3. Strategic Community Plan Approach. 4. Legislative Requirements and Corporate Policy Context

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1 Co r p o r a t e Cr ed it Ca r d P o lic y Classification: Policy Name: First Issued / Approved: Last Reviewed: Council Policy Corporate Credit Card Policy 11 August 2015, C August 2015, C10311 Next Review: August 2017 ECM Tracking No.: Responsible Officer: Relevant Legislation: General Manager, Corporate Services Local Government Act 1999 Local Government (Financial Management) Regulations 2011 Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Commonwealth) Related Documents: Internal Financial Controls Framework New General Ledger Financial Information Policy New Corporate Credit Card Protocol - New Risk Management Policy Liability Protocol 1. Introduction 1.1 This Policy applies to the provisions of the Local Government Act 1999 (the Act) Section 124 (Accounting Records to be Kept) regarding Council s Corporate Credit Cards and how financial information pertaining to Credit Card purchases, transactions and reconciliations are undertaken across all Council operations. 1.2 It is subordinate to the Internal Financial Control Framework which outlines the risk management principles all Council financial policies are created under and must comply with. 1.3 The Internal Financial Control Framework complements Council s overarching Risk Management Policy outlining risk mitigation principles for all Council operations. 1.4 This Policy also informs the Liability Protocol which prescribes how Council s administration treats various purchases and transactions recorded and reported within its financial systems. 2. Strategic Community Plan Desired Outcome 2.1 The strategic Desired Outcomes are;

2 Governance - Delivery of good governance in Council business. Finance - A financially sound Council that is accountable, responsible and sustainable. 3. Strategic Community Plan Approach 3.1 The strategic Community Approaches are; Regularly review, update and adopt leading governance, risk management and administrative practices. Provide sufficient resources to meet current and future needs of the community. 4. Legislative Requirements and Corporate Policy Context 4.1 This Policy forms part of Council s Internal Financial Control Framework as a direct consequence of the provisions of Section 125 (Internal Control Policies) of the Act for South Australia. 4.2 This commits Council to carry out its activities in an efficient and orderly manner to achieve its objectives, to ensure adherence to management policies, to safeguard assets, and to secure (as far as possible) the accuracy and reliability of council records. 4.3 Section 127 (Financial Statements) of the Act prescribes a Council to produce annual financial statements in accordance with standards required by the regulations. 4.4 In addition Section 129 (Conduct of Audit) of the Act requires an external auditor to form an opinion as to whether there is sufficient evidence providing reasonable assurance that the financial transactions of the Council have been conducted properly and in accordance with law. 4.5 This has been further elaborated upon within Local Government (Financial Management) Regulations 2011 (the Regulations) at Part 3 Accounting Principles, Part 4 Financial Statements and Part 6 Audit clause 19(b). 4.6 Part 3 of the Regulations prescribes standards adopted are the Australian Accounting Standards overseen by the national peak body for accounting policies and principles, the Australian Accounting Standards Board. 4.7 Part 4 of the Regulation prescribes the statements are compiled according to the Model Financial Statements, according to those published by the Local Government Association (LGA) website on an annual basis for administrative adoption. 4.8 In addition, the LGA has published revised Financial Sustainability Information Papers (FSIP) as part of its ongoing Financial Sustainability Program (FSP) with the aim of harmonising high-level policy positions for Council administration adoption and use. 4.9 The Information Papers are not statutory measures however they are considered best practice for council administrations to commit to. Corporate Credit Card Policy Page 2 of 7

3 4.10 This Policy has made particular reference to the following FSIP; LGA FSIP No.18 Financial Policies and Procedures 4.11 The Policy also adheres to and identifies specific provisions in the Commonwealth Anti-Money Laundering and Counter-Terrorism Financing Act 2006, primarily concerning identification of staff members in order to initiate a corporate credit card with the issuing bank. 5. Interpretation 5.1 For the purpose of this policy: Council means the City of Burnside Council. Delegated Credit Limit means the transactional amounts in Australian Dollars that can be processed to a particular card over a prescribed timeframe. Delegated Authorising Officer means the senior officer authorised to approve credit limits and transactions incurred on a subordinate employees' corporate credit card. Daily Limit means the total value of transactions in Australian Dollars that can be purchased by a staff member in a continuous 24 hour period. Monthly Limit means the credit balance that is allowed to be incurred without requiring repayment prior to the statement cut-off date. PIN means the Personal Identification Number assigned to a card for electronic purchases authorisation. Card Provider means the bank or credit provider issuing the card to the staff member. BPay means a recognised form of remitting funds electronically to suppliers within Australia. Taxation Receipt means a record of the purchase provided by the merchant that has a supplier Australian Business Number. Merchant means a supplier of a good or service allowing a purchase via credit card. Corporate Credit Card Policy Page 3 of 7

4 6. Objectives 6.1 Corporate credit cards are used by Council to transact its business in a more efficient manner and at the same time provide Council administration officers with a more convenient method to meet costs they incur on Council s behalf. 6.2 Corporate credit cards should be recognised as a valuable tool for the efficient and effective operation of Council s daily business and not as a benefit assigned to specific individuals. 6.3 The use of corporate credit cards is encouraged in undertaking relatively low value, high volume transactions in nature. 6.4 This maximises the most efficient method of transacting business for supplying products or services such as arranging transport, accommodation and registration for attendance at conferences. It also eliminates the need for overseas bank drafts for certain purchases. 6.5 It also allows for maintaining control of business activity through reconciliation processes in accordance with timings in Finance Department s Reconciliation Matrix. 6.6 Corporate credit cards also reduce the need for staff members to use a personal credit card to conduct Council business. 6.7 Staff members are not to use their personal credit card to conduct Council business over the amount of $100 in any one transaction. 7. Approvals and Delegations 7.1 The Chief Executive has delegated authority to issue corporate credit cards to staff members. 7.2 Procedures to issue a corporate credit card are contained in the Corporate Credit Card Protocol, including the staff member providing sufficient identification, current forms and templates requiring completion to issue the card and Council s current bank policies and procedures for issuing credit cards to clients. 7.3 The Chief Financial Officer shall be responsible for gaining the Chief Executive s approval to issue corporate credit cards. 7.4 On receipt of the card from the card provider, both the Chief Financial Officer and the staff member shall formally acknowledge receipt of the card. 7.5 The staff member shall also acknowledge they have read and understood the terms and conditions contained in this Policy and the Terms and Conditions of Use by the card provider. Delegated Credit Limits 7.6 Each corporate credit card shall have a daily and monthly limit capping total expenditure for that period. 7.7 The credit limit for any particular staff member shall be determined by Chief Executive and the staff member s functional General Manager. Corporate Credit Card Policy Page 4 of 7

5 7.8 Credit limits for the Chief Executive s corporate credit card shall be approved by Council. 7.9 These approval processes shall be replicated for any subsequent amendments to monthly expenditure limits after the initial credit limit has been approved. Expenditure Approval Delegations 7.10 Total monthly expenditure incurred on corporate credit cards shall be authorised according to the Expenditure Authorisation Matrix contained in the Corporate Credit Card Protocol accompanying this Policy. 8. Terms of Use 8.1 Over and above those terms and conditions of use a staff member must acknowledge before being issued with a card, corporate credit cards are to be used as a normal credit card, with individual transaction authorisation or Personal Identification Number (PIN) input required to authorise individual transactions. 8.2 Corporate credit cards should not be used when there is an alternative form of procurement and payment available to the staff member at the time of purchase i.e. raising purchase orders for supply of goods and services. 8.3 Cash advances are strictly prohibited and BPay facilities are not available. 8.4 Personal expenses of any kind are not to be incurred by a staff member on a corporate credit card. 8.5 If by unintentional causes, personal expenses are incurred, the staff member will be personally liable for those transactions. 8.6 Cards are not to be linked to any form of loyalty points program. 8.7 All transactions are to be verified with a taxation receipt on completion. Primarily this is for statement verification and transaction checking and also for confirming input tax credits accumulated by Council for Goods and Services Tax reporting purposes. 8.8 Under no circumstances are corporate credit cards to be used to purchase software, without first consulting the current Manager Information Systems. 8.9 Council administration reserves the right to request a corporate credit card be forfeited by a staff member at any time A staff member found to have used a card in contravention to terms and conditions of use as prescribed by the card provider, or those stated in this Policy may be subject to disciplinary action. 9. Verification and Reconciliation 9.1 All individual transactions listed on statements are to be reconciled with accumulated taxation receipts collected by the staff member. 9.2 If all transactions reconcile with the taxation receipts, the statement and attached reconciliation documentation shall be forwarded to the staff members delegated Corporate Credit Card Policy Page 5 of 7

6 authorising officer as stipulated at clause 7.10 of this Policy (Expenditure Authorisation Matrix). 9.3 The authoriser shall check the reconciliation documentation for accuracy and if there are no errors, the outstanding total expenditure amount shall be approved for payment. 9.4 The statement and reconciliation documentation shall be forwarded to the Finance team for payment of the outstanding total expenditure amount by the stipulated due date. 9.5 Finance Team will arrange for the outstanding monthly amount to be paid in full by the due date stipulated on the statement. Disputed or Unverified Transactions 9.6 Any listed transaction unable to be verified by a taxation receipt shall be reported to the staff members delegated authorising officer, immediately the staff member becomes aware of the transaction. 9.7 The authoriser will also report the unreconciled item/s to the Chief Financial Officer and request a search copy of the transaction from the card issuer immediately. 9.8 Where it is anticipated the investigation to resolve any unreconciled transactions will extend beyond the outstanding amount payment due date, the Chief Financial Officer shall notify this to the card issuing bank representative. 9.9 In lieu of the investigation being finalised, the staff member shall relinquish the corporate credit card to the Chief Financial Officer until such time as to the reason for unreconciled transactions has been ascertained When a dispute occurs, the staff member shall refer all details to the Finance Team for it to investigate with the transaction merchant. If the transaction details cannot be resolved then further assistance and negotiation shall be instigated with the card issuing bank representative The banking representative may be able to assist resolving disputed transactions involving duplicated charges, charges for goods not receipted or credit refunds not processed after a refund has been agreed with the merchant. 10. Lost or Stolen Cards 10.1 If a staff member loses or has their card stolen it is their responsibility to immediately report this to the card issuing bank, whether this is discovered within normal working hours or not The card issuing bank s lost or stolen contact details can be gained from the Finance Team within working hours or by contacting the Chief Financial Officer, or via Council s intranet site, or in the Corporate Credit Card Protocol Documentation formerly notifying of the lost or stolen card must be completed by the staff member, then authorised by the delegated authorising officer before forwarding to the Chief Financial Officer. This must be done by no later than the next business day after the card has been reported lost or stolen to the card issuing bank. Corporate Credit Card Policy Page 6 of 7

7 10.4 A replacement card will be arranged with the card issuing bank and distributed to the staff member once received by the Chief Financial Officer, and countersigned by the staff member s delegated authorising officer. 11. Replacement Cards 11.1 The card issuing bank will automatically issue replacement cards one month prior to the expiry date embossed on the staff member s card Finance Team will distribute replacement cards to staff members once received from the card issuing bank If a staff member s card requires replacement prior to these arrangements above, for instance where a card has been damaged or has become dilapidated, the staff member shall notify their delegated expenditure authoriser and Finance Team Finance Team will be responsible for contacting the card issuing bank to arrange a new card for the staff member The replacement card will be distributed to the staff member once received by the Chief Financial Officer, and counter-signed by the staff member s delegated authorising officer The card will then be free for distribution to the staff members delegated authorising officer and counter-signed with the staff member as receipted in readiness for use. 12. Availability 12.1 The Policy is available to be downloaded, free of charge, from Council s website The Policy will be available for inspection without charge at the Civic Centre during ordinary business hours and a copy may be purchased at a fee as set annually by Council. City of Burnside Civic Centre 401 Greenhill Road, Tusmore SA 5065 Telephone; Fax; ; burnside@burnside.sa.gov.au Office hours: Monday to Friday, 8.30am to 5.00pm (except public holidays) Corporate Credit Card Policy Page 7 of 7