TOWN OF BANFF POLICY POLICY # POLICY TITLE AUTHORITY AUTHOR C092 Corporate Credit Card Policy COU02-280 Maier/CORP ========================================================================== 1. POLICY STATEMENT A Corporate Credit Card can be issued to Councilors and Town employees on the approval of the Town Manager or Department Director. The use of Corporate Credit Cards for Town business will not circumvent the intention or application of the Town Purchasing Policy or any other applicable policy. 2. PURPOSE/BACKGROUND To provide a convenient, cost-effective and less cumbersome method of procuring and paying for low value goods and services by simplifying the procurement process, reducing accounting paperwork, speeding up vendor payments and empowering staff who have procurement responsibilities. 3. DEFINITIONS Cardholder A Town Councilor or employee who have been issued a credit card and who are authorized to make purchases in accordance with this policy. Corporate Credit Card Administrator - The person responsible for all program details, including all cardholder inquiries. Employee Agreement Form - A contract to define the limits of use for Town issued credit cards provided to certain employees in order to make purchases of goods and/or services. Supplier - A company from which a cardholder is purchasing materials and/or equipment or services under the provisions of this policy. 4. PROCEDURES 4.1 Benefits More direct and efficient means of obtaining goods and services. Reduction of administrative effort, data entry, requisitions and purchase orders, forms, envelops, postage, filing, cheque costs, and petty cash reimbursement. Multiple charges on one monthly invoice from the credit card firm. One payment per month. Improve customer service internally and externally. Enhanced management information to identify and negotiate better supplier contracts. Benefits to the supplier are lower overhead, opportunity to strengthen customer relations, improve payment terms and reduce credit risk. Page 1
4.2 Program Participants CORPORATE CREDIT CARD ADMINISTRATOR(S) Senior Accountant/Support Services Supervisor will: Maintain and control a central record of all cardholders, limits, etc. Evaluate buying patterns. Evaluate and provide updates to this document. Evaluate customer satisfaction. Provide ongoing education and training programs. Provide updates on GST policies. Distribute program updates. Provide general information on the Corporate Credit Card program. Manage supplier pricing structures. Assist in rectifying disputed credit card charges with suppliers and the credit card company. CARDHOLDERS Cardholders will: Agree to the program responsibilities and restrictions. Sign the Employee Agreement of the program responsibilities. Reconcile their monthly transaction records against the monthly credit card statement. Forward to the Senior Accountant all documentation required for audit purposes. Take appropriate action to resolve any problem. Ensure their credit card is secure to avoid risk of unauthorized use. Return the credit card to the Senior Accountant upon request. 4.3 Application Form Complete the Corporate Credit Card Application Form available on the Town s intranet Purchasing web page or from the Corporate Credit Card Administrator(s). The cardholder and the appropriate authorities within the department will sign the application form. The original signed application form must be returned to the Senior Accountant for processing. The cardholder should retain a copy. 4.4 Credit Limits The maximum limit per day will be $2,500. Requests for limit changes should be directed to the Corporate Credit Card Administrator and must be approved by the Town Manager. 4.5 Card Approval All Corporate Credit Card applications must be approved by the appropriate Department Director, and then forwarded to the Corporate Credit Card Program Administrator for processing. Page 2
4.6 Cardholder Agreement And Orientation Each cardholder must attend an orientation on Corporate Credit Card usage and sign the Employee Agreement Form. The original Employee Agreement Form will be sent to the Corporate Credit Card Administrator. A separate Employee Agreement Form must be approved for each Corporate Credit Card issued. 4.7 Guidelines The daily transaction limit is $2,500 including GST, Shipping and Handling. The monthly default limit is $10,000. The Corporate Credit Card is a Town of Banff credit card that is issued to you as an individual. Each Corporate Credit Card has a unique number and is issued to an individual for use only by that individual. The cardholder must sign the credit card. The Corporate Credit Card must only be used to make authorized Town of Banff purchases within the Town s established Purchasing Manual policies and procedures. It is the cardholder s responsibility to ensure that both internal and external guidelines that govern the account are complied with. Any service charges or interest incurred that are not an allowable expense are the cardholder s responsibility. Any related Town of Banff processing deadlines lie with the cardholder. Each cardholder is responsible for ensuring the Corporate Credit Card expenses are recorded accurately and submitted in a timely manner designated by the Senior Accountant. 4.8 Corporate Credit Card Restrictions The Corporate Credit Card Administrator shall ensure that each cardholder is informed of the transaction and credit limits of their Corporate Credit Card as well as responsibilities and restrictions regarding the use of the Corporate Credit Card. The Corporate Credit Card will NOT be used for the following: 1. Personal and Private Use The Corporate Credit Card will not be used to purchase items or services for personal use. Personal purchases could jeopardize the Town s tax status, permits or supplier contracts. The Corporate Credit Card will be cancelled and its use will be revoked. The Town must be reimbursed immediately for the amount of the personal purchase. Any violation of this policy will be investigated and could result in termination and/or criminal prosecution. 2. Split Purchases Corporate Credit Card transactions must not be split up to divide a large purchase over the cardholder s single purchase limit. Page 3
3. Inappropriate Purchases To obtain cash. Transactions valued over $2,500 (an individual card limit may be lower or higher). Computers and related equipment. Capital projects. Controlled items such as Hazardous Material, Radioactive Material, etc. Contractor services. Maintenance contracts. Extended rentals or leasing of equipment; Direct employment of individuals. 4.9 Non-Compliance The use of a Corporate Credit Card will be revoked and the Corporate Credit Card will be cancelled for any of the following reasons: Personal Purchases Split Purchases Inappropriate Purchases Failure to Provide Required Documentation Failure to Reconcile Monthly Statement In the event of willful or negligent use, the Town shall take any action deemed appropriate, that the law permits. 4.10 Ordering E-mail and internet purchases are prohibited unless the purchase is placed through a secure web site. Ordering By Phone, Fax or Snail-Mail Inform the supplier that you are ordering on your Town of Banff Corporate Credit Card. Give your name as it appears on the card, the credit card number and expiry date. Give the supplier accurate delivery information including: Freight Carrier Contact Name Address Telephone Number Request that a copy of the packing slip and credit card slip be enclosed inside the package. 4.11 Purchasing Goods Or Services In Person Inform the supplier that you are making a purchase for the Town of Banff. Give the supplier your Corporate Credit Card for processing. Obtain the credit card transaction slip plus a packing slip at the time of purchase and file in your desk for month end reconciliation. Page 4
4.12 Card Rejection If a supplier rejects the Corporate Credit Card it will be for one of the following reasons: The Corporate Credit Card has reached the transaction or other limit. The supplier has been purposely excluded from the Town of Banff s Corporate Credit Card program, through the use of Merchant Category Codes (MCC). MCC codes have been assigned to suppliers based on various forms of industry activities and provide a security for both the Town and the cardholder based on policy. The supplier is currently not a merchant that accepts the brand of Corporate Credit Card used by the Town of Banff. 4.13 Purchasing Log The cardholder is required to keep a Purchase Log. The following information should be recorded: Order Date Name of the Supplier Description of the Purchase Dollar amount of the Purchase Whether the purchase appeared on the Cardholder Monthly Statement Whether the transaction has supporting documentation All documentation received at the time of purchase or through the receipt of the goods must be attached to the monthly statement as support for transactions. 4.14 Receipts And Returns It is the cardholder s responsibility to: Ensure receipt of goods and services. Follow up with suppliers to resolve any delivery problems, discrepancies and/or claims for damaged goods. To coordinate returns directly with the supplier. To secure the appropriate credit. At the time of return, request that the supplier issue and send a credit transaction slip to verify that credit is given. 4.15 Imported Goods - Customs Tariffs & GST If an order is from out of the country, applicable duty and taxes will be incurred in one of the following ways: 1. Through the Town s customs brokers. 2. Via courier. Couriers will issue an invoice for payment that will be sent to accounts payable and charge to the appropriate account/sub-account. 3. Via Canada Post. Submit the Canada Post import form to accounts payable and charge to the appropriate account/sub-account. Page 5
4.16 Taxes Taxes and rebates will be calculated using the following basic assumptions: Alberta purchases have been charged GST, but not PST. Out of Alberta purchases have been charged GST and PST. Out of Canada purchases will not have been charged either GST or PST. 4.17 Air Miles/Aeroplan Collection Air Miles, Aeroplan and other promotional offers cannot be collected for the personal use with purchases made with the Corporate Credit Card. 5. REVISION HISTORY (YMD) 02 11 25 New Page 6
Employee Agreement Form Credit Card The Corporate Credit Card represents the Town of Banff s trust in you. You are empowered as a responsible agent to safeguard Town assets. Your signature below is verification that you have read the Corporate Credit Card Policy and agree to comply with the Corporate Credit Card guidelines as set out therein, as well as the following responsibilities: 1. I understand the credit card is for Town approved purchases only, and I agree not to charge purchases outside the parameters described in the Corporate Credit Card Policy. 2. Improper use of this credit card can be considered misappropriation of Town funds. This will result in disciplinary action, up to and including termination of employment. 3. If the credit card is lost or stolen, I will immediately notify the Bank and the Administrator by telephone. I will confirm the telephone call with a written notice sent by mail or facsimile with a copy of the notification to the Administrator. 4. I agree to surrender the credit card immediately upon severance of employment. 5. The credit card is issued in my name. I will not allow any other person to use the credit card. I am considered responsible for any and all charges against the credit card. 6. All charges will be billed directly to and paid directly by the Town. The Bank cannot accept any moneys from me directly; therefore any personal charges billed to the Town could be considered misappropriation of Town funds. 7. As the credit card is Town property, I understand that I may be periodically required to comply with internal audit procedures designed to protect Town assets. This may include being asked to produce the credit card to validate its existence and account number. I agree to obtain and forward to accounting original receipts for every purchase as per the Corporate Credit Card Policy. 8. I will receive a Monthly Reconciliation Statement, which will report all activity during the statement period. Since I am responsible for all charges (but not for payment) on the credit card, I will resolve any discrepancies by either contacting the supplier or the Bank. 9. The charges made against my credit card are automatically paid against the account assigned to the credit card as specified in the Corporate Credit Card Application Form. To change an account, please provide a written request to the Administrator. 10. I understand the Corporate Credit Card is not necessarily provided to all employees. Assignment is based on my need to purchase materials for the Town. My credit card may be revoked based on change of assignment or location. I understand that the credit card is not an entitlement nor reflective of title or position. By signing below, you, the credit cardholder, are confirming that you have read the above, that you understand the above, that you are in agreement with the above. Variances to limits set out below and travel use require Director or Town Manager approval in writing. Signature of Credit Cardholder Print Name Signature of Supervisor Signature of Director Signature of Town Manager Daily Transaction Limit: $2,500 Monthly Limit: $10,000 Travel Use Required? Yes No Request for Alternative Transaction Limit: $ Signature of Town Manager Credit card received by: Signature Z:\Governance\Policies\Current\C092_CreditCard_EmployeeAgreement.doc