Purchase of Supplies, Materials, and Services/Travel and Entertainment Expenses (to $2500)
|Oversight Unit:||CONTROLLERS OFFICE|
|Attached form file:||PurchasingCardContract.pdf|
|This policy has a related guideline. Click to view the guideline below.|
This policy governs only purchases less than or equal to $2500; purchases above this limit are governed by the Standard Purchasing Policy. The scope includes but is not limited to the purchase of supplies, materials, and certain services as well as travel expenses, business meetings, and business entertainment expenses.
All persons purchasing goods or services as well as travelling or entertaining on behalf of the University.
Northern Michigan University expects ordinary and necessary business expenses. These will be paid by the University when they are properly authorized and documented.
The Controller’s Office, in conjunction with the Purchasing Department, will ensure that expenses remain proper, supported, and controlled. The Controller will provide the rules (guidelines) and work steps (procedures) to instruct the University regarding purchases totaling up to and including $2500. These will include:
- The levels of approval necessary to pay or reimburse expenses;
- The rules for allowed expenses;
- The requirements for documentation;
- The responsibilities associated with use of a purchasing card; and
- The repercussions for failure to properly purchase, settle, or document expenses.
Purchasing Card Purchases and Settlement
At NMU, new policies are supported with procedures (work steps) or/and guidelines (current rules). The word guideline is not intended to indicate that the rules are flexible. NMU uses the term “guideline” to indicate that this particular set of rules may require updates more frequently than could be accomplished in University policy. This guideline reflects external regulations, including State of Michigan and IRS regulations, as well as a processing system called Concur. The Controller will update these guidelines as necessary. All versions of the guidelines are archived and available for reference through the Internal Audit office. The most recent update for this guideline occurred February 25, 2020.
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1. Purchases that are NOT ALLOWED with a purchasing card
2. Purchases that are allowed using a purchasing card (and authorization required)
3. Purchases of supplies, materials, and services
4. Travel expenses
5. Business entertainment expenses
6. Requirements for documentation (proper receipts)
7. Accidental charge for a personal expense
8. Process for missing receipt(s)
9. Employee responsibilities
10. Supervisor responsibilities
11. Detecting and addressing fraud
12. Settlement requirements and timing rules
13. Starting a Concur expense settlement report
14. Concur invoice check request for purchases $2500 or less
15. Concur payment with a purchase order
16. FAQ, terms & examples of various combinations of meal charges (by request)
1. PURCHASES THAT ARE NOT ALLOWED:
Purchases over $2500 are not allowed to be made with a University purchasing card, cash, or personal credit card. Purchases of supplies or equipment over $2500 are governed by the rules of the Standard Purchasing Policy.
Personal Services Contracts, Professional Services Contracts, and Limited Services Contracts are processed by the Risk Management Department. These are contracts used to pay campus speakers, persons who conduct training on campus, and persons who perform other professional services for the University that are not required to be paid as temporary labor. See the Risk Management website for current contracts and instructions. In general, if there is a scope of work document, use a personal services, limited services, or professional services contract and do not make payment using a purchasing card.
More complex contracts, typically including promises and requirements for both the University and the vendor, absolutely may not be paid with a purchasing card. These require legal review and must be signed by an individual authorized by the Board of Trustees. See Contract Approval Policy.
Sponsorships and donations are not allowed to be paid using a purchasing card. All sponsorships and donations must be approved through the President’s office and must be paid with a check request. See the Finance and Administration website for a sponsorship request form.
Moving expenses must be processed using a check request. See the applicable Union Contract and Moving Expense Policy for moving expense limits and approval requirements.
The following expenses are generally NOT allowed to be purchased with a University purchasing card or reimbursed through the expense settlement process (except by the department authorized in the following policies listed):
- Copiers or other duplication/scanning equipment - See Copier Purchase Policy
- Laptop, desktop, or other computer or media equipment for instructional, administrative, or public service use - See Media Equipment Purchase Policy. Note that peripheral devices for equipment already procured may be allowed to be purchased using a purchasing card.
MCC Codes that are blocked: Certain types of purchases are blocked through a purchase, or MCC, code used by the credit card company. The MCC codes that have been blocked include charges related to casino entertainment, health spas, and other non-typical University expenses. If a legitimate purchase has been blocked at the MCC code level, contact Vendor Payables.
Expenses that ARE NOT allowed to be purchased or reimbursed by any method:
- Political donations, including but not limited to tickets to political fundraisers, political donations, or political messaging materials
- Any item procured for the personal benefit of the purchaser
- Any item not in support of University business
- Any traffic violation tickets, including but not limited to speeding or parking tickets
- Drivers license or state identification card fees
- Any item purchased without the approval of the org. code owner
Purchases of $2500 or less for legitimate University business should be paid using a University purchasing card. These include any purchase of supplies, goods, or materials for University business totaling less than $2500.01. Travel expenses incurred while conducting University business may also be paid through a purchasing card. Business entertainment expenses, whether incurred locally or while travelling, may also be paid with a purchasing card.
The dollar limit for the purchase of approved goods and services is first governed by the department’s budget. A secondary standard limit of $2500 per purchase and $5000 per month for each purchasing card is set by the Purchasing Department when the card is issued. The Purchasing Department may grant higher limits in special circumstances on a permanent or short-term basis.
Small service contracts: While most contracts may not be paid with a purchasing card (see expenses NOT ALLOWED, above), two types of contract payments are allowed. Use a purchasing card for:
- One-time advertising contracts (for example, to advertise an open position)
- Small recurring charges, such as streaming services, verification services, telephone, gps, etc.
Vendors that do not accept credit cards: In these cases, purchases of $2500 or less may be processed through the Controller’s Office using a check request. The department will have to collect IRS form W9 from the vendor, allow enough time for NMU’s Vendor Payables to verify the W9 information with the IRS, and note that the vendor does not accept credit cards on the check request.
Vendors that charge a specific fee for credit card purchases: In general, the department must pay these fees as a cost of doing business. The Vendor Payables Department may grant an exception if the department anticipates large recurring expenses.
Using cash or personal credit cards: Legitimate University expenses may also be paid using cash or an employee’s personal credit card; formal approval and reimbursement is requested through the Concur Settlement system. The rules for allowed reimbursements are nearly identical to those for using purchasing cards. However, never use a personal card or cash if a good is under warranty; warranties are void when purchases are made using a personal card or cash and reimbursed by the University.
Purchases that require special approval:
President, Vice President, or VP designate approval is required to purchase or reimburse:
- Services from an external vendor that are already offered within the University. Examples include professional photographic services not on the contracted services list (a list of contracted photographic service providers is available from Risk Management); printing services; signs; equipment rentals for equipment already owned by NMU; etc.
- Funeral flowers. A University department or division is allowed to purchase flowers for the funeral of persons with strong relationships to NMU or for the funeral of an NMU employee’s family. If the purchaser representing the department/division does not directly report to the President or a VP, attach an email from the President or VP in the receipt field of Concur Expense as evidence of approval. Charge the expense (allocate) to an org. code that does not start with a “2” since this purchase may not be paid from the general fund.
- Passport fees or TSA pre-enrollment fees.
- Business Entertainment Expenses during travel that do not include a university guest. University employees traveling are expected to adhere to the per diem allowance for meals. Special approval is required for all business entertainment expenses that do not include a university guest except for planning meetings during travel, and travel expenses within NCAA rules for athletes and athletics staff. See Business Entertainment Expenses for details.
- Expenses related to any on-campus or near-campus office get-togethers for employees. Approval may be granted if the purpose of the event is to recognize an employee(s), for planning purposes, or for staff training purposes. However, no VP approval is required for on-campus retirement gatherings with light refreshments.
Athletic Director or the Athletic Director Designate (currently the Associate Director Intercollegiate Athletics) approval is required for expenses related to NCAA intercollegiate athletes and athlete support-staff. This ensures a review for NCAA compliance. In cases where the NCAA requirements are different from those in this guideline, including more stringent rules about support evidence and receipts, the NCAA rules take precedence.
On-campus retirement gatherings: Supervisors may approve an on-campus retirement gathering for persons retiring from NMU. Supervisors must utilize NMU food service for cake, cookies, coffee, water, punch, or similar light refreshments and the gathering must occur on campus. This option is only available for those retiring, and not those leaving for another job. If there are charges not directly billed by the Conference and Catering Department, use Concur Expense and select “travel and entertainment,” “business meal,” and show retirement gathering in the comment section. List at least the supervisor, the retiree, and an entry that says “other University employees” in the attendees section; do not list each guest.
Travel expenses for an employee’s spouse, partner, and/or dependent will not be paid or reimbursed. Exceptions may only be approved by the Board of Trustees (for the President’s spouse/partner or dependents) or the President (for all others). In addition, the Controller will review the expenses to determine if they are a taxable benefit to the employee.
3. PURCHASES OF SUPPLIES, MATERIALS, AND SERVICES
Supplies, materials, and services purchased must be used for University business. Position advertising is an example of a service allowed to be paid with a purchasing card. To purchase supplies, materials, or allowed services for University business, obtain the organization code owner’s approval before the purchase. When the materials are received or the service is complete, ensure that the receipt matches the materials or services received. Sign on to Concur Expense to settle the expense before the semester settlement deadline. Use the “Purchasing” category. Attach a scanned copy of the receipt for each purchase unless an acceptable “smart receipt” has been automatically input into Concur Expense. Several purchases may be grouped together in a single Concur Expense report.
Adhere to the Central Stores Requisitions Policy. This policy addresses materials and supplies purchased in bulk and stored in Central Receiving and supplies available through a vendor contracted to provide the lowest price.
Purchasing hazardous materials is allowed when it complies with the Hazardous Material Management Policy.
Purchasing memberships for professional organizations is only allowed as described in the Reimbursement for Professional Membership Policy.
Warranties: Most warranties are not transferable. When purchasing goods for the University, use the University credit card or invoice purchasing process (and not a personal credit card or cash) in order to preserve the warranty for the University.
4. TRAVEL EXPENSES
For domestic travel, obtain the organization code owner’s approval before making any travel purchases. If applicable, refer also to the University Related Travel for Non-employees Policy or the University Related Travel for Non-employee Groups Policy. Consideration should be given to available department funds, the type of program or activity, and benefits that may be derived for the University. Settle the expenses before the semester settlement deadline through Concur Expense, Travel and Entertainment Expense category. Attach a scanned copy of the receipt when required under this guideline unless an acceptable “smart receipt” has already been automatically loaded into Concur Expense.
For international travel, the same basic budgeting and reimbursement rules apply. Approval for the trip is governed by the International Travel Policy. This policy details additional registration and approval steps. Without proper registration, no international travel expense will be paid or reimbursed.
Authorized travel expenses can include:
- Meals and tips when the trip is part of an overnight stay
- Meals and tips without an overnight stay (taxable to employee)
- Vehicle rental and gas -or- personal vehicle mileage
- Airfare-related expenses, such as baggage charges
- Charter airfare
- Hotel and other lodging
- Conference fees
- Tolls, parking, taxis, and limos
- Tickets for business-related events
- Foreign currency exchange
Meals (including tips) will be reimbursed at actual cost, not to exceed $32 in a 24-hour period.
Meals for individuals traveling without an overnight stay will be reimbursed at actual, reasonable expense and will be included in employee wages for tax purposes. This will be shown in Box 14 on the employee’s year-end W2 form.
Vehicle rental or personal vehicle mileage: Employees are allowed to expense either the charge for vehicle rental or for personal vehicle mileage. Employees may decide whether to rent a vehicle or use a personal vehicle for travel. There is no University requirement to rent the smallest or least expensive car available. While extravagant or luxury rental vehicles are prohibited, employees should choose vehicles that offer adequate safety protections for the driving conditions and the number of passengers to be transported. When renting a vehicle, gas may be expensed. When employees use a personal vehicle, the employee requests a mileage reimbursement, but not a separate reimbursement for gas purchased.
Employees are expected to travel together when doing so would decrease University expenses. When two or more employees could drive together but choose to drive separately, the department head may, at their discretion, authorize limited expense reimbursement for each traveler.
Northern Michigan University has a contract with the local Enterprise car rental agency for a discounted rate. Under this agreement, employees may waive insurance coverage because NMU’s policy provides coverage. The contract code needed to obtain the rate can be obtained from Risk Management.
The personal vehicle mileage rate will equal the IRS standard mileage rates. The Controller sends a University-wide email when the IRS mileage rate changes and resets Concur Expense to calculate mileage based on this rate. Employees enter the destination and the number of miles travelled and Concur Expense calculates the reimbursement amount.
Allowance for student travel-gas reimbursement: Departments sometimes agree to pay part of the cost for students to travel to events, conferences, or other educational experiences. If the department offers to reimburse certain expenses, such as the cost of gas to travel, the Controller’s Office requires evidence of the distance of the trip (such as an internet calculation) and a receipt for the purchase of gas. In no case will the expense be allowed to exceed the IRS mileage rate for the trip distance; that is why the Controller needs an estimate of the distance.
Airfare and airfare-related expenses, such as baggage charges, will be paid/reimbursed at actual, reasonable expense. Plane fare should be at economy or lowest priced fare. A printed copy of the ticket or an itinerary showing payment must be submitted when reconciling expenses.
Airlines offer incentive programs for frequent flyers whereby the accumulated mileage traveled provides bonuses which can be used for free tickets or other benefits. The University permits the benefits derived from tickets paid for by the University to accrue to the individual.
Option for upgrading travel options (traveling first class): The University will only reimburse for economy class. Employees who upgrade or take advantage of different options must pay any extra expense. When filing the Concur Expense reimbursement, provide both a copy of a screen-print showing the economy price as well as the actual price and list the difference in price as a personal expense.
Driving, using an alternate airport, or other preferences: Employees may choose to drive rather than fly, leave from a different airport, or pursue other unusual options. However, when the price is higher than flying from a local airport, the employee must pay the additional expense. Document the lowest expense possible versus the actual expense, and enter the difference in price as a personal expense.
None of these travel guidelines supersede or override medical advice given by a doctor. The University will abide by all laws, regulations, and contract stipulations for accommodating disabilities and/or medical necessity.
Charter airfare or the State of Michigan charter plane may be authorized when it is to the advantage of the University, measured by comparative travel costs and the time of the travelers. Price advantage must be carefully documented so as not to damage the University’s reputation.
Private plane air travel using employee-owned or employee-leased aircraft is prohibited without Risk Management pre-approval. Risk Management will review for both insurance coverage and other liability issues. Approval for private plane travel is rarely granted.
Hotel and other lodging is paid/reimbursed at actual, reasonable cost.
Tips are not allowed in this category, although tips for lodging may be reimbursed through the $32 per diem.
Reasonable cost for lodging is defined as the rate for a single room. If a hotel or other lodging is shared with a non-University person, any additional expenses incurred are the responsibility of the employee. If an employee “upgrades” to a suite or additional amenities, the employee must only expense the amount equal to a single room rate as evidenced on the lodging website or other rate evidence.
Employees may, but will not be required to, share lodging. However, supervisors may make trip approval decisions based on the expense of single versus shared lodging.
Home or apartment rental services, such as Airbnb, VRBO and others, will be allowed when the expense is less than other lodging options. Rental service expenses can be less expensive than the lodging offered at a large conference hotel. Department supervisors may request additional support from the employee to show that the lodging expense would have been greater at a hotel/motel.
Assessing the risk of home or apartment rental services: Risk Management has developed a safety guideline for using this type of lodging. When employees choose this option, they are encouraged to review this safety guideline to remind themselves to check for fire exits, smoke detectors, doors and windows that lock, etc. When employees accompany students and choose this type of lodging, the employee in charge MUST complete the safety checklist before allowing the students to stay overnight. See the Short-Term Accommodations Guideline.
Conference fees are allowed when approved and authorized by the org. code owner, typically a supervisor of the travelling employee at the Dean, Department Head, or Vice President level. Administrative Department Heads make approval decisions based on the department budget and value of the conference to the University. Academic Deans and Department Heads also must consider the faculty union contract provisions.
Tolls, parking, taxis, and limos will be paid/reimbursed at actual reasonable cost, plus a tip not to exceed 20% rounded to the next dollar. No receipts are required for transactions less than $75.00.
Tickets for events are allowed when there is a specific business purpose; typically meaning tickets to trade shows or new technology exhibitions. Tickets to entertainment events are governed by the business entertainment section of this guideline.
Foreign currency exchange transactions are automatically detailed when using a University purchasing card outside the United States. These will be processed as part of the individual purchase or expense. The Controller’s Office encourages travelers to consider these expenses in the travel budget. Other, separate exchange transactions, as when exchanging paper currency before a trip, must be accompanied by a receipt expressed in U.S. dollars. Travelers are encouraged to take into account favorable foreign exchange rates when applicable.
Requests for payment in advance of travel (aka travel advance): There is a specific form required. Receipts are required for all expenses.
5. BUSINESS ENTERTAINMENT EXPENSES:
Reasonable entertainment expenses related to entertaining a University guest in support of legitimate University business may be paid with University funds. The following types of entertainment expenses are allowable:
- Meals and beverages for University guests and employees joining the guests (certain rules apply for alcoholic beverages-see “Rules for alcohol” below).
- Tickets for Northern Michigan University events, including employee tickets, for the purpose of entertaining University guests
- Other reasonable entertainment expenses to host guests of the University
ALL business entertainment expenses must be supported with a receipt along with other proper documentation: Proper documentation depends on whether this is a small gathering with invited guests or if this event is open to community members. See the required documentation section.
Vice President or President approval is required for Business Entertainment Expenses that do not include a university guest: University employees traveling on University business are expected to adhere to the per diem allowance for meals. The only exceptions are the option for a planning meeting during travel and travel expenses within NCAA rules for athletes and athletics staff.
Option for a planning meeting during travel: During conferences or training sessions, it may become obvious that planning and information sharing will be necessary to incorporate the new information into University business processes. In these cases, employees traveling together may be authorized to share a meal while planning to implement the new resources.
Under this option, the senior employee present will be allowed to use a University purchasing card to charge a shared meal (typically dinner) for all employees attending the planning/sharing session. The meal should not be extravagant, but the amount will not count toward any employee’s $32/day limit. However, each attendee must reduce the per diem for that day to $16.00 and comment that a planning session meal was hosted that day by the senior employee. Unless otherwise agreed, the senior employee’s department will cover the whole expense as business entertainment and the Concur Settlement report must list each employee attending.
Gift cards must be recorded as a business entertainment expense. Under IRS regulation, the Controller’s Office must track every gift card purchased. The University must record the recipient name, business purpose, as well as the NMU IN for employees or students if applicable because this is reportable income if it meets the IRS reporting amount or if the recipient is an employee of NMU. The IRS reporting amount for non-employees is currently $600 per year. Note that all gift cards must be reported for employees, including student employees, and will show on the year-end W2.
Rules for alcohol:
- Purchasing alcohol to be carried outside a store/restaurant is strictly limited to food service personnel who are purchasing specifically for food service operations. These purchasing card expenses will be settled using Concur Expense “Purchasing.”
- Federal grants specifically disallow alcohol expenses and other grants only rarely allow alcohol expenses. Do not allocate alcohol to a grant account without pre-approval from the Grant Accountant.
- Purchasing alcohol for students is prohibited, even if they are of legal drinking age.
- The legal purchase of alcohol for employees and business entertainment guests, to be consumed with a meal or as part of a business entertainment function, may be reimbursed under the Travel and Entertainment policy option. Purchases will be limited to after-business hours. Driving under the influence of alcohol is illegal. Illegal driving voids most University insurance protections.
6. REQUIREMENTS FOR DOCUMENTATION (Proper Receipts)
Receipts are from the vendor and include the vendor name, the date of the transaction, the items purchased, and the amount charged. The receipt should match the date and amount of the MasterCard charge shown on Concur Expense and at MasterCard. Receipts are required to be scanned or uploaded into Concur Expense. After Concur Settlement, the Controller’s office will review, approve and mark the expense as “paid.” After the expense is marked paid, the original paper copy is not required to be retained. The University requires employees to keep the paper receipt until this point so that illegible, blurred, or otherwise unviewable receipts can be reattached.
Purchases made online may be evidenced by attaching a scanned or print-screened online receipt, either from the vendor site or delivered to the purchaser’s email address. The same rules for vendor name, date, detail of purchase, and amount apply.
“Smart receipts” and MasterCard transaction receipts
Concur Expense has an interface with several major vendors that results in a detailed receipt for purchases importing directly into Concur. When a smart receipt loads to Concur Expense and shows each item purchased, the paper receipt or a scanned copy of a paper receipt is not required to be uploaded to Concur Expense.
Not all imported “smart receipts” show enough detail to allow bypassing the scanned receipt. One kind of “smart receipt” is the MasterCard transaction detail. MasterCard transaction details are marked with a purple circle icon in Concur Expense and show MasterCard on the top, with the date, vendor, vendor address, and total amount of the transaction. Use the MasterCard transaction receipt as a purchase receipt IF it shows each item purchased. For example, when the MasterCard transaction receipt shows full hotel or car rental charges with the vendor, dates, and amount of the charges, it may be used as a receipt as long as the Concur comment indicates that the MasterCard detail is being used as a receipt.
When unsure if there is a “smart receipt” for the purchase, err on the side of caution and attach a scanned copy of the paper receipt or an on-line receipt to the Concur Expense settlement item.
Receipts are required for:
- Purchasing materials, goods, or services.
- Any business entertainment expense.
- Lodging expenses.
- Airline expense – submit a copy of the itinerary showing payment as well as any additional charges for baggage. Upgrades to first class or seats with extra features must be paid by the employee as a personal expense.
- Rental car expenses.
- Gasoline reimbursement for a rental car.
- For certain departments (e.g. Admissions and/or Athletics) travel meals purchased with an employee’s own personal credit card or cash and submitted for reimbursement (in the exact amount of the purchase not to exceed $32 per day).
- Tickets to a business-related event, such as a trade show or technology exhibit.
- Tickets to an entertainment event (ONLY allowed as business entertainment).
- Conference fees.
- All travel advances (specific form required).
- Foreign/U.S. dollar exchange for paper currency – must be expressed in U.S. dollars.
Mileage evidence is required: Print Screen and attach any mileage calculator results to evidence the number miles entered into Concur for reimbursement. Mileage is reimbursed from the University’s address to the destination unless driving from home is closer to the destination. (Travel from home to point of employment is considered commuting and is not reimbursable).
Alternatively, employees may log the beginning and ending mileage of the trip; enter that in the comments of Concur. Gasoline reimbursement is only for rental vehicles. It is not allowed when personal vehicle mileage is charged because the rate already includes an allowance for gasoline. Under IRS guidelines, expenses for gasoline, repairs, towing, etc. are included in the mileage allowance. Expenses for parking, storage, tolls and ferries are separately reimbursable. Mileage incurred in the vicinity of the destination will be allowed when the vehicle is used for business purposes in the area being visited.
Receipts are not required:
- For a per diem request.
- For employee travel meals during a trip with an overnight stay: however, the maximum that will be reimbursed is $32/day. Any additional amount must be settled as a personal expense.
- For any meal when there is no overnight stay; note that the total may not exceed $32 and the amount will be included in Box 14 on the year end W2 as this amount is taxable.
- Taxi/uber/limo expense less than $75.
- Tolls less than $75.
- Parking less than $75.
- Toll for the Mackinac Bridge.
Pro-tip for receipts: The Concur App gives employees the ability to use their phones to take a picture of the receipt when it is received (use the camera icon in the lower left of the App). When employees take a picture of the receipt at each purchase, the receipts will be available to attach to the reports whenever the expense is settled.
Business Entertainment Required Documentation (on campus or during travel):
For business entertainment where specific individual guests were invited, proper documentation includes:
- receipts for all expenses
- names of all guests
- position or title of all guests
- name of the business represented by the guest(s)
- business purpose of the entertainment expense
For business entertainment open to the community or a large group of people, the business purpose of the event and receipts are still required. However, rather than listing each guest, include a descriptor such as “open to the community” or “all accounting students” to show that the guest names were too numerous to record.
7. ACCIDENTAL CHARGE FOR A PERSONAL EXPENSE
Employees may not purposely use a University purchasing card for personal purchases. Michigan law does not allow the University to give what is, in effect, an interest free loan to employees.
If an employee accidentally uses a University card for a personal expense, settle the transaction in Concur Expense as soon as possible, preferably before the month-end that the purchase took place. Mark the charge as a personal expense and submit the report. After Concur Settlement, the University will issue an ebill to the employee’s account for payment. If the employee is not set up on ebill, a postal service bill will be sent to the home address of record. The employee should pay the University back in a timely manner. Lack of payment or repeated personal charges will be grounds to revoke or suspend the purchasing card. Human resources may also be notified.
Employees may be granted a one-time exception from the Controller if a receipt cannot be located. Follow this missing receipt process:
- Write or type a description showing the date of the purchase; the vendor; the things purchased and the cost of each; the business use for the purchase. “Business use” is an IRS term that means the reason the item was purchased for the University or how the University will use the item;
- Find support to evidence the purchase price. A screen capture of a website showing the item with the price would suffice. The price evidence could be slightly different from the actual price but should be close. The support evidence is necessary both to satisfy IRS guidelines and in case an external auditor must use the information to verify the price of the items purchased;
- Attach the description AND the support to the Concur Expense transaction in the location where a receipt is normally attached. Type “missing receipt for xxx” in the comment section for the transaction, where xxx is the description of the items purchased.
Since this process is an exception, it is a best practice to contact Vendor Payables to let them know that the exception report will be submitted. Only the Controller or a designate may grant an exception for occasional missing receipts; they will consider the type of purchase and the evidence presented that the purchase was for University business. In certain cases, the IRS rules will require that the expense be shown on the employee’s year-end tax statement as a taxable benefit.
Numerous missing receipts may be processed using the following procedure:
- Arrange a meeting with NMU’s Internal Auditor (phone x2375). The Auditor will both guide the process and sign the request for settlement, if appropriate;
- Group all the unreceipted items together onto a Concur Expense report;
- Prepare a list of the dates of purchase, vendor, items purchased, and purchase amount for each item;
- Obtain support for the price of the items purchased or expensed. A screen capture of a website showing the item with the price would be appropriate. The price evidence could be slightly different from the actual price but should be close. The support evidence is necessary both to satisfy IRS guidelines and in case an auditor must use the information to verify the price of the items purchased;
- Work with the Internal Auditor to arrange for an appropriate level of authority to attest that the item(s)/expense(s) were for legitimate business purposes. Typically this would be a supervisor who can attest that the purchase arrived at the University, or that the trip was for University business, etc.
- Obtain the Internal Auditor’s signature on the packet of evidence. Attach the packet of support to Concur Expense where a receipt would normally be attached and submit the report for Controller review.
When there is insufficient evidence that the purchase was for University business, the Controller has the discretion to either allow the charge to be paid by the employee as a personal expense, or to include the expense in the employee’s year-end wage statement as a taxable benefit to the employee.
When employees apply for and are issued a Northern Michigan University purchasing card, they become fiscal agents for the University and are responsible for:
- Learning and ethically abiding by the purchasing rules;
- Settling all purchases through the Concur Expense system within the semester deadlines; and
- Using either the email reminder system -or- logging into either MasterCard or Concur Expense each month in order to detect possible fraudulent transactions
- Keeping the card secure: the card is to be used only by the card holder named on the card and is NOT to be loaned to any other individual.
Persons issued purchasing cards sign a contract outlining the rules and responsibilities. A copy of this contract is attached to this policy/guideline for reference. In addition, purchasing rules are communicated through this policy guideline and other purchasing policies. The Purchasing Department, Vendor Payables, the Controller, and Internal Audit are all available to answer or clarify any questions.
There are at least eight basic responsibilities for supervisors to consider when authorizing employees to obtain a University purchasing card. When employees are issued a purchasing card, their supervisors are expected to regularly and as necessary:
- Give employees instructions about what charges are authorized and how that authorization should be obtained. For instance, a supervisor may tell an employee that they are only authorized to use the card to purchase department supplies within the annual budget of $x dollar amount but no pre approval is necessary as long as the purchases are within budget. Or perhaps the employee is authorized to use the card to pay for travel to a conference within the AAUP-contracted professional development funds allocation but only with a Concur Travel Authorization or an e-mail preapproval from the department head.
- Review submitted expenses. Ensure charges match the receipt; the charge is for the benefit of the University; there are no personal expenses charged; the charges are within the department budget; and employee charges are settled in a timely manner.
- Approve (or send back or deny) expenses in a timely manner. All charges are to be reviewed before the semester-end cut-off dates;
- Remind employees that all charges must be fully settled within the semester deadlines or the card may be suspended.
- Ensure that employees who are leaving the department settle outstanding expenses. Inform the Purchasing Department of the last date that charges should be accepted and when the card should be cancelled. Cancelling the card does not prevent the employee from using Concur to settle outstanding charges. Even an employee transferring within the University to a new supervisor should have their card cancelled as the employee can get a new card if their new supervisor approves. Review the employees’ prior charges to determine if there are any recurring charges for services that should be cancelled or transferred to another card.
- Consider suspending or cancelling cards when employees are on long-term leave. This will free the employee from the duty to check the account each month for fraud or unauthorized charges.
- When an employee leaves unexpectedly, contact Purchasing to cancel the card. If possible, try to work with the employee so that charges can be settled. Check for recurring charges that would indicate that a service will be cancelled. Contact the Controller if there are circumstances that will make final settlement difficult. For unsettled transactions, determine if outstanding charges should be charged to the department (because the charges are determined to be for the University) or if the employee should be charged for personal or unsupported expenses.
- When employees do not adhere to the responsibilities associated with a purchasing card, supervisors should withdraw their authorization and notify Purchasing to cancel the employee’s card.
There are at least three ways to detect fraud on a purchasing card. First, employees can sign on to the card’s online account each month to review the statement. Second, employees can rely on the Concur Expense/Gmail interface and read the messages that come into the @nmu.edu mailbox. The Gmail messages inform employees when there has been a charge to the account. These messages allow quick identification of any fraudulent transactions. Finally, employees who do not consistently read email messages from Concur Expense may simply sign onto the Concur Expense system each month to check that all the transactions are authorized. See the section called “Starting a Concur Expense Report” for the work steps. In an informal test of this sign on, it took less than 30 seconds to log in and review for unauthorized transactions.
When a possibly fraudulent transaction is identified:
Businesses have less time than other consumers to notify the purchasing card company (MasterCard) of a fraudulent transaction. NMU only has 30 days after the statement date to notify MasterCard of possible fraud in order to receive a reimbursement. This makes it critical for every card user to check transactions no less than monthly.
If a transaction may be fraudulent:
- Notify MasterCard so that they can flag the transaction and investigate; the Purchasing Department will provide a current contact phone number. Keep a record of the call;
- Notify the department supervisor and the NMU Police Department;
- Notify Purchasing so that a new card will be issued; and
- MasterCard will investigate the fraud and NMU may receive provisional credit for the dollar amount;
- File a Concur Settlement report to “clear” the transaction after the credit is received. Concur will show both a charge and a credit from MasterCard for the same amount. Put both on the same report and the amount will equal zero. If you do not receive credit within 30 days of reporting the fraud, contact the Vendor Payables Department for instructions.
When employees follow these procedures, NMU will likely be reimbursed and the employee’s department will not be charged the amount of the fraudulent transaction. When these procedures are not followed, the employee may be charged personally for these charges as per the purchasing card agreement signed when the card was issued.
Settlement Deadlines: Employees must settle University purchases during the semester the charge is made or shortly after. For consistency, settlement deadlines have been set at:
- September 15 for Summer charges made after June 15;
- February 15 for Fall Semester charges; and
- June 15 for Winter Semester through June 15 charges. Because faculty and staff often travel to conferences and on other University business in May and early June, the Winter Semester deadline is stretched to include these May and early June charges.
- In departments with more complex budgeting processes or higher volume of purchasing, the department supervisor may require employees to settle University purchasing cards before the standard settlement deadlines. Some departments require settlement at the end of every month.
Revoking or suspending card privileges for late settlement or failure to follow policy: With few exceptions, each June, the Controller will force-settle any outstanding charges made before June 15 by charging organization code of the employee’s department (the default organization code) and then will suspend or revoke the employee’s purchasing card privileges. Card privileges are typically revoked for no less than one year, although a department supervisor may request an early end to revocation when there is good reason to do so.
The Purchasing Department will audit purchases on a monthly basis to ensure transaction guidelines are being followed. This includes the use of a double swipe by the employee to circumvent the $2,500 single transaction limit. A violation notice will be sent out for the first offense, the card will be suspended for 30 days after a second offense, and any subsequent offense made within the same year will result in the card being suspended for (1) year.
Requests for reimbursement of personal credit card or cash payments that are submitted after the settlement deadlines will not be accepted or paid without Controller approval.
Settling trips booked far in advance: Historically, the University has encouraged settling all expenses for a trip at one time shortly after the trip is complete. This is still encouraged. However, when using a University purchasing card to pay for some expenses before the winter semester deadline of June 15, and the trip will occur after June 15, settle the trip in two settlement reports. Label the first report FIRST HALF OF TRIP TO (LOCATION NAME) and submit it before the June 15 deadline. When the second report is filed, label it SECOND HALF OF TRIP TO (LOCATION NAME). In this way, the University will book all expenses incurred in the correct fiscal year.
13. STARTING A CONCUR EXPENSE SETTLEMENT REPORT
The Controller’s Department will issue step-by-step instructions for using Concur. Until this is posted, this is a quick reference for signing onto Concur Expense:
- go to nmu.edu
- click MyNMU
- click Login
- enter the user id and password (two-factor authentication is recommended) and click Login
- select the Employee Services tab
- Under Concur Settlement System, click the “click here to submit a settlement report”
After signing into SAP Concur Expense and selecting “Expense” from the top menu bar and “Manage Expenses” to settle or review purchasing card expenses there are only three choices for categorizing expenses. These are called “policies” in Concur Expense. The choices are:
- Purchases of supplies, materials, and services for University business. To process these, choose the “Purchasing” policy option in the Concur Expense system. Note that food may only be purchased in this category when it is for a food service, concession, or science laboratories; no prepared meals may be purchased through the purchasing policy option.
- Travel expenses incurred while conducting University business within the United States are categorized as a “Travel and Entertainment” policy in Concur Expense.
- Travel expenses incurred while outside the United States are categorized as a “Travel and Entertainment” policy in Concur Expense.
- Business entertainment and business meetings are categorized as a “Travel and Entertainment” policy in Concur Expense.
- The Concur “Travel Authorization” policy sends a travel authorization date range and estimated amount to be spent through the Concur Expense approval channels to document pre-approval. For International Travel, both the Concur Travel Authorization and the MyNMU International Travel Registration (an emergency contact system) are required. For domestic travel, some departments require a Concur Travel Authorization.
Certain expenses must be paid by check. These include:
- Moving Expenses (see related Moving Expense Policy)
- Refunds (Northern Center for Lifelong Learning, PEIF membership, etc.)
- Ticket Refunds (this is one of the only exceptions where employees can be issued a check through the Concur Invoice Check request process )
- Certain external vendors who will not accept credit card payments
- Student travel expenses authorized by a department
- Reimbursement for authorized University expenses paid by students
- Reimbursement for contractors
- Reimbursement for potential job candidates
- Reimbursement for Board of Trustee travel
- Medical expenses paid by the University
Certain checks are authorized to be printed at the University and held for the recipient. These include:
- Beer or alcohol purchases by the Dining Services/Concessions area;
- University speakers or performers who must be paid immediately after the performance
- Purchase of property (where the check is delivered at the closing meeting)
- Perkins loan disbursements
- Parent loan disbursements
- Certain library payments
- Any other specifically authorized by Vendor Payables or Financial Services
- Check for vendors not in the United States (work with the Controller’s Department because the process is highly regulated).
Employees may NOT use Concur Invoice System Check requests for Employee Expenses (except for ticket refunds). Generally, these must be processed through the Concur Expense system.
Certain check requests must be accompanied by specific forms, typically available on the Finance and Administration website. These include:
- Alcohol purchases for Conference and Catering
- Wire transfers
- Invoice payment - attach the invoice AND include invoice number or date of invoice to prevent duplicate payment
- Travel advances - Documentation is required for all expenses.
- Moving expense - attach evidence of all expenses
15. CONCUR PAYMENTS WITH A PURCHASE ORDER
Payments requested for a purchase order (purchases over $2500) still flow through the Concur system, but are not paid by a purchasing card or by a check printed in and sent from Marquette, MI. For reference, the keystroke choices in Concur are Invoice, Create New Invoice, and enter a Purchase order number in the Purchase Order Search field. After all work step processes are complete, checks are sent to the vendor from a remote location.
16. TERMS AND FREQUENTLY ASKED QUESTIONS
“Concur,” also called SAP Concur, can be accessed through the Employee Services tab of MyNMU. The Concur App can also be downloaded to smartphones or other devices. Once signed on to Concur, there are tabs across the top of the screen with options. Depending on the user’s job responsibilities, there may be options for Expense, Invoice, Reporting, Approvals, or other options. Most of this guideline references Concur Expense, meaning the “Expense” tab on the top of the Concur’s first screen and the options shown within that “Expense” processing tab.
“Concur App,” also called the SAP Concur application, is the mobile application downloaded to a smartphone or other remote device. Most of the things that can be done from a desktop can be done from the App. The App conveniently allows users take pictures of receipts when they are received.
“Purchasing Card” is the University name for the official NMU credit card. This card is requested through the Purchasing Department. The current card provider is MasterCard. These are also referred to as University Credit Cards, pcards, procurement cards, or University MasterCards.
“Per Diem” is the term for the maximum daily amount that the University will allow for food and incidental expenses.
The university will reimburse or pay for the actual amount that employees spend during travel on meals and incidentals up to the per diem rate. If employees spend less than the per diem amount, they should only ask to be reimbursed for the amount spent. This may occur, for example, when a conference provides breakfast and lunch, but not dinner. If all meals are provided during a travel day, no per diem should be requested for that day (assuming no other legitimate incidental expenses).
No receipts are required when an employee requests a “per diem'' in lieu of submitting receipts for meals. The University currently uses a $32 per day per diem rate. This is lower than the maximum allowed by law, but is offset by the fact that the University does not require travelers to reduce the per diem amount on the first and last day of travel.
“Settle” or “Concur Settlement” means accessing the Concur Settlement System (on the employee tab of MyNMU) to explain the charge and send it for approval. Specifically, employees attach an electronic receipt, select the department that should be charged for the expense (called allocation), describe the transaction to explain the expense, attest that the charge is for University business, and submit it to the person who is authorized to approve the purchase.
FAQ1 – Is it better to put one report through for each expense? Or should expenses be grouped together? The quick answer is that employees have options to group expenses as meets their needs. The University is charged by Concur for each report, so it is cheaper for the University when expenses are grouped together. Also, it is often easier for a supervisor to see all the expenses related to a trip all together, or all office supplies grouped on one report. If it is easier to track or approve expenses if they are grouped in a different way, though, that is fine as well. There are a few situations where some expenses will have to be split so that they are booked to the University’s accounting system in a timely manner (some trips, for instance). As a general guideline, group expenses when you can, and split them when it makes sense to do so.
FAQ2 - Meal examples: When this guideline was developed, reviewers asked for examples of submitting meals when some are made from cash or personal credit card and others are paid using a University credit card.
During an overnight business trip, an employee traveling on University business spends the following on meals in a single day:
$6.00 cash on breakfast
$8.00 the employee’s own personal credit card for lunch
$18.00 plus $3.60 tip for dinner ($21.60 total) charged to a University purchasing card
The limit for meal expense per day is $32.00. In this case, the employee would submit Concur Settlement charges of $21.60 for the meal charged using the University purchasing card (no receipt required) and $10.40 as the remaining per diem amount (no receipt required). No entries are required for the $6.00 cash or $8.00 personal credit card charges.
Breakfast charged to the hotel room -$11.00. (The hotel bill was $261 - $250 for room and $11 for breakfast) charged to a University purchasing card
Lunch - $12.00 on a University purchasing card
On the drive home, the employee used the purchasing card for gasoline for the rental vehicle plus a sandwich and banana from the same gas station. Gas $35.00 and sandwich/banana $7.00 - total receipt for $42.00
Describe the $12 lunch as a meal. No receipt required.
Describe the $261 University purchasing card expense as personal with a comment that it includes both meals and hotel.
Enter the $42 University purchasing card charge as personal with a comment that it includes both meals and gas. These three entries clear the University purchasing card charges.
Then manually enter a hotel charge $250 and attach the hotel receipt with the hotel portion circled before scanning.
Manually enter the meal charge for the $11 breakfast.
Manually enter gas charge as $35 and attach the gas receipt with the gas portion of the expense circled before scanning.
Manually enter the $7.00 as a meal charge. No receipt required.
These four charges will offset the $303 that you entered as personal and you will not owe the University any money.
Example 3 (meal purchase listed as a personal expense and offset by a per diem charge):
Breakfast $6.00 cash
Lunch $8.00 University purchasing card
Dinner $45.00 University purchasing card
It is best to charge expenses over the $32/day limit on your own personal card. However, when the expense is greater than expected or the restaurant does not take the type of card you carry, etc. it will be allowed to book the expense as follows on Concur:
$8.00 Choose Expense Type Meals and click the personal expense box
$45.00 Choose Expense Type Meals and click the personal expense box
Click New Expense in the upper left. Enter $32 for an amount and Choose Expense Type Meals. Type meal per diem in the comment box.
If these were the only charges on the expense report, the employee would be billed $21 to cover the difference of the maximum meal per day allowance and the amounts charged to the purchasing card. There is no reason to enter the $6.00 breakfast in Concur as it would be another charge over the $32/day limit and would be the employee’s responsibility anyway.
Employee spends their own cash or personal credit card on their breakfast, lunch, dinner, snacks and incidental expenses in an amount near or over $32 each day.
For each day travelling, click New Expense in the upper left. Enter $32 for an amount and choose Expense Type Meals. Type “meal per diem” in the comment box. No receipts required. The employee will be reimbursed $32.00 for each travel day either directly to their bank account by ACH (if set up) or by check to the home address of record.
FAQ3: What should be done if my hotel expenses do not evenly divide by the number of days I traveled?
PRO-TIP FOR PROCESSING HOTEL EXPENSES IN CONCUR: The default for Concur hotel expenses is to split the stay into daily charges. This can be frustrating. Employees are allowed to simply list the number of days as ONE DAY (the start day and the end day are the same) and show the whole expense as one expense. Show in the comments section the actual number of days you stayed. Alternatively, you may split the expense into day-by-day charges. When the total charges do not split equally then use Concur Expense go into a single day and adjust it to bring the total into balance.
FAQ4: Why do we use Concur with credit card purchases? NMU uses Concur for three things. Concur ensures that each purchase is authorized, accounted for in the correct general ledger account, and paid on time.
The Controller has assigned an organization code (org. code) to each department. Within the department org. code, an annual budget is assigned for categories of expenses, such as office supplies and travel. These categories are also called “Account Codes.” Each org. code is assigned to a single owner. Only the org. code owner may authorize and approve purchases, and only when the charge is both within the department budget and is also an allowed expense.
When an employee makes a purchase using a purchasing card, the expense detail is delivered by MasterCard into the Concur system. However, it is not charged against any department’s budget until the purchaser makes a settlement report, selects the org. code to be charged, and submits it for approval. At that point, Concur Expense routes the report to the org. owner, who reviews the attached receipts in Concur and either approves the charge or sends it back to the employees for a change to the report. Finally, approved reports are reviewed by the Controller’s Office to check that the purchase is charged correctly.