PURPOSE

The purpose of this Purchasing Card Policy ("Policy") is to provide structure, limits and accountability in the use of a Purchasing Card ("P-Card").

P-Cards provide a convenient, efficient and managed approach for appropriate small-dollar purchasing transactions. A P-Card is offered to the Cardholder to ease the administrative burdens for Allowable Purchases (as defined in this Policy). This Policy lays out appropriate uses of P-Cards and articulates responsibilities of Cardholders, Expense Approvers and Budget Owners. This Policy also provides structure around routine Audits that will be conducted to ensure proper oversight to the program.

Having a P-Card is a privilege, and possession comes with specific requirements and responsibilities set forth in this Policy and the corresponding P-Card Guidelines. This Policy provides substantial consequences, including revocation of P-Card privileges, for violations of Policy requirements and P-Card responsibilities.

SCOPE

For the purpose of this Policy, "University" refers to Drexel University and its colleges, schools, divisions, subsidiaries, and affiliates. All University trustees, officers, faculty, professional staff, students, and any other individuals who may be granted P-Card privileges are subject to this Policy.

IMPLEMENTATION

Implementation of this policy is the responsibility of Procurement Services.

ADMINISTRATIVE OVERSIGHT

The Executive Vice President, Treasurer and Chief Operating Officer is the Drexel University official responsible for the administration of this policy.

DEFINITIONS

Allowable Purchase: A purchase of goods that are needed for a legitimate University business purpose, are not available through the University's e-procurement system, fall under the P-Card Limits, and are not otherwise restricted by existing University policies for purchase with a P-Card. The P-Card Guidelines include a non-exhaustive list of commonly purchased items that are Allowable Purchases.

Audit: An examination of transaction reports and related documentation by an auditing authority, as more fully described in the P-Card Guidelines.

Budget Owner: A faculty or professional staff member who is responsible for providing oversight of departmental funds. A Budget Owner determines the internal reporting structure and who is an Expense Approver and Cardholder within their department.

Capital Equipment: Any asset that has a value of $5,000 or greater.

Cost Center: A combination of a six-digit Fund and four-digit Organization number, also known as a Fund-Org-Account-Program-Activity-Location (FOAPAL). Please reach out to General Accounting or Research Accounting for further information.

Expense Approver: A faculty or professional staff member designated by a Budget Owner and at a higher level than the Cardholder. A Cardholder cannot function as their own Expense Approver, and temporary employees cannot be the sole or final Expense Approver of P-Card charges.

Prohibited Purchase: A purchase of goods that is not an Allowable Purchase, a purchase of Capital Equipment, or any purchase of services. For the avoidance of doubt, personal expenses are always Prohibited Purchases. The P-Card Guidelines include a non-exhaustive list of Prohibited Purchases.

Purchasing Card (P-Card): A University-issued credit card paid by the University for Allowable Purchases.

Purchasing Cardholder (Cardholder): A full-time benefits eligible faculty or professional staff member or other individual who has been given a P-Card to use for making Allowable Purchases and trained in accordance with this Policy.

Purchasing Card Administrator (P-Card Administrator): Designated by Procurement Services, the individual responsible for administering the University P-Card program and ensuring adherence to all rules, guidelines and policies by Cardholders, Expense Approvers and Budget Owners. Also serves as a liaison between Cardholders and credit card providers.

Purchasing Card Guidelines (P-Card Guidelines): Specific guidelines applicable to P-Cards as may be updated from time to time by Procurement Services.

Purchasing Card Limits (P-Card Limits): Limits on single transactions, transactions per monthly cycle, and total spend per monthly cycle, as set by the Associate Vice President of Accounts Payable & Procurement Services and Budget Owners and Expense Approvers.

Reconciliation Portal: Online access provided by the credit card provider to view, edit, add materials, and approve transactional information.

Stringing/Splitting: When a single purchase is broken into multiple transactions to intentionally circumvent P-Card Limits.

Transaction Notes: A description of the business purpose of a P-Card transaction, as more fully described in Section D.6 below.

Transaction Allocation Report: Reports generated in PaymentNet, reviewed by the Cardholder and Expense Approver, and submitted to the P-Card Office.

POLICY

P-Cards may only be used by Cardholders for Allowable Purchases in accordance with this Policy and the P-Card Guidelines. Inappropriate use of the P-Card, including but not limited to personal purchases, will result in disciplinary action up to and including termination of employment, as set forth in this Policy and the P-Card Guidelines.

A. Appropriate Use of P-Cards

Only Allowable Purchases may be charged to the P-Card; Prohibited Purchases to the P-Card are forbidden. It is the responsibility of the Cardholder and Expense Approver to ensure that all purchases made with the P-Card are Allowable Purchases. Exceptions for Prohibited Purchases must have written pre-approval from Procurement Services. The P-Card Guidelines set forth non-exhaustive lists of Allowable Purchases and Prohibited Purchases.

For purposes of determining what is an Allowable Purchase of business meals, (i) snacks/refreshments are addressed in the Business Meeting Meals and Catering Expense Guidelines; and (ii) meals purchased while on business travel are addressed in the Business Travel Expense Policy.

P-Card Limits and usage will be reviewed on a regular basis to determine current departmental needs. Any findings will be shared with Cardholders and Approvers prior to action being taken.

B. P-Card Limits

The Associate Vice President of Accounts Payable & Procurement Services sets forth University-wide P-Card Limits. Specific P-Card Limits for each Cardholder shall be established by the applicable Expense Approver and Budget Owner based on reasonable and normal requirements and shall be set at the lowest level possible to satisfy those requirements, subject to review by Procurement Services.

The P-Card Office will periodically review actual P-Card usage and may adjust University P-Card Limits at any time based on actual need.

An exception to P-Card Limits may be granted by the Associate Vice President of Accounts Payable & Procurement Services or their designee if it is determined that the University interest would be best served. Such exception must be requested and granted in writing, with the requester providing information on the business purpose to be satisfied through the exception.

Effective Dec. 4, 2020, the Associate Vice President of Accounts Payable & Procurement Services grants a blanket exception to establish higher P-Card Limits for Accounts Payable to accommodate authorized large payments on behalf of Drexel University. This exception is subject to revision at the discretion of the Associate Vice President of Accounts Payable & Procurement Services.

C. P-Card Reconciliation

All P-Card transactions must be reconciled monthly by the Cardholder through the Reconciliation Portal and accompanied by detailed Transaction Notes with supporting purchase documentation, which together reflect an efficient stewardship of resources, as more particularly described in Section D.6 below. Schedule of reconciliation and Transaction Allocation Reports are outlined in the P-Card Guidelines. All P-Card transactions and accompanying reconciling requirements must also be reviewed and approved by designated Expense Approvers monthly.

Misuse or unauthorized use of the P-Card may result in the loss of card privileges and disciplinary action, up to and including termination of employment. Cardholders are responsible for reimbursing Drexel University for the total amount of the unauthorized purchases. If the Cardholder fails to reimburse the University at the negotiated time and date set by the Expense Approver and Procurement Services, the University may deduct the total amount from the Cardholder's salary or from any other payment amounts made to the Cardholder regardless of the Cardholder's employment status. If Drexel University initiates legal proceedings to recover amounts owed by the Cardholder, the Cardholder must pay legal fees and costs incurred by the University in such proceedings.

D. Cardholder Responsibilities and Procedures

Cardholders shall have the following responsibilities and shall abide by the following procedures as a condition to receiving and retaining a P-Card:

1. Acknowledge and agree to abide by the P-Card Policy and P-Card Guidelines.
2. Successfully complete all required P-Card training, including initial training upon receipt of P-Card, annual online refresher training in Career Pathway, and any additional P-Card training required by the P-Card Office.
3. Maintain the security of the P-Card, including:
   1. Safeguarding the P-Card from theft and loss;
   2. Not allowing the use of the P-Card by parties other than the Cardholder;
   3. Immediately notifying the card provider first, and then the P-Card Administrator immediately thereafter, if the P-Card is stolen, lost, or if fraudulent activity is believed to have occurred;
   4. Transferring all outstanding orders/recurring transactions to a replacement P-Card account if a P-Card is lost, stolen or canceled for any reason;
   5. Following the procedures outlined below in Section D.9 below if transferring departments, leaving the University, or going on extended leave;
   6. Notifying the P-Card provider of international travel prior to departure; and
   7. Notifying the P-Card Administrator of any updates to name, business address, University phone number, change in Expense Approver, default Cost Center (unrestricted funds only), and/or of desired limit changes by completing and submitting the P-Card Change Form.
4. Obtain detailed receipts for P-Card purchases. Detailed receipts, at a minimum, must include the date of transaction, supplier's name, time of transaction, and location of the supplier. Refer to the P-Card Guidelines for further information regarding detailed receipts.
   1. For purchases where a receipt is obtained but later lost, Cardholders should first request a duplicate copy from the supplier. If a copy is no longer available, Cardholders must complete and maintain the Missing Receipt Form for any transaction over $25. Explanations must also be provided in the Transaction Notes if multiple Missing Receipt Forms are provided.
   2. If service transaction fees charged on the P-Card (card provider, international transaction fees, or travel agency) do not generate a receipt, a Missing Receipt Form is not required if the transaction is reconciled correctly.
   3. International transaction fees must be reconciled to the correct cost center; however, the Transaction Notes for these charges may be left blank.
5. Ensure that sales tax is not charged in states where the University has sales tax exemption. If unsuccessful, an explanation must be provided in the Transaction Notes in the Reconciliation Portal for any purchase greater than $25. Drexel Tax Exemption Certificates are available in DrexelOne.
   1. For purchases within Pennsylvania:
      1. Advise the supplier prior to purchase that the purchase is for Drexel University and is exempt from Pennsylvania state sales tax;
      2. Present the supplier with Drexel's tax-exempt number, which is printed on the front of the P-Card; and/or
      3. Present the supplier with a copy of the Pennsylvania Exemption Certificate.
   2. For purchases outside of Pennsylvania in states where Drexel University has a sales tax exemption, the Cardholder must use applicable Tax Exemption Certificates (available on DrexelOne).
   3. If sales tax is erroneously charged to a Cardholder, the Cardholders is obligated to ask the supplier to remove the tax. If a supplier refuses to accept Drexel's tax exemption, the Cardholder must reflect the effort made in the Transaction Notes. The P-Card Office reserves the right to reach out to the supplier to verify what efforts were made by the Cardholder to remove the tax.
   4. If sales tax is not reported on the receipt but is reported in the transaction listed on the card provider's system, the sales tax must be corrected during reconciliation. Please see the P-Card Guidelines for more information on Tax Management.
6. Review P-Card charges monthly and provide a detailed Transaction Note and Cost Center for all P-Card transactions.
   1. Cardholders may designate a proxy to reconcile their P-Card charges on their behalf, provided that the proxy successfully completes P-Card training. Using a proxy does not relinquish the responsibilities of the Cardholder. Any violations of the P-Card Policy are the sole responsibility of the Cardholder regardless of proxy designation. Cardholders must review all Transaction Notes and Cost Centers for P-Card transactions reconciled by their proxy for accuracy.
   2. P-Card purchases to be paid with grant or research funds must also comply with Research Accounting Services' protocol.
   3. The P-Card Office may suspend Cardholders if transactions are not consistently reconciled and reviewed per the P-Card reconciliation schedule.
   4. If a Cardholder does not reconcile their P-Card transactions prior to the applicable deadline, the transaction must be corrected through a journal entry. Please see the Comptroller's website for more information on journal entries.
   5. All Transaction Notes must include the following required information:
   1. Who: Specific names of the individuals or groups who incurred the expense or benefited from the purchase; name of the supplier if not indicated on the receipt (e.g. PayPal receipt).
   2. What/Why: Explanation of the expense (what was purchased; why was the purchase made on behalf of the University).
   3. When: The time/date of the transaction (if not clearly indicated on the receipt).
   4. Where: The location of the supplier/event (if not clearly indicated on the receipt).
   5. The following are examples of acceptable Transaction Notes:
   1. Professor Brown took a taxi from Drexel to Temple University with Professor White to give a presentation on behalf of Drexel at the National Biochemistry Conference held at Temple's Liacouras Center.
   2. John Doe and Jane Black's lunch at Temple University while attending the 2017 University Supplier Fair on behalf of Drexel University.
   3. Professor Smith's business lunch with doctoral candidate at Zavino to discuss recruitment opportunities in the upcoming fiscal year. Two appetizers were purchased and consumed by each party. See transaction documentation for departmental approvals.
7. Provide receipts and completed Transaction Allocation Reports to Expense Approvers in a timely manner.
   1. At the end of each monthly P-Card cycle, Cardholders must ensure all P-Card transactions are reconciled, provide all transaction documentation (e.g., receipts, forms, and approvals), sign the Transaction Allocation Report, and have their Expense Approver review and sign the Transaction Allocation Report.
   2. Transaction Allocation Reports and receipts must be maintained in adherence with the Record Retention Policy. Please note electronic records are acceptable as long as they are stored on any University network drive.
   3. Cardholders must adhere to any additional requirements set by the P-Card Administrator.
8. Respond to Audit inquiry requests by the P-Card Office within two business days of request.
9. Notify the P-Card Office prior to any inter-department transfer, department transfer, termination/departure, or extended leave.
   1. Cardholders must inform the P-Card Office within 48 hours after their acceptance of a new University position, or after notice of departure or extended leave is given to the University.
      1. If a Cardholder is transferring departments and requires a P-Card in their new position, the Cardholder is required to submit a P-Card Change Form to the P-Card Office, provide a new unrestricted Cost Center as a default, and designate a new Expense Approver.
      2. If a Cardholder is terminated from the University, it is the responsibility of the Expense Approver to notify the P-Card Office via email with a completed P-Card Change Form.
      3. If the Cardholder is going on FMLA or extended personal leave, their P-Card will be placed on temporary suspension until Cardholder returns to work. If the Cardholder is going on sabbatical, the P-Card may remain active or be placed on temporary suspension at the discretion of the Cardholder’s supervisor. If a P-Card remains active while a Cardholder is on sabbatical, the Cardholder and their supervisor remain responsible for any violations of this Policy.
   2. Cardholders who are transferring departments and no longer have P-Card responsibilities, or who are leaving the University, must physically destroy their P-Card and ensure all receipts, documentation, and Transaction Notes are complete and any outstanding transactions are reconciled.

E. Expense Approver Responsibilities and Procedures

Expense Approvers shall have the following responsibilities and abide by the following procedures:

1. Acknowledge and agree to abide by the P-Card Policy and P-Card Guidelines prior to fulfilling duties of the Expense Approver role.
2. Successfully complete all required P-Card Expense Approver training, including initial training upon assumption of Expense Approver duties, annual online refresher training in Career Pathway, and any additional P-Card training required by the P-Card Office.
3. Review P-Card transactions for applicable Cardholders, including receipts and Transaction Notes, and sign Transaction Allocation Reports, before monthly online reconciliation closure. The Expense Approver must verify that each P-Card transaction is an Allowable Purchase and otherwise permissible per this Policy and the P-Card Guidelines, has a complete detailed Transaction Note, is reconciled to the appropriate Cost Center, and has acceptable proof-of-purchase documentation.
4. In the event that a P-Card transaction has not been reviewed by a Cardholder due to the sudden absence of such Cardholder or other mitigating factors, Expense Approvers must still review and reconcile these charges as soon as possible to ensure the P-Card transactions contain the supporting documentation as required in this Policy.
5. Review, verify and make any necessary corrections to all Cost Center codes for all P-Card transactions for applicable Cardholders. When charging against a fund with restrictions, the Expense Approver must ensure that the charges are consistent with sponsor or donor restrictions.
6. Ensure sales tax is not charged to the applicable Cardholders in states where the University is exempt. In instances where sales tax is charged to a Cardholder, Expense Approvers are required to direct the Cardholder to reach out to the supplier to remove the tax or reach out to the supplier directly.
7. Ensure applicable Cardholders are abiding by the P-Card Policy and Guidelines. Expense Approvers must continually be aware of P-Card misuse and use reasonable due-diligence to detect such misuse, including:
   1. Personal Misuse, including but not limited to, purchases made for the sole purpose and benefit of the employee; use of P-Card by an employee who has been terminated or suspended; and high volume of Missing Receipt Forms in lieu of receipts.
   2. Administrative Misuse, including but not limited to, lack of adherence to reconciliation guidelines and policies on a monthly basis; Stringing/Splitting; use of P-Card for Prohibited Purchases.
8. Immediately report any activity deemed suspicious, unusual, or in breach of this Policy or P-Card Guidelines to the P-Card Administrator.
9. Respond to Audit inquiry requests by the P-Card Office within one business day of request.
10. Maintain proof of purchase documentation and Transaction Allocation Reports from all applicable Cardholders to quickly produce at times of Audit. See the University's Record Retention Policy and P-Card Guidelines for further clarification.
11. Notify the P-Card Office within 48 hours when applicable Cardholders are transferring within a department or to a new department at Drexel, leaving the University, or going on extended leave. Ensure that Cardholders who are leaving the University or who no longer need their P-Cards physically destroy their P-Card. Expense Approvers must ensure all receipts, documentation and Transaction Notes are complete and any outstanding transactions are reconciled for applicable Cardholders who are leaving the University or who no longer need their P-Cards.

F. Budget Owner Responsibilities and Procedures

Budget Owner shall have the following responsibilities and abide by the following procedures:

1. Acknowledge and agree to abide by the P-Card Policy and P-Card Guidelines prior to fulfilling duties of the Budget Owner role.
2. Successfully complete all required P-Card Budget Owner training, including initial training upon assumption of Budget Owner duties, annual online refresher training in Career Pathway, and any additional P-Card training required by the P-Card Office.
3. Approve P-Card applications and roles (Cardholder, Expense Approver) for their college, school or department.
4. Set appropriate P-Card Limits.
5. Ensure applicable Cardholders and Expense Approvers are aware of this Policy and the P-Card Guidelines and timetables, and provide sufficient oversight and review to ensure all Cardholders and Expense Approvers are in compliance with this Policy and the P-Card Guidelines.
6. Notify the P-Card office within 48 hours of any changes to designated Expense Approvers.

G. P-Card Administrator Responsibilities and Procedures

The P-Card Administrator shall have the following responsibilities and abide by the following procedures:

1. Acknowledge and agree to abide by the P-Card Policy and P-Card Guidelines, and understand P-Card Administrator responsibilities, prior to fulfilling the duties of the role.
2. Complete the required Cardholder, Expense Approver, and Budget Owner training.
3. Work with the Office of General Counsel, Accounts Payable, Procurement Services and any other appropriate University office or department to determine any additional P-Card training and/or policy requirements for Cardholders, Expense Approvers, and Budget Owners.
4. Administer the P-Card program in compliance with this Policy and the P-Card Guidelines.
1. Confirm eligibility of new P-Card applicants, responsibilities of Expense Approvers/Budget Owners, set credit limits, process and submit P-Card applications, and distribute P-Cards to Cardholders upon receipt.
2. Request cancellation or suspension of P-Cards and ensure all outstanding receipts and transactions are reconciled for employees that have left the University or that are on long-term leave.
3. Monitor credit limits and ensure that all change limit requests are appropriate and contain the appropriate approvals.
4. Monitor P-Card declines.
5. Determine access rights to the Reconciliation Portal.
6. Perform Audits of Cardholders as outlined below in Section H and in the P-Card Guidelines.

H. Audits

The P-Card Office will conduct regular, random Audits of Cardholders as more fully set forth in the P-Card Guidelines. Cardholders and Expense Approvers must respond to Audit inquiries by the P-Card Office within two business days of the request. If questions, deficiencies, inconsistencies or other concerns arise from an Audit, the following will apply:

1. The Cardholder must address each item, outlining steps that will be taken to assure future compliance; and
2. The P-Card Office will conduct a follow-up Audit within six months to assure that corrective measures have been put in place.

Failure to comply with Audits in any way will result in the immediate suspension of all applicable P-Cards until compliance is achieved.

I. Consequences

Violations of this Policy and/or the P-Card Guidelines may result in suspension or cancellation of P-Card privileges, and/or other disciplinary actions, up to and including termination of employment.

All infractions to the P-Card Policy and Guidelines will be reviewed by the P-Card Office to determine appropriate disciplinary action. Possible consequences for each infraction are laid out in the "P-Card Policy Infraction" grid below.

Types of Infractions

• Reconciliation Infraction: Failure to reconcile P-Card transactions and submit Transaction Allocation Reports as outlined under Cardholder Responsibilities in this Policy and reconciliation guidelines set forth in the P-Card Guidelines.
• Material Infraction: Any purchase made not in compliance with the P-Card Policy and Guidelines.
• Approver Infraction: Approval of purchases which were non-compliant with the P-Card Policy and Guidelines, and such non-compliance was detectable through the use of reasonable due diligence. Infractions are counted as an aggregate across all P-Cards under the Approver.
  Personal expenses made on a P-Card must be reimbursed to Drexel University. Failure to do so will result in the loss of card privileges and disciplinary action, up to and including termination of employment. Drexel University may pursue recovering the total amount of the personal expenses from the Cardholder's salary.

Accrual of Infractions

For purposes of determining consequences associated with Reconciliation Infractions and Approver Infractions, except those involving Material Infractions (see below), such infractions will accrue over a period of two calendar years. The two-year period will end on December 31 of each even-numbered year (e.g., 12/31/2020, 12/31/2022, etc.). At the expiration of the applicable two-year period, any prior offenses will be removed from the Cardholder's record. Where circumstances warrant, Procurement Services reserves the right to evaluate offenses across multiple two-year periods (e.g., related infractions spanning both the period ending 12/31/2020 and the new period beginning 1/1/2021) and impose appropriate consequences as set forth below. Additionally, where Procurement Services determines that a Reconciliation or Approver Infraction is minor, such an infraction may not be counted as an offense for purposes of determining consequences.

Material Infractions will accrue over the life of the P-Cardholder's possession of a P-Card and will not reset. Approver Infractions which involve approval of a purchase which constitutes a Material Infraction will accrue over the course of the Approver's employment at Drexel University and will not reset.

P-Card Policy Infractions

J. Appeal Process

A Cardholder may appeal the cancellation of a P-Card. The appeal must be made in writing to the Associate Vice President of Accounts Payable & Procurement Services, who has sole discretion to reinstate the P-Card. If it is determined that a P-Card will be reinstated, the Cardholder will be required to comply with the P-Card Policy and Guidelines moving forward. Any additional violations by the Cardholder will result in permanent cancellation of all P-Card rights without appeal, and appropriate personnel action will be taken.