms of the contract. • There was no requisition or purchase order created and approved as a result of the inappropriate contract. • University Purchasing did not have to sign the contract, and in this case, we could not have made the payment. The Student Affairs operation’s management may have been personally liable for the commitment. • Payment to the performing company became a “rush” that significantly impacted the • Student Affairs operation’s business office • Student Affairs Business Office • University Purchasing (Director and the Buyer), and • University Accounts Payable Students First 5-10

11. Student Affairs Buying 101 Topic 6 Ethics in Buying at OSU Students First 6-01

12. Student Affairs Buying 101 Ethics in Buying at OSU Topic Objectives Have an understanding of the Buying Ethics at OSU PERCEPTION = TRUTH Students First 6-02

13. Student Affairs Buying 101 Ethics in Buying at OSU Overview In Topic 2 (Where It All Begins), we discussed that we are all “stewards” and have been entrusted with fiscal responsibilities for the University and the public. As a “steward,” it is important that we have a basic understanding of the various laws and Code of Ethics for which we must comply, as well as discuss some potential situations and examples for which our ethics are important. • In this topic, we will • Discuss the Ohio Ethics Laws • Discuss the National Association of Educational Buyers Code of Ethics, and • Discuss the National Association of College Auxiliary Services Code of Ethics, and • Work through some considerations and examples Perception = Truth Students First 6-03

14. Student Affairs Buying 101 Ethics in Buying at OSU Ohio Ethics Law Enacted in 1973 to promote confidence in government. • As a public employee, we should not accept any: • Gratuities • Premium, or • Other incentives The ethics laws also prohibit any employee from purchasing from a family member or friend, which is referred to as a “Conflict of Interest”. Conflict of interest is considered as receiving a premium or other incentive (above), regardless if the employee receives any personal benefits or not. It is critical that we give all competitive suppliers equal consideration/opportunities. Each employee involved in the expenditure of public funds must be held to the highest degree of public trust. Perception = Truth Students First 6-04

15. Student Affairs Buying 101 Ethics in Buying at OSU National Association of Educational Buyers Code of Ethics • Give first consideration to the objectives and policies of the University • Strive to obtain the maximum value for each dollar of expenditure • Decline personal gifts or gratuities • Grant all competitive suppliers equal consideration insofar as state or federal • statute and institutional policy permit • Conduct business with potential and current suppliers in an atmosphere of good • faith, devoid of intentional misrepresentation • Foster fair, ethical and legal trade practices • More (see the Code of Ethics in Appendix H) Perception = Truth Students First 6-05

16. Student Affairs Buying 101 Ethics in Buying at OSU National Association of College Auxiliary Services Code of Ethics • The auxiliary services professional shall represent the institution with personal • integrity and shall conduct the business of the institution professionally. • The personal and professional conduct of the professional shall be such that it • enhances the integrity and prestige of the institution. • The professional shall refrain from entering into private or personal activities • that may be interpreted as a conflict of interest and from accepting gifts or • favors that infer an obligation of the institution. • More (see the Code of Ethics in Appendix H) Perception = Truth Students First 6-06

17. Student Affairs Buying 101 Ethics in Buying at OSU Key Considerations and Examples Key Considerations (in addition to the law): • “Perception” = “Truth” (whether it is true or not) • Would you want it to appear on the front page of the paper? • Would you like to be treated like that? • Is it fair to everyone? • Does it “feel” right? (If not, then it probably isn’t right.) Perception = Truth Students First 6-07

18. Student Affairs Buying 101 Ethics in Buying at OSU Key Considerations and Examples When you are buying something, what factors do you consider? Perception = Truth Students First 6-08

19. Student Affairs Buying 101 Ethics in Buying at OSU Key Considerations and Examples What are the most common expectations from both the university and vendors? • TRUST – both directions • Being treated fairly • Building long-term relationships • Getting the best goods/services • Reliability • Reputation • Service • Timeliness • Price • Open and honest information on needs and expectations • Accurate billing and timely payments Perception = Truth Students First 6-11

20. Student Affairs Buying 101 Ethics in Buying at OSU Group Work Each group will be given at least one situation and will brief-back the situation and answer the below questions for each situation. Situation: What is the perception? Is this right? Is this something that could appear on a newspaper’s front page? If you were the buyer for the manager, how would this make you feel? Is it fair to everyone? What would you do in this situation? Perception = Truth Students First 6-12