The Town of Oakville (town) uses purchasing cards for departmental procurement and payment of goods and services where it is efficient, economical and operationally advantageous to do so.
All procurement activity must be compliant with the current Purchasing Card Operating System (PCOS) Procedure, the Purchasing By-law and any applicable corporate policies and procedures.
This procedure applies to managers, directors and all employees authorized to use purchasing cards for town business.
Purchasing Card Administration as approved by the Purchasing By-law is to be used as a guideline for purchasing card reconciliation and compliance with this procedure.
This procedure authorizes managers and directors to empower approved employees within their departments or areas of responsibilities to use purchasing cards for purchases within specified limits.
The purchasing card is a credit card that is owned by the town. An employee in receipt of a purchasing card has the delegated authority to purchase goods and services on behalf of the town, up to their designated transaction limits and in adherence of this procedure.
The cardholder is responsible to ensure there is no misuse or abuse and that all purchases are in adherence to this procedure or any other Corporate policies and procedures.
Upon payment of goods or services at a vendor location, the purchasing card must be provided to the vendor. The vendor will swipe the card or insert it into the machine on which you will enter your PIN for US Bank verification and authorization to proceed with the transaction. The cardholder will be required to authorize the transaction. A copy of the transaction slip and a receipt itemizing the goods/service purchased must be retained by the cardholder for reconciliation (see section 5 “How to Reconcile”). The transaction slip (“chit”) is not enough on its own and must be accompanied by a proper receipt.
The purchasing card may be used for the following purchases relating to town business subject to the cardholders transaction limits:
How to apply for a purchasing card:
Lost or stolen cards:
If the card is lost or stolen, the cardholder must immediately contact the following:
All purchasing cards have an expiry date. The PCC will arrange for the distribution of replacement/renewal cards as provided by the US Bank.
Charges that appear on the transaction list that do not accurately reflect transactions made by the cardholder must be identified immediately.
All original records of purchases made with purchasing cards will be kept in Accounts Payable in accordance with the Records Retention By-law, as applicable.
Mandatory training will be arranged with the cardholder once they have made purchases on their card and have transactions to be reconciled. The training session shall provide the steps necessary to complete the reconciliation process and prepare the monthly Account Activity package.
Cardholders will be provided updated training by PCC if required.
Cardholders will be responsible for:
Accounts Payable (A/P) will :
Cardholders must attend a training session prior to completing the first reconciliation of their purchasing card.
The PCC will maintain a master file of all purchasing cards, limits and blocking templates.
Each purchasing card will have a unique number and will be issued in the name of the Town of Oakville and the employee who has been authorized to use the card.
Cards are not transferable among employees.
No single transaction can exceed the prescribed transaction limit (in Canadian funds) nor can the monthly credit limit be exceeded. If a cardholder attempts to process a transaction that is in excess of the transaction limit or the monthly limit, the US Bank will refuse to process the transaction.
The town has standard Blocking Templates which control which Merchant Control Codes (MCC) each cardholder has access to. These templates are designed to prohibit the use of the purchasing card within specified vendor’s groups. If a cardholder attempts to process a transaction for which they do not have clearance, the transaction will be declined. These blocking templates are listed on the Purchasing Card Application Form (Form PC-01).
It is incumbent on those reviewing and approving reconciled cardholder Account Activity Statements (manager/director, the Purchasing Card Administrator (PCA), and/or Accounts Payable) to watch for personal purchases and split transactions and report such actions immediately to the PCA for investigation and action.
Reports detailing cardholder transactions are generated on a monthly basis and are reviewed by the PCA.
The transaction limit per card is tiered dependent upon the employee’s purchasing responsibility. The following Spending Categories and Blocking Templates are to be selected by the employee’s manager/director.
Purchasing card limits:
Spending Categories can be viewed on the Purchasing Card Application Form (Form PC-01)
Purchasing blocking templates:
The Blocking Templates can be viewed on the Purchasing Card Application Form (Form PC-01).
Cash advances are not permitted at any time under any circumstance.
Requests for temporary changes to limits and template blocking, shall be submitted on the Maintenance Form (Form PC-03) along with details of why the request is being made, and be approved by the cardholder’s manager/director. The request will be processed and put in place for a maximum of one cycle month at which point the original limits and/or template blocking will be restored by the PCC.
Single transactions shall not exceed the Single Transaction Limit (STL) including taxes. Larger purchases will not be permitted to be broken into smaller purchases in order to meet transaction limits.
Purchases must be within the stipulated total Monthly Transaction Limit (MTL).
The cardholder may use the purchasing card for payment at a vendor location. The purchasing card will be swiped at the vendor location (like a personal credit card) or inserted requiring your confidential PIN number and the US Bank will:
Cardholders are responsible for ensuring that the vendor returns their purchasing card and a copy of the itemized transaction slip is obtained. If a vendor rejects the purchasing card, the vendor may be blocked by a MCC. If the decline is questionable, the cardholder shall contact the US Bank using the phone number on the back of the purchasing card to determine if the transaction was declined because of a MCC restriction or if it exceeded the per transaction limit or the monthly limit. If the MCC code or the purchasing card limit requires temporary alteration, Maintenance Form (Form PC-03) must be completed in full and submitted to the PCC.
Neither PCC or PCA have access to your PIN, if this is forgotten, you must contact the bank directly using the number on the back of your card for assistance.
Purchasing is not able to assist you with this as it is a Personal Identification Number between cardholder and the US Bank only.
If the purchasing card information is provided to the vendor by telephone, the cardholder must request that the itemized transaction receipt be delivered with the goods or a copy of the itemized transaction slip be faxed to the cardholder.
The purchasing card can be used for internet purchases. It is recommended that the cardholder call the company before making an online purchase to ensure the purchase is being made from a legitimate business. The cardholder shall be responsible for printing and retaining the order confirmation number and any other relevant information after the purchase has been made. As the invoice is not always shipped with the merchandise, the cardholder shall maintain all documents relative to the order until the invoice is received for reconciliation purposes.
The cardholder shall retain all itemized transaction receipts, packing slips, etc. for their monthly transaction reconciliations.
If a purchased item needs to be returned, the cardholder is responsible for obtaining and maintaining a copy of the credit voucher from the vendor itemizing: the product(s) returned for credit; quantity returned, unit price, extended price including applicable taxes. The cardholder will not accept cash or cheque for any returned items. The applicable total cost associated with the credit must be applied back to the credit card for which the initial charge was allocated.
Each cardholder will receive information in their transaction list when in Access Online, detailing the vendor name, subtotal, taxes and total for each transaction accrued for the previous month.
Cardholders will be trained in the process for itemization of the reconciliation process.
All purchasing card activity/purchases will be monitored by managers/director and PCA to ensure that the use of the card is in compliance with this procedure and the employee Code of Conduct.
Non-compliance activities include, but are not limited to:
Action to be taken with occurrence of non compliance incidents:
Three (3) incidents of non-compliance for the same cardholder will result in that cardholder losing their privilege of having a purchasing card and the card will be suspended. Incidents of non-compliance may also be subject to other disciplinary action.
If the purchasing card is suspended it can only be re-issued to the cardholder with the written authority of the respective manager/director, and the PCA, after a twelve (12) month period following the third non-compliance incident.
Account activity statement: the monthly transaction statement issued by the US Bank electronically for each cardholder. The account activity statement is a tool used to reconcile all transaction slips and related documentation.
Back up documentation: transaction slips, credit vouchers, packing slips, etc. that provide the necessary information related to the actual purchase and will be used to match to the Account Activity Statement monthly.
Blocking templates: the variations of templates available which control the MCC codes that a cardholder has access too, or is blocked from.
Cardholder: a town employee that has authority to use a purchasing card for the purchase of goods and/or services in accordance with this procedure.
Credit return receipt: a receipt provided by a vendor when an item originally purchased using the purchasing card is returned to the vendor and the applicable transaction fee is returned and applied against the purchasing card account.
Foreign purchase: a purchase made that is not in Canadian funds.
Itemized transaction receipt: a detailed receipt provided by the vendor detailing individual products and services purchased by product description, unit price, subtotal, taxes and extended total.
Merchant Control Code (MCC): codes that are placed on all purchasing cards restricting the location and type of purchase.
Monthly Transaction Limit (MTL): the collective total of all transactions to a stipulated maximum dollar value on a monthly basis including all taxes.
Personal usage: using the purchasing card to purchase goods/services that are not relevant to work requirements and are of no benefit to the Town.
Purchasing card: a credit card provided by the US Bank imprinted with the cardholder’s name, Town of Oakville, credit card number and validity period.
Purchasing Card Administrator (PCA): the Manager of Purchasing & Risk Management or individual designated by the Manager acting as the primary controller of the purchasing card program in its entirety.
Purchasing Card Co-ordinator(s) (PCC): the purchasing card co-ordinators in Purchasing & Risk Management, who act as the primary contacts for the purchasing card program with respect to day to day functionality.
Purchasing Card Operating System (PCOS): the purchasing card program as a whole.
Reconciliation (reconcile): the process of matching transaction receipts and documentation to the Transaction list ensuring all charges, taxes and account allocation is documented and correct.
Single Transaction Limit (STL): the stipulated maximum dollar value that can be applied to the purchasing card on a per transaction basis.
Spending categories: the categories that the monthly and single
transaction limits fall under.
Transaction: the total extended purchase price including all applicable taxes.
Vendor: any person or enterprise supplying goods or services to the Town of Oakville.
The following describes individual roles and responsibilities of those involved in the purchasing card process.
The PCA acts as the primary controller for the town’s purchasing card program and shall be responsible for:
The PCC manages account requirements and functionality on a daily basis and shall be responsible for:
The cardholder shall be responsible for:
Manager and directors shall be responsible for:
Accounts payable shall be responsible for:
Procedure Number: A-BMG-001-003
Parent Policy: A-BMG-001
Sub-Section: Business Management
Effective Date: 2011 Nov 15
Review by Date: 2018
Last Modified: 2013 Dec 16
Form PC-01 – Purchasing Card Application Form
Form PC-02 – Purchasing Card – Cardholder Agreement
Form PC-03 – Purchasing Card Maintenance Form
Form PC-04 – Purchasing Card Compliance Form
A-BMG-001 Integrated Risk Management Policy