Procurement of Goods and Services Procedure (MPF1089)
- GOVERNING POLICY
- 1. Internal procurement
- 2. External procurement requirements
- 3. Purchases for goods and services less than $150,000
- 4. Evaluation of quotations
- 5. Purchasing requirements for expenditure greater than $150,000
- 6. Leasing or long term hire of equipment
- 7. Purchasing cards
- 8. Purchasing card responsibilities
- 9. Cancellation of purchasing card
- 10. Cabcharge
- 11. Fuel card
- RELATED DOCUMENTS
- RESPONSIBLE OFFICER
- IMPLEMENTATION OFFICER
- VERSION HISTORY
About this document
- Category: Finance and procurement
- Review due by: November 30, 2014
- Version: 1
- Responsible Officer: Chief Financial Officer
- Approved on: August 24, 2012
- Implementation Officer: Manager, Accounting Operations
- Effective date: August 24, 2012
- Approval Authority: Senior Vice-Principal
- Status: Published
This procedure is made under the Procurement Policy.
This procedure applies to all staff at the University involved in the purchase of goods and services (other than for buildings works) up to $150,000. Requirements for the procurement of assets are covered separately under the Asset Management Policy.
1. Internal procurement
1.1 Purchasing goods and services from internal rather than external suppliers is encouraged. Budget units can request goods or services from internal suppliers or other budget units by means of standard internal documentation, such as: Themis internal requisitions, internal orders, building requisitions and chargeouts. (Refer Supplier Payment and Goods Receipting Procedure)
2. External procurement requirements
2.1 The Strategic Procurement website lists all preferred suppliers for the purchase of goods and services using University funds.
2.2 If staff are unable to achieve performance levels on price, product or service as specified in the university agreement, staff must:
- not outsource the contracted goods or services
- raise the concern directly with the supplier for resolution
- engage Strategic Procurement if a satisfactory outcome is not achieved directly with the preferred supplier.
2.3 The authorising officer will ensure that a Pre-purchase Risk Assessment Checklist is completed, to ensure OHS requirements are met.
2.4 Hiring or leasing equipment is considered to be a purchasing expense (refer section 6 of this procedure for special requirements).
3. Purchases for goods and services less than $150,000
3.1 The requirements for items purchased under $150,000 from either preferred or non-preferred suppliers are outlined in the Procurement Policy, Schedule A - Goods and Services Purchase Levels and Processes.
3.2 Staff members must obtain quotations from external suppliers for goods or services that are valued over $5,000 and up to $150,000 in accordance with the Procurement Policy, Schedule A - Goods and Services Purchase Levels and Processes, where there is no preferred supplier on the University’s preferred supplier list.
3.3 No verbal quotations are accepted.
3.4 Staff must ensure the following process is implemented where quotations are required:
- suppliers invited to quote are provided with identical information to assist with the provision of comparable quotations and the selection process
- all quotations and related decision making documentation is placed on file.
4. Evaluation of quotations
4.1 Evaluation of quotations are to consider the following:
- previous experience with supplier
- special factors dictated by a particular project, including conflict of interest
- documented reasons when a quote which is not the lowest is accepted.
4.2 The foreign exchange risk must be considered in the evaluation of quotations from overseas suppliers.
5. Purchasing requirements for expenditure greater than $150,000
5.1 All purchases of goods and services which are greater than $150,000 are to be referred to one of the following two Tender Boards:
- the Minor Goods and Services Tender Board for purchases between $150,000 - $400,000, quotations, supporting documentation and the recommended supplier must be reviewed prior to selecting a supplier in accordance with the Tender Requirements Procedure.
- the Major Goods and Services Tender Board for purchases greater than $400,000 in accordance with the Tender Requirements Procedure.
6. Leasing or long term hire of equipment
6.1 The head of budget division may approve an initial short term (less than 12 months) hire of equipment with a value up to $150,000.
6.2 Long-term hire is considered to be for a period of 12 months or more. Repeated periods of hire less than 12 months are also considered to be long-term, and these contracts must be referred to the Major Goods and Services Tender Board for approval.
6.3 Approval to either lease or commit to a long term hire of equipment is required from the Major Goods and Services Tender Board.
6.4 Long term leasing of buildings are to be reviewed by the Major Buildings Tender Board in accordance with the Leasing of Premises Procedure.
6.5 Any proposal for leasing or long-term hire, regardless of costs, must be submitted to the Major Goods and Services Tender Board.
6.6 Leasing or long-term hire must have tender board approval because:
- financial leases are subject to State Government approval
- operating leases do not allow title to pass and consequently there is no trade-in or salvage value
- leasing increases the overall cost
- unnecessary commitments many years hence are unwise
- sources of finance are available within the University.
6.7 Departments should be able to arrange bridging finance with their faculties, or with the chief financial officer in the case of administrative departments, as the amounts involved are generally not large. As a last resort, an application can be made to Finance Committee through the Major Goods and Services Tender Board for an internal loan to finance the lease or hire of equipment.
6.8 Financial Delegations outlines the expenditure approvals and Table 2 of the Procurement Policy, Schedule A - Goods and Services Purchase Levels and Processes provides a summary of purchase levels and authorisation for leasing.
6.9 Subject to approval by the Minor Goods and Services Tender Board, the Chief Financial Officer and Director of Finance have authority to approve the leasing or long term hire of equipment, and short term hire of equipment, with a value between $150,000 and $400,000.
6.10 The Tender Board Secretary is to be consulted prior to committing to a lease.
7. Purchasing cards
7.1 The University Purchasing Card is the method for payment to be used for University business expenditure which is below $5,000. This is a National Australia Bank Visa card which has no access to a membership rewards program.
7.2 Purchasing cards are issued on a needs basis based on a staff member’s position and responsibilities, and are available to staff at HEW 4 and above in accordance with a special and limited financial delegation.
7.3 Purchasing cards may be issued to staff on a short-term basis for a particular project or trip.
7.4 An applicant must complete both a Visa Purchasing Card Application and Agreement form and the NAB Visa Card Application.
7.5 An application for a Purchasing card must be approved by a level 2 delegate.
7.6 To activate a new purchasing card, the card holder must meet with the Purchasing Card Administrator to:
- collect and sign the card
- confirm their clear understanding of the conditions of use
- receive training in the use of the reconciliation software Intranet Creditor Management System (iCMS).
7.7 An information booklet will be provided to all purchasing card holders outlining the conditions of use, including the types of purchases precluded.
7.8 Card holders may nominate other staff access to their card data to carry out administrative tasks on their behalf.
7.9 All credit card holders and coders and delegates must use iCMS to allocate a Themis account string against each item of expenditure.
7.10 iCMS is accessed via the Themis home page.
7.11 University purchasing card transaction limits and monthly purchasing card limits are set as part of the application process in accordance with the financial delegations.
7.12 Monthly card expenditure must be authorised by the cardholder’s authorising manager with financial delegation.
7.13 In the absence of the cardholder’s manager the expenditure must be authorised by the head of budget division.
7.14 Cards issued to staff at level HEW4 or HEW 5 will have a predetermined monthly limit of $6,000, including a limit of $2,000 per transaction. Purchases are to be made at the direction of the authorising manager.
7.15 A cardholder must complete a Purchasing Cardholder Maintenance form for any change in details including a card limit increase.
7.16 Staff are not permitted to use the University Purchasing card either for personal expenditure or for the purpose of earning membership loyalty rewards points.
7.17 Any accidental use of the University Purchasing card for personal use is to be repaid promptly and separately by the card holder before the balance of the credit card is charged to the card.
7.18 The purchasing card may be used to pay travel costs where no per diem has been paid to the card holder.
7.19 The cardholder must not also claim a reimbursement for expenditure incurred on the purchasing card.
7.20 Loss or theft of the card must be reported immediately to NAB and to the Purchasing Card Administrator.
8. Purchasing card responsibilities
8.1 The cardholder must:
- comply with the terms and conditions of use outlined in the purchasing card information booklet
- complete the monthly card expenditure statement
- attach original receipts to the expenditure statement
- provide documentation to substantiate fringe benefits tax
- submit the signed monthly card expenditure statement together with the required documentation to the authorising manager or head of budget division, by the due date.
8.2 The cardholder or cardholder’s delegate must:
- code purchasing card transactions in iCMS in accordance with the Chart of Accounts
- submit the monthly card expenditure statement by the due date
- maintain adequate documentation
- verify transactions and match these to the original documentation
- resolve any transaction discrepancies by first contacting the merchant then complete the Purchasing Card Disputed Transaction Advice.
8.3 The authorising manager must ensure:
- all cardholders submit their monthly card expenditure statement for authorisation
- all cardholders forward the authorised statement to the business centre by the due date
- all card expenditure and account allocations, including GST are reviewed and verified
- all original receipts are attached
- all necessary information has been provided for the purpose of FBT
- any issues regarding the use of the card are promptly discussed and resolved with the staff member concerned
- cards are cancelled where there is a deliberate or repeated breach of policy and procedures by the cardholder.
8.4 Serious or repeated failure by a cardholder to fulfill their responsibilities will result in the cancellation of the staff member’s credit card. Intentional wrongdoing may result in action for a criminal offence.
8.5 Accounting Operations must:
- arrange payment of credit cards and clear the Purchasing Card Clearing Account within the general ledger
- follow up any disputed transactions with NAB
- advise budget divisions of failure to submit authorised monthly statements and other performance deadlines.
8.6 The compliance review of monthly purchasing card statements must not be carried out by the same staff member responsible for coding and submitting the statement for authorisation.
8.7 iCMS reports with original supporting documentation must be retained by the budget division for the period prescribed in the Records Retention and Disposal Procedure.
9. Cancellation of purchasing card
9.1 The cardholder must surrender their card when requested by an authorised officer of the University.
9.2 The card must be returned when the cardholder resigns or transfers to a position not requiring the use of a purchasing card.
9.3 When a purchasing card is cancelled, the cardholder or authorising manager will:
- appoint a delegate to code and submit all outstanding transactions
- destroy by cutting up, the purchasing card in the presence of the budget division manager
- complete an F49 Purchasing Cardholder Maintenance form.
- ensure the F49 form contains the signature of both the cardholder and authorising manager to certify that the correct procedure for cancellation of the card was followed.
10.1 Budget divisions may have a Cabcharge account for taxi use.
10.2 Budget divisions may contact Cabcharge directly to set up the account.
10.3 The establishment bond will be waived by Cabcharge.
10.4 A Cabcharge account operates with both vouchers and personalised cards.
10.5 The heads of budget division must ensure adequate security and control is maintained over the issue of Cabcharge vouchers which are accountable documents.
10.6 Budget divisions must keep a register of cards and vouchers issued.
10.7 Cabcharge cards must be returned to the budget division manager upon resignation or transfer of the staff member to another budget division.
10.8 Budget divisions must ensure documents are forwarded to Accounts Payable in adequate time for processing and payment to Cabcharge. Late payment fees are payable by the budget division.
11. Fuel card
11.1 The fuel card, which is administered by the Fleet Officer in Property and Campus Services, is issued to each University vehicle to pay for all petrol and maintenance costs associated with the vehicle. Purchasing cards must not be used to pay for these costs.
11.2 Transactions are debited on a monthly basis for all transactions made with the fuel card. Copies of these accounts are available to budget divisions for reconciliation.
11.3 Lost, damaged or stolen cards must be reported immediately to the Fleet Officer, who can arrange for new or temporary cards to be issued.
- Asset Management Policy
- Financial Delegations
- Leasing of Premises Procedure
- Pre-purchase Risk Assessment Checklist
- Procurement of Building Works Procedure
- Procurement Policy
- Procurement Policy, Schedule A - Goods and Services Purchase Levels and Processes
- Purchasing Cardholder Maintenance form
- Records Retention and Disposal Procedure
- Strategic Procurement website
- Supplier Payment and Goods Receipting Procedure
- Tender Requirements Procedure
- Travel Policy
- Travel Portal
- University Vehicle Fleet Procedure
Major Goods and Services Tender Board
Board established to review all non-building related proposals to purchase goods and services over $400,000 (including GST).
Minor Goods and Services Tender Board
Board established to review all quotations for non-building related purchases of goods and services between $150,000 and $400,000 (including GST).
Supplier who provides goods or services under agreements established through a competitive tendering process.
The acquisition of goods, services or building works by way of purchase, lease or other contractual arrangement.
A single decision to follow a course of action, regardless of how many individual purchases are involved.
An online order and authorization for the purchase of goods, services or building works generated from the Themis Finance System.
The Chief Financial Officer is responsible for the development, compliance monitoring and review of this procedure and any associated guidelines.
The Manager, Accounting Operations, Finance and Planning Group is responsible for the promulgation and implementation of this procedure in accordance with the scope outlined above. Enquiries about interpretation of this procedure should be directed to the Implementation Officer.
This procedure is to be reviewed by 30 November 2014.
Senior Vice Principal
24 August 2012
24 August 2012
New version arising from the Policy Simplification Project. Loaded into MPL as Version 1.