1. Student Affairs Buying 101 Buying Requirements & Other Considerations Students First Topic 9 9-01

2. Student Affairs Buying 101 Students First Topic Objectives Understand the general requirements and considerations for buying Know the purchasing bid limits amounts for goods and services Understand who must approve all waivers for bids within Student Affairs 9-02 Buying Requirements & Other Considerations

3. Student Affairs Buying 101 Students First The following are buying requirements and considerations and are intended to help ensure compliance with the guidelines set by the various State codes and the University’s Board of Trustees for all authorized University funded purchases. Board Resolutions 98-62 and 2002-97 define the policies that guide the purchasing process.  Contracts – No one in Student Affairs is authorized to sign a contract or agreement between the University and non-University entities. The only person authorized to sign contracts or agreements between the University and non-University operations are Bill Shkurti, Helen DeSantis, Bob Quinn, and University Legal.  Conflict of Interest – It is the responsibility of each member of the University staff to assure that the University does not knowingly enter into any purchase commitment, which could result in conflict of interest. 9-03 Buying Requirements & Other Considerations

4. Student Affairs Buying 101 Students First  Buy America – Ohio codes require that the Purchasing Department give first consideration (some exceptions exists) to goods, which are mined or produced in the United States.  Buy Ohio – Ohio codes require that the Purchasing Department participate in the “Buy Ohio Program.” Bidding procedures under this program remain unchanged; however, 5% economic preference is afforded to those firms located in Ohio and bidders from “border” states, as determined by the State of Ohio. (Boarder States include only Michigan, Kentucky, Pennsylvania, and New York. Both Indiana and West Virginia have a “Preference Against Ohio Rule.”)  State Use Law – Ohio codes direct that state agencies use a qualified non- profit state agency (e.g. Ohio Industries for the Handicapped) for the purchase of products and/or services, which are available from a work center employing persons with disabilities. 9-04 Buying Requirements & Other Considerations

5. Student Affairs Buying 101 Students First  Ohio Penal Industries (OPI) – Ohio codes direct that state operating use the Department of Rehabilitation and Corrections for the purchase of products and/or services available from state correctional and penal institutions.  Vending Services – Vending Services represents the University in administering all vending machine service and concession agreements and contracts. When appropriate, the Purchasing Department will develop specifications and obtain competitive bids for any proposed vending or concession service. All requests for installation of vending equipment and concession service should be directed to the Vending Coordinator. 9-05 Buying Requirements & Other Considerations

6. Student Affairs Buying 101 Students First  University Name – The Ohio State University regulates and controls the use of the University’s name and property in advertising conducted by suppliers who have provided products or services to the University. All requests by suppliers for use of the University’s name or other identifying marks in their advertising materials must be forwarded for approval to the Office of Trademark and Licensing Services.  International Transactions – Shipments from international sources are cleared by the University’s contract customs broker who works with the United States Customs Office. Brokerage fees will be charged to the using department’s fund indicated on the purchase order.  Gift-in-Kind – A gift-in-kind is any non-cash, tangible gift given to the University. A gift review form must be completed prior to receipt of the non-cash gift property, regardless of value. A donor intent form, purchase order, invoice, and if applicable documentation should accompany the gift review form. 9-06 Buying Requirements & Other Considerations

7. Student Affairs Buying 101 Students First  Restricted Commodities – the following purchases require the additional approval of the individuals and areas noted, and must be processed through the Purchasing Department regardless of the dollar value (the following is a sample listing; a complete listing is provided in your materials): Alcohol – appropriate Dean, Chair or Vice President Painting services and renovations involving painting services – Director of Facilities in Student Affairs and Director of Purchasing Department. Signage – Campus Graphic Coordinator and Facilities Planning and Development Computers/Software & Components – Director of Student Affairs Information Technology team to help ensure compatibility and support. 9-07 Buying Requirements & Other Considerations

8. Student Affairs Buying 101 Students First  Prevailing Wage  Renovation projects (installation or repair) with estimated project totals of $20,955 or more  New construction projects with estimated project totals of $69,853 or more Buying Requirements Must include standard Prevailing Wage comments on the requisition/PO (Additional reviews are conducted at University Purchasing by Buyer) Vendor Requirements Must pay at least specified minimum wage amounts Must submit detail documents on each employee’s hours and pay Documentation must be reviewed by Office of Facilities Planning & Development (OFPD) prior to invoice being paid 9-08 Buying Requirements & Other Considerations

9. Student Affairs Buying 101 Students First  Sales Tax – The Ohio State University is exempt from Ohio sales and use tax. The Blanket Exemption Certificate is locate on the OSU Purchasing website (www.osupurchasing.com).  Shipping and Handling – As a part of the buying process, the buyer must take in consideration the shipping and delivery requirements of each vendor and/or item to be delivered. 9-09 Buying Requirements & Other Considerations

10. Student Affairs Buying 101 Students First  Bid Process – The Purchasing Department has the responsibility to solicit formal bid inquiries from two or more suppliers when the estimated dollar value of the requested purchase for goods if over $25,000 and for services is over $50,000, unless the items can be obtained under existing contracts. These competitive bid thresholds are established by the University’s Board of Trustees Resolution 98.62. The Purchasing Department may competitively bid any request regardless of the dollar amount, when it best serves the University. Options – Request for Quote (RFQ – also called a bid or price inquiry) Request for Proposal (RFP) Request for Information (RFI) 9-10 Buying Requirements & Other Considerations

11. Student Affairs Buying 101 Students First  Waiver of Competitive Bidding – The University procures goods and services competitively whenever practicable. The Assistant Vice President for Business Operations (Helen DeSantis) may waive competition and approve waiver requests when justified. The following are reasons for granting a waiver of competitive bidding: Sole Source Emergency Economic (Note: All Student Affairs requests for waivers must be reviewed and signed by the Director – Business Services (Dan Allen). Purchasing rejects all waivers without Dan’s prior signed approval.) 9-11 Buying Requirements & Other Considerations

12. Student Affairs Buying 101 Students First Total Purchases by Vendor  Do Not “Split Purchase Orders” - Bid limits apply to every combination of For example, if we add all purchases for a vendor for each Fund, ORG, and Program combination, we must not exceed bid limits. If we exceed bid limits, then we are not giving equal opportunity for all vendors to compete for our business (public’s money). We must use the Bid Process for these situations. 9-12 In this example, have we “split purchases”? These are all Goods. Fund ORG Program Project, and Vendor Buying Requirements & Other Considerations

13. Student Affairs Buying 101 Students First Other Critical Considerations: Procurement Card (Pcard) Usage 9-13 Buying Requirements & Other Considerations  Secure the card and card number at all times.  Do not share the card. Be sure to return the card to the card manager. Do not hand it off to another user.  Know what you are and are not permitted to purchase. Ensure you are complying with the card’s restrictions.  Know your card dollar limits. Never “split purchases” to get around card limits.  Make sure that all Pcard purchases are approved in advance and all receipts are immediately returned to the card manager and attached to a completed Pcard transaction form.  Make sure you are not paying taxes.  Minimize use of Pcards. Use Purchase Orders as much as possible. ** Student Affairs Pcard internal control structures are available in the documents library on the Student Affairs Business Office web pages.

14. Student Affairs Buying 101 Students First Topic 10 10-01 Roles and Responsibilities for Procurement Processes Buying Processes, Methods & Documentation

15. Student Affairs Buying 101 Students First Topic Objective Understand the general roles and responsibilities for the procurement processes 10-02 Roles and Responsibilities for Procurement Processes

16. Student Affairs Buying 101 Students First * General Procurement-Related Responsibilities Requester Anyone needing goods or services that initiates the purchase of the goods or services. Generally this is the “knowledge expert” for exactly what is needed. Requester should obtain quotes for the goods or services and complete the appropriate forms. The documented request is then provided to appropriate unit manager. The requester can be anyone within the operation. * These are general responsibilities and each may vary according to the unit. Manager/ Reviewer Ensure purchases are planned and budgets established. Review the purchase requests to ensure proper accounting chartfield is being used, the purchase is within budget limits, quotes have been provided, and approve the purchase as appropriate. Once approved, purchase request is provided to the requisitioner/delegated buyer. Requisitioner Review for buying requirements and determines the proper buying procedures to be used. As appropriate, enters requisitions into the University’s procurement system (PeopleSoft). All requisitions are then reviewed using PeopleSoft workflow by the appropriate assigned reviewer/approver. Once approved, the requisition goes to Purchasing for review and purchase order generation/issuance. 10-03 Roles and Responsibilities for Procurement Processes

17. Student Affairs Buying 101 Students First Buyer (Delegated Buyer). Confirm quotes with vendors, verify proper buying procedures, verify proper chartfield, enter purchase information into the system. The buyer will dispatch the purchase order to the vendor after management review and approval for purchase orders under $5,000. * These are general responsibilities and each may vary according to the unit. Business Office (Buying) Review and approve all requisitions. Receives items from vendors & verifies the receipt of goods or services, in accordance with the established shipping documents and purchase order. Receiver 10-04 * General Procurement-Related Responsibilities Roles and Responsibilities for Procurement Processes

18. Student Affairs Buying 101 Students First Enter the invoice into the system for payment. Scan the invoice into the system and file all documentation. * These are general responsibilities and each may vary according to the unit. Business Office (Payment Processing) Reconciler Reconcile all payments/expenses to the supporting documentation to verify that payments are correct in the general ledger. Invoice Approver Verifies that the goods or services were provided as required from the purchase order and that the invoice is correct and approved for payment. The invoice is stamped approved/signed by unit management approver. Invoice is then is sent to Business Office for payment processing. 10-05 For units that process their payments through Central Accounts Payable, the vendor will send the invoice directly to Central Accounts Payable and the invoice will be processed. If the invoice is for under $5,000, it will be paid without unit reviews or approvals. * General Procurement-Related Responsibilities Roles and Responsibilities for Procurement Processes

19. Student Affairs Buying 101 Students First * These are general responsibilities and each may vary according to the unit. Ensure all business processing is complete, to include the reconciliation within the unit. Review financial statements for accuracy and budget availability. Support the buying processing staff to ensure that roles and responsibilities are performed as appropriate and ensure adherence to polices and procedures. As appropriate, certify compliance with internal controls. Manager 10-06 * General Procurement-Related Responsibilities Roles and Responsibilities for Procurement Processes

20. Student Affairs Buying 101 Students First A memorandum of understanding is signed by the delegated buyer, department director, Director of Business Services, and Director of Purchasing. With this MOU, all signors agree to comply with specific purchasing requirements, such as: Delegated Buyer MOU To adhere to the principles and standards of the National Association of Educational Buyers as well as the Ohio Ethics Laws and related statutes. Uphold the highest degree of public trust and not permit any illegal or improper purchasing practices. Abide by State laws and university purchasing policies and procedures, and applicable codes. Purchase goods or services under contract, price agreements, or with prime suppliers. Retain all purchasing documents subject to applicable University record retention schedules. Agree not to use their purchasing authority for unapproved/restricted items.... and more See copy of MOU in Appendix D. 10-07 Roles and Responsibilities for Procurement Processes

21. Student Affairs Buying 101 Overview of Procurement Processes Students First Topic 11 11-01

22. Student Affairs Buying 101 Students First Topic Objectives Understand the general (overview) procurement process and the various documents for Obtaining goods and services Processing payments and reconciliations 11-02 Overview of Procurement Processes

23. Student Affairs Buying 101 Students First The next slide provides an overview of the general procurement process. As you can see from the overview slide, there is more to the overall process than just requesting the goods and services.... And this is just an overview. Overview of Procurement Processes 11-03

24. Student Affairs Buyers Council – December 200311-04

25. Student Affairs Buying 101 Procurement Methods Students First Topic 12 12-01

26. Student Affairs Buying 101 Students First Topic Objectives Have a general understanding of the 5 primary ways to obtain goods and services For each, have a general understanding of the timelines, advantages, and disadvantages 12-02 Procurement Methods

27. Student Affairs Buying 101 Students First The previous slides primarily focused on Procurement considerations, but what procurement methods are available? The primary means to obtain goods and services are as follows:  Requisitions / Purchase orders  Non-purchase orders (FAS-12)  Procurement cards  Internal orders (100Ws)  Petty cash reimbursements Procurement Methods However, for each of these processes, the basic steps are generally the same. 12-03

28. Student Affairs Buying 101 Students First Procurement Methods 12-05 Purchase Order – A purchase order is the offer of a contract between the University and an off- campus vendor for the purchase of goods/services. Delegated buyers need to confirm that the cost of goods/services is within the allowable buying limit of $5,000. After the delegated buyer creates the PO, the status of the PO will remain at “Pending Approval” until it is reviewed for compliance to the University Expenditure Policies and departmental policies. If the cost of goods/services is over $5,000, an on-line requisition should be created.  Timeline –If over $5,000, once the requisition has been approved by the Business Office, you should expect the purchase order within 3 to 5 working days if everything is OK. If purchase exceeds bid limits, expect 3 to 5 weeks to go through the bid process.  Advantages – with a purchase order you have a contract with the vendor to deliver goods and/or services at a specified time and amount. Vendor sends itemized invoice to be approved before payment is issued. MBE is tracked. Able to take advantage of discounts from vendors as arranged per contracts.  Disadvantages – may take a little more time if additional approvals are needed.

29. Student Affairs Buying 101 Students First Procurement Methods 12-06 Blanket Purchase Order – A blanket purchase order is a type of purchase order. A blanket purchase order is generally issued to a vendor for miscellaneous items, that are not specifically listed on the purchase order. Typically, a blanket purchase order does not specify a delivery time period or prices, and is generally open for one year. A blanket purchase order establishes a line-of- credit with the vendor and the originating department. Example: A department may issue a blanket purchase order to a vendor for miscellaneous office supplies. Then as the office supplies are needed, the department contacts the vendor and places a phone order.  Timeline – (Same as a purchase order). Typically entered into PeopleSoft in June for the following fiscal year.  Advantages – Separate POs are not needed for each time items are requested. Vendor sends itemized invoice to be approved before payment is issued. MBE is tracked.  Disadvantages – no lock-in on prices. Fiscal reports recognize the PO amount as an encumbrance which may create incorrect budget remaining balances. Only one blanket order can be issued per vendor, per organization and fund each year.

30. Student Affairs Buying 101 Students First Procurement Methods 12-07 Non-PO Voucher (FAS-12) – The non-po voucher is a paper form that designates the items that can be purchased without the creation of a requisition or purchase order. (See list of allowable expenses for Non-PO Vouchers in Appendix M, page 4). If the goods/services being purchased are on the approved list (see Non-PO Voucher List included in your materials) and within any specified limit (see list), proceed with submitting the invoice or FAS12 directly to Student Affairs Business Office satellite Accounts Payable. Please note – the Web FAS12 is not longer available for use by Student Affairs units due to compliance changes in the University Expenditure Policies (effective 6-06).  Timeline – payment can be made after appropriate paperwork is complete and approved usually within a week (assuming vendor is already setup in the payables system).  Advantages – no need for purchase order. Payment processing is faster.  Disadvantages – no MBE tracking, restricted use, and information is not included in buying/tracking reports.

31. Student Affairs Buying 101 Students First Procurement Methods 12-08 Procurement Card – purchases made with the Pcard provide faster payment to the vendor. Eliminates use of an employee’s own funds. Must uphold our tax-exempt status. Does the vendor selected accept the University’s Procurement Card? Is the cost of the goods within the allowable limits of your Procurement Card?  Timeline – immediate ability to purchase goods.  Advantages – billing is automatic through bank and OSU.  Disadvantages – Purchasing cards have no dispute rights for fraudulent charges. If the card or card number are lost or stolen, the bank can charge the department up to $5,000 (or maximum card limit). No MBE, card dollar limitations, more restricted commodities, and no contract with vendor that goods will work properly. Always make sure that vendor is not charging sales tax. Cannot use Pcard for purchasing services. Not able to take advantage of vendor discounts that may be provided by established university contracts (purchase orders).

32. Student Affairs Buying 101 Students First Procurement Methods 12-09 Internal Orders (100Ws) - (internal OSU vendors) – Using the 100W form is a practical and easy method of procuring goods and services within the University. Required Controls: validate that a complete chartfield appears validate a departmental approver signature appears on the 100W require a receipt signature for all goods and/or services provided to initiating department personnel must maintain security over 100W forms (treat as signed checks) and log to track use.  Timeline – purchase of goods or services is immediate  Advantages – internal billing – less paperwork  Disadvantages – no MBE tracking. Note – no longer are departments permitted to accept an accounting chartfield in place of a 100W. Stores is now beginning to require Requisitions and not 100Ws.

33. Student Affairs Buying 101 Students First Petty Cash Reimbursements – A reimbursement is the paying back of money to a staff member that has been spent on behalf of the University. Reimbursements differ from refunds in that a refund is the paying back of money that has been paid to the University. No employee may approve his or her own reimbursement request. The approving authority must hold a higher University rank than the person being reimbursed. When possible, efforts should be taken to avoid making University related purchases using an employee’s personal funds.  Timeline – purchase of goods or services in immediate.  Advantages – provides quick and easy way to procure items.  Disadvantages – no MBE tracking and fewer controls. Employee fronts funds. Maximum reimbursement amount is $50.00 and using Petty Cash for services is prohibited. Considerable paperwork and time required to reimburse petty cash fund. Procurement Methods 12-10

34. Student Affairs Buying 101 Students First How are the processes generally the same? For each you should: Plan, identify, and document the need and get approval Ensure adequate funds and proper chartfield Identify the provider of the goods and services Establish the contract (e.g., use of a Pcard is an agreement that we will pay for the goods) Receive the goods or services Receive the invoice (e.g., statement from bank that OSU pays for Pcard expenses) Match invoice with the purchase order/receipts/receiving documents Request payment Pay the vendor Reconcile transactions and supporting documentation to the general ledger Regardless of the purchasing or payment method, all documentation must be the same; Document business purpose Service or delivery dates Itemized expenses File and retain the documentation in accordance with records retention guidelines Procurement Methods 12-11