2.20.1 University Purchasing Card Procedures

Effective: 03/05/2025
Senate Proposal: No
Responsible University Officer: Associate Vice President for Finance
Responsible Office: Financial Services and Operations

Introduction

The Michigan Technological University Purchasing Card (PCard) program is designed to provide an efficient and cost-effective method for authorized employees to make routine business purchases on behalf of the university. This guide outlines the responsibilities, policies, and procedures for cardholders, supervisors, and financial managers to ensure proper usage, compliance with university policies, and effective management of university funds.

The PCard is a privilege granted by MTU and must be used in accordance with established policies. Misuse or failure to comply with these policies can result in revocation of the PCard and other disciplinary actions. This document provides an overview of general policies related to card usage, restrictions, allocation, and reporting to promote accountability and safeguard university resources.

Process

Becoming a Cardholder

Employees who are responsible for purchasing supplies for their department and/or those who will be frequently traveling on university business, with supervisor and Director/Chair/Dean approval, may apply for a University Purchasing Card. 

1. Complete the Purchasing Card Application and submit to pcard@mtu.edu for processing.
2. Cardholder will be assigned the online training and PCard test.
3. The Cardholder must complete the required training and pass the PCard test prior to the card being ordered.  Cardholders are expected to review and understand all University Policies, Procedures and Guidelines prior to use.

Sharing the PCard

Only the authorized cardholder may use the PCard. Delegation of authority is not permitted, and sharing the PCard with others is strongly discouraged, as it increases the risk of fraud. The cardholder is held responsible for all charges made against their PCard. Therefore, cardholders should carefully monitor their transactions and alert the PCard administrator and bank if fraud is suspected.

PIN & Chip technology

The University PCard features “PIN & Chip technology” as an extra fraud prevention measure. Upon setting up and activating your PCard, you will need to set up a 4-digit PIN #. When purchasing products in-store and are prompted to enter a PIN # at the point-of-sale kiosk, you must do so or your transaction will be declined.

Spending limits

Individual transactions must not exceed $4,999 on the default-limit card (including shipping/handling). Transactions at $5,000 and greater will be denied at the point of sale. The default PCard limit is $5,000. The spending limits can be temporarily increased, using the PCard Exception Request Form, with approval from the supervisor. Please note exceptions will not be changed with the bank until the PCard administrator has approved the request. The cardholder and supervisor will receive an email notification that the request was completed once the PCard administrator has approved the request. 

Multiple transactions

It is not permissible to make multiple charges on the same day or on consecutive days to the same merchant to facilitate a transaction that exceeds $4,999. This practice, known as a split transaction, is prohibited. An exception may be made for cases where a cardholder needs to register multiple attendees for the same conference or for expenses related to lodging, airlines, etc.

Prohibited items

In addition to the policies outlined in the Business and Finance policies, certain items are prohibited from being purchased on the PCard. For a list of restricted items, see the list of Prohibited Items.

Travel Expenses

The University Purchasing Card is the preferred method for paying for business-related travel expenses. Cardholders may use the card for their own travel expenses as well as for covering travel expenses for others. When a cardholder incurs expenses on behalf of another individual, these must be included in the cardholder’s Concur PCard report. The report must clearly document the business purpose, including details about who the expense was for, what it was for, where and when it occurred, and why it was necessary.

IT Software and computer purchases

Before purchasing software or any IT equipment (such as computers, tablets, and printers, etc.) on a PCard, the cardholder must contact Information Technology Procurement at (906) 487-1111 or email it-procurement-l@mtu.edu. If approval is granted, an IT ticket number will be issued and must be noted in the cardholder’s business purpose.

Amazon Business account

The PCard is used to place purchases with the MTU Amazon Business account. No other cards (personal or other) are authorized.

Sales tax

The MTU Federal tax identification number is included on every PCard. It is the cardholder's responsibility to ensure that sales tax is not charged by providing suppliers with a copy of the Sales and Use Tax Exempt Status Certificate.

1. If the supplier is not accepting of MTU’s tax exempt status, please contact the Purchasing Department for assistance.
2. Cardholders should contact the vendor for a tax credit in cases where sales tax was incorrectly assessed.
3. The cardholder’s attempts to rectify incorrect sales tax charges must be documented in the Comment section of the transaction when allocating. 
4. Refer to Purchasing Sales Tax Exemption for further guidance on sales tax.

Shipping

All PCard orders should ship to an official MTU address or research location. Any exceptions to this policy should be authorized by your departmental leadership and submitted as a request to Purchasing via the Purchasing Card Exception Request Form. The cardholder is responsible for ensuring receipt of materials as well as any follow up efforts required to resolve delivery problems, discrepancies, damaged goods, billing problems, and returns.

Recurring payments

The PCard may be used for recurring payments for items or services, provided the items or services are not prohibited from purchase per the PCard policy. For a high volume of such transactions, a purchase order (PO) may be a more appropriate vehicle. Please consult with the Purchasing department if you think the total value will exceed $10,000 per year.

Trade sanctions

The U.S. Treasury Department's Office of Foreign Asset Control (OFAC) maintains a list of countries with which economic trade sanctions have been imposed. The sanctions pertain to the importing and exporting goods and services to and from countries whose practices are inconsistent with U.S. foreign policy and national security. Under no circumstances should a shipment or purchase be made to or from a country that appears on the sanctioned list regardless of the funding source. MTU employees must abide by all export controls, including during the purchase of intangible goods such as software.

Federally funded contracts may further restrict purchases from certain parties who are deemed excluded from receiving federal contracts, subcontracts, etc. These individuals and/or businesses can be viewed on the U.S. Treasury Department website. Under no circumstances should purchases be made from these listed parties using a PCard tied to federal funds. 

International transactions

PCards may be utilized for international transactions, provided that all requirements and policies outlined in the Business and Finance policies and procedures are met. This includes adherence to the terms specified within federally funded contracts or grants. Additionally, preference should be given to domestic suppliers whenever possible to support local businesses and ensure compliance with procurement standards.

1. A 2% international transaction fee will be automatically assessed by the bank and added as a separate PCard transaction. No receipt is necessary for this fee.  Use account code E916T-International Transaction Fee (PCard).
2. If the transaction is declined at the point of sale, it may have been flagged by the bank as potential fraud. Please contact Bank of America’s Fraud Department at (800) 432-1000 for assistance. 
3. MTU’s tax exempt status does not protect against foreign sales tax or value added tax (VAT), which may be assessed on international transactions.
4. Customs and duty fees based on the value of your transaction (sometimes in excess of 25%) may be charged on some international transactions. The ownership of these fees should be clarified with the vendor before proceeding with the purchase.

Allocation and Accounting

Itemized receipts and business purpose

All purchases must have an itemized receipt and a business purpose to support the expense.

1. The cardholder is responsible for obtaining receipts, packing slips, etc. for all PCard purchases. Itemized receipts for PCard purchases must be scanned and attached to the corresponding transaction in Concur. Receipts must be:

1. 1. scanned and attached to the expense transaction in Concur
   2. itemized and legible

• • An appropriate receipt normally includes:

1. 1. 1. 1. Name of Vendor
         2. Address/Phone number/website
         3. Description of each item purchased
         4. Shipping charges, if applicable
         5. Grand Total
         6. Date of purchase
         7. Shipping Address, if applicable
         8. Method of payment (last 4 digits of PCard)

1. When placing an order over the phone, remind the merchant that an itemized receipt is required with the shipment.
2. A business purpose must be indicated for each transaction. The business purpose field is located in the expense detail in Concur. A business purpose means a clear explanation of how and why the item or service will be used or was needed.

Transaction feed to Concur and Banner

All PCard transactions will automatically feed into the cardholders Concur Available Expenses within 2-3 days after the post date. All expenses, and credits, are required to be processed on an expense report in Concur. Once an expense report has been submitted and approval workflow complete, the expense(s) will integrate with Banner.

Reporting timeline

All transactions, including disputed charges and credits, must be submitted on an expense report.

1. Supplies and Services (your non-travel expenses): A Concur Purchasing Card Report must be submitted once per month. It is recommended to submit your report around the 23rd of each month to ensure time for approvals and expenses to integrate with Banner before the month closes. This requires that your expense report makes it through the necessary approvals before month end. DO NOT submit a report for each card transaction.

While it is preferred that your expense report be fully submitted and approved before the end of the month, cardholders are allowed up to forty-five (45)  days from the first day of the month to allocate, submit, and obtain approval for that month's expense report. This timeline accounts for processing by the cardholder, supervisor, financial manager, Dean/Chair/Director, and any necessary ad hoc approvals. 

To ensure compliance with PCard policy, submit your PCard report before the end of each month to provide adequate time for the approval process.

2. Travel Expenses &/or Business Meal Expenses:  A Concur Travel &/or Business Meal Report must be submitted within two weeks after the end date. See Travel Expense Reporting for more information.

Separation of duties

 A Delegate may not prepare a cardholder’s report and approve the same report on behalf of the cardholder’s supervisor.  It is required by both Internal Audit and the PCard administrator that an appropriate separation of duties exists. 

Responsibilities

Expenditure policies

The cardholder is expected to adhere to university expenditure policies, outlined in the Business and Finance policies. Purchases made on the PCard must be in accordance with the established policies and be made in an ethical manner. Preferences or set-asides for diverse suppliers or Minority/Women-owned Business Enterprises (MWBEs)—unless a federal requirement for receipt of funds—are not allowed per Michigan law.

• CONSTITUTION OF MICHIGAN OF 1963  
  Article I § 26 The University of Michigan, Michigan State University, Wayne State University, and any other public college or university, community college, or school district shall not discriminate against, or grant preferential treatment to, any individual or group on the basis of race, sex, color, ethnicity, or national origin in the operation of public employment, public education, or public contracting. 

1-2-3 Strike Policy

The PCard is a privilege granted by the university and it is expected that it will be used responsibly. Violation of the PCard policies and procedures may result in loss of this privilege. A 1-2-3 Strike Policy is in place to handle PCard violations. The cardholder and their Supervisor will be notified of all strikes given; however, a warning may be given to cardholders only prior to the incurrence of a strike. Strike 1 will result in a 30-day card suspension; Strike 2, 90-day card suspension; and Strike 3 will result in card cancellation, and the employee will not be able to apply for a new PCard for a period of 12 months. Example policy violations that may incur a strike include:

• Any violation of any section of the MTU Business and Finance Policies and Procedures
• Missing business purpose or incorrect itemized receipt
• Purchase of a prohibited item, without prior approval from PCard administrator
• Splitting charges to skirt the single transaction limit
• Failure to process transactions within the reporting requirements.
• Failure to have monthly report fully approved within 45-day time limit
• An audit finding by Internal Audit or the PCard administrator 
• Inappropriate charge of sales tax without documented attempts to rectify

Card suspension/cancellation

Department supervisors or Dean/Chair/Directors may request that a PCard be suspended or canceled at any time by emailing pcard@mtu.edu. For urgent requests, please call the PCard administrator immediately.

Leave of Absence, Employee Termination, or Change in Position

Cardholders are responsible for allocating and submitting expense reports for all card transactions prior to the following events:

1. Leave of absence (30 days or more):

1. 1. Card to be suspended two weeks prior to change in status, if scheduled

1. 1.   Card remains suspended while Cardholder is on leave

2. Scheduled employee resignation/retirement/termination

1. 1. Card must be closed two weeks prior to change in status

1. 1.   All transactions must be allocated and submitted on a report 

3. Department transfer to different department

1. 1. Cardholder will be contacted by the PCard administrator providing instructions for the following options:
      1. 1. Closing the PCard if no longer needed in new position, or
         2. Completing a new PCard application for the employee’s new department

In the event of immediate termination, the employee’s immediate supervisor collects the card(s) and immediately contacts the PCard administrator.

Reporting lost/stolen cards

If a PCard is lost or stolen, it is the cardholder's responsibility to notify the bank and the PCard administrator. The credit card will be canceled immediately, and a replacement credit card issued. If the PCard is stolen on campus property, cardholders must also contact MTU Public Safety and Police Services. The department will be liable for any charges that may have occurred prior to the PCard being canceled.

Lost or Unobtainable Receipts

If you lose a receipt or, for some reason do not receive a receipt or invoice, contact the vendor to get a duplicate. In the rare situation that you cannot get a receipt from the vendor, you should complete a Substantiation for Lost or Unobtainable Receipts form.  

This form is intended for occasional use only. If a cardholder uses the Substantiation for Lost or Unobtainable Receipts form frequently, it may indicate a pattern of non-compliance with receipt requirements. As such, repeated use of this form may result in the temporary suspension or revocation of the cardholder’s privileges. Cardholders are encouraged to maintain proper records and promptly obtain receipts for all transactions.

Cardholder, Supervisor, Financial Manager and Delegate responsibilities

Although the PCard has many built-in controls, there are certain steps that the cardholder and approver must take to ensure the responsible use of university funds.

1. Cardholder responsibilities:
   1. Ensure that MTU's resources are spent in a responsible and ethical manner, in accordance with all University policies.
   2. Never share a PCard; only the authorized PCard cardholder may use the PCard.
   3. Be aware of prohibited items.
   4. Never use the PCard for personal use.
   5. Immediately report a lost or stolen card.
   6. Obtain original itemized receipts for all purchases.
   7. Notify the merchant that MTU is tax exempt and provide the tax ID number or Sales and Use Tax Exemption Certificate if requested by the merchant.
   8. Review the transactions in Concur every month. Scan and attach a detailed, legible receipt to each transaction prior to submitting it for approval. Ensure receipt of materials or service, and resolve any delivery problems, discrepancies, damaged goods, billing problems or returns with merchants.
   9. Contact Bank of America immediately for any disputed charges that a vendor is unwilling to correct.
   10. May assign a Delegate to help prepare expense reports and/or approve on the cardholder’s behalf. Note that the cardholder is ultimately responsible for following all policies and procedures.
   11. Request updates to the cardholder record by emailing pcard@mtu.edu, including for changes in legal name, address, phone, and email address.
   12. Prior to the effective transfer date when moving to a new department, cardholders can either:

1. 1. 1. 1. Submit a new PCard Application with your new department information, including approvals by your new department. Your PCard information will be updated which allows the cardholder to use the PCard in the new department.
         2. Submit an email to pcard@mtu.edu requesting a cancellation of the PCard. This option is intended for cardholders that will no longer need a PCard in their new role. The PCard should be cut up and destroyed upon transfer.
         3. In either case, all expense transactions must be allocated and submitted on an expense report in Concur.

m. Prior to the effective termination date of a cardholder's employment at MTU, the cardholder is required to request the cancellation of their PCard via an email to pcard@mtu.edu. The card should then be cut up and disposed of. Cardholders are responsible for all purchases up to the point of cancellation. All transactions must be allocated in Concur and submitted prior to the cardholder’s departure. Any receipts for outstanding transactions that have not flowed into Concur must be left with the supervisor.

n. If job duties change and there is no longer the need for a PCard, notify pcard@mtu.edu to cancel their card.

2. Supervisor responsibilities:

a. The supervisor is responsible for reviewing the accuracy of cardholder documentation on all transactions which includes verifying:

• The index(s) and account code(s) are accurate.
• The transaction is an appropriate expenditure of university funds.
• The purchase complies with university policies, such as:

1. 1. 1. 1. Adherence to the PCard policy and its restrictions (e.g. chemicals, software, etc.)
         2. Compliance with MTU policies and procedures
         3. Alignment with award stipulations if associated with Contracts and Grants Administration funding.

• An itemized, legible receipt matching the PCard amount is attached, and no sales tax was charged.
• A clear business purpose is indicated, and the charge is not fraudulent/personal.
• The cardholder has not split transactions to purposely circumvent policy.
• Yes – approve report
• No – return report for additional actions notated in the comments. Note that approvers can revise indexes and account codes, if necessary.

b. Attend cardholder training to better understand the program and ensure compliance.

c. When a cardholder terminates from the university or transfers to another department, verify the cardholder has notified pcard@mtu.edu to cancel or transfer the PCard.

d. Work with the PCard administrators to complete final transactional allocations for employees whose last transaction(s) arrive after they have left their position. The cardholder is required to leave all outstanding receipts with the supervisor in this case.  

3. Financial Manager responsibilities:

1. Verifying the accuracy of cardholder documentation on all transactions.
2. Attend cardholder training to better understand the program and ensure compliance.
3. Review all transactions and receipts, verifying the index(s), account code(s) and the transactions are appropriate expenditures of university funds and comply with university policy.
   1. 1. Yes – approve report; report workflow continues
      2. No – return report for additional actions notated in the comments. Note that approvers can revise indexes and account codes, if necessary.

4. Delegate responsibilities:

1. A Delegate Can Prepare, Can Submit Request, Can View Receipts, Receive Emails, and Can Approve on behalf of the cardholder, pending access granted by the cardholder.
2. Note that the cardholder is ultimately responsible for following all policies and procedures.
3. If a Delegate is granted Approval access, they must follow all supervisor and financial manager responsibilities.

Audits

MTU audits

Department of Internal Audit, Sponsored Programs Office, and/or the PCard administrator will conduct periodic audits of cardholders' transactional reports. Additionally, the PCard administrator performs compliance reviews to ensure that PCard procedures are being followed properly. Department of Internal Audit, Sponsored Programs Office, or the PCard administrator may request additional documentation on a particular transaction or group of transactions where they appear unclear or lack proper detail. The cardholder must provide the information by the date requested or the PCard may be suspended.

Restitution

The university will seek restitution for any inappropriate charges made to the PCard. Fraudulent or intentional misuse (including the use of the PCard for personal purchases) will result in revocation of the PCard, possible criminal charges, and discipline up to and including termination.

Reporting suspected misconduct

All administrators, faculty members, support staff, and other employees are to promptly report any known or suspected fiscal misconduct by contacting the PCard administrator at (906) 487-2510 or pcard@mtu.edu, or the Department of Internal Audit at (906) 487-1976 or by reporting online. The university has also established a toll-free hotline (844) 490-0055 that can be used to anonymously report known or suspected misconduct.

Related Information

(Include here any supporting information for this procedure or policy.)

2.20 University Purchasing Card Policy

Forms and Instructions

In support of this procedure, the following forms/instructions are included: