Procedures Manual - TRU Corporate VISA Purchasing Card
Overview
The effective procurement of smaller value goods and services has been an ageless acquisition issue.
The normal purchasing cycle involves raising a purchase requisition, compiling a purchase order, processing a receiving document and receiving and payment of the invoice.
In 1995, an analysis of TRU's purchasing system indicated that for a single purchase, as many as 16 to 20 steps can take place, from the request, through the purchase order, until final delivery. Each step in the process utilized tremendous resources and can cost the organization anywhere from $50 to $200 in hard and administration costs per transaction - in some cases, possibly more than the value of the item being purchased.
TRU has been using Visa Purchasing cards since 1996, as a result of intense analysis by a focus group and a planning task force group challenged with simplifying the purchasing process.
Benefits
- Local suppliers are paid immediately
- Streamlined and less expensive processes with significant workload reductions
- With payment consolidation, the volume of cheques is reduced
- Allows managers to focus on more strategic matters
Who can use a Purchasing Card?
The Purchasing Department, in consultation with department managers, will look at the department structure and purchasing requirements to determine who should have purchasing cards.
In some departments, such as the Bookstore and Library, the cards are issued in the name of the department head, but used by authorized persons within the department for small transactions.
Employee Acknowledgement Letter
Each person issued a Visa purchasing card will be required to sign an employee acknowledgement letter which will outline their monthly credit limit and individual transaction limit, as well as policy and procedures.
Built in Restrictions
- Dollar limit per transaction
- Credit limit per month
- Restriction to cash withdrawals from ATMs
- Exclusion of identified commodity groups (i.e. restaurants, hotels, golf courses, etc.)
- Each card is attributed to an individual employee for their responsibility
VISA Log Reconciliation
The Purchasing department will provide guidance with regard to the format for the VISA log and on the importance of keeping it up-to-date. Statements are issued, reconciled with receipts, and also to the VISA log each month.
Declined Transactions
If a cardholder violates any of the authorization controls, (i.e. credit limit, transaction limits, both dollar and number, and merchant category exclusions - MCC codes), set specifically for their account, their card will be declined. If a cardholder is declined at a merchant type where they are permitted to purchase, inform your card coordinator.
When a Decline Occurs
Initially, we may experience declines with new cards where the MCC codes have never been opened, as there was no need in the past. The card coordinator, Tanis Carmichael (5604), will contact USbank Visa to open the MCC code under which the decline occurred, and then the purchase can be resubmitted. We appreciate your patience and cooperation when problems arise.