will be redesigned by the instructor team for consistent template

• Purchase Orders (POs) 

Purchase Orders are placed by the buy, and approved through a designated workflow in the university’s financial system. The purchase order is a legally binding commercial document with terms and conditions indicating the supplier, types, quantities, and agreed prices for the products or services provided to the university.

• Payment Methods

After placing the purchase orders, the transaction payment on behalf of a university can be made through these following methods – Purchasing Card and Utilization of Cash.

1. Purchasing Card (P-Card)

Purchasing, Procurement, or Payment Card Program is widely used in cashless modality to facilitate authorized employees to make payment on business-related transactions. The card will be issued by the university to departments, faculty, and staff for small amount transactions. P-Card process provides segregation of duties in order to reduce the risk of error or any inappropriate action. For transactions listed on the P-Card monthly expense reports, at least two of the roles in the procurement process must be separate individuals. The following are the example components drawn from Indiana University standards (University Policies, n.d.)

1.     Purchaser

• A person who makes the purchase online or in-person

• Must be the cardholder or user authorized by the cardholder

2.     Cardholder

• A person whose employee ID is associated with the card and who is responsible for card activity whether the card is issued in their name or in the name of the unit

3.     Reconciler

• Cardholder or assigned travel and expense system delegate

• Reconciles P-Card and Meeting Card expenses

  • Attaches receipt and supporting documentation to the expense report to complete the audit record and to document and rectify any non-compliant transactions

4.     P-Card transaction approver

• Reviews P-Card expense reports to ensure policy compliance

• Approves P-Card transactions in the expense report

5.     Meeting Card transaction approver

• Reviews Meeting Card expense reports to ensure policy compliance

• Approves Meeting Card transactions in the expense report

There are also other payments that are useful in other cases such as Hazmat Card, Travel Card.

2. Utilization of Cash

• Expense Reimbursements (ERs) 

In most U.S. universities, it is only permitted to utilize personal funds for purchasing items when extenuating or logistical reasons prevent using a PO or P-Card. In order to negotiate university terms and conditions and to save money on state sales tax, purchases bought with personal cash should be kept to $500 or less. It is not allowed to use personal cash to make purchases over the $5,000 micro-purchase cap. The purchase of services with personal funds is prohibited. Each purchase made with personal funds must be justified and documented in compliance with the Business Travel and Expense Policy. 

• Petty Cash 

Petty cash funds can be used to make necessary purchases and to compensate people for out-of-pocket non-travel expenses of up to $5,000. The department may choose the dollar thresholds for the fund total, but Accounts Payable must first approve them before they can be implemented. 

The university's payment methods are not allowed to be used for personal purchases or costs. Regardless of the intention to compensate, purchases must be made for the use and benefit of the university. It will be regarded serious misconduct and will lead to disciplinary action if any user connected to the transaction engages in willful fraud or other inappropriate behavior regarding the correct use of the requisitioning and purchasing procedure.

Carnegie Mellon University. (n.d.). Payment card acceptance policy - university policies - carnegie Mellon University. Payment Card Acceptance Policy - University Policies - Carnegie Mellon University. Retrieved May 2, 2023, from https://www.cmu.edu/policies/financial-management/payment-card-acceptance.html 

Carnegie Mellon University. (n.d.). Procurement Manual - Procurement Services - Finance Division - Carnegie Mellon University. Retrieved May 2, 2023, from https://www.cmu.edu/finance/procurementservices/policies-procedures/procurement-manual.html 

Holyfield, T. (n.d.). Procurement Toolkit. Procurement toolkit. Retrieved May 2, 2023, from http://workday.preview.yale.edu/APToolkit/#/ 

Indiana University. (n.d.). Procurement card program. University Policies. Retrieved May 2, 2023, from https://policies.iu.edu/policies/fin-purch-07-procurement-card-program/index.html