Part III - UNM Finance: Practical Applications

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Standard Accounting Resource Manual (SARM)

MSC 0000 00
1 University of New Mexico
Albuquerque, NM 87131

Purchasing Cards

The Purchasing Card is a tool issued to UNM Employees for the purpose of making purchases on behalf of the University. Goods, materials, supplies and non-capital equipment not exceeding $5,000.00, and approved services not exceeding $2,500.00 are allowed on the PCard. Cards will not be issued to Temporary or Student Employees. The University will submit payment to the issuing bank for approved purchases made using the Purchasing Card.

The Purchasing Card Program is intended to simplify the procurement and payment process and reduce total acquisition cost. Additionally, it provides users with greater flexibility.

With any procurement process, there is a risk factor. Risk is managed by establishing a controlled process that has formal review and periodic audits. The Purchasing Card Program is a controlled process with most of the responsibility for control placed at the user level.

The following will give you an overview of the process of requesting a Purchasing Card, using it to make a purchase, Cardholder reconciliation of statement, and Purchasing and A/P PCard functions. We will go into each process in greater detail later in the training module.

  1. Department completes UNM Purchasing Card Application Form.
    1. This request contains the information the Purchasing Card Administrator needs to order a PCard from the bank. It also contains internal information such as UNM default index and account code, department information, Banner security access, transaction controls, Merchant Commodity Code (MCC) blocking, and a statement that the Cardholder and department Director agree to the Cardholder Agreement.
    2. The application for Purchasing Card is routed through the appropriate Accounting Office for approval.
  2. Purchasing Card Administrator: The Purchasing Card Administrator orders the Purchasing Card from the bank and sets up all internal files.
    1. The Cardholder will pick up the PCard from the Purchasing Card Administrator and sign the Cardholder Agreement.
  3. Cardholder places an order and enters the order on the Transaction Log.
    1. The Cardholder calls or physically places an order with the vendor and enters the information on the Transaction Log. The vendor either electronically or via phone call to Visa requests an authorization for the order. Visa checks the preset authorization parameters established for the Cardholder and either approves the transaction or declines it. If approved, the vendor ships the items.
  4. Cardholder receives the order and secures the original packing slip, paid invoice, or register receipt.
    1. The Cardholder files the packing slip and other relevant documents with the Transaction Log.
  5. Cardholder approves receipt of the items and reallocates in Banner if necessary.
    1. The Cardholder notes the receipt date on the Transaction Log.
    2. 2-3 days after the purchase is made, the transaction is available in Banner for reallocation.
    3. Upon logging into Banner, you will receive a message that you have PCard transactions awaiting your review.
    4. The Cardholder can reallocate the charges to approved index and/or account codes. The Cardholder can also split the charge amount among any of the approved index and/or account codes (not to exceed 10 indices/accounts per transaction).
    5. Any reallocation must be done within 10 days from the date the transaction appears in Banner (prior to Feed Date).
    6. If a transaction is not reallocated within the 10 day period, a Journal Voucher must be processed to move the dollars and an PCard infraction will be logged.
  6. Transactions are posted on the Feed Date (10 days after the transaction is loaded in Banner).
  7.  Accounts Payable pays the bank.
  8. Bank of America mails a monthly PCard statement directly to the Cardholder.
    1. Statements are not generated if there are no transactions.
    2. The billing cycle runs from the 6th to the 5th.
  9. Cardholder compares monthly PCard statement with the Transaction Log and Banner.
    1. Each Cardholder will receive a monthly billing statement from the bank. Upon receipt of the billing statement, the Cardholder will reconcile the:
      1. Billing statement
      2. Transaction Log(s)
      3. Original packing slips, paid invoices, or register receipts
    2. Any discrepancies should be noted and if unresolved within or by the department, or directly with the vendor, a Cardholder Statement of Disputed Item is sent to the Purchasing Card Administrator. Instructions for disputed transactions can be found in the Disputed Transactions section of this procedure.
    3. The Cardholder will file the reconciled statement, Transaction Log(s), and packing slips by monthly billing cycle. The Cardholder will forward the files by billing cycle to the Purchasing Card Administrator within 30 days of the billing cycle.
    4. Accounts Payable will receive a monthly corporate billing statement that will list activity for all Cardholders. The Cardholder will not send their billing statement to Accounts Payable.