Part 5 - Management Services
Chapter 23 - Government-Wide
Commercial Purchasing Card
5-23.1 INTRODUCTION
- Purpose. The Indian Health Service (IHS) Government-wide Commercial Purchasing Card (GCPC) program is designed to meet the following objectives:
- Exist within the Federal Acquisition Regulations (FAR).
- Reduce paperwork and administrative costs.
- Streamline payment procedures for the acquisition of supplies and services within the Simplified Acquisition Threshold (SAT).
- Improve cash management practices such as forecasting, consolidating payments, and reducing or eliminating imprest funds.
- Provide a methodology for procedural reviews and oversight.
- Provide structure to assess acquisition policy and training unique to the IHS.
- Facilitate feedback to managers to strengthen the overall management control and decision-making relative to fund control management.
- Background. The Federal Government uses various methods to accommodate the acquisition of necessary supplies and services. Traditional Federal Government purchasing has been administratively cumbersome, costly, and time-consuming. The Federal Government needed a procurement program that was user-friendly, with reduced paperwork, and offered efficient procurement and payment solutions. The GCPC has provided this flexibility, simplified the acquisition and payment process, and reduced the total acquisition costs to Federal agencies.
- General Services Administration. The General Services Administration (GSA) implemented the SmartPay Card Program that awards contracts for the use of purchasing cards under the GCPC program. This purchasing card program, similar in nature to a commercial credit card, issues a purchasing card to agency personnel authorized for their use to acquire materials, supplies, goods, and services. The purchasing cards are issued to Federal contracting officers (CO) and non-contracting officers with limitations on their use.
- Federal Supply Service. The GSA Federal Supply Service (FSS) administers the multiple award contracts for the Federal Government to provide these particular services. The GSA contracts provide, at the request of Federal ordering agencies such as the Department of Health and Human Services (HHS), the GCPC program and associated services for civilian and military Government employees to make purchases under the FAR for official Government use.
- Procedures. Agencies using the purchasing card shall establish procedures for the use and control of the card that comply with the Treasury Financial Manual for Guidance of Departments and Agencies (4-450) and are consistent with the terms and conditions of the GSA contract for the purchasing card service. It is not the intent of this chapter to repeat the detailed information set forth in the referenced regulations, but rather to provide and define Agency policy, operating guidance, and responsibilities.
- Policy. The IHS will use the GCPC and associated services for purchases within the SAT whenever possible.
- Definitions.
- Agency/Organization Program Coordinator. The Agency Program Coordinator (APC) is responsible for the IHS GCPC program and represents Level 3 in the GSA Government Services platform hierarchy.
- Approving Official. The Approving Official (AO) is responsible for reviewing the statement of account (SOA) certifying that all SOAs are reconciled in accordance with Agency policies and procedures, and ensuring that purchases are for bonafide Government needs.
- Authorization Code. An authorization code is an entry in the GSA contractor computerized system that sets limits on all cardholder (CH) purchases. Codes are currently in effect for the merchant categories, single purchase limit, the CH 30-day limit, and the monthly office limit.
- Cardholder. The CH is the individual to whom the card is issued following GCPC training and a current delegation of authority (DOA) from the senior contracting officer (SCO) or the APC for IHS Headquarters (HQ).
- Cardless Transaction. A cardless transaction is a purchase transaction in which an account number rather than a plastic card is used for orders made by telephone, fax, or mail. The cardless purchase transaction will be reflected on the SOA the same as a plastic purchasing card transaction.
- Delegation of Authority. A DOA is a certifying document that identifies a specific individual and his/her unique spending limits.
- Designated Billing Office. The designated billing office (DBO) is an IHS finance office that receives and reviews the official invoices. The DBO also authorizes payment to the GSA contractor and works to resolve payment issues.
- Dispute. A dispute can arise regarding charges for merchandise or services not received, returned merchandise, unauthorized purchases, duplicate or unrecognized charges, or a questionable transaction that is posted on a CH’s SOA. Charges that cannot be disputed are identified in section 5-23.6T(6).
- Dispute Office Contact. The Dispute Office Contact coordinates, processes, and monitors disputed purchases, credits, or billing errors that the CH is unable to resolve. The Dispute Office Contact is the SCO at each Area Office and the APC at IHS HQ.
- Division of Acquisition and Grants Management. The Director, Division of Acquisitions and Grants Management (DAGM), has direct overall responsibility for the IHS acquisition programs and the delegation or re-delegation of procurement authority, including the GCPC and checking accounts (convenience checks) program.
- Financial Management Office Contact. The Financial Management Office (FMO) arranges and authorizes direct payment to the GSA contractor as the financial institution using central billing procedures.
- Government-wide Commercial Purchasing Card. The acronym for the official name of the U.S. GCPC program authorized by FAR 13,301. This card is also known commercially as the “International Merchant Purchase Authorization Card (IMPAC).” The IMPAC acronym may continue to be printed on all cards, convenience checks, and forms provided by the GSA contractor as identification of the contract and program. Since GCPC is the regulatory title authorized by FAR, the acronym, “GCPC” is used for IHS policy and regulatory compliance.
- Government-wide Commercial Purchasing Card Checking Account. The GCPC checking account is commonly referred to as “convenience checks.” Convenience checks are used as a supplement to the purchasing card program to pay for official supplies and services obtained from merchants who are unable to accept the purchasing card.
- Head of Contracting Activity. The Head of Contracting Activity (HCA) has overall responsibility for all of the IHS acquisition programs and systems.
- International Merchant Purchasing Authorization Card. The IMPAC is the name of the specific commercial Government services provided by the GSA contractor selected by the HHS under the GSA SmartPay Card program.
- Micro-purchase. A micro-purchase is an acquisition of materials, goods, supplies, and services where the aggregate amount does not exceed $2,500. The exception is construction services, which are stringently limited to $2,000.
- Monthly Cardholder Purchase Limit. This is the spending limit imposed on a CH’s cumulative purchases in a given 30-day billing cycle.
- Monthly Office Limit. The monthly office limit is an amount established to cover the aggregate sum of the AO's monthly purchase limits.
- Non-expendable Personal Property. Non-expendable personal property is accountable personal property with a normal life expectancy of more than 2 years that has a continuing use as a self-contained unit is not consumed in use, and does not lose its identity when put in use. There are two categories of non-expendable personal property:
- Non-capitalized Items. Non-capitalized items include property with an acquisition cost of less than $25,000 per unit.
- Capitalized Items. Capitalized items include property with an acquisition cost of $25,000 or more per unit.
- Oral Contract. Note: All IHS contracts must be in writing. Only warranted COs possess the legal authority to enter into Federal contracts. Oral contracts are oral offers accepted by the vendor/contractor but are unfulfilled orders. Actual performance defines this as an implied contract. Oral contracts are not to be confused with oral offers or quotations. Oral contracts are subject to ratification procedures requiring written contracts.
- Oral Procedure. An oral procedure is a cardless procedure where an order is placed or a purchase is made by an oral agreement made in person or by telephone.
- Ratification. Ratification is the act of approving an unauthorized commitment by an official who has the authority to do so and may require the next level of review and approval. In some cases, circumstances may require legal counsel assistance and decisions. Oral contracts are subject to ratification procedures.
- Request for Quotations. Request for Quotations procedures are used to communicate Government requirements to prospective vendors and contractors and to solicit quotations from them on the requirement. Identical information concerning the proposed acquisition must be furnished to all prospective contractors or vendors. When required, the rule is to solicit to secure at least three quotations and document this in the CH’s files.
- Senior Contracting Officer. The SCO serves as the liaison among the AO, FMO, and the HCA. The SCO is also the procurement official with plenary delegated authority for each of the 15 contracting activities of the IHS.
- Sensitive Items or Equipment. Sensitive items or equipment are items, such as supplies and equipment that are highly desirable and easily converted to personal use.
- Simplified Acquisition Threshold. The SAT is the threshold established for acquisitions using methods prescribed in FAR, Part 13, “Simplified Acquisition Procedures.” These procedures were formerly known as the “Small Purchase Procedures.”
- Single Purchase Limit. The CH single purchase limit is the maximum dollar amount of a single purchasing card transaction.
- Statement of Account. The SOA is a monthly listing of all transactions made between the CH and merchants. It is prepared by the GSA contractor and sent directly to the CH at the end of each billing cycle.
- Unauthorized Commitment. Unauthorized commitment is a non-binding agreement since the representative who made it lacked the authority to enter into it on behalf of the Federal Government.
- Unauthorized Use. Unauthorized use occurs when the purchasing card is used by a CH for personal purchase, a purchase of supplies or services that the CH had no authority to make, expenditures contrary to the proper use of appropriated Federal funds, or by a person other than the authorized CH.
5-23.2 OPERATIONAL FRAMEWORK
- Operational Instructions. This section provides IHS employees with guidance on the policy, use, and responsibilities of the GCPC. One of the GSA contract associated services is the check account, or the more commonly called “convenience checks.” Some specific provisions for the use of the convenience checks are also covered in 5-23.6K.
- Administration/Management. The DAGM, Office of Management Support (OMS), IHS HQ, shall manage the GCPC program to ensure all IHS transactions comply with this policy and any other applicable Federal laws, regulations, or guidelines. Additional guidance will be issued upon formal notification of changes to the GSA Federal program or the GSA “SmartPay” contractor. This is the sole policy for the IHS, and no Area Office or service unit supplemental policies shall be used in lieu of this policy.
- Reference Regulations. The GCPC program is an acquisition and payment method subject to all simplified acquisition provisions established in the FAR, Health and Human Services Acquisition Regulations (HHSAR), and IHS supplements thereto. The authorizing regulations for the GCPC program are FAR, Subchapter C, “Contracting Methods and Contract Types,” Part 13, “Simplified Acquisitions Procedures.” Additional authority to re-delegate procurement authority to IHS COs and non-contracting officer personnel is cited in FAR, Part 1.6. The ability to delegate micro-purchasing authority to non-contracting officers is cited in FAR, 1.603-3 and HHSAR 301.603-70(b).
5-23.3 INDIAN HEALTH SERVICE GCPC PROGRAM
- Organizational Framework. The organizational framework of the IHS GCPC program must adhere to FAR and Office of Management and Budget (OMB) Circulars, and operate in accordance with the proper use of Federal funds and the GSA purchasing card program operated under the GSA contracts. The Federal purchasing card program design, unlike commercial credit card systems, is based on a multiple-level system developed by GSA to accommodate the various organizational structures. Six operating levels arranged in a pyramid system for contractual and programmatic implementation exist under a GSA contract. (The operational guidance and responsibilities for level 3 through 6 are defined in this chapter.)
- Level 1. Level 1 is the GSA, and this level requires a unique prefix number on all Federal purchasing cards to distinguish the Federal purchasing cards from the commercial credit cards of a financial institution (GSA contractor). This also allows the GSA to meet reporting requirements and establish separate authorization and processing controls for Federal Government accounts.
- Level 2. Level 2 is the executive office, department, commission, etc., in the Federal system. For the IHS GCPC, it is HHS. The second two-digit code identifies HHS as the next organizational level. This signifies the reporting requirements and information created for this level, such as the exclusive billing period for HHS.
- Level 3. Level 3 is a major organizational subdivision. For the IHS GCPC program, it is OMS, DAGM.
- Level 4. Level 4 is the next organizational subdivision assigned to each of the 15 IHS contracting activities, which include IHS HQ, Area Offices, and the engineering service offices. The respective SCO is responsible for all acquisitions and administration of the procurement programs, including the GCPC.
- Level 5. Level 5 is the next organizational and functional subdivision. This level identifies all IHS AOs located in IHS HQ, the Area Offices, and engineering service offices.
- Level 6. Level 6 is the final organizational level and represents the individual IHS CH(s).
- Indian Health Service HQ Responsibilities.
- Director, OMS. The Director, OMS, has the general responsibilities for the GCPC policy cited in this chapter.
- Director, DAGM. The Director, DAGM, is directly responsible for the coordination, administration, and oversight of the IHS GCPC program.
- Head of Contracting Activity. The Director, DAGM, is the HCA. The HCA has overall responsibility for all of the IHS acquisition programs and systems. Responsibilities:
- The HCA is responsible for the IHS GCPC program.
- The HCA will execute a formal re-delegation to the APC and alternate APC to delegate the duties, responsibilities, and periphery of agency representation.
- Agency Program Coordinator. The APC is responsible for the Agency-wide IHS GCPC program and represents Level 3 in the GSA Government Services platform hierarchy. The APC is responsible for the oversight review every 2 years and for the administration and management of the IHS HQ GCPC program. The APC serves as, the liaison between the IHS, HHS, and GSA contractor and the GSA CO. The APC serves as the primary point-of-contact for interpretative questions on card use, GSA contract administration matters, the coordination of Agency applications, issuance and destruction of cards and convenience checks, the establishment and review of any Agency management reports, and general administration of IHS GCPC training.
- Approving Official. The AO is responsible for the reviews, certifies that SOAs are reconciled in accordance with Agency policies and procedures, and ensures purchases are for bonafide Government needs. The AO serves as the liaison between the CH and the SCO. The AO receives his/her DOA from the SCO after proper training and certification. The AO is responsible for the timely reviews of CH files.
- Acquisition Management Branch Chief. The Acquisition Management Branch (AMB) Chief manages the GCPC program on a day-to-day basis. The AMB Chief:
- may serve as the APC or recommend an AMB staff member to manage the program,
- oversees Agency training,
- interprets the policy or questions on proper use,
- ensures oversight reviews, and
- updates policy for the 5-5.23, Indian Health Manual
- General Operation of the GCPC Program. The issuance of an IHS purchasing card is based on the purchasing needs of a particular office. The Federal purchasing card programs are not intended to provide each individual employee with a purchasing card. Indeed, such a system would impair the checks and balances of fund controls and the separate receipt of goods. Therefore, the approving SCO will review each request for a purchasing card based on the need and size of the office; the current number of CHs; and the acquisition history, including the office’s past use of the purchasing cards and/or a transferred IHS employee’s past CH use. The IHS GCPC program is designed for efficiency of procurement and payment and to meet the immediate needs of IHS personnel.
- The use of the purchasing card is an Agency privilege.
- The IHS purchasing cards or convenience checks will not be used to make the customary payments to Federal contractors.
- Contract payments are required to be paid by the Department of the Treasury, Fiscal Services, and Electronic Funds Transfer (EFT). This instruction and compliance is implemented by provisions of Section §31001(x) of the Debt Collection Improvement Act of 1996.
- The IMPAC cards or convenience checks must be used solely for valid procurements for the benefit of the Federal Government.
- Cardholder Eligibility Requirements. The use of the purchasing card is directly related to the legal obligation and expenditure of IHS appropriated funds. A CH is customarily an IHS employee, but exceptions may exist.
- Authorized Individual. An IHS CH is the individual to whom the card is issued after GCPC training and a current DOA from the SCO.
- Personnel Authorized. When Federal employees of other departments, agencies, etc., are employed through an Intergovernmental Personnel Act (IPA) or memorandum of agreement (MOA) with the IHS and are authorized to obligate and expend IHS funds in the performance of their duties with IHS, the employee may be issued an IHS purchasing card.
- Personnel Not Authorized. When an IHS employee is operating under an IPA or MOA with a Tribe, Tribal organization, or another Federal Agency, an IHS purchasing card will not be issued. The employee will not be allowed to continue using a formerly authorized purchasing card if he/she has one. The purchasing card will be terminated, and a new account will be set up when the IPA or MOA is completed or the individual returns to a Federal position.
- Exceptions. Each office requesting an exception must do so in writing to the SCO and/or to the APC.
- Any requests for exceptions to this rule must be made in writing and submitted to the SCO or APC. If the SCO concurs with the purchasing card request, it is sent to the APC for future review and concurrence. Consideration will be based on the legal relationship of the contractor to the IHS, the expenditure of IHS funds, and the benefit to the Agency. Again, the issuance and use of the purchasing card is limited to the expenditure of IHS funds. If the APC concurs with the request, it is submitted to the HCA for final approval.
- The SCO or APC must ensure the Federal employee completes IHS-specific GCPC training. The employee’s CH file must be maintained for the duration of the formal appointment with IHS.
- Personal service contractors are firms or individuals performing services on behalf of the IHS. As contractors operating under formal Federal contracts, they are not eligible to request a purchasing card.
- Prerequisite Training Requirements and Application for a Purchasing Card and Check Account.
- Acquisition Personnel. All acquisition personnel using the GCPC must have at least a Level I certification, possess a valid procurement warrant, and have completed approved IHS GCPC training conducted by either the SCO for the Area Office or the APC for IHS HQ. The appointment of a CO shall be made by the HCA and shall be at one of the four levels specified under the HHS Acquisition Certification Program.
- Set-up Information Form. If the requesting individual currently has an appointment and warrant as a CO and has completed the IHS GCPC training, he/she shall submit a completed CH Account Set-Up Information form for approval by the SCO. The GSA contractor will provide forms.
- $100,000 Purchasing Limits. Only Level IV SCOs are authorized for $100,000 limits on their respective purchasing cards based upon exceptional need or emergency situations. The HCA may authorize a higher dollar threshold up to $250,000.
- Non-acquisition IHS Personnel. The HCA is authorized to determine what training requirements are necessary for non-acquisition personnel to be provided purchasing cards in accordance with FAR Part 1.603 and HHSAR 301.603-70(b). The HCA determines if the IHS GCPC training provided on the use of the purchasing card is sufficient for the dollar thresholds and duties involved. The SCO may delegate acquisition authority to non-acquisition personnel, but limitations are established by the HCA. Non-acquisition personnel may be delegated up to $2,500 after successfully completing the IHS GCPC purchasing card training. There is one exception to this limit. A higher limit of $10,000 may be authorized for contract health care officials.
- Completed Training. After an individual has completed the GCPC training, he/she shall submit the completed CH Account Set-Up Information form to the SCO. Upon receipt, review, and concurrence, the SCO, the APC, or the APC's designee will input the data via the approved GSA contractor electronic systems for an account to be opened for the individual.
- Certificate. Each potential CH who has received the IHS-specific GCPC training will be issued a training certificate signed by the cognizant CO and the HCA. The CH is responsible for maintaining this as a record of prerequisite training. It is to be presented when applying for a new purchasing card.
- Refresher Training. Every 2 years, the SCOs and respective AOs will identify CHs who should receive refresher training. The SCO may use training offered on the GSA Web site or the GSA Contractor’s Web site to provide such training or conduct Agency training.
- Procedures. The purchasing card and convenience checks are directly mailed from the GSA contractor to the CH. Upon receipt, the CH must immediately notify the GSA contractor. It is very important that this be done promptly. If the CH does not receive the purchasing card and/or convenience checks within 10 working days after submitting the completed CH Account Set-Up Information form, the SCO must be notified. If the GSA contractor does not receive a response within 30 days after the purchasing card and/or convenience checks are mailed, a followup report will be sent to the SCO. The SCO will then initiate action to check for possible lost or stolen purchasing cards or convenience checks and may terminate the account. If the account is terminated, a new request must be initiated.
5-23.4 INDIVIDUAL ROLES AND RESPONSIBILITIES
- Agency Program Coordinator. The APC is responsible for the IHS GCPC program. He/she serves as the liaison among the IHS, HHS, GSA contractor, and the GSA CO. He/she also serves as the primary point-of-contact for the IHS and the GSA contract administration; coordinates the Agency applications; establishes and reviews any Agency management reports, the IHS GCPC training program, and general administration of the IHS GCPC; and conducts program oversight. The APC is responsible for the following:
- Serves as the administrator of the IHS HQ GCPC program.
- Ensures all SCO(s), AO(s), and CH(s) are trained in the purchasing card procedures sufficient enough to carry out their responsibilities.
- Provides and ensures that all applicable GSA contractor forms and training certificates are available to the IHS offices.
- Performs random reviews of the IHS monthly summary reports as determined appropriate.
- Serves as the liaison among the SCO, HCA, the GSA contractor, and FMO.
- Handles unresolved disputes reaching Level 3 between the IHS and the GSA contractor.
- Is responsible for Agency-wide training and issuing training certifications.
- Takes action to cancel CH privileges and/or initiates or coordinates the type of disciplinary action, if determined to be appropriate.
- Follows up on reported investigations or theft and independent actions taken by the GSA contractor as the financial institution reported by a SCO or identified by the Office of Inspector General (OIG).
- Performs policy responsibilities and conducts oversight function.
- Senior Contracting Officer. The SCO is responsible for the overall operations and administration of the Area Office or engineering office GCPC program, including oversight. This responsibility is not redelegable since the SCO is also responsible for the Area acquisition programs and systems. The SCO has under his/her purview one or more AOs. The SCO does the following:
- Conducts training and issues certificates to CH(s) and AO(s) in the GCPC program.
- Ensures all AOs are trained in simplified acquisition procedures and the use of purchasing cards sufficient to carry out their responsibilities.
- Obtains certificates from AOs certifying that they understand and agree to abide by the IHS internal procedures in the use of purchasing cards and convenience-checks; maintains a file of such certificates.
- Performs random reviews of the monthly summary reports.
- Performs periodic on-site and in-depth reviews of all purchasing-card and convenience-check activities.
- Determines when a CH purchasing card account is opened or terminated.
- Serves as the liaison among the AOs, FMOs, APC, and HCA.
- Receives and maintains a file with a copy of each monthly master SOA and conducts a review of individual CH purchasing on a random basis, comprising of at least 10 percent of the SOA each month.
- The review will focus on evidence of order splitting, as well as on the general adequacy of documentation and compliance with these published procedures, when applicable.
- The review will also consist of examining individual CH purchases to ensure they are within the individual dollar limitations and approved activity codes and demonstrate the proper use of Federal funds.
- This review should be accomplished within 30-days of receipt of the report.
- Inappropriate or questionable CH purchases and follow-up actions are to be annotated on the report and maintained in the file.
- If it appears that inappropriate or questionable CH purchases were made, questions will initially be addressed to the AO.
- The SCO determines if there was intentional misuse of the purchasing card, initiates followup on the infraction, and makes a determination on the first course of action.
- The SCO may consult with APC or HCA on actions to be taken.
- However, the SCO will take the initial actions and if the infraction warrants it, notify the OIG.
- The SCO will immediately terminate the account and notify the APC of the first course of action.
- Performs periodic, on-site, and in-depth reviews of purchasing card activities.
- This review will include the activities of the individual CH and the AO.
- Reviews at the CH level will ensure adequate file documentation of SOA files, receipts, justifications, price quotes, etc., as well as the activities for the current month.
- Reviews at the AO level will include a review of Master Summary Report files and any other documentation determined to be necessary to ensure compliance with regulations and procedures.
- Provides an annual updated list of all CHs, the AO(s), and Alternate AO(s), to the FMO. The FMO will use the list for auditing and provide it to any other Government auditors and/or investigators, as necessary.
- Warranted IHS Contracting Officers. Warranted IHS COs may exercise increased authority to place orders and to pay for purchases against contracts established in FAR, Part 8 procedures, when authorized and agreed to by contractors as authorized by FAR, Part 13.
- Approving Official. The AO administers one or more CH account(s). The AO is responsible for monitoring and administering the GCPC program in close coordination with the SCO and assumes responsibility for the following:
- Ensures CHs receive GCPC training in simplified acquisition procedures sufficient to carry out their responsibilities.
- Monitors purchasing card purchases to ensure the monthly office limit is not exceeded.
- Ensures that a monthly SOA is received from every CH within 5 working days of receipt, reviews the documentation received, reconciles the individual reports with the report summary, signs where appropriate, and forwards the summary to the FMO by the 14th calendar day after the date of receipt of the SOA.
- Assists the CH in resolving disputes and, if required, elevating the disputes to the SCO and or APC.
- Recommends to the SCO that a CH purchasing card be canceled, if deemed appropriate.
- Conducts timely audits of purchasing files for proper recordkeeping.
- Receives a report summary (within 5 days of the end of the monthly billing cycle) at the same time the CHs receive their individual statements; compares expenditures.
- Ensures an SOA is received from all CHs within 5 working days of their receipt of the AO monthly summary report; matches the number of SOAs received against the list of CHs on the consolidated report.
- Receives the SOA(s) from every active CH listed on the summary; if not informed that the SOA will be late, follows up to ensure timely submission to the FMO.
- Ensures when an SOA cannot be signed on a timely basis by the CH due to extended leave, illness, travel, or transfer/resignation/retirement or other extenuating circumstances and that the SOA is reviewed with the supporting documents. The AO then certifies and forwards the SOA to the FMO with an explanation of why the CH could not sign.
- Examines the maintenance of the purchasing cards for frequent problems with the CH, such as timeliness of receipt of the SOA, maintenance of the receipts associated with the SOA, lack of internal controls, and inappropriate purchases or lack of documentation to support purchases, and notifies the CH's supervisor. If the problem persists, the AO may request the SCO to cancel the individual's GCPC account.
- Verifies Common Accounting Numbers (CAN) and Object Class Code (OCC).
- Verifies that the items purchased were for official use and received by the Government.
- Ensures each purchase complies with CH restrictions.
- Reviews any item placed in dispute by the CH identified in red ink and provides an explanation on the reverse side of the SOA; and ensures that the Complete Statement of Questioned Item form is attached to the SOA.
- Follows up on any purchase on an SOA that is questioned and secures an explanation on the nature of the purchase.
- If the CH cannot substantiate that the purchase was necessary and for official use, he/she must return the item and provide a credit voucher for the full amount of the purchase.
- Any incidence of improper use of the purchasing card must be reported to the SCO, or for IHS HQ to the APC.
- Coordinates any noted discrepancies with the FMO and works with the CH to resolve them in a timely manner.
- Returns copies of the signed SOA to the CHs and retains file copies.
- Responsible for meeting the FMO’s due date even in the absence of the CH. It is imperative that the due date be met to ensure the IHS complies with the Prompt Payment Act for timely payments.
- After signing the SOA, the AO will return a signed copy to each of the CH(s).
- Cardholders. The CHs are Federal employees of the IHS who are properly trained and authorized to use purchasing cards. Although accounts are issued in an individual’s name, the charges incurred are the liability of the Agency and can be transferred to the CH as a personal liability for misuse, fraud, or other abuse. The CH is expected to do the following:
- Use the purchasing card only in accordance with IHS policies.
- Remind the merchant of the tax-exempt status of the purchasing card.
- Be responsible for the primary fund control and recording of an obligation prior to making any purchases with the purchasing card or convenience checks.
- Maintain an accurate up-to-date purchasing card log or an office commitment register, or use the Acquisition Resources Management System (ARMS) and include all relative fees when making purchases.
- Keep all receipts and maintain purchase files for reconciliation.
- Receive an SOA within 5 working days after the end of the monthly billing cycle. The SOA documents and records all purchases made by card and convenience checks, credits, and other transactions that have been made during the monthly billing cycle by the CH.
- Review the SOA for accuracy, complete it in accordance with this chapter’s procedures, and sign the SOA certifying its accuracy.
- Annotate certain information on the SOA to match all transactional information with the invoice receipts the CH has on file, and forward the signed/certified statement to the AO within 5 working days. Information to be entered on the statement includes the OCC, a brief description for each item purchased, and the CAN. The FMO will provide information on the finance codes and assist when necessary.
- Check each transaction on the statement to verify the accuracy of the data. If an item has been returned and a credit voucher received, the CH must check if the credit has been reflected on the statement. If credit(s) are not on the SOA, a copy of the transaction should be retained until the next SOA. If the credit(s) do not appear on the next SOA, the CH will annotate the SOA to that effect and attach a copy of the credit slip before forwarding the SOA to the AO. The CH is responsible for verifying and initiating followup actions.
- Submit a timely and reconciled SOA to permit recording of purchasing card and convenience checks transactions in the IHS Financial Accounting System.
- Notify the AO if unavailable to verify and sign the SOA within the 5-day time frame after receipt to ensure that the AO can obtain the SOA for action. Note: In the absence of the CH, the AO will review the SOA and supporting documents, sign, date, and note the CH’s absence [on the reverse side] and forward the SOA to the FMO.
- Maintain all purchase file documentation on purchases.
- Be responsible for first resolution of a dispute and if unresolved, continue to the next levels of the IHS GCPC program.
- Financial Management Officer. Each FMO will receive a consolidated report of all SOA balances for all CHs reporting to his/her office. This report is considered the official invoice. Payment is made to the GSA contractor in accordance with the Fast Payment Procedure (FAR 13.401) for the amount due on the official invoice. The FMO is responsible for the following:
- Making payments in a variety of forms, as determined by the Finance Office. Regardless of the payment method used, the 12-digit invoice number must accompany the payment to ensure the payment is applied to the appropriate office account. If the payment is made for less than the total invoice amount, the payment and supporting documentation must be provided to the GSA contractor and SCO. If the payment is made by electronic means, the supporting documentation can be included in the electronic payment message. If the payment is made via U.S. Treasury check, the supporting documentation must be sent to the GSA contractor and SCO. This coordination is necessary since Levels 1 to 4 administrators may be contacted separately via notices of late payments and the consequences of slow or no payment on GCPC invoices, including the suspension of services.
- Making payments to the GSA contractor in a timely manner, even if all CH statements are not received. As provided in the “Prompt Payment,” FAR Clause 52.232-25, this does not refer to payments to a contractor prior to the 30th day after receipt of the invoice. The GSA contract terms prevail regarding the receipt of the invoice and payment to be made.
- Ensuring compliance with all provisions of the Prompt Payment Act and OMB Circular A-125 that apply regarding interest penalties for late payments.
- Receiving from each AO a default CAN and a default OCC to be charged in the event an SOA and supporting documentation are not received within 14 calendar days of the date of the statements, or if the SOA and supporting documentation received do not indicate a CAN and OCC. Once an item is charged to the default CAN and OCC, the FMO is not to change the charge. The AO is fully responsible for transfening the charge to the appropriate CAN and OCC.
- Issuing the Internal Revenue Service (IRS) form 1099, pursuant to 26 U.S.C. §6041 and §6041A and as implemented in 26 Code of Federal Regulations (CFR) in part. Government agencies as payors are required to report on the IRS form 1099 all payments over $600 made to contractors within a calendar year. The 26 United States Code (U.S.C.) §6109 requires each contractor to provide its Taxpayer Identification Number for use on form 1099; the IHS Area FMO, or for IHS HQ, the payment office in the Program Support Center, is responsible for submitting the form 1099 to the IRS. All CHs and AOs are responsible for submitting the IRS form 1099 to the FMO.
5-23.5 PRIORITY SOURCES OF SUPPLY USING THE GCPC
- Federal Acquisition Streamlining Act. The Federal Acquisition Streamlining Act of 1994, established the priorities for using the Government supply sources as stated in Part 8 of the FAR. Micro-purchases are not exempt from this requirement.
- General Use. Generally, the GCPC can be used under the simplified acquisition procedures to acquire any type of supplies or services the CH can purchase via the simplified acquisition process. The GCPC can be used for orders placed against established contracts or with established sources of supply when authorized by the contract or regulation requiring the use of that source.
- Government Supply Sources. There is a statutory requirement under FAR Part 8 to acquire supplies and services from or through Government supply sources when available. These sources include, in the following order:
- Supplies or Equipment.
- Indian Health Service inventories
- Excess from other agencies
- Federal Prison Industries, Inc.
- The blind and other severely disabled
- Wholesale FSS
- Mandatory FSS
- Indian-owned businesses
- Services.
- The blind and other severely disabled
- Mandatory FSS
- Optional FSS
- Federal Prison Industries, Inc.
- Indian-owned businesses
- Commercial sources
- Open-Market/Commercial Sources. Prior to using an open market or commercial source, the CH must first determine whether the supplies or services needed are available from an established mandatory source of supply and if the use of that source is required in a given circumstance. The consideration of availability, delivery, back ordering, substitutions, or cost may affect the Government’s needs, patient care, etc. and are real factors in purchasing from these sources. If the CH learns that the requirement cannot be met because of any of the above considerations, the CH is free to make that purchase in the open market. The acquisition may be purchased from an eligible Native American enterprise under the Buy Indian set-aside. This authority does not remove the requirements of securing fair and reasonable prices.
- Buy Indian Act. The IHS has statutory authority for setting aside acquisitions under the Buy Indian Act (25 U.S.C. 47) to those Native American enterprises determined to be eligible for the set-asides. This discretion is defined by Federal law and IHS policy.
- Micro-purchases. Micro-purchases ($2,500 or less) may be made without securing competitive quotes if the price is considered reasonable. Although the CH is not required to buy from small business concerns, he/she is encouraged to continue to support local rural communities and small businesses, including American Indian/Alaska Native enterprises, by rotating purchases among the vendors who offer reasonable prices. Using the same vendor continuously subjects the Agency to the appearance of favoritism, unfair advantage, or conflict-of-interest.
5-23.6 PURCHASING PROCEDURES
- Obligation and Expenditures. After the prerequisite IHS training and receipt of the purchasing card, the CH may begin the obligation and expenditure of funds to meet the needs of his/her office. The CH should display the IHS GCPC or IMPAC training certificate as a means of notifying the public of their DOA to use the card. There are three authorized uses of the GCPC for the IHS:
- Physical Presentation. The plastic account is the physical presentation of the plastic card that displays the 16-digit account number and expiration date for each IHS account holder for obligation, procurement, and payment.
- Cardless. The cardless transaction occurs when the account number is used in telephone, fax, or mail orders.
- Convenience Checks. The IHS authorizes the use of an associate service called check accounts, but more commonly referred to as “convenience checks.” Convenience checks are a supplement to the purchasing card program and are used to pay for official supplies and services obtained from merchants who are unequipped to accept the purchasing card.
- Telephone Orders. Oral procedures may be used to acquire supplies or services as long as the requirements are described in sufficient detail so that both parties to the agreement have a clear understanding of what is being acquired. Telephone orders must be for standard commercial items or the type of item that can be adequately described over the phone. A telephone order can only be made when either the supplier or the Government requires a purchase order or a services contract. The Government requires a purchase order when the supplies or services needed are complex enough to warrant a detailed description or the thresholds are exceeded. There should be no question or ambiguity by either party as to what is required. When placing telephone orders, the CH will perform the following functions:
- Confirm that the vendor will accept the purchasing card.
- Confirm the pricing per unit and in total, and the shipping charges (if applicable).
- Confirm whether delivery can be made when and where needed.
- Confirm that the vendor agrees to charge the purchasing card at the time shipment is made so that receipt of supplies or services may be certified on the monthly SOA.
- Confirm that all items purchased by telephone will be delivered before the end of the billing cycle. If the vendor cannot guarantee delivery and billing within the billing cycle, the CH should not place the order. The purpose of this rule is to ensure that all items that appear on the monthly SOA have been received so that they can be certified for payment.
- The GSA contract requirements mandate that merchants delay the processing of a transaction until the purchased merchandise has been shipped.
- Back orders cannot be charged to the purchasing card and transacted on the SOA.
- Inform the vendor that: “... the purchase is for, “OFFICIAL U.S. GOVERNMENT USE; therefore, the purchase is not subject to State or local taxes.” When a vendor will not grant a tax exemption without a certificate, the GSA contractor can be contacted by using the “800” number on the back of the purchasing card. The GSA contractor will verify the tax-exempt status of the card and inform the merchant that a State tax exemption certificate is on file. If the vendor still insists on charging taxes, the CH cannot make the purchase and must seek another source.
- Instruct the vendor to include the following information on the shipping document or packing slip:
- The CH name and office/correspondence symbol (if used)
- The appropriate delivery address
- The CH's telephone number
- The term "Purchasing Card"
- Instruct the vendor to have invoices include the entire above, plus:
- Unit of issue
- Price per unit
- Description of item(s)
- Extended price and total price
- Possibly request another staff member to pick up the supplies at the merchant’s facility. If someone other than the CH picks up the order and is required to sign the purchasing card receipt, it should be signed “Received by ...” Verification of the pickup is made by the CH when the monthly SOA is certified and confirmed by the receipt in the purchase file. This serves as a good internal control for the ordering, receipt, and payment of goods.
Note: An exception to the telephone procedure is when the CH has an extensive list of requirements, acquisitions with written specifications, or acquisitions requiring lengthy or detailed descriptions, such as a service contract. These are difficult to purchase over the phone and should not be done. Use of the alternate simplified acquisition procedures is more appropriate for these purchases. Telephone orders lead to oral contracts that are subject to ratification. All IHS contracts should be in writing and executed by IHS COs who possess authority to enter into such contracts.
- If the merchant is not registered with the GSA contractor as the financial institution, the purchasing card cannot be used for the purchase.
- If a registered merchant accepts the purchasing card but attempts to impose a premium or additional charge on the purchase, the merchant must be reminded that premiums are prohibited by the GSA contract.
- The ordering office using the purchasing card is responsible for receiving the supplies and services ordered. If the shipping destination is different from the ordering office location, an official at the destination must confirm receipt and notify the ordering office.
- There are three purchase limits set forth for use of the purchasing card as outlined in 5-23.6C. Although these limits are established, the CH must certify the funds’ availability prior to making any purchase. The CH must also log the purchase on the office commitment register or use ARMS indicating that the purchase was made by a purchasing card or convenience checks.
- All purchases that exceed the micro-purchase limit ($2,500) must be purchased using the alternate simplified acquisition procedures.
- An “800” telephone number is listed on the back of each IHS purchasing card. This number should be used for questions concerning the procedures used by the GSA contractor on approval of purchase and for immediate assistance if a merchant has questions concerning acceptance of the purchasing card. This number is also used to confirm the tax-exempt status of the card. All other questions relative to the use of the IHS purchasing card or to Agency policy shall be referred to the SCO or APC.
- Spending Limits. The spending limits of purchasing card or convenience check accounts shall not exceed the legal limitations of the individual warrant amounts and legal stipulations or those set forth for non-1102 personnel. In short, the spending limits will be commensurate with the IHS warrant and shall not exceed the imposed individual legal authorities for any reason or purpose. This type of unauthorized commitment may not be ratified, and IHS employees may be personally liable for the cost of expenditures. Such improper use of authority is subject to review and the reduction of dollar authority or suspension of warrants by the HCA. The following are definitions of the GCPC spending limits:
- Single Purchase Limit. The purchase limit of a single requirement of transaction.
- Office Purchase Limit. The purchase limit imposed on cumulative purchases in a given month. The monthly purchase limit for each CH is established by the management of that level, unit, or delegated procurement authority at the time the CH account is set up.
- Monthly Purchase Limit. The total of all individual monthly purchase limits for the CH under the purview of an AO. This limit should be consistent with and not exceed the monthly office limit.
- Changing Account Limits (One-time Basis). Occasionally, a unique situation or emergency may require a purchase over the CH’s established limits. On receiving a request to change the account, the AO should contact the SCO. If the SCO determines that the request is valid and a bonafide need exists, the SCO will make the one-time change to the spending limit. Changes for longer periods of time must be submitted on a CH Account Update form to the SCO. The SCO is responsible for the timely reinstatement of the normal spending limit. This procedure shall not be used to circumvent non-contracting personnel limits for any reason. If established time or use limits have been exceeded and the SCO has not formally requested or processed the reinstatement, the APC and HCA may automatically reduce the limits without notice.
- Guidance on Specific Purchases. The IHS purchasing card program is for the purchase of materials, supplies, goods and services as authorized in this procedure. The use of the purchasing card should be limited to merchants who accept the card and merchants who are unable and unequipped to accept purchasing cards but will accept convenience checks. In this situation, the Government’s best interest would he served by purchasing via an alternative acquisition method, i.e., convenience checks. Specific purchase guidance:
- Offices currently using simplified acquisition procedures, Blanket Purchase Agreements, purchase orders, imprest funds, Standard Form-44, etc., to acquire services or supplies needed in the day-to-day operation of the organization will purchase those items using purchasing cards or convenience checks. All pre-purchase approvals or clearances, e.g., on capitalized items, non-capitalized items, sensitive items, relocation or moving costs, ADP equipment, training, and office furnishings are required and must be included in the official purchase file or ARMS.
- Non-capitalized items with an acquisition value of less than $25,000 per unit may be paid for with the GCPC. The respective Property Management Officer (PMO) should be contacted for specific approval requirements. The purchase of non-capitalized items, e.g., copying machines, facsimile machines, systems or modular office furniture, and motor vehicles must have prior approval of the PMO. It shall be the responsibility of the purchaser to provide pertinent information to the PMO for applying IHS decals and adding to the property inventory.
- Capitalized items with an acquisition cost of $25,000 or more per unit may be paid for by a purchasing card. In all instances, prior approval must be obtained from the respective PMO before property is ordered and procured. It shall be the responsibility of the purchaser to provide pertinent information to the PMO for applying IHS decals and adding to the property inventory. There are no exceptions or waivers to this procedure, and a purchase without pre-approval is subject to ratification procedures.
- Any equipment that is highly desirable and easily convertible for personal use is considered to be a sensitive item. Sensitive items include but are not limited to weapons, pneumatic tools, calculators, cameras, VCRs, DVDs, pocket dictating or electronic organizers, pagers, cell phones, laptop personal computers, computer software, two-way radios, etc. Regardless of the cost, the purchaser will obtain prior approval from the PMO before ordering and procuring any item or equipment classified as sensitive and ensure that it is inventoried. The office purchaser and CH are responsible for the monitoring and financial recordkeeping of such items.
- Any training course with a cost must be approved in writing by the authorizing training official prior to the start of the course. The employee requesting the training will make payment with a purchasing card unless it is cost-beneficial to the Government to pay a group price for onsite training or group discounts. Training approved and paid for after the fact will be considered an unauthorized commitment and will be processed as a ratification.
- When registering a trainee for any training course(s), an HHS form 350 (ARMS IHS 844) must be generated and routed through the approval process and must include a statement that the training is to be paid by purchasing card. This prevents a double obligation of funds. When the CH submits the SOA to the AO, the training form number and the name of the trainee must be noted next to the amount charged. These training instructions do not apply to IHS scholarship recipients who are paying for courses, books, and materials or to nursing students under Section 118 authorized by the Indian Health Care Improvement Act, Public Law 94-437, as amended.
- Subscriptions may be ordered and payment authorized even though the subscription is not received prior to billing. Multiple-year subscriptions (up to 3 years) may be ordered if there is a cost savings to the Government when compared to multiple 1-year subscriptions. Such subscriptions must be well documented in the CH’s files since disputes may arise from new annual charges and billings.
- The purchasing card or convenience check can, whenever needed, be used to pay for all charges against contract health service’s funds except those processed by the IHS Fiscal Intermediary Contractor. Medical supplies or services that require third-party reimbursement shall not be acquired with a purchasing card or convenience check.
- Purchases for medical supplies and materials from the open market or orders against existing contracts not subject to third-party reimbursements can be made using the purchasing card.
- Procurement of hotel or non-Government facility contracts are considered special-use situations. If the IHS meeting, conference, or training must be held in a non-Government facility, the purchasing card may be used for the purchase of services. The acquisition must be a straightforward requirement, such as a single room for a few days, without detailed arrangements. However, if the booking requires a room block, monetary default or penalty fees for cancellations or no shows, light refreshments, need of the space for several days, and/or negotiations, the facilities requirement must he forwarded to a warranted CO. The CO will conduct the formal negotiations and sign the contract.
- Unauthorized Use of the GCPC. Purchase limits and Merchant Activity Codes are established for each CH account and set the limitations or authority for each card. A CH cannot use the purchasing card or convenience checks to purchase supplies or services that exceed his/her authority or are from an unauthorized merchant. All codes and limits are encoded in the magnetic strip on the back of the card. Each time a CH makes a purchase with the purchasing card, the authorization system will review all of the information on the card before determining approval.
- Authorized Single Purchase Limit. The total of a single-purchase may be comprised of multiple items but cannot exceed the authorized single-purchase limit assigned to the CH. Purchases may not be split in order to stay under the authorized single-purchase limit. All purchases that exceed the limit must be purchased using alternate simplified acquisition procedures.
- Service Contracts. An IHS employee who does not possess legal authority to enter into a service contract may not purchase such a Government requirement using a purchasing card or convenience check. Merely presenting a purchasing card as a means of paying for said services does not confirm that the CH has the legal authority to enter into a formal contract. Service contracts for specific purchase descriptions or a scope of work with specific requirements and deliverables of a nature to be negotiated must be forwarded to the respective, warranted CO. Non-acquisition CHs do not possess the legal authority to enter into contracts using the purchasing card. Since this type of contract is subject to protests, disputes, and claims or other legal matters, only warranted IHS COs possess authority to award such contracts.
- Federal/Departmental/IHS Requirements. The CHs must follow all Federal, departmental, and IHS requirements including those specified herein.
- The purchasing card and convenience checks may not be used to provide or pay for personal use items, travel expenses, cash advances, subsistence items for Federal employees or any other persons, greeting cards or business cards, the rental or lease of land or buildings, major telecommunication services, Federal salaries, wages, or reimbursement purposes.
- The CH must not purchase any supplies, goods, or services contrary to 31 U.S.C. §1301 or violating any requirements of the FAR, HHSAR, IHS appropriations.
- Federal funds may be used only for the purposes for which they were appropriated. Unauthorized use, fraud, or abuse involving the purchasing card or convenience checks by an individual subjects that person to termination of his/her account, disciplinary action, OIG investigation, and possible criminal prosecution.
- Fund Control. At the beginning of each fiscal year, Federal funding is generally uncertain. Therefore, when the IHS must operate under a Continuing Resolution, it is essential that the CH check with the appropriate FMO and SCO to ensure funds are available before making card purchases. When a Federal appropriation lapses, no new obligations shall be incurred. There are few exceptions to this rule.
- Timely instructions. The Division of Resource Management or DAGM is responsible for issuing timely instructions on spending limits; usually, only critical purchases are approved for purchase. Unauthorized actions during this period will not be ratified when normal operations resume.
- Primary fund control. The primary fund control method for the CH is to record an obligation prior to making any purchase. This requires daily maintenance of the office commitment register when using a purchasing card or convenience check. When payment of the bill is made, the expense is to be charged to the CAN entered on the appropriate monthly obligation.
- Local written decisions. The SCO may make local written decisions when an ARMS requisition is required for Area procurements. Local guidance may vary and will be based on the SCO’s oversight and program reviews.
- Convenience Checks. The convenience checks program supports and enhances the use of the GCPC program. Convenience checks shall be used for official Government business and only when the vendor is unable and or unequipped to accept the purchasing card. Use of a convenience check is authorized only when use of the EFT is unavailable for payment and other authorized payment mechanisms, such as the purchasing card or Treasury checks, are not possible. The use of a convenience check is considered the last alternative for payment.
- The GCPC check accounts do not accrue interest. Convenience checks will be authorized only for purchase CHs and are considered a supplement to the program. A check account will not be approved independent of an existing purchasing card account. Under the IHS Check Account program, the check writing authority is delegated only to IHS COs and approved CHs.
- The SCO and the APC are the only people authorized to submit convenience check account setup forms and make account changes.
- Convenience checks should be used only when supplies or services cannot be readily obtained through the purchasing card.
- Convenience checks may be used for speakers at cultural events, seminars or conferences; transportation of IHS patients for medical treatment; and rural vendors or contractors not belonging to the purchasing card program.
- Convenience checks shall not be used for Federal salaries and wages or travel expenses for any reason.
- Convenience checks shall not be used for reimbursements other than for valid procurements.
- The convenience checks are personalized with the individual’s name, office address, and the Great Seal of the United States. As with the purchasing card, no other staff member, family, friends, supervisor, or anyone else may use the individual’s convenience checks. The CHs are responsible for all convenience checks written on their account.
- It is important to note that all information, rules, and regulations set forth for the general use of the purchasing cards are applicable to the convenience checks, unless otherwise specified. Identical terms and definitions apply to both the purchasing card and convenience check account writing programs.
- Use of Convenience Checks. As with the purchasing card, the use of a convenience check does not relieve an IHS employee from adhering to any Federal, departmental and IHS acquisition regulations, policies, and procedures that may apply.
- The single purchase limit shall be a maximum of $100,000 for warranted check writers.
- When using a convenience check, the following information shall be entered in ink or typed:
- Date. Enter the date on which the convenience check is prepared, e.g., January 20, 1999. Do not predate or postdate a convenience check.
- Pay To the Order Of. Enter the name of the payee in this space. Under no circumstances may convenience checks be issued to “Cash.” Individuals will not issue convenience checks payable to themselves or to other IHS employees.
- Amount. Write the dollar amount of the convenience check, e.g., $126.39 and One hundred twenty-six and 39/100, followed by a horizontal line out to the end of the space provided.
- Authorized Signature. The signature must match the name printed on the convenience check exactly, e.g., first, middle, and last name.
- Additional Information. The CH must enter the OCC with a brief description and CAN on the “For” line of the convenience check.
- Other applicable information. Any other applicable information should be entered in the convenience check register.
- Specific purchase information for each convenience check shall be recorded in the check register.
- The mathematical calculations for convenience checks must be checked for correctness, as convenience checks can only be written for the exact amount of the purchase.
- Convenience check sets will include an original and a carbon copy of each convenience check. Duplicate carbons must be treated and retained as official Government records.
- If an error is made and a convenience check must be voided, the CH shall write in ink or stamp “Void - Not Negotiable” on the check and the carbon copy in the space provided for the authorized signature. Both the voided convenience check and the carbon copy must be retained and maintained in the CH’s files. These records are subject to oversight reviews.
- Exceeding Single Purchase. The single purchase limit restricts the amount of spending for each transaction. The SCO will inform the CH of his/her delegation. Issuing a convenience check that exceeds the approved purchase level will subject the CH to ratification procedures by the SCO. Repeated infractions will warrant termination of both the purchasing card and convenience check privileges. Oversight by IHS HQ will include a review of timely and appropriate ratifications of such occurrences.
- Convenience Check Fees. Fees are 1.25 percent of the face value of the convenience check for the use of convenience checks. Requisitions for purchases must include this fee; purchases will not he made or paid for until the fee is included. The 1.25 percent fee is an added cost to the requestor and may not be transferred to the finance or contracting office. When a copy of a convenience check is requested, the GSA contractor charges a handling fee of $2 per convenience check.
- Stop Payment. If a stop payment is necessary, the GSA contractor is to be notified immediately. There is a $20 charge per convenience check for this service.
- Overdraft. Exceeding any of the aforementioned check limits will result in a convenience check(s) being returned or force-posted by the bank. There is a $15 fee charged by the bank for each occurrence.
- Check Authority and Responsibilities. It is imperative that single purchase and monthly limits not be exceeded. Convenience checks are not subject to electronic approval at the point of purchase; therefore, it is possible for a vendor to accept a convenience check that exceeds one of the authorized limits of the CH as the check writer. This will result in a “bounced convenience check” or overdraft when presented to the GSA contractor for payment.
- Check writers are responsible for tracking their individual available balance and recording the cleared convenience checks. Check writers should work with their program managers to ensure their monthly limit is large enough to avoid “bounced” checks. The amount of the convenience check is deducted from the monthly limit when the check clears the bank, not when it is written. Therefore, it is important to allow enough time for each convenience check to clear, since the checks may overlap billing cycles. The CH is responsible for ensuring that when all convenience checks have cleared, the monthly limit will not have been exceeded.
- It is important to note that this is a different management system from a personal checking account in that the unused balances do not accumulate. Each convenience check writer should closely monitor their 30-day limit and quickly notify their AO or SCO of any limits that may need to be reviewed. The GSA contractor will provide a customer service line enabling the CH to monitor available balances and cleared convenience checks.
- The SCO and AO are responsible for this particular cognizance and oversight. The GSA contractor will notify the APC of the individual check account overdrafts. The APC may give oral approvals on the overdrafts. The APC records these occurrences by CH for each Area Office. Repeated occurrences will require review and possible termination of the convenience-check use for that specific CH and possibly for the Area Office.
- Convenience Check Register. Each convenience check written shall be entered in the check register. The convenience check number, date issued, payee, a brief description of the purchase, the fee, and the check amount must be entered.
- Reconciliation of Convenience Checking Account. The SOA must be reconciled with the convenience check register to ensure that the amounts are the same. If a billing error is identified, such as a dollar amount on the convenience check differing from the amount on the SOA, the GSA contractor is to be contacted immediately to confirm the amount or contact the vendor and resolve the discrepancy.
- Safeguarding and Accounting for Blank Convenience Checks. For security purposes, the following items are pre-printed on the face of all convenience checks:
- Name of the authorized convenience check writer.
- “For Official Use Only”
- “U.S. Government Tax Exempt”
- Name of the Agency/Organization
- “Not Valid for Cash,” “Non-negotiable,” or “Invalid 60 Days After Issue.”
- The single purchase limit for the authorized convenience check writer.
- If the check writer’s limits are changed, replacement checks must be ordered.
- If the purchasing card or check account is terminated for any reason, all convenience checks for that account must be destroyed and the action annotated in the convenience check register. The bank will not honor any checks from a terminated (closed) account.
- Security of the GCPC and Convenience Checks. The individual CH is responsible for the security of the purchasing card and the convenience checks. The CH should do the following:
- Take precautions to prevent others from having access to his/her purchasing card or convenience checks.
- Not give out the account number to anyone, since this could lead to misuse and personal liability.
- Keep the convenience checks secured at all times.
- Safeguard unused convenience checks. This is mandatory and essential.
- Perform an inventory of the blank convenience checks on a regular basis.
- Maintain the blank convenience checks in a fire resistant safe or cabinet, preferably with a lock and dual control system.
- Procedures After Purchase and Reconciliation.
- Statement of Accounts-Questioned Items and Disputes. Whenever an incorrect charge is listed on an SOA, it must be lined through in red ink with an explanation provided on the reverse side of the form.
- The CH must immediately seek to resolve the problem with the GSA contractor by completing a “CH Statement of Questioned Item” form indicating the nature of the problem (i.e., credit not stated, wrong amount charged, shipping and handling charges, etc.) and mail the original to the proper address. The “CH Statement of Questioned Item” form includes several possible reasons why the merchant charge is being questioned. The form should he completed in accordance with the detailed instructions contained on it. Copies of the forms are available from the SCO or APC.
- A copy of the “CH Statement of Questioned Item” form must be attached to the SOA.
- The CHs have 60 days from the time a disputed item is noticed on their SOA to file a dispute. The GSA contractor’s ability to reverse a debit to the merchant is diminished after 60 days. Note: This reiterates the need for timely reconciliation of the SOAs.
- The CH is to forward the SOA with a copy of the “CH Statement of Questioned Item” form. The FMO will then deduct the disputed amount from the CH’s SOA and add the required information to the contractor’s “Notification of Invoice Adjustment” form. This form will then be sent to the contractor as supporting documentation for the amount paid by the FMO.
- The CH should contact the GSA contractor only to report a lost or stolen card or to verify tax-exempt status. All other questions should be directed to the SCO. If the SCO is unable to answer the questions, he/she may contact the APC.
- If items purchased with the purchasing card/convenience checks are found to be defective or if services purchased are found to be unsatisfactory, the CH has the responsibility to obtain replacement or correction of the items. If the merchant refuses to replace or correct the faulty item, the purchase will be considered “in dispute.” Items in dispute are to be handled in the same manner as billing errors. The dispute or error should be reported on the CH’s monthly SOA and “CH Statement of Questioned Item” form should he prepared. The GSA contractor will credit the transaction until the dispute is resolved.
- Any dispute that cannot be resolved by the CH or AO should be elevated to the SCO in his/her Area Office and/or the APC at IHS HQ. The SCO and/or APC should be provided with all documentation related to the purchase.
- The following charges cannot be disputed because of external regulations or by terms and conditions of the GSA SmartPay contract:
- Foreign exchange rates
- Taxes
- Convenience checks
- Shipping and handling charges
- Cardholders must verify that no sales tax has been included or added later to the order. If a sales tax has been included, the CH must immediately resolve the error. The GSA contractor, same as the financial institution, cannot reverse sales tax charges after the fact.
- Fiscal Data. It is the responsibility of each CH to keep copies of each charge or credit slip, reconcile each monthly statement, and forward the information to the AO. Each CH must do the following:
- Write the CAN and OCC on the "SOA" as appropriate:
- to reduce the possibility that all items on the SOA may be charged to the same CAN and OCC, and
- to identify multiple CANs and OCCs.
- The CH must make a CAN and OCC summary on the SOA, and the AO must verify this information.
- If a credit has been obtained but only the charge shows up on the current SOA, the CH must note on the SOA the date the credit was obtained.
- The FMO will establish a “pending file,” track the pending credit, and take action to ensure it is received. This action does not relieve the CH of the primary responsibility of ensuring that the credit is obtained.
- Record-keeping and Retention. The GCPC records include the SOA, convenience check registers, all receipts, and supporting documentation for purchase descriptions, justifications, quotes, etc. These documents are considered official Government records and shall be retained by the CH.
- Each CH must set up a monthly purchase file containing all proof-of-purchase documents associated with purchasing card and convenience check transactions.
- When a purchase is made over the counter, the CH must obtain a customer copy of the sales slip.
- Any shipping documents or cash register receipts associated with the order shall be maintained in the purchase file.
- All carbons are to be destroyed when purchases are made over the counter. All documentation should match the purchases on the SOA.
- Purchase Files. All convenience check records, especially those for which the CH has paid for services rendered, are to be retained by the IHS FMO for a period of 6 years and 3 months in accordance with AO files. The purchase files are subject to periodic and required reviews by the AO, SCOs, and/or the APC. These records must include the following:
- Vendor name and address
- Vendor Employer Identification Number (EIN), Social Security Number, etc., when required for IRS 1099 reporting
- Amount and date of purchase
- Check number
- Description of purchase applicable only to services rendered (materials, goods or supplies)
- Receipts
- Explanation of why a convenience check was used in lieu of the EFT or a purchasing card
- Carbon or copy of the issued check (if possible)
- Lost or Stolen Cards. Should a purchasing card be lost or stolen, the CH must notify the GSA contractor immediately by telephone.
- Information on how to report a lost or stolen card is cited on the back of the purchasing card. The numbers are subject to change depending on the award of the GSA contract and selection of the financial institution by the HHS.
- The IHS will not be liable for any unauthorized use of the purchasing card.
- The CH may be held negligent and administratively accountable to the IHS if the loss is not reported immediately.
- After the initial verbal notice, the CH must send the GSA contractor a written confirmation notice.
Note: Immediate notification minimizes the potential liability for both the IHS and the GSA contractor.
- The AO must make a written report to the APC (forwarded through the SCO) within 5 working days. The report will include the following:
- The account (card) number
- The complete name as it appears on the account
- The date and location of the loss
- If stolen, the date it was reported to the local police
- The date and time the GSA contractor was notified
- Any purchase(s) made on the day the card was lost/stolen
- Any other pertinent information
- A new account will be opened and a purchasing card will usually be mailed within 2 to 5 business days of the reported loss or theft.
- If the CH finds the card after it has been reported lost or stolen, the CH will cut it in half and forwarded it to the SCO.
- Lost or Stolen Convenience Checks.
- The CH must notify the GSA contractor immediately to report lost or stolen convenience checks.
- The CH is also to notify the AO and SCO or APC as soon as possible after notifying the GSA contractor.
- If there are only one or two stolen or missing convenience checks, a stop payment action is the most appropriate action.
- If more than two convenience checks are lost or stolen, the account shall be terminated (closed), and a new account will be opened.
- The SCO will make the determination to open a new account.
- The replacement time is approximately 2 weeks.
- There is no fee for reporting lost or stolen convenience checks or for requesting a replacement account.
5-23.7 TERMINATION AND APPLICATION PROCEDURES
- Administrative Changes in Cardholder Status. When a CH transfers or is reassigned within the IHS, retires, or resigns, the CH must destroy the card by cutting it in half and submitting the destroyed card to the AO. The AO will do the following:
- Complete a “Card Destruct Notice” and forward both the destroyed card and the notice to the SCO. The SCO or his/her designee will enter the data into the GSA contractor records system.
- Notify all purchasing card holders intending to retire, resign, or transfer to cease making any purchases on the card 45 days prior to the effective date of their action.
- If a monthly SOA is received after the employee has left his position, the AO will sign the SOA and attach an explanation regarding the lack of the CH’s signature before forwarding it to the FMO.
- Terminate the purchasing card at the departing duty station upon reassignment or transfer of an IHS CH from one duty station to another, e.g., from one Area Office to another.
- Ensure that prior to an application for a new purchasing card, the Area Office SCO requests written clearance that the CH is in good standing from the CH’s previous Area Office SCO.
- Confirmation is necessary that all SOAs have been received and that no disputes, irregularities, or misuse by the CH exists at the previous Area Office.
- If any abuse or misuse of the purchasing card or convenience checks is found in the SOAs or after final payment, a card will not be issued to the individual at the new duty station.
Note: No card will be issued for 1 year or until the matter is completely resolved to meet the Government’s interest.
- When an AO transfers, retires or resigns, the next highest official for that office shall sign the monthly SOAs until a new AO is trained and confirmed by the SCO and the GSA contractor has been notified.
- Ratifications. All IHS offices shall ensure that our contractual commitments are executed in a manner conducive to sound acquisition practices and within applicable Federal regulatory guidelines. Ratification procedures will be applied to unauthorized or improper procurements involving the use of the purchasing card or convenience checks.
- When applicable, the appropriate HHS 393, Purchase/Service/Stock Requisition, or an ARMS requisition, containing the proper approvals, clearances, statements of work, purchase descriptions, etc., must be submitted to the CO before purchases are made.
- If the CH exceeds his/her authority, the transaction is considered to be unauthorized and is subject to ratification procedures.
- To ratify the unauthorized commitment, the CH must submit a ratification request to the SCO.
- A ratification can only be approved by a SCO with the appropriate delegated authority to approve the transaction and allow payment to be made.
- The purchase may not always be ratified. Non-ratification results either in nonpayment of the vendor by the Government, return of the merchandise, or both.
- If Federal funds were improperly used or no funds were available, the purchase cannot be ratified and the CH will be required to repay the cost to the Government.
- Sanctions for exceeding any authority include rescinding delegated authority, termination of the purchasing card, and/or other disciplinary actions.
- Unauthorized Use and Termination of Account. The GCPC cards and convenience checks are for official use only. No purchases for personal use or benefit are allowed. Upon discovery, such purchase will be the basis for immediate cancellation of the account. Administrative personnel disciplinary action and demotion and/or removal are actions to be considered by the supervisor and/or IHS management. Such decision will be based on the IHS Personnel Management Manual and in accordance with 18 U.S.C., Section 287, based on the misuse, infraction, intent, and dollar value.
- Unauthorized Use. Unauthorized use of the purchasing card and/or convenience checks must be immediately reported to the respective AO and SCO or HCA.
- The first point of review after discovery is the responsibility of the AO.
- The AO will make a finding and notify the respective SCO.
- The SCO must immediately notify the immediate supervisor of the misuse or fraud to begin formal personnel management procedures.
- Such action will require advice of the respective Personnel Management Officer.
- The SCO will take all actions necessary to collect the debt including, if necessary, recommending salary offset to the supervisor and the Area Personnel Management Officer.
- The SCO has the responsibility to determine whether administrative remedies are sufficient, including the immediate cancellation of the DOA for the card and/or convenience checks.
- If the infraction is a criminal finding, the SCO must notify the APC and/or the HCA.
- Consultation to determine the next course of action is necessary
- After joint determination between the SCO and APC and/or the HCA that circumstances warrant it, formal action will be taken in compliance with Agency procedures to refer the matter to the OIG immediately for criminal investigation.
- Any employee or merchant/vendor may report suspicious activity of a CH to the IHS or OIG without notice to the SCO, APC, immediate supervisor, or the HCA. Use of the purchasing card and/or convenience checks for unauthorized purposes will be considered an attempt to commit fraud against the U.S. Government and will result in disciplinary action.
- If misuse and/or violation of procurement regulations is evident, it is possible that under 18 U.S.C. §287 the penalties for fraudulent use of the card and/or convenience checks could include a fine of not more than $10,000 or imprisonment for not more than 5 years or both, if the CH is prosecuted.
- Upon notice that misuse or personal purchases have been made using the IHS purchasing card or a convenience check, the SCO will ascertain the dollar amount with the AO and FMO immediately. It will become a debt to the Government upon final determination of the dollar value. The SCO will issue a debt determination and a bill of collection. Subject to the above-cited personnel management actions, the employee will be billed for the full cost of the purchase(s) plus interest and any administrative debt-collection fees authorized by the Debt Collection Act. Any property improperly acquired using the purchasing card or convenience checks may be confiscated by the Federal Government.
- In cases of independent cardless or electronic theft, the GSA contractor will immediately upon detection or formal notice take independent actions on the CH account. The Investigation Unit of the GSA contractor will directly notify the CH and terminate the account. The GSA contractor will open a new account for the CH within 24 hours unless probable cause exists not to do so. This decision will be coordinated with the SCO and APC. The CH is responsible for immediately notifying the AO and SCO when contacted by the GSA contractor. The SCO will notify the APC unless the APC was notified when the theft occurred or was detected.
- If the cardless theft remains undetected until the SOA is received by the CH, the CH must immediately notify the vendor and confirm that he/she is not responsible for the transaction. Upon notice to the AO and SCO, the CH and AO must notify the GSA contractor of the electronic theft and request that the purchasing card be terminated. This termination action must be reported to the APC.
- The CH must cooperate with the GSA contractor’s Investigative Unit when this occurs since the GSA contractor has the initial legal jurisdiction for investigation. The local police and or the OIG may be brought in to assist, or the matter can be referred to law enforcement for prosecution. The investigation may also include a review of all purchase file records during or at the time of the theft as well as interviews with the CH and AO.
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