Chapter 23 - Government Purchasing Card Policy
Part 5 - Management Services
|Manual Exhibit 5-23-A||IHS P-Card Request|
|Manual Exhibit 5-23-B||Cardholder and Approving Official Agreement|
- Purpose. The purpose of the Indian Health Service (IHS) Government Purchase Card Policy is to provide a supplemental guide to the Department of Health and Human Services (HHS) Purchase Card Directive, Version 7.0, dated September 2015. The IHS Government Purchase Card Policy provides policy and guidance regarding the use of the Government-wide Commercial Purchase Card and Convenience Checks issued under the purchase card program.
The procedures stated in this supplemental policy must be used in conjunction with the policies and procedures stated in the most recent version of the Department of Health and Human Services (HHS) Purchase Card Program Guide, Version 7.0, dated September 2015.
In accordance with Federal Acquisition Regulations (FAR) 13.301, the purchase card is the primary method of making micro-purchases at IHS.
- Authorities. Many regulations and policies govern the use of the purchase card. These include, but are not limited to, the following:
- Federal Acquisition Regulation (FAR): Federal regulations governing the acquisition of supplies and services by executive agencies.
- Office of Management and Budget (OMB) Circular A-123 Appendix B: This circular prescribes policies and procedures for agencies on how to maintain internal controls that reduce the risk of fraud, waste, and abuse in government charge card programs.
- General Services Administration (GSA) Government Charge Card Program Contract: Master contract awarded by GSA to banks and credit card associations for government-wide commercial purchase, travel, and fleet card services.
- Government Charge Card Abuse Prevention Act 2012 (Public Law 112-194): Law that requires federal agencies to put new controls on government charge cards and enforce more stringent penalties for violations by federal employees.
- (IHS)Acquisition Regulation and the current HHS Purchase Card Program Guide (September 2015, Version 7.0): Department-wide regulations governing the acquisition process and contracting relationships between the HHS contracting offices and contractors, as well as HHS policies and procedures specifically related to the government purchase card program.
- IHS Purchase Card Procedures: Policies and procedures that address the purchase of products and services unique to IHS.
- Policy. IHS government-wide commercial purchase cards may only be used in accordance with the guidance contained in this policy as well as the HHS Purchase Card Program Guide. In the event of a conflict between the IHS Government Purchase Card Policy and the HHS Purchase Card Program Guide, the policies and procedures of the HHS Purchase Card Program Guide shall govern. The government-wide commercial purchase card is the preferred method of making micro-purchases. Micro-purchases are governed by FAR Part 13.
Abuse and/or fraud will result in cancellation of the purchase card assigned to the cardholder. In addition, the cardholder may be subject to disciplinary action, up to and including termination of employment. An employee may be personally liable to the government for the amount of any unauthorized transaction and subject to criminal prosecution.
Only federal employees may be cardholders, approving officials and agency/organization program coordinators (A/OPCs).
The overall programmatic responsibility for the Lead A/OPC resides with the Division of Acquisition Policy (DAP). The Lead A/OPC is responsible for implementing and overseeing the Purchase Card Program at IHS. The Area A/OPC resides with their respective Area Office and is responsible for oversight and providing guidance at the local level. The Lead and Area A/OPC also serve as the liaison among cardholders, Approving Officials, and the servicing bank. Additionally, the Lead A/OPC serves as the liaison among IHS, HHS and GSA regarding purchase card matters.
If an IHS employee suspects purchase card misuse by any purchase card program participant, he/she is encouraged to contact their Area A/OPC immediately. Purchase Card Program participants and IHS employees may contact their Area A/OPC for any ethical related inquiries. If the Area A/OPC cannot answer the inquiry, the inquiry will be escalated to the Lead A/OPC (or their backup). Both the Lead and Area A/OPCs are responsible for addressing potential misuse or ethical inquiries under the Purchase Card Program.
- Lead Agency/Organization Program Coordinator (Lead A/OPC). Resides with the Office of Management Services, Division of Acquisition Policy under the IHS Head of Contracting Activity (HCA). The Lead A/OPC is responsible for:
- Program oversight;
- Establishing IHS-specific purchase card policy and guidance;
- Ensuring training is provided to all prospective cardholders and Approving Officials and refresher training is completed annually by current cardholders and Approving Officials;
- Ensuring necessary resources are available for cardholders and Approving Officials to understand policies and procedures regarding purchase card usage;
- Implementation of the Purchase Card Program;
- Providing guidance and oversight to each Area A/OPC;
- Serving as the liaison among cardholders, Approving Officials, and the servicing bank;
- Serving as the liaison among IHS, HHS and GSA regarding purchase card matters; and
- Serving as point of contact regarding the use or misuse of the purchase card.
- Area Agency/Organization Program Coordinator (Area A/OPC). Resides with their respective Area Office and is responsible for:
- Area program oversight;
- Providing guidance at the local level;
- Appointing their respective Area’s Approving Officials (AO);
- Appointing AOs in writing (form located in Appendix B);
- Serving as point of contact regarding the use or misuse of the purchase card; and
- Serving as the liaison among cardholders, AO, and the servicing bank.
- Requestor. The individual who requests the goods or services. The Requestor must ensure they provide their name, suggested vendor(s), list of items being purchased, estimated cost or quote, accurate Common Account Number (CAN) and proper Object Class Code (OCC). In addition, the Requestor must also include a justification for the purchase of goods or services and address the following:
- Who: Individual of office intended to receive the goods or services;
- What: Clear description of the goods or services to be purchased; and
- Why: Clear description as to why the goods or services are needed.
If the justification is insufficient, the cardholder should follow-up with the requestor to obtain additional information.
Requestors must understand that written pre-approval for each purchase must be obtained before the cardholder can make the purchase. The approval signature certifies the purchase is for a legitimate need of the government and not for personal benefit. The bona fide needs rule of appropriations law states a fiscal year’s appropriations must be used only for a legitimate need that arises during the year for which the appropriation is made. If applicable, requestors must obtain clearance from the IHS/Area Property Management Officer for all property to be acquired on the IHS Purchase Card Request Exhibit (Manual Exhibit 5-23-A) prior to purchase. Also, information technology (IT) clearance is required if applicable.
- Receiving Official. The individual that accepts and acknowledges receipt of the goods or services. The individual that received the good or service should sign and date the receiving document, Circular Exhibit 2015-05-A, or send an email to the cardholder verifying the good or service was received. A person other than the cardholder should receive the goods or services to ensure separation of duties. The receiving documentation must be retained in the monthly purchase card file for each transaction.
- Approving Officials. The AO is appointed by the Area A/OPC. The AOs must be an equivalent or a higher-grade level than the cardholders under their purview. There should be no more than six cardholders assigned to an AO to minimize risk. Under certain circumstances, the Area A/OPC may allow AOs to have additional cardholders. In these cases, cardholders’ volume of monthly transactions will be considered. The AO must submit an explanation of how he/she will oversee the additional cardholder(s) to their Area A/OPC for consideration and approval. The role of the AO is a critical oversight function in the Purchase Card Program. The AOs will:
- Ensure cardholders understand the purchase card procedures outlined in the HHS Purchase Card Directive and other IHS specific policies and procedures;
- Ensure cardholders’ transactions are legal, proper, mission essential, and in accordance with purchase card policy;
- Ensure accountable property purchased by a cardholder has been reported to the Property Officer;
- Ensure cardholders log each purchase in the Monthly Purchase Card Log Sheet and register each transaction in the HHS Purchase Card System;
- Ensure cardholders reconcile their monthly bank statements, monthly purchase card log, and transactions. Cardholders shall reconcile their monthly bank statements by the 13th of each month;
- Review and approve cardholder transactions and ensure cardholder files contain a signed monthly purchase card log, signed bank statement, and supporting documentation for each purchase, and that the file is complete, accurate, and reflects only authorized purchases;
- Ensure resolution of any questionable purchases and disputes are filed timely and properly with the servicing bank by their cardholders;
- Ensure cardholders complete annual refresher training and any other training required by the HHS Purchase Card Directive. Cardholders must provide a copy of the completion certificate to their Area A/OPC by the applicable date of each calendar year, with the Area A/OPC uploading the certificate to the central repository;
- Report fraud, waste, or abuse immediately to the Area A/OPC;
- Notify the Area A/OPC when a cardholder is leaving the Agency;
- In compliance with the IHS Records Management Policy, ensure cardholder’s purchase card files are maintained and retained for six years after payment date;
- Send account administrative changes to the Area A/OPC for processing;
- Provide oversight of cardholders under their purview to ensure compliance with all purchase card policies and procedures;
- The appointed AO must sign the Cardholder and Approving Official Agreement (Manual Exhibit 5-23-B), demonstrating that they fully understand their role and responsibilities to serve as the AO;
- Provide adequate assurance that there is no fraud, waste, misuse, or abuse;
- Review transaction documentation after purchase; and approve transactions in the HHS Purchase Card System.
- Cardholders. Individual cardholders are nominated by the Program Office or Operating Division (OPDIV) and given a Delegation of Procurement Authority (DPA) signed by the Area Chief Contracting Officer (CCO). Cardholders are required to sign the Acknowledgement Form acknowledging that they understand their responsibilities and limitations as set forth in the DPA. Cardholders are responsible for the following:
- Completing all required initial and annual refresher training and providing a copy of the certificate to the Area A/OPC for upload to the central repository by the applicable date of each calendar year;
- Making authorized purchases and, in accordance with the IHS Records Management Policy, maintaining accurate purchase records and documentation for six years from final payment;
- Obtaining required approvals of all purchases before the transaction is made on the Purchase Card Request Exhibit and/or SF-182 Authorization, Agreement and Certification of Training Form , or other acceptable purchase request mechanism;
- Registering, logging, and reconciling purchases timely;
- Submitting their monthly managed purchase card file, which contains all supporting documents relating to each transaction made within that month, to the AO for review and approval after the monthly reconciliation is completed;
- Maintaining all required purchase card documentation, including a monthly purchase card log, and monthly bank statement. These two documents must be signed by the cardholder and AO;
- Ensuring sales tax is not paid and all available discounts have been received;
- Ensuring accountable property documentation is provided to the Property Officer;
- Resolving any questionable charges with the merchant, or filing a dispute with the bank within 90 days from payment date;
- Storing the purchase card in a secure location; and
- Sending account administrative changes to the Area A/OPC for processing.
- Office or Program Directors. If a Program Office would like to request a new cardholder, please follow the procedures outlined below:
- Complete Request for Cardholder. The Request for Cardholder is completed by the prospective cardholder and includes the individual’s name, information, and requested amounts for single and monthly purchase limits. The proposed limits must be justified and support the needs of the program(s) that the prospective cardholder supports. The default CAN and OCC shall be included in the cardholder request. If the prospective cardholder teleworks full-time, it must be noted on the form.
- Complete Annual Purchase Card Training. Training is required on an annual basis for all cardholders. The prospective cardholder or the Approving Official must submit a PDF file, via email, to the Area A/OPC containing:
- Training Completion Certificate(s);
- Request for Cardholder Form; and
- Training Certification Form.
- Read, complete, and sign the Training Certification Form.
- A/OPC Establishment of Purchase Card Account. Once the required forms and training certificate(s) are submitted to the Area A/OPC, the A/OPC will process the request through the bank to establish an account and ensure the information is used to identify the cardholder. It will take approximately 10 business days for the new account to be established by the bank.
- A/OPC Meeting with New Cardholder. The Area A/OPC will schedule a meeting with the cardholder to discuss the Purchase Card Program and provide the following documents:
- HHS Purchase Card Directive;
- Template for the Monthly Purchase Card Log;
- IHS Purchase Card Procedures;
- Government Purchase Card;
- Cardholder User Guide; and
- Signed DPA.
- Purchase Card Activation. Upon receipt of the government purchase card, the cardholder shall contact the bank at the telephone number located on the sticker on the front of the card to activate and verify account information. The bank will require the cardholder to designate a unique personal identification number that will be used when calling the bank to identify the cardholder. Once the card has been activated, the cardholder is able to make approved purchases.
- Purchase Card Expiration. Purchase cards expire on the last day of the expiration month displayed on the card. For example, if the expiration month is April, the purchase card will expire on the 30th. Before the expiration date, the cardholder will receive a new card from the Area A/OPC. No action is required of the cardholder to receive an updated card. The cardholder should activate the new card immediately and shred/destroy the expired card.
- Account & Card Security. Cardholders must safeguard the physical security of their purchase card and protect card account information at all times. Only the individual to whom the card is issued may use the purchase card or purchase card account number. Cardholders should not write down their entire account number, expiration date, and security code, except when required for the cardholder to complete an authorized purchase, as this could cause fraud or misuse to occur.
If a Program or Area Office would like to request a purchase card AO, the prospective AO must ensure the appropriate request and the required training has been completed, signed, and submitted, via email, to the Area A/OPC for processing. If the Program Office is appointing another individual to serve as an Approving Official, they must submit the Appointment of Approving Official Memorandum to the Area A/OPC for processing. The prospective AO will be required to sign the Appointment of Approving Official Memorandum acknowledging they understand their role and responsibilities as an AO.
- Request for Purchase Card Approving Official. The Request for Purchase Card Approving Official shall be a written request that includes the name, title, address, and a list of cardholders that will report to this Approving Official along with the cardholders’ grade and monthly limit.
- Training Certification. In addition to completing the above-referenced request, the AO is also required to take purchase card training.
When the training and forms are completed, the prospective AO must submit a PDF file, via email, to the Area A/OPC containing:
- Completed Training Certificate(s);
- Request for Purchase Card Approving Official;
- Signed Appointment of Approving Official Memorandum (if applicable); and
- Training Certification.
- Approval of Approving Official. The Area A/OPC will review the required request documents and training certificates for approval. If approved, the Area A/OPC will update the AO for the respective cardholder(s) in the bank’s electronic access system that will automatically update the information in the HHS Purchase Card System. It will take approximately five business days for changes in the AO’s profile to be reflected with the bank and in the banking system.
- A/OPC Meeting with Approving Official. The Area A/OPC will schedule a meeting with the AO within 10 days of approval to discuss their role and responsibilities under the IHS Purchase Card Program.
- Notification to Cardholders by A/OPC. The Area A/OPC will send an email to all cardholders notifying them of the new AO. The cardholder(s) DPA will also be revised to reflect the new AO.
- Changes in Cardholder and/or Approving Official Information. Changes in cardholder or AO status (e.g. address, room number, phone number, name changes, etc.) must be reported to the Area A/OPC immediately so that the information can be updated with the bank. If a cardholder transfers to another Agency or Area, the purchase card must be cancelled. If the cardholder needs an account at the new Area, then a new purchase card application must be submitted to the Area A/OPC for processing.
- Cancellation of the Purchase Card. If a cardholder leaves IHS (e.g., resignation, retirement, etc.) or no longer needs a purchase card, the following steps must be followed:
- Notify the AO of departure date. The AO must notify the respective Area A/OPC of the date the cardholder will be leaving the organization.
- The cardholder must stop using the purchase card immediately; and shall return the purchase card and any convenience checks to the AO or Area A/OPC to be destroyed.
- The A/OPC is responsible for ensuring that any required purchase card transactions are supported until a new cardholder is established.
- The cardholder contacts any vendors who have not yet billed to ensure prompt billing prior to account closure.
- The cardholder must finalize reconciliation and resolve any pending disputes and/or credits.
- The cardholder must notify the AO and Area AOPC when reconciliation is completed and all items are paid.
- The Area A/OPC will close the account with the bank after the above steps are completed.
- Account Termination. The Area A/OPC shall terminate cardholder or AO accounts as a corrective action for improper use of the card; failure of the AO or cardholder to carry out their responsibilities; failure of the AO or cardholder to complete the required training; inactivity; or upon the direction of management.
- The IHS must use the Section 508 Compliant Purchase Card Request Exhibit (Manual Exhibit 5-23-A) to purchase products and/or services. In order to process a procurement request, the cardholder must receive a requisition package.
- The following information must be included with the requisition package:
- Requestor's name;
- Suggested vendor;
- Description(s) of items being purchased; quantity, unit and extended price;
- Applicable quotation(s), market research and any supporting documents;
- CAN; funding information; proper OCC;
- Justification for purchase;
- "Requestor" signature;
- Approval signature(s). This must be the "Supervisor", or the "Recommending Approver" and the second line or higher level "Supervisor" or official with oversight of the "Requestor", referred to as the Approving Official;
- Funds Certifier’s signature; and
- Special Approvals or Clearances required [i.e., Property, Office of Information Technology (OIT), etc.].
- The cardholder must provide the Approving Official (AO) with the Purchase Card Request Exhibit, including any supporting documentation for the purchase. The AO’s signature certifies the purchase is for a legitimate need of the government and not for personal benefit. After obtaining the "Supervisor" approval signature, or "Recommending Official" and the "Supervisor" approval signature, the cardholder must then obtain approval from the respective Funds Certifier verifying that the funds are available for the purchase. Failure to obtain approval from AO and the Funds Certifier prior to purchase is an automatic unauthorized commitment for which the cardholder and/or AO may be held personally liable and subject to possible disciplinary action.
It is the cardholder’s responsibility to ensure he/she does not exceed the amount approved on the Purchase Card Request. If the price has increased since the original approvals were obtained, the cardholder must go back and obtain approval from the AO and Funds Certifier for the increased amount prior to making the authorized purchase. The AO and Funds Certifier must initial and date any increase in total price on the Purchase Card Request or provide an approval email stipulating/certifying the revised amount is available. The cardholder must attach the approval email to the Purchase Card Request and retain with the transaction documentation.
- Determine If the Purchase Is Available from a Required Source. Federal Acquisition Regulation (FAR) Part 8, "Required Sources of Supplies and Services," requires that agencies acquire products and services from required sources when available. Required sources provide several benefits to cardholders and the IHS. They are generally easier to obtain, more cost effective because of volume discounts, and offer stable prices over the long term. Cardholders must check required sources for all orders before making a purchase. A personal preference or recommendation, which is subjective in nature, is not an adequate reason to obtain an item from an open market merchant when the item is available from a required source. If the item is not available from a required source, the cardholder may use an open market merchant.
IMPORTANT: If a required source is not used, the cardholder must document the reason (e.g., explanation for using an open market merchant) in their monthly purchase card file. Lowest price should not be the sole reason for not purchasing from a required source.
- Determine Price Reasonableness. For purchases at or below the micro-purchase threshold, cardholders are not required to obtain quotes from more than one merchant but may compare value among merchants, if time permits. If the cardholder considers the price to be fair and reasonable, the purchase may be made without obtaining competitive quotes. For purchases above the micro-purchase threshold, the cardholder must follow the policies in FAR Part 13.106-3, "Award and Documentation," for determining price reasonableness.
- Consider "Green" Purchasing. Before purchasing, cardholders must check to see if the goods or services can be purchased within one of the six "green" purchasing categories below:
- Products manufactured from recovered materials
- Environmentally preferable products
- Energy efficient products
- Bio-based products
- Alternative fuels and fuel efficient vehicles
- Non-ozone depleting substances
- The purchase of "green" products is required by law unless the product does not meet performance needs or is only available at an unreasonable price. Further guidance is available in FAR Part 23, "Environment, Energy and Water Efficiency, Renewable Energy Technologies, Occupational Safety, and Drug-Free Workplace." For additional policy information, cardholders must refer to the HHS Purchase Card Directive.
- If a request is received for an employee to register for training, conference registration, symposiums or any event where registration and payment is required, the cardholder must ensure the SF-182 Authorization, Agreement and Certification of Training Form is completed and approved prior to the employee(s) attending the training, conference, symposium or event.
- If the cost of the training exceeds the micro-purchase threshold, the purchase must be procured by the local Contracting Office. The requestor must ensure the SF-182 is completed and that a fully awarded contract issued by a warranted Contracting Officer is in place prior to the employee(s) attending the training.
- Authorized Purchases. Cardholders are responsible for using their purchase card only to make authorized purchases that are for a legitimate IHS need and not for personal benefit. Examples of authorized purchases include the following:
- Commercially available goods (e.g., office supplies, toner, books, etc.);
- Commercially available services (e.g., printing, copier maintenance. etc.);
- Rental of meeting or conference space;
- Training, conferences, and registration fees; and
- Unauthorized Purchases. The government purchase card may only be used to make purchases for a legitimate need and not for personal benefit. Purchasing goods or services for personal use is prohibited. The following transactions are unauthorized on the purchase card:
- Airline Tickets;
- Advance payments;
- Automobiles or related expenses (e.g. fuel and repairs);
- Backordered items (unless card is charged only upon shipment);
- Bail or bond payments;
- Cash advances;
- Casino, racetrack, lottery, or other betting or gambling expenses;
- Controlled substances;
- Dating and escort services;
- Decorations for individual offices;
- Fines or penalties (e.g., parking tickets);
- Gifts for employees (including retirements and farewells);
- Holiday greeting cards;
- Lobbying or other political contributions;
- Luxury items;
- Membership fees in a society or association for individual employees;
- Personal items (including space heaters, electric fans, radios, Bluetooth speakers, etc.);
- Products not meeting a bona fide need of IHS;
- Rental/lease of buildings or land;
- Savings bonds;
- Services that do not meet a bona fide need of the Department;
- Temporary Duty (TDY) travel or travel-related expenses (hotels, airline, bus and train fares, meals);
- Weapons (including arrows, ulu knives or similar); and
- Purchases Requiring Special Attention, Approvals, or Clearances. Refer to the HHS Purchase Card Program Guide (September 2015, Version 7.0) for listing. All procurements in this category must be reviewed thoroughly to ensure prudent use of federal resources. Purchases must be accompanied by strong justifications that clearly demonstrate an appropriate use of minimal resources. Lavish spending is strictly prohibited and items for individual areas may not be purchased.
Prohibition on Personal Use of Merchant Rewards. Many vendors offer incentives for purchase of their products and services, such as rewards points that may be redeemed for merchandise, cash back, free products and services, etc. Regulations 45 C.F.R. § 73.735–303 and 304, prohibit the personal use of Government property and funds. Since merchant rewards earned on purchase card buys are gained through the expenditure of government funds, they may not be used for personal gain. Programs that find a specific instance of such activity should refer the matter to the Area A/OPC, Ethics Officials and to the Office of Inspector General (OIG).
Merchant rewards may be used for the benefit of the Government where practicable; for example, using rewards points earned on the purchase card to obtain discounts or additional merchandise needed by the cardholder’s program office.
- Register Purchase Information on the Monthly Purchase Card Log. After making a purchase using the card, the cardholder must register the purchase on the monthly purchase card log. The monthly purchase card log must correspond to the billing cycle from the bank. The IHS billing cycle is from the sixth of the month to the fifth of the following month. At a minimum, the log must include the date purchased, a description of the product or service, the merchant name, the amount paid, and the date received by IHS. Cardholders can use the Monthly Purchase Card Log Template provided in the HHS Purchase Card Program Directive, Appendix B, or a similar format as long as all required information is included.
The monthly purchase card log should cover all transactions that have taken place during the billing cycle. If a product/service is not received by the end of the billing cycle, the transaction should be moved to the following monthly purchase card log.
The cardholder must compare the recorded purchases on the monthly log with the transactions reported on the monthly bank statement to determine if the purchases and amounts are accurate and match each other. If there are differences between the logged purchase and the monthly bank statement, the cardholder should contact the vendor to attempt to resolve the discrepancy. If it cannot be resolved with the vendor, the cardholder must treat the discrepancy as a disputed item.
- Register the Purchase in the HHS Purchase Card System. In addition to registering the purchase on the monthly purchase card log, cardholders are required to also log each purchase in the purchase card banking system with item details such as the description; Purchase Card Request number; CAN; OCC; Vendor; and amount.
The servicing bank imports transaction details for each cardholder into the HHS Purchase Card System on a daily basis. The purchase card log and transaction details should be cross-referenced for accuracy.
- Receiving Products and Services. When the cardholder or customer receives delivery of a product, the cardholder should match or cross-reference the product delivered with what was ordered to ensure that the proper item was delivered and is not damaged or defective. If the product differs from what was ordered the cardholder should contact the merchant to resolve the discrepancy. If a merchant refuses to replace the product or make corrections, the transaction should be considered to be in dispute.
The individual that receives the good or service must sign and date the receiving document (e.g., packing slip or invoice). The receiving documentation must be retained in the monthly purchase card file for each transaction.
If someone other than the cardholder receives the delivery, they must check off the items received, sign and date the receiving document/packing slip and give to the cardholder for their records.
For any sensitive items or property and/or equipment purchased, a copy of the receiving documentation must be provided to the Property Management Officer.
- Receive and Reconcile Monthly Bank Statement. Cardholder purchases made during the monthly billing cycle will be reflected on a monthly bank statement. The monthly bank statement is sent by the servicing bank directly to the cardholder (by mail or electronically). The recommended and preferred statement delivery is electronic. The cardholder must review the monthly bank statement to ensure that all of his/her transactions are matched to the corresponding transaction on the monthly purchase card log.
After reconciliation, the cardholders must sign and date the monthly bank statement indicating the charges are accurate. The signed monthly bank statement must also be kept with the monthly transaction documentation.
- Purchase Card File – Cardholder Documentation. The purchase card file is used to maintain all documents associated with purchase card transactions for each billing cycle. Cardholders must maintain a file (hard copy or electronic) for six years from payment date. Random reviews will be conducted by the DAP to ensure files are maintained for six years.
If maintaining electronic files, all documentation associated with each purchase must be saved and clearly named. All transactions for a given billing cycle must be kept together with the signed monthly purchase card log, signed bank statement. Use of electronic signatures is allowable. It is important to keep documentation organized and accessible in the event of an audit.
- The cardholder's monthly purchase card file must include the following documentation for each transaction:
- Purchase Card Request - must include a justification for the purchase and an itemized list of items to be purchased (note: you may use a separate sheet to list items, unit cost, and total price). Any clearance obtained must be attached to the Purchase Card Request. All required signatures/approvals must be obtained prior to making a purchase.
- SF-182 Authorization, Agreement and Certification of Training Form is required for all training purchases. The cardholder is responsible for obtaining all approvals/signatures on the SF-182 prior to paying for training. The cardholder is also responsible for completing the certification of training completion portion of the form that constitutes the training has been received. The Purchase Card Request Exhibit is required in addition to the SF-182.
- Any request(s) for products/services. This can be emails and/or written requests for products/services received from staff.
- Market research, quote, shopping cart printout, invoice, cash register receipt, email order confirmation, email correspondence, etc.
- Documentation from the merchant showing the total price charged must be included in the purchase card file. Merchant documentation can be in the form of an invoice, cash register receipt, order confirmation from the merchant via email, or a packing slip with the total price included. If the merchant refuses to provide documentation showing the total price, the cardholder should dispute the charge and indicate that an invoice or receipt is needed from the merchant.
- Packing slips and/or proof of receipt of goods or services. The individual that receives the good or service must sign and date the receiving document (e.g., packing slip).
- Monthly Purchase Card Log (signed by cardholder and AO)
- Monthly Bank Statement (signed by cardholder and AO)
- If applicable, file documentation should include the following documents:
- Dispute form (with supporting documentation)
- Fraud Affidavit
- Credit Letter Response
- Submitting Monthly Purchase Card Documentation to Approving Official. The cardholder must provide their AO with all transaction documentation after reconciliation of the monthly purchase card log and monthly bank statement. This documentation must include the items detailed in Section E above. The cardholder should put the signed/dated monthly purchase card log and signed monthly bank statement on top of all the transaction documentation for the period.
- Approving Official Responsibilities and Oversight. The AO is required to review all transaction documentation for the billing cycle for each cardholder under their purview. If AO review determines all purchases were legal, proper, justified, and in accordance with purchase card policy, the AO must sign/date the following documents and return to the cardholder to maintain with the monthly file:
- Monthly Purchase Card Log
- Monthly Bank Statement
The AO must also approve the transactions in the HHS Purchase Card System on a monthly basis by going to the "Transactions" screen for each cardholder. The screen will show a list of transactions with the date, merchant name, amount, and status. Click the "Approve" button to accept the transaction data. If the items amount total the transaction amount, the transaction will move to the approved status.
The AO is required to make sure the cardholder assigned the correct CAN and OCC to each purchase. If the transaction is not reconciled, the payment will be made out of the cardholder’s default CAN and OCC. If the AO questions the legitimacy of a purchase and the cardholder is unable to justify the purchase, the cardholder will either have to provide restitution to the Government, or return the unauthorized products to the merchant and obtain a credit to the cardholder’s account. The AO must notify the Area A/OPC immediately of any questionable purchases. The cardholder will also be subject to disciplinary actions for card misuse as well as criminal and/or civil penalties for fraudulent actions.
As an oversight tool, DAP will conduct random reviews of transactions across IHS. Additionally, an annual audit will be conducted to ensure the AO is performing this critical control function.
This section details the administrative requirements under the IHS Purchase Card Program.
- Compliance Reviews/Audits. The integrity of the IHS Purchase Card Program is extremely important and participants in all aspects of the Program must seek to avoid instances and appearances of fraud, waste, misuse, and abuse. To mitigate risk, IHS has instituted a three-tier review process and the following internal controls to identify misuse, improper or erroneous purchases and to ensure program integrity and program effectiveness.
- The Lead A/OPC within the Office of Management Services (OMS), Division of Acquisition Policy monitors transactions on a monthly and as needed basis in the HHS Purchase Card System.
- DAP conducts random reviews of transactions and conducts reviews initiated by the HHS Purchase Card Manager or other automated analytics tools.
- DAP conducts the annual OMB Circular A-123, Appendix B testing of internal controls to mitigate fraud, waste and abuse and to ensure compliance with government policy.
- IHS Purchase Card Analytic Dashboard (PCAD). The PCAD is the comprehensive analytic tool developed and maintained by the IHS to improve and increase periodic and random purchase card compliance reviews and audits. It serves as a visualization software to simplify data analysis. The PCAD will allow for improved decision-making by identifying and forecasting spending trends through the use of customized filters, pattern matching and data visualizations.
- Owner and Responsible Party. The PCAD is managed by the OMS, DAP, Government Purchase Card Program. The HCA and Lead A/OPC are responsible for ensuring the PCAD data is accurate and used responsibly to support the IHS Purchase Card Program.
- Data Update. The OMS DAP is responsible for ensuring the data transmitted to PCAD is uploaded within five days after the 15th of each month.
- User Access. Access to PCAD will be limited to the OMS Director; IHS HCA; IHS Lead A/OPC (and the alternate); Area CCOs; and Area A/OPCs (if different from CCO). User Access outside of the approved positions above will require review and approval from the HCA.
- User Access Responsibility. Users shall ensure all data modeled via PCAD is protected and utilized only for the purposes of supporting the IHS Purchase Card Program.
- Compliance Review/Audits Using PCAD. CCOs and Area A/OPCs shall utilize PCAD to conduct periodic and random compliance reviews and audits to:
- Organize and analyze large volumes of purchase card transaction data;
- Increase insight into spending trends and continuous monitoring of purchase cardholders and AOs;
- Increase efficiency of post-transaction reviews to ensure that potentially fraudulent or improper payments are identified and resolved in a timely manner;
- Increase oversight, monitoring and reporting capabilities. This will help to inform Area and HQ leadership of current trends, and provide valuable insight to shape policy and governance updates to improve internal controls;
- Improve the purchase card review process by following a standardized, electronically-accessible mechanism for monitoring transactions;
- Track the effectiveness of the audit/review process; and
- Reduce the overall cost of reviews and the potential for audit non-compliance;
- Separation of Duties. It is imperative that all IHS Purchase Card Program participants maintain separation of duties. Separation of duties is a mandatory management control to prevent key functions from being performed by the same person and to minimize risk of fraud and/or loss of property. A cardholder cannot serve as the approving official for his/her own purchase card. At least three separate individuals must be involved in the purchasing process. Each of the duties outlined below should be assigned to at least three different individuals to minimize risk of fraud. This can include the following roles:
- Requester – Person who requests the goods or services. This individual completes the Purchase Card Request for goods or services or the SF-182 for training and obtains required approvals/signatures.
- Funds Certifier – Approves funding availability and certification for the purchase. This should always be Finance personnel.
- Approving Official – Person who certifies the purchase is for a legitimate need. This individual signs the Purchase Card Request Exhibit and/or SF-182, conducts oversight of cardholder(s) under their purview; and approves each purchase in the financial interface (if applicable).
- Cardholder – Person who makes the purchase using his/her Government-issued purchase card.
- A/OPC – Provides oversight of the IHS Purchase Card Program.
- Receiver – Person who verifies and accepts the goods and services.
- OMS/DAP – Conducts random reviews of cardholder transactions to ensure required approvals are obtained, ensure policies and procedures are adhered to by both cardholder and AO, and validates separation of duties.
- Third Party Oversight – Responsible party that conducts the annual OMB Circular A-123, Appendix B testing of internal controls to mitigate fraud, waste and abuse and to ensure compliance with government policy.
- Authorized Individuals to Purchase Products or Services. The only individuals authorized to purchase products or services with the government purchase card are employees given authority, via a DPA or Standard Form 1402 Certificate of Appointment, signed by the Lead A/OPC or the Head of Contracting Activity.
- Transaction Record Keeping. Cardholders must maintain a file (hard copy or electronic) for six years from the transaction paid date.
- Protection of Accountable Property, Records, and Purchase Instruments. Cardholders are responsible for reporting all accountable property purchased with the purchase card to the Property Management Officer. Cardholders are required to provide a copy of the receiving documentation to the Property Management Officer. Accountable property includes products such as medical devices and equipment, computers, computer-related items, or other Information Technology equipment. Contact the Property Management Officer if there are any questions about accountable property.
- IHS Internal Controls. Internal controls are the measures taken to ensure program integrity, safeguarding of account information, and program effectiveness. Internal controls consist of the policies, procedures, training, organization, and surveillance governing the IHS Purchase Card Program.
- Agency Internal Controls. DAP may implement their own internal controls to monitor its cardholders and AOs to ensure fraud, waste, and abuse is not occurring. Examples of internal controls are:
- Separation of Duties – A cardholder and an AO must not certify funds availability. A Funds Certifier must not approve a purchase and certify funds availability.
- Reconciliation – Reconciliation is a dual responsibility of the cardholder and AO.
- Records Retention – Ensure transaction documentation is retained for six years from payment date.
- Documentation Oversight – Ensure cardholders and AOs are reviewing/signing required monthly purchase card log, monthly bank statement, and Invoice Detail Report.
- IHS A/OPC Internal Controls. The Lead A/OPC is responsible for overseeing the IHS Purchase Card program. The A/OPCs will conduct surveillance on purchase card accounts for the following:
- Inactive Accounts – The A/OPCs shall monitor accounts that have not been used for 180 days. It is a potential risk to have cards issued that are not being used. If the cardholder does not have a need to purchase products/services, the account should be closed unless there are extenuating circumstances. Purchase cards should not be issued as back-up cards. The A/OPCs will provide the AO with a determination memorandum to complete justifying why the account should remain open or requesting the account be closed. If the card is not used in the next 180-day period, the A/OPCs will ask for an explanation and determine if the account should be closed.
- Fraud/Waste/Abuse/Misuse – If a cardholder, AO, or other purchase card program participant identifies a case of fraud/waste/abuse/misuse, the nature of the offense will dictate what personnel action or other punishment is imposed. The A/OPCs will refer to the consequences for purchase card fraud and abuse in the most recent version of the HHS Purchase Card Directive. IHS will hold all program participants accountable for violations. Documented cases will be forwarded to the IHS Ethics Office, Office of Human Resources, Office of Inspector General, or employee relations for appropriate action.
- Potential Fraudulent Activity/Account Compromise from Outside Source – If the A/OPCs identify potential fraudulent activity to a cardholder account, the A/OPCs must immediately contact the cardholder and AO. The A/OPCs may suspend the cardholder account until a determination is made whether a charge or attempted charge is legitimate or if the fraudulent activity is from an outside source. If it is determined to be fraudulent activity by an outside source, the A/OPCs will close the existing account and will open a new account with a new account number to prevent additional attempts of fraudulent activity from occurring. The new card will be provided to the cardholder for activation.
- Testing of Internal Controls. The IHS has implemented a three-tier review process for testing of internal controls to identify misuse, improper or erroneous purchases and to ensure program integrity and program effectiveness.
- The A/OPCs monitor transactions on a monthly basis in the HHS Purchase Card System.
- The DAP conducts random reviews of transactions on a monthly basis.
- The Third Party Oversight official conducts the annual OMB Circular A-123, Appendix B testing of internal controls to mitigate fraud, waste and abuse and to ensure compliance with government policy. Testing is conducted to validate compliance with training requirements; validate funding certification; validate review/approvals of credit card purchases by the AO; and validate separation of duties.
- Agency Internal Controls. DAP may implement their own internal controls to monitor its cardholders and AOs to ensure fraud, waste, and abuse is not occurring. Examples of internal controls are:
- Training Requirements. Purchase card training is required on an annual basis for all cardholders and AOs. Cardholders and AOs shall take the GSA government charge card program on-line training or the HHS Learning Portal course titled "Using the Purchase Card at HHS", available via the HHS Learning Management System. For the GSA course, you must register/create an account at the top of the page prior to taking the course to get your completion certificate. The A/OPC may require additional training and reserves the right to change the training requirements. Cardholders are responsible for completing all required initial and annual refresher training and provide a copy of completion certificate(s) to the Area A/OPC by the applicable date of each calendar year.
Failure by a cardholder or AO to provide the training completion certificate to the Area A/OPC will result in suspension of your purchase card account or ability to serve as an AO until the training has been completed.
Each fiscal year, Congress must pass an appropriation bill that provides the government with legal authority to spend or obligate U.S. Treasury Funds. In the event of a government shutdown, no purchases are to be made using the government purchase card unless your program is "excepted" and the procured goods/services are related to an "excepted" activity. The Executive Officer for each Area Office is responsible for notifying the Area A/OPC, via email, which cardholders will be working during a shutdown.
The same purchase card processes and procedures to make purchases are required during a government shutdown. Cardholders must obtain approval from the AO and Funds Certifier prior to making a purchase.
- The cardholder's monthly purchase card file must include the following documentation for each transaction: