Procurement Cards 101
The board has a fiduciary responsibility to the taxpayers. This responsibility is demonstrated in two primary ways:
1) The Review and approval of the annual budgets and, as appropriate, extensions to those budgets.
2) The review and approval of expenditures (vouchers) from those budgets as a control against fraud and misappropriation of taxpayer resources.
With the advent of procurement cards the transparency of the expenditures effectively disappears. The board is asked to approve a payment to US Bank with virtually no detail associated with that expense.
One of the difficulties with procurement cards is the timing of billing and payment do not neatly coincide with our typical pay cycles. Generally speaking, when we use the purchase order process we are invoiced net 30, in other words, from the time we receive the bill we have 30 days to pay the bill. Procurement cards are different.
6th - 8th of month we receive the "Cutoff notice" and cardholders are asked to reconcile their cards. This process involves matching receipts to the bill, inputting appropriate accounting information, and returning the reconciled bills to accounts payable. This occurs by the 15th to 17th of the month. Payment is due on or around the 20th of the month. Because of this timing Accounts payable knows the total amount due to US Bank prior to the first board meeting of the month but they do not have all of the reconciled detail until later in the month, either just before or just after the voucher is certified by the board and paid by account's payable.
In visiting with Stephanie Patterson today I learned that there are two different reports that we can make available to the board, retrospectively, (attached as PCard Detail 1, & PCard Detail 2). We have several different options available to the board, including: 1) Forwarding one or both of the reports to the board on the third or fourth Friday of each month. 2) Attaching the Report to the board packet for review, retrospective to payment, or 3) Make reports available to individual board members on demand or for a scheduled review.
A fourth option would be to delay payment until after the full reconciliation. Doing so would mean that our primary benefit, the rebate associated with card volume, would be significantly reduced or eliminated.