Government Purchase Card Program Account Holder Training

1. U.S. Army MEDCOM Health Care Acquisition Activity Great Plains Regional Contracting Office Brooke Army Medical Center, Fort Sam Houston, TX Government Purchase Card Program Account Holder Training

2. Training Outline 2 • Authority Structure • DOD Charge Card Program • Purchase Card Program • Management Controls & Expectations • Regulatory Authority • Key Players & Responsibilities • Definitions • Authorized Use & Limitations • Required Sources • Pre Purchase Approvals • Prohibited Items • Purchasing Process • Waivers/Clearances • Account Reconciliation • Records • Access Online • Establishing Accounts • Account Security • Liability

3. 5 6 7 8 9 4 3 2 10 1 Authority Structure 3 Army MEDCOM / Health Care Acquisition Activity GPRMC GPRCO 1 Brooke Army Medical Center 2 Carl R. Darnall Army Medical Center 3 William Beaumont Medical Center 4 Raymond W. Bliss Army Health Center 5 Evans Army Community Hospital 6 Irwin Army Community Hospital 7 Munson Army Health Center 8 General Leonard Wood Army Medical Center 9 Reynolds Army Community Hospital 10 Bayne-Jones Army Community Hospital

4. Contract & Administration by GSA • Includes: • Purchase Card • Supplies and services • Travel Card • Lodging, car rental, meals, cash advances, • but not registration fees. • Fuel Card • Maintenance & Repair of Government Vehicles • to include Fuel and Oil. DOD Charge Card Programs 4

5. The Government Purchase Card 5 2 NOTE: Bank trademark Formerly known as “IMPAC”

6. Purchase Card Program 6 $143M $122M $116M $102M $87M

7. Benefits of the Purchase Card Program 7 The government saves time, money and resources. The purchase charge card program provides the government with financial and cash management control over low dollar value, high volume procurements. With the streamlined purchasing power to the lowest user end level comes great responsibility. “Guardians of the Public Trust”

8. Management Controls and Expectations 8 • Tools and activities used to identify, correct and prevent fraud, • waste and abuse: • Support from higher levels • An expectation of high integrity and ethical behavior • Audits and risk assessments to identify fraud, waste and abuse • Controls in place to reasonably ensue losses are minimized • Proper training and reporting to ensure personnel have proper • skills, knowledge, and information • Adequate management oversight

9. Regulatory Authority 9 • Federal Acquisition Regulation (FAR) Part 8 &13 • Defense Federal Acquisition Regulation Supplement • (DFARS) Part 213.270 • Army Federal Acquisition Regulation Supplement • (AFARS) Part 13 • DOD Government Charge Card Guidebook for • Establishing and Managing Purchase, Travel and Fuel Card • Programs, 19 August 2008 • Army Regulation 715-XX, Revised 2 May 2007 • GPRCO SOP, currently being revised • Many Others

10. Keyplayers and Responsibilities 10 • Refer to DOD Guidebook, Appendix A • Outlines each key-players’ role and special emphasis items • Contract Specialist designated to manage • the day-to-day operation • Implementing and administering the program • Establishing policy and guidance • Conduct training • Conduct oversight • Liaison between organization, bank, DFAS and • other regional and Army/MEDCOM activities Agency Program Coordinator:

11. Keyplayers and Responsibilities 11 • Billing Officials/Certifying Officials: • Administration of cardholder accounts • Certifying officer – financially responsible • Purchase approvals • funds accountability • property accountability • invoice certification • Oversight • Cardholders: • Making authorized transactions • Collecting and maintaining required documentation • Logging and reconciling transactions • Trained • Card security • Reporting questionable transactions

12. Keyplayers and Responsibilities 12 • Financial Managers: • Provide appropriate funding for accounts • Maintain accurate financial records • Fulfill financial management reporting requirements • Supervisors/Senior Leadership: • Oversee and support program • Promote high integrity and ethical behavior • Conduct risk assessments periodically and • ensure management controls are implemented

13. Keyplayers and Responsibilities 13 • Defense Finance and Accounting Service: • Disburse payment • Control valid appropriation data • Establish electronic interface • Ensure timely processing of disbursements and • rejects • Ensure adherence to the provisions of the Prompt • Payment Act

14. Keyplayers and Responsibilities 14 • Others: • Audit/Investigative agencies (IR, IG, CID, FBI, etc.) • Office of the Under Secretary of Defense (Acquisition, • Technology and Logistics) • Office of the Under Secretary of Defense (Comptroller) • Office of the Under Secretary of Defense (Personnel • and Readiness) • Army Contracting Agency • Medical Command Health Care Acquisition Activity)

15. Definitions 15 A B C D E F G H I J K L M N O P Q R S T U V W X Y Z See Handout

16. Authorized Use & Limitations 16 • Make micro- purchases • $3,000 = Supplies • $2,500 = Services • $2,000 = Construction • Place a task or delivery order • Basic contract in place • BPA • Make payments • Formal contract in place and exceeds micro – • purchase thresholds

17. Definition of a “Split Requirement?” 17 Split Purchase: Separating a requirement that exceeds a CH’s single purchase limit or threshold into two or more buys as a means of getting around the CH’s purchase limit. No government purchase CH may fragment/split purchases that exceed the CH’s limit or threshold, as a means to use the purchase card. To do so is a violation of federal procurement law.

18. What is a “Split Requirement?” 18 Avoid "Splitting the Requirement" It might seem logical for you to divide a purchase into parts so each purchase would then be below your agency limits. It is NEVER permissible to intentionally divide purchases into parts just to get under your limits. This is called "splitting the requirement." When you have a defined need, all the parts of that need are considered one purchase

19. Required Sources of Supply 19 • Sources of Supplies Include: • Agency inventories • Excess from other agencies • Supplies which are on the Procurement List maintained by the • Committee for Purchase From People Who Are Blind or Severly • Disabled • Wholesale supply sources (GSA, DLA, VA) • Federal Supply Schedules • Army BPAs for offices supplies (EMall)

20. Required Sources of Supply 20 • Services Sources Include: • Supplies which are on the Procurement List maintained by the • Committee for Purchase From People Who Are Blind or Severly • Disabled • Federal Supply Schedules • Federal Prison Industries, Inc.

21. Items That Require Pre-Purchase Approvals 21 • Printing • Printing purchases must be through the Defense Automated • Product Service (DAPS) • Hazardous material • Advertising • Video information • Information technology • Equipment and material • Ergonomic-related and low vision equipment • Travel related purchases • Short term rental or lease of land and buildings • Wood packaging material

22. Medical Supplies 22 • Can only be purchased by Logistics • AR 40-61: Cardholders are not authorized to bypass the • Installation Medical Supply Activity (IMSA) for Class VIII • medical expendable/durable supplies or equipment. • POC is Ms. Debra Thompson, Logistics Area Manager (LAM), • at 916-4539.

23. Appropriated Funds - Frequently categories • Food and refreshments • Personal purchases • Memberships • Greeting cards and decorations • Cellular Phones and Pagers • Bottled water services • Motor vehicles, long-term rental or lease • Trophies, gifts, awards, plaques, and mementos as give-away times • for hails, farewells, and other occasions • Business cards • Clothing Fiscal Law Issues 23

24. Prohibited Items 24 • Cash advances • Long-term lease of land and • buildings • Aircraft fuel • Repair of leased GSA vehicles • Telecommunication systems • Construction services over • $2,000 • Wire transfers • Savings bonds • Foreign currency • Dating and escort services • Betting, casino gaming chips and • off-track betting • Transactions with political • organizations • Court costs, alimony, and • child support • Fines • Bail and bond payments • Tax payments

25. Required Source Determination 25 • When mandated sources can not meet your requirement: • Item is not available (out of stock). • Item is not what is required. • Quantity of issue is not adequate. • Item can not be delivered within 30 days. • Price is cheaper elsewhere (significantly). • Document the reason for bypassing mandatory sources and • obtain waiver/clearance as required. • Your documentation must pass the scrutiny of an audit.

26. The Purchasing Process 26 • Plan your monthly purchases • Ensure availability of funds • Conduct market research • Select best value • Seek State Tax Exemption • Talk to merchants • Determine dollar limits • Exceeding your dollar limit • Select a required source • Shop smarter

27. Market Research and Best Value 27 • Micro-purchases are not required to be set-aside for small • businesses. • Competition is not required, provided the price paid is • determined to be fair & reasonable. • Purchases are distributed among qualified suppliers.

28. Government Estimate Catalog Prices Adequate Price Competition Previous Price Paid Determining Fair and Reasonable Price 28

29. Waivers and Clearances 29 • A waiver/clearance is required if: • A current contract/warranty exists (copy service, custodial services, etc. • Contact local IMD Help Desk (BAMC at 6-4357) for copy service information. • The purchase is for Automated Data Processing Equipment (ADPE) • BAMC Contact 6-0823 • The purchase is for Hazardous Material (HAZMAT) • BAMC Contact 6-0369 • The purchase is for Construction (including safety/fire/historical issues) • BAMC Contact 6-4534 • The purchase is for Training Support Equipment (TV, VCRs, Projectors) • BAMC Contact 6-4357 • Accountable property • Hand Receipt Manager 6-2560 • Property Book Officer 6-3132 • Acquisition Team 6-7127 • Contact 6-0410 • ** Don’t forget to document file with waiver/clearance approval

30. Account Reconciliation 30 Cardholder: • Reconciles all transactions electronically in Access Online • Print Account Statement from Access Online • Attaches receipts (packing slip and register slips) to Account • Statement • Identifies any transaction in dispute • Keeps copies of CSQI (Questioned Items) • Maintains own files of purchase activity

31. Approving and Certifying 31 Cardholder: • All charges will be reconciled (approved) or disputed in ACCESS • Cardholders have 60 days from the date of the first listing of the • transaction to dispute with the bank • Fraudulent charges (stolen card situations, etc.) are reported • to Fraud Department (800 815-1405) and APC • Do not complete CSQI when transaction is reporting fraud

32. Avoiding Delinquent Accounts 32 • Must certify within 5 working day of the end of the billing cycle • CH = 3 days • BO = 2 days • Currently monitoring all accounts due to command visibility • Interest is assessed against the Billing Official’s unpaid balance • IAW AR 715-XX: • Accounts that are 61 days delinquent will be temporarily • suspended by the bank • No card transactions will be authorized until the account is • paid in full with interest

33. Disputed Transactions 33 • Cardholder should resolve with vendor quickly • Without resolution, CSQI to Bank (within 60 days) • Click the Dispute button in Access Online • Selected situations: Click Dispute button if: • Defective items already charged to your account • Unauthorized charges (someone other than the cardholder • using the card or additional supplies ordered) • “Billed but not received” on next billing cycle • Review status of existing Disputed Transactions • Statement must be paid in full

34. Records 34 * Must be maintained for 6 years, 3 monthsafter final payment of invoice Purchase Card Files

35. Access On - Line 35 • https://wbt.access.usbank.com • Passwords are in effect through 6 April 2009 • Government cardholder: seattle • Government AO/BO: puget • Government Financial Manager: whale • Organization short name: army • “Lesson Only Logon” or “Register A New Account” • If you require assistance, call the bank’s Customer Service Center • at 1 888 994-6722

36. Establishing Billing Official Account 36 • Memo processed thru budget office requesting an • individual be appointed as an Approving Official (application) • Budget office will coordinate on application and include funding info • Individual must complete mandatory DAU CLG 0001 training, fiscal • law training and classroom training provided by GPRCO APC – • training certificates are required • DD Form 577, Appointment/Termination Record –Authorized • Signature, must be included • Application package delivered to APC for processing • APC will set up account in bank system, provide appointment letter • and await budget office on line processing • APC final approves account and releases userid/password • BO Span of Control can not exceed 7 Cardholders

37. Establishing Cardholder Account 37 • Memo processed thru budget office requesting an individual be • appointed as an Cardholder (application) • Budget office will coordinate on application and include funding info • Individual must complete mandatory DAU CLG 001training and • classroom training provided by GPRCO APC – training certificates • are required • Application package delivered to APC for processing • APC will set up account in bank system, provide delegation letter, • await budget office on line processing • APC final approves account and requests bank release card • Cardholder receives and activates card AND must self register for • userid and password

38. Account Limits 38 • Monthly BO limit = Total dollar limit to cover all CHs • under managing account • Monthly CH limit = Total dollar limit for each CH • Single Purchase limit for CH = Total dollar limit per transaction • All limits approved and set by budget officer/resource manager • Monthly cycle runs from the 20th of the month through the • 19th of the following month.

39. CH Account Limits - Example 39 Monthly Limit = $10,000 First Month’s Transactions: $2500 $600 $400 Bill is received & lists the following transactions: $600 $400 ($2500 charge pending ) Next Month - Monthly Limit available is $7500. $10,000 -$2,500 $7,500

40. Account Security 40 • Secure card at all times • Secure account numbers at all times • If card is lost, stolen or account numbers are compromised, • immediately contact US Bank at 1-888-994-6722 • Report to Approving Official and APC next working day & write a • memorandum of record for your files (provide a copy to APC) • Good business practices: • Precaution when providing credit card # by fax or internet • Do not provide copies of card to vendor • Advise vendors to NOT annotate account number on packing slips, • delivery tickets, etc. • Black out card numbers on paperwork transmitted to others

41. Liability 41 • Use of the GPC by an authorized Cardholder to make an • unauthorized purchase is the liability of Government • However, the organization is responsible for taking • appropriate action against CH and BO as necessary • Any misuse of the GPC is subject to criminal, civil, Uniform Code • of Military Justice, administrative, and disciplinary actions as • appropriate

42. Program Integrity 42 • Management controls are in place to guard against improper, • fraudulent, or abusive use of the purchase card • Purchase card misuse, or fraud, has consequences • Counseling • Cancellation of purchase card account • Notation in employee performance evaluation • Reprimand • Suspension of employment • Termination of employment • Criminal prosecution

43. Unauthorized Commitment 43 • An agreement or purchase that is not binding solely because the • Government representative who made it lacked the authority to enter • into that agreement on behalf of the Government • Unauthorized commitments must be ratified. Ratification is the act • of approving an unauthorized commitment by an official who has the • authority to do so • Less than or equal to $10,000 = Regional Contracting Office Chief • Less than or equal to $100,000 = Principal Assistant Responsible • for Contracting (PARC) • Exceeding $100,000 = Head of Contracting Agency

44. Unauthorized Commitment 44 • Authority • Actual • Expressed • Implied • Apparent • Avoid presenting appearance of authority that is not granted • Only two people can obligate the government: • A warranted Contracting Officer • Duly appointed credit card holder or ordering officer within the • scope of appointment

45. Unauthorized Commitment 45 • CHs not staying within delegated authority (limits and authorized use) • Emergency purchase procedures were not followed or individual is • not aware of the procedures • Vendor mistakes a request for info or estimate as an actual order • An activity approves supplies or services above the scope of an • existing contract or continues to receive supplies or services after the • expiration date of the contract • DO NOT use the GPC to “clean up” an Unauthorized Commitment

46. Ethics 46 • Foundation • “Fair and Impartial” • Public expectation of fairness and impartiality • Absence of conflict of interest • Avoiding conflict and improper influence • U18 U.S.C. 208 – The Conflict Statue • A criminal statue • May not participate personally and substantially in matters such • as the government credit card transactions in which you, your • spouse, minor child, partner, organization in which you are an • officer or employee, or company with whom you are negotiating • for employment---has a financial interest

47. Ethics 47 • Basic things to remember • Avoid conflict of interest • Avoid the appearance of conflict of interest • Do not split requirements • Rotate sources of supplies and services • No personal use • Annual ethics training • Appropriation laws are strictly enforced • “If it is not prohibited, it must be ok” – NO! • Administrative and criminal penalties apply

48. Account Application Process 48 IMPORTANT • 2 – 3 week process • All accounts must have BO and ALT BO in place • Bank system and human processing • Email or Fax directly to GPRCO GPC Program Office • Complete application package • Application form with RM coordination • Training certificates (classroom, fiscal law & DAU certificates) • DD577 if BO or Alt BO • New or Replacing an existing BO • Appointment Letter or Letter of Delegation of Procurement Authority • Must sign and return copy or process halted • Userid/Password • BO Alt BOs = Contracting will provide • CHs = self registration

49. Account Maintenance 49 IMPORTANT • Billing Officials and Alternate Billing Official are responsible for the account • Coordinations and Requests • Dollar changes on accounts must have Budget approval • Codes, address changes • Notification of CH, BO or Alt BO leaving • 30 to 45 PRIOR to leaving • Replacements vs New Accounts • Ensure supporting documentation is present for all transactions • Report weaknesses or unauthorized purchases • Maintaining the integrity of the program

50. Mandatory Fiscal Law Training 50 IMPORTANT • Reference: Memorandum from Office of the Assistant Secretary of • the Army, Financial, Management and Comptroller Memo, Fiscal • Law Training, 7 Feb 2008 • Approving/Billing Officials Only • Under Section 2-18 DoD Procedures Manual Chapter 2, • Paragraph 8 • All designating Approving/Billing Officials MUST be • complete fiscal law training. • Certifications of purchase-card billing statements are • certifications of propriety and correctness for payment