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Finance and Accounting Manual
Corporate Card Procedures
Finance and Accounting Manual
Date of effect: 20 September 2011. Updated for Delegation amendment 4 October 2011.
- Approved by the Chief Financial Officer on 20 September Corporate Card Procedures
- OVERVIEW Table of Contents
- 1.1 Purpose
- 1.2 Coverage.............................................................................................................................
- 1.3 Essential Information
- 1.3.1 Operating Principles
- 1.3.2 Exclusions
- PROCEDURES AND GUIDELINES
- 2.1 Applications
- 2.1.2 Steps in Applying for a University Corporate Card
- 2.2 Cardholders Procedures
- 2.3 Goods and Services Tax (GST)
- 2.4 Fringe Benefits Tax (FBT)
- 2.5 Travel Expenses
- 2.6 Cash Claims (Out of Pocket Expenses)
- 2.7 Authorising Officers
- 2.8 Corporate Card Administrator and Faculty Finance Directors
- 2.9 Disputed Amounts
- 2.10 Bank Fees and Charges
- 2.11 Lost or Stolen Cards
- 2.12 Increasing/Decreasing Credit Limits
- 2.13 Expiry of Corporate Cards/Replacement Cards
- 2.14 Cancellation of Corporate Cards
- INTERNAL CONTROLS..................................................................................
- 3.1 Responsibilities/Accountability........................................................................................
- 3.2 PeopleSoft Accounting Entries and Information
- 3.2.1 Initial Transaction Entry
- 3.2.2 Approval Process
- 3.3 Controls/Reconciliation/Reporting Activities
- RELATED INFORMATION..............................................................................
- CONTACT AND REVIEW
- APPENDIX A: CORPORATE CARD RETURNED GOODS PROCEDURE
- APPENDIX B: CORPORATE CARD DISPUTE RESOLUTION PROCESS
- ALLOCATION OF CREDIT RECEIVED FOR A DISPUTED TRANSACTION
- APPENDIX C: CORPORATE CARD – 100 POINT ID VERIFICATION
Finance and Accounting Manual Corporate Card Procedures
Finance and Accounting Manual
Corporate Card Procedures
Approved by the Chief Financial Officer on 20 September 2011 Date of effect: 20 September 2011. Updated for Delegation amendment 4 October 2011.
1. Overview
1.1 Purpose To provide procedures on the issue, use and responsibilities for University Corporate Cards.
University Corporate Cards can be issued to any University representative with the approval of a Finance Director/Associate Director Finance, within a specified accountability area. The approval must specify whether the card can be used for:-
(i) regular expenses on approved University business, eg, cardholder‟s own travel and entertainment expenses, conferences, etc. Refer to the Travel Policy for details on travel;or (ii) limited travel expenses, eg, cardholder‟s own specifically approved travel expenses;and/or (iii) the purchase of goods and services for the University to a maximum value of $5,000 per transaction (GST inclusive).
1.2 Coverage This procedure applies to everyone involved in the operation, supervision, management and administration of University Corporate Cards for the acquisition of goods and/or services, excluding travel expenses. Refer to the Travel Policy for details on travel.
1.3 Essential Information 1.3.1 Operating Principles (i) University Corporate Cards are to be used for University business purposes only. They cannot be used for types of expenditure listed in either section 1.3.2 below or the Non-Allowable Expense Procedures.
(ii) Individual monthly credit limits should be established for each cardholder having regard to the anticipated usage of the card and the likely expenditure to be incurred. Unless specific approval is given by the Finance Director/Associate Director Finance for a higher credit limit, the maximum monthly credit limit per Corporate Card for expenses on approved University business, eg, cardholder‟s own travel and entertainment expenses, conferences, etc, will be $5,000.
(iii) The Authorising Officer and Corporate Card Administrator are to monitor the continued need for the card and the credit limit applying for each cardholder on a regular basis, at least annually.
(iv) The cardholder must comply with the Corporate Card Procedures, Procurement Policy, Non-Allowable Expense Procedures and other relevant University policies and procedures. Expenses incurred on a University Corporate Card require the normal examination, certification and authorisation.
Finance and Accounting Manual Corporate Card Procedures
(viii) Supplier Consolidated Invoice Payments The following suppliers are paid by the University on a consolidated invoice and individual invoices must not be paid: Avis for car hire Cabcharge Corporate Express for stationery OfficeMax for stationery Zip Express Couriers
(ix) Computer desktops/laptops, software, telephones These items must be acquired through ICT to comply with the University‟s Standard Operating Environment Policy, with payment made through Accounts Payable.
(x) Imaging and Copy Devices These items must not be acquired pending finalisation of a managed service provision.
2. Procedures and Guidelines
2.1 Applications 2.1.1 Approval (i) The University has a VISA Corporate Card Facility with the National Australia Bank (NAB).
(ii) The Finance Director/Associate Director Finance has delegation to:- (a) Approve an application for a University Corporate Card for a staff member; and (b) Set monthly credit limits. (Refer to part 6.4.3 of the Delegations of Authority – Administrative Functions.
Note: For administration and professional service portfolios the Director Corporate Finance and Associate Director Corporate Finance can approve University Corporate Card applications and set monthly card limits.
2.1.2 Steps in Applying for a University Corporate Card (i) The applicant reads the Corporate Card Procedures, completes and signs the Corporate Card Application and Agreement form.
(ii) The applicant‟s Finance Director/Associate Director Finance must sign the cardholder‟s application forms and complete the Corporate Card Authorising Officer Agreement. When approved the application form is sent to the Corporate Card Administrator.
(iii) Once the application form has been approved, the Corporate Card Administrator or other staff with AUSTRAC verification will complete the 100-point ID verification with the applicant (refer to Appendix C for details on the 100-point ID verification).
(iv) After the 100-point ID verification has been completed the Corporate Card Administrator shall ensure that the application is endorsed and arrange lodgement with the NAB. The NAB takes between 5-7 working days to process a card once the application has been lodged.
(vi) The cardholder shall be advised when the card arrives. The card is issued following completion of formal training in the credit card management system.
Finance and Accounting Manual Corporate Card Procedures
2.2 Cardholders Procedures (i) Cardholders are accountable for transactions incurred on their Corporate Card and for the safe keeping of their card. It is also the responsibility of the cardholder to follow up unknown transactions. (Refer to Section 2.9 Disputed Amounts)
(ii) Cardholders are required to maintain a record of the transactions incurred on their Corporate Card and to provide sufficient explanation of the nature and purpose of the transaction, using the credit card management system to record this information.
(iii) On a daily basis transactions will appear on the online bank statement in Spendvision. The Spendvision User Guide details the instructions for cardholders in more detail.
(iv) Cardholders are accountable for acquitting all transactions in their Spendvision account within the statement period.
Failure to comply with these procedures will result in cancellation of the Corporate Card or reduction of the credit limit to $1.
Cardholders will be required to:-
(a) Review the Statement to verify all the transactions listed, at the very least on a monthly basis. Note: The last day of the accounting period for the credit card management system is normally the 25th^ of the month, with all transactions requiring coding and approval within the credit card management system by the 29th^ of the month if they require to be posted to the correct accounts in the period. Transactions that are not coded or approved by the end of the month are accrued to the cardholder‟s default accounts for posting to the correct accounts in the subsequent month.
(b) Attach Tax Invoices and Receipts for each transaction that appears on the online statement. Tax Invoices are not required to be obtained or kept where the transaction value is less than AUD$82.50 inclusive of GST (or converted foreign exchange equivalent) but sufficient explanation as to the purpose of the transaction must be entered within the credit card management system and the University retains the right to seek reasonable explanation for all credit card amounts. Where reasonable explanation cannot be given, the transaction will be considered a personal expense and referred to Audit and Risk Management. It is still necessary for the recipient to retain and produce some form of documentation (receipt, cash register dockets) when required by the Authorising Officer. Note: Corporate Card Transaction dockets are NOT valid Tax Invoices and are not sufficient to claim credits for GST paid. (Refer to Section 2.3 GST)
(c) Attach other supporting documentation. i.e. Screen prints of Internet orders Letters/Memos explaining/approving the expenditure Email correspondence/ File notes
(d) Identify transactions on which FBT is payable and follow procedures outlined in section 2..
(e) Identify asset transactions and provide the asset information, including location and serial number.
(f) At the end of the accounting period, sign a copy of the online statement and attach all supporting documentatio n.
Finance and Accounting Manual Corporate Card Procedures
(iv) The FBT liability will be automatically calculated in PeopleSoft General Ledger for each transaction in the FBT eligible account classes.
Example: Entertainment Fringe Benefit The cardholder charges the full cost of a business lunch of $150 (GST inclusive) to the Corporate Card. One University staff member and two clients (non-University staff) attended the lunch. Fringe Benefits Tax will be payable on one third of the cost of the lunch being the cost for the staff member.
The cardholder should complete the on-line questionnaire and record one employee and two clients in attendance. The correct account classes will be automatically selected: 5900 Entertainment – GST/FBT eligible $ 50. 5901 Entertainment – GST/non FBT eligible $100. (Note: account class 5904 is used for Entertainment GST Free/FBT eligible).
2.5 Travel Expenses Refer to the Travel Policy for details on travel where corporate cards have been approved to be used for travel.
2.6 Cash Claims (Out of Pocket Expenses) All University travellers and Spendvision.com account holders MUST claim reimbursement for travel and non-travel related expenses, in Spendvision.com, Expense Management system (refer to section 10.6 of Travel Policy).
Non-travellers who do not have Spendvision.com account may claim reimbursement through Petty Cash for amounts less than $25. Amounts over $25 must be claimed through Spendvision.com only.
„Payment Request‟ forms for claiming travel or non-travel related reimbursements will not be accepted by Accounts Payable for payment processing.
2.7 Authorising Officers (i) Authorising Officers are accountable for reviewing, certifying and authorising charges incurred by cardholders. The Authorising Officer should request any additional information or explanations that may be necessary to verify that the transactions are valid charges to the University.
(ii) The Authorising Officer also approves the electronic transaction in the credit card management system. (Refer to Section 3.2.2).
(iii) Authorising Officers must ensure that the cardholder is complying with Corporate Card Procedures and other relevant University policies and procedures. The Authorising Officer must request reimbursement to the University for any personal expenditure incurred on the Corporate Card by declining the transaction and initiating recovery of the costs (account class 1196 should be charged for any personal expenditure by the cardholder). The Authorising Officer can request that the cardholder‟s card be cancelled for non-compliance with University policies and procedures. Any misuse must be notified to the Corporate Card Administrator immediately.
(iv) The Authorising Officer must review the need for the Corporate Card for each cardholder under their supervision on a yearly basis.
(v) Where a cardholder resigns, the Authorising Officer is accountable for the recovery of the Corporate Card, ensuring that the card is cut in two and returned to Corporate Card Administrator for cancellation.
Finance and Accounting Manual Corporate Card Procedures
2.8 Corporate Card Administrator (i) The Corporate Card Administrator is accountable for the overall administration and management of the Corporate Card facility and all contact with the NAB Business Banking Centre in relation to applications for new cards, cancellations, increased credit limits. The Corporate Card Administrator is also responsible for the administration and management of cardholders.
(ii) On a weekly basis the Corporate Card Administrator will obtain details from Human Resources on employees that have terminated their employment and cancel any issued Corporate Cards, any automatic deductions connected to the card, and Spendvision accounts.
(iii) The Corporate Card Administrator and Audit and Risk Management monitor compliance with Corporate Card Procedures and other relevant University policies and procedures. In consultation with the cardholder‟s Authorising Officer, Audit and Risk Managementand the Corporate Card Administrator may request reimbursement to the University for any personal expenditure that is incurred on the Corporate Card. They may also request that the card be cancelled due to non-compliance of the cardholder with University policies and procedures.
(iv) The Corporate Card Administrator and the Authorising Officer are to monitor and follow up outstanding transactions not yet acquitted. (Note: Cardholders should acquit their Corporate Card Statement regularly). The cardholder should be contacted in the first instance and if still outstanding after two months, the cardholder‟s Authorising Officer. If cardholders have not fully acquitted their Corporate Card Statement for three consecutive months then the Corporate Card Administrator will cancel t he Corporate Card with approval of the Finance Director/Associate Director Finance.
The term „acquitted‟ means to verify the transaction as being proper and correct and allocate each transaction to the correct financial accounts in the credit card management system.
(v) The Authorising Officer and Corporate Card Administrator are to monitor the continued need for the card and the credit limit applying for each cardholder on a regular basis, at least annually.
(vii) The Corporate Card Administrator will coordinate spot audits of selected Corporate Cardholders each month, reviewing the acquittal of expenses, type of expenses incurred and the filing of documentation. The Corporate Card Administrator will provide a report to the Director Procurement and Chief Financial Officer on the findings of the audits.
(vii) Investigations by Audit and Risk Management into misuse of a Corporate Card will activate temporary suspension of the Corporate Card. The temporary suspension will occur during the investigation period until the investigation is complete.
2.9 Disputed Amounts (i) It is the cardholder‟s responsibility to ensure that all expenses listed on the online Statement issued by the NAB are correct. Where a cardholder does not agree with a transaction that appears on their Corporate Card Statement, they need to investigate this with the supplier and where necessary, lodge a dispute with the NAB through the dispute form within the credit card management system.
The cardholder should undertake the following steps when a transaction is a duplicate or is not recognised:- (a) Contact the supplier and attempt to verify the transaction;
Finance and Accounting Manual Corporate Card Procedures
(iii) The Corporate Card Administrator shall lodge the request with the National Australia Bank and the cardholder will be advised when the new credit limit takes effect.
(iv) The Chief Financial Officer will review annually all credit card limits in excess of $20,000, including the justification for the credit card limit. Where the credit card limit in excess of $20,000 relates to the procurement of goods and services, compulsory training for cardholders and authorising officers on procurement activities including preferred suppliers will be required to retain the high credit card limit.
2.13 Expiry of Corporate Cards/Replacement Cards Close to the date of expiry of a Corporate Card, the National Australia Bank will automatically issue a replacement card. This renewal card will be delivered to the Corporate Card Administrator who will advise the cardholder about collection with suitable photo ID.
2.14 Cancellation of Corporate Cards (i) If the cardholder resigns, moves to another department/unit or the card is no longer required, the Authorising Officer must advise the Corporate Card Administrator as well as advising whether or not there any automatic deductions linked to the card. The Corporate Card Administrator will advise when any automatic deductions and the card have been cancelled with the NAB, after which the card should be cut into pieces and forwarded to the Corporate Card Administrator.
(ii) The Corporate Card Administrator may cancel the Corporate Card or reduce the card limit to $1 where: (a) Fraud or suspicion of fraud has been reported; (b) Corporate card has been inactive for a period of 12 months or more; (c) Card is lost or stolen; (d) Corporate Cardholder has left the University; (e) Cardholder has not provided requested documents to the Authoriser, Corporate Card Administrator or Audit and Risk Management.
(iii) The Corporate Card Administrator may cancel the Corporate Card or reduce the card limit to $1 in liaison with the Finance Director/Associate Director Finance, Director Corporate Finance or Associate Director Corporate Finance where:- (a) There is a breach of corporate card procedure and other relevant University policies and procedures; (b) The Cardholder has not acquitted transactions within the statement period (refer section 2.2).
3. Internal Controls
3.1 Responsibilities/Accountability
Officers Responsibilities Cardholders Responsible for complying with the Corporate Card Procedures. Responsible for the security and safekeeping of the Corporate Card. Ensuring that the Corporate Card is not transferred or shared with any other person including University employees. Responsible for the use of the Corporate Card and for providing all supporting documentation for transactions. Authorising Officers Review, certification and authorisation of cardholder transactions.
Finance and Accounting Manual Corporate Card Procedures
Ensure compliance with Corporate Card Procedures. Corporate Card Administrator
Overall coordination, administration and management of Corporate Cards and implementation of controls. Administration and management of cardholders. Ensure compliance with Corporate Card procedures.
3.2 PeopleSoft Accounting Entries and Information Transactions incurred on the University Corporate Cards are processed via an expense management system called Spendvision.com. These transactions, once verified, are processed for approval via electronic workflow to an Authorising Officer. Approved transactions are uploaded daily into the University‟s Financial System, PeopleSoft Financials.
There are two main stages in this process:- Initial transaction entry Approval process
3.2.1 Initial Transaction Entry Transactions are updated daily on the bank statement in Spendvision. No accounting entries are made to the University‟s Finance System until the approval process has been completed.
3.2.2 Approval Process (i) Corporate Card charges must be coded and approved before the 29th^ of the month. This involves the cardholder correctly coding the online transactions to appropriate account classes, claiming GST credits where applicable (refer to section 2.3) and applying FBT charges where applicable (refer to section 2.4).
(ii) Correct account classes, responsibility centres, project/grants, analysis codes (optional) and transaction descriptions (maximum 30 characters) must be included so the expenditure can be recorded accurately in the University‟s Financial System. Cardholders may also charge the transactions to different responsibility centres, project/grants and analysis codes (optional) where necessary.
(iii) Any transaction deemed to be personal expenditure must be declined by the authorising officer in Spendvision. The declined transaction will default to account class 1196 which requires reimbursement by the cardholder to the University.
(iv) Credits made to the Corporate Card (i.e. refunds, dispute resolution credits) should be charged against the account codes that the original debit was charged to.
(v) The cardholder must indicate the correct GST and FBT coding in the credit card management system. Imported goods have a 0% GST default setting, whilst all other transactions have a 10% GST default setting. Transactions that do not attract GST need to have the GST coding changed, eg, bread, milk, fruit and vegetables.
3.3 Controls/Reconciliation/Reporting Activities (i) Expenditure incurred on University Corporate Cards must be subject to review, certification and authorisation as detailed in this procedure. Any unauthorised expenditure must be reimbursed by the cardholder or will be recovered by the University.
(ii) The Corporate Card Administrator is responsible for ensuring the total monthly Statement balances are reconciled to the direct debit from the University‟s bank account and the transactions recorded in the University‟s Financial System.
Finance and Accounting Manual Corporate Card Procedures
5. Contact and Review
5.1 Contact
Procedure interpretation, support and application Unit: Corporate Card Helpdesk Phone: 9036 9424 Fax: 9114 0556 Email: pcardhelp@sydney.edu.au
Procedure amendments and strategy Unit: Director, Procurement Services Phone: 9036 9342 Fax: 9036 5386 Email: procurement.services@sydney.edu.au
5.2 Review The Finance and Accounting Manual will be reviewed annually and on an ad hoc basis if required.
The Chief Financial Officer will approve changes to financial procedures and guidelines and will co-ordinate changes to financial policy, with the Vice-Chancellor delegated to approve University financial and infrastructure policy.
Amendments to forms, schedules and weblinks will be processed by Financial Services.
Amendments to the Finance and Accounting Manual procedures and forms are listed on the Financial Services website under:-
FAM Amendments Amendments to Forms
Please forward suggestions and comments on the Finance and Accounting Manual via the Feedback Form.
Finance and Accounting Manual Corporate Card Procedures
APPENDIX A: CORPORATE CARD RETURNED GOODS PROCEDURE
This procedure outlines the process for managing the return of goods or credit note processes for those purchases acquired with the University of Sydney Corporate Card.
Open Accounting Period
It is the cardholders responsibility to:-
- Contact the supplier/ vendor for any items purchased using the Corporate Card that require the return of goods and need either a credit transaction or credit note prepared.
- If the supplier/vendor will not guarantee a credit transaction the cardholder must raise this as a dispute within the credit card management system if it is within the open accounting period, i.e. this period has not yet been closed. (Refer Disputed Amounts procedure in section 2.8)
- Once the supplier/vendor has been notified, arrangements should be made to have the good(s) returned to the supplier. Local processes vary for each supplier/ vendor on how this will be managed.
- A Credit Transaction should be found on the online Bank Statement once the supplier/ vendor has processed this credit to the cardholder‟s University of Sydney Corporate Card.
- The credit transaction must be coded to the account code where the original charges were debited. This will reverse the original transaction and have a net effect of zero on the account codes.
- Where the supplier is unable to process a credit to the Corporate Card, the cardholder is responsible for securing a credit note from the supplier/ vendor for the good(s) returned. The credit note should be attached to the online Bank Statement for the accounting period and adjusted against future purchases with the supplier.
Closed Accounting Period
It is the cardholder‟s responsibility to:-
- Contact the supplier/ vendor for any items purchased using the Corporate Card to advise of the need to return the good(s). This must be completed at least within 90 days of the posting date of the transaction, bearing in mind the supplier may need to be advised earlier as per contract arrangements.
- If the supplier/ vendor is not willing to guarantee a credit transaction, the cardholder must raise a manual dispute with the NAB, also advising the Corporate Card Administrator.
- Once the supplier/vendor has been notified, arrangements should be made to have the good(s) returned to the supplier. Local processes vary for each supplier/ vendor on how this will be managed.
- A Credit Transaction should be found on the online Bank Statement once the supplier/ vendor has processed this credit to the cardholder‟s University of Sydney Corporate Card.
Finance and Accounting Manual Corporate Card Procedures
APPENDIX B: CORPORATE CARD DISPUTE RESOLUTION PROCESS
This procedure is a guideline for processing disputes identified through the use of the Corporate Card. The following flowchart provides a view of the process that is documented within the Corporate Card Procedures, Disputed Amounts Section 2.9.
Disputed Transaction Process
Finance and Accounting Manual Corporate Card Procedures
ALLOCATION OF CREDIT RECEIVED FOR A DISPUTED TRANSACTION
