Presentation on theme: "State of California Purchase Card “CAL-Card”"— Presentation transcript:
1State of California Purchase Card “CAL-Card” OVERVIEW
2Graphics make it easy for an employee to distinguish it from their personal card
3CAL-Card Contract Term: October 19, 2006 to October 18, 2011 Contractor:Term: October 19, 2006 to October 18, 2011Five year contract with one (2) year option for renewal
4What is a “CAL-Card” ?The State of California offers state and local government agencies a Master Service Agreement providing VISA purchase card servicesThe CAL-Card is a payment mechanismPurchases of goods/services up to $100,000 per transaction, higher limits are available upon approval from US BankTravel expenses for local agencies only; travel insurance is not includedThe CAL-Card is a purchase card issued in the “name of the cardholder” and billed to the agency
5How did the program start? Together with Auditor/Controller and the Purchasing/Fleet Services initiated the Procurement Card Program.County looking at ways to improve the way it does business, promoting vendor acceptance, and operational efficiency in the way we purchase some its items.A/C office issues 20,000 “Type-B Warrents” for $1,000 or less each month; was looking for an easier way.Pilot program started July 2001 with 5 depts. and 35 Cardholders.
6What can the CAL-Card replace? Purchase OrdersNo longer restricted to businesses that acceptPurchase Orders.Travel Expense ClaimsLocal agencies onlyPetty CashPayment mechanism for Purchase Orders, Contracts, and some Service Orders.Ask if anyone continues to use Petty Cash Boxes?Confirm that petty cash boxes are a lot of administrative work.CAL-Card eliminate the need for petty cash.CAL-Card purchase cards can be controlled and issued as needed by the Cardholder.Remember CAL-Card is issued in the name of the Cardholder not be be used as a “Group” card.
7CAL-Card AdvantagesExpanded supplier base – honored where ever VISA is accepted.No minimum card count or spend.Suppliers are paid promptly - within 2 to 3 daysEliminates multiple checks, one monthly check to U. S. Bank.Standard cycle date is the 22nd of each monthor agencies may choose any date from the3rd to 27th of each month.Option for multiple billing cycle dates.Multiple billing level options - separate invoicesfor different divisions within the agency.Read slide
8More CAL-Card Advantages Improved access and opportunities to save $$ for the purchase of goods and services:Walk-in purchases.Telephone orders.Internet – (Tip: Print itemized order.)Obtain goods and services when needed.Controls - dollar limits and Merchant Activity Type (MAT) restrictions.Min. Cost program with the exception of late fees.Dept. is accessed a $45/yr county management fee.Read slide:Here are some important tips specifically related to internet purchases.Stress when Cardholders are making internet purchases to only use secure sites beginning with “https”.Print the invoice from the screen while placing the order, some internet merchants will not send an itemized invoiceConfirm shipping costs in writingSTOP the order if merchant will not confirm shipping costsWe suggest that this information be included in the Cardholder written procedures
9More CAL-Card Advantages Prompt Payment Rebate.Payment due 45 days from invoice date.VISA dispute, fraud and Waiver Liability protection up to 60 days from invoice date.Quarterly User Group Meetings.Training and support tools provided at no costAccess On Line – Free U.S. Bank web based program for CAL-Card Program management.Read slideNote that detailed information on the prompt payment rebate and the training opportunities will be covered later in the workshop
10CAL-Card Program Each cycle generates a “Department Invoice” called a “Corporate Account Summary”Unpaid amounts do roll forward to the next month’s Cardholder Statement and to the Department InvoiceCAL-Card is paid from the monthly invoice, not from the Cardholder StatementRead slideMonthly invoice shows the debits and credits posted during the thirty day cycleMonthly invoice aging report, F110, Invoice Status Report, identifies any open or outstanding invoice balances
11(Corporate Account Summary) Transaction FlowCounty of RiversideCard HolderMerchantMerchant’s BankVisaU.S BankTalk about the transaction flow process through to the Statement of Account, the R090 and the R060Department Invoice(Corporate Account Summary)Cardholder Statement
12Billing Office prepares payment to U.S. Bank Statement of Account U. S. Bank sends the Cardholder Statement of Account & Department InvoiceDept.Invoice (AccountSummary)Billing Office prepares payment to U.S. BankStatement of AccountCardholderforwards to Approving OfficialCardholdersReconciliationEnvelopeApproving Official forwards to Billing Official
13General InformationThe CAL-Card is embossed with your name, sent to your department’s address. Do not allow others to use it!There will be no credit check of your personal credit history, it is a County purchasing card in your name.The CAL-Card is a “payment mechanism” not a procurement method. County buying rules still apply.The payment terms are 45 days, late payment interest penalty begins on the 46th day for any open, undisputed balance. The department will be “shut-down” on 61st day.The Cardholder is responsible for handling returns and exchanges in a timely manner.The Cardholder is responsible for reconciling and approving the monthly Statement of Account and forwarding it to the Approving Official in a timely manner [by County established policy (1st of the month)].Read slide.Stress payment mechanismMust follow agency established policy/procedures for purchasingNo personal information – all based on agency solvencyNote that the presentation will review MCCs, billing documents and key management reports later in presentation
14General Information Continued Items prohibited by Contract , as well as the County, spending limits, and purchase restrictions still apply.The CAL-Card is prohibited for “any personal use”.The CAL-Card cannot be used as a group card (ghost card), the Cardholder is responsible for all transactions.The Cardholder should call U.S. Bank Customer Service1 (800) to request a duplicate copy if your statement is not received within 10 business days from the cycle date. Cycle date is usually the 22nd of the month.The Cardholder is required to immediately notify [U.S. Bank], their Approving Official, Agency Program Coordinator, if a CAL-Card is lost, stolen, or if the card is worn and needs to be replaced.Read slide title_________________________________________________________________
15The Cardholder (C/H)Should have knowledge of agency/CAL-Card policies and procedures for purchasingActs as a purchasing agentReceives and reconciles receipts to monthly Cardholder Statement of Account and forwards to the Approving OfficialAuthorizes payment and/or use of credits in a timely mannerPromptly reports fraud and disputes within 60 days of cycle date and monitors through to closureInitiates disputes, completes and faxes dispute form (CSQI) to U. S. BankRead slideC/H must be familiar with agency purchasing processes and policy. Recommend that C/H must have reconciled and approved SOA to A/O by specific date, 10th of the month. C/H has 60 days from cycle date to dispute or report suspected fraud or dispute and/or fraud rights are lost. Keep fax confirmation sheets for all communications regard dispute or fraud and take the name of the U.S. Bank contacts when report a dispute or a fraud. Dispute rights and fraud protection will be lost if and to U.S. Bank, if Cardholders does not respond to written communications or phone calls from U.S. Bank relating to reported disputes or fraud reports
16Contract Excluded Transactions Review slide – Represents contract “Excluded Transactions or Merchant Category Codes” which will automatically decline if purchase by a CAL-Card is attempted.
17Payment Terms Requires payment to be made within U. S. BankGOVT SERVICESRequires payment to be made within45 days of Dept. Invoice date.U.S. Bank posts payments based on the date of the check, after the check is received.Payment options include:Check.Electronic fund transfer (EFT) via Automated Clearing House (ACH) EDI.Read slide
18Interest PenaltyInterest penalty is based on the State Prompt Payment Act which is announced annually.Penalty calculation begins on the 46th day from the invoice cycle date.Read slideNote that late payment interest penalty rate is announced annually by the State Department of Finance upon passage of the state budget. The interest rate is announced in writing by a “Budget Letter.” Participating APC and B/O are sent copies of the budget letter and the current Budget Letter is always posted on the CAL-Card web page. The web page address is provided in the handouts which will be reviewed at the end of the workshop.Total Amount Past Due times Number of Days Past Due times Interest Rate ( 3.256%) divided by = Late Payment Interest Amount.NOTE: Agencies are responsible for calculating interest. The interest penalty amounts shown on the F110 are estimated only.
19The Dispute Process How to make it work! Following we will review the dispute process and the required documentation.
20Fraud ProtectionFraud must be reported to U.S. Bank Customer Service at 1(800) , within 60 days from Cardholder Statement of Account date.Third party fraud - non employeeZero deductibleZero liabilityFraud committed by an employeeVISA Liability Waiver Coverage - if employeeis terminated1 - 4 cards $5,000 – per card5 + cards $100,000 – per card RIVCORead SlideInvoking Visa Liability Waiver Program coverage is an option and a decision left to each participating agency.
21CardholdersMust be familiar with, and adhere to, their agency’s procurement guidelines and proceduresAll charges must be for “Official Business Only”Responsible for reconciliation of receipts to monthly Cardholder StatementCardholder is responsible for filing disputes, if neededThis may be done through Access Online, filing a CSQI form or calling customer serviceReconciles monthly Cardholder Statement promptly to avoid late payment penalty and “shut-down”
22ApproversResponsible for reviewing and approving Cardholder transactionsTake the time to review all documentation for accuracy; make no assumptionsTransactions are for “Official Business Only”Ensure that all documentation has been provided by Cardholder per agency’s policies and proceduresMay approve Cardholder statements through Access Online or hardcopyBeware of repetitive “Missing Receipt” documentation
23Billing OfficialResponsible for reconciling the Managing Account Statement (Invoice)Verifies that all documentation has been provided by Cardholder for paymentVerifies charges have been approved for payment by the agency “Approver”Reviews Cardholder charges; question any item that seems out of the ordinary. Refer those items to the Program Administrator.Processes Managing Account Statement (Invoice) and pays U.S. Bank quickly to avoid late payment penalty and “shut-down”.Monitors past due balancesBeware of repetitive “Missing Receipt” documentation
24Program Administrators Primary Program Administrator should be the “hands on” person for program managementResponsible for developing procedures and training for Approvers, Cardholders and Billing OfficialMonitors all past due balances; works with Billing Officer to clear unpaid amountsPerforms random monthly audits of CAL-Card spendsReviews monthly management reports for agency program compliance and spending patternsAdds/deletes Cardholders, Approvers and Billing Officials, establishes Cardholder spending limits and Merchant Category Codes,
25Important Things To Remember Purchases must be for “Official Use Only”! No Personnal Purchases.Must have money in the budget.Honor current County contracts & awards.County Purchasing Rules still apply. Must follow established policy/procedures for purchases.Do not allow others to use your card.
26CAL-Card website: www.pd.dgs.ca.gov/calcard Questions ?CAL-Card website:(916)orU.S. Bank