60-Day Rule for Expense Reports

To avoid tax consequences on expense reimbursements, University employees should remember the 60-Day Rule:  Expense reports for out-of-pocket expenses must be submitted within 60 days from the date the expense was incurred (in the case of travel, within 60 days from end of trip).

Per federal tax regulations, expenses submitted after 60 days will be reported as taxable income to the employee, and applicable Federal, State, FICA and Medicare taxes will be deducted from a subsequent salary check.  Timely reporting and submission of expense reports is the responsibility of the employee being reimbursed regardless of whether the employee self-submits or has designated a delegate for expense reporting.  When combining smaller instances into one expense report, employees are encouraged to submit at least once a month (for example, mileage logs or multiple small out-of-pocket expenses).

The 60-Day Rule is stated in the UA Spending Policy, the UA Travel Policy, and the UA Tax Office Fringe Benefit Taxation site.

Concur Missing Receipt Affidavit

The Concur system allows for a Missing Receipt Affidavit to be completed within the system replacing the formerly used paper form.  Employees should always first contact the vendor to obtain a duplicate copy of the lost or misplaced documentation.  However, if a duplicate copy cannot be obtained, a Missing Receipt Affidavit should be completed within Concur using the instructions in the Missing Receipt Affidavit Guide available on the UA Concur website.  Remember that using the Missing Receipt Affidavit should be a last resort.  If this form must be used, make sure to provide an itemized listing of purchased items in the comments of your report.  Also, please be aware that the use of the Missing Receipt Affidavit is monitored and any perceived abuse of this mechanism will be reviewed.

Concur Reports

We are seeing a large number of Concur Expense Reports submitted with only one transaction included on the report. While this might be appropriate for an individual with only one transaction within the month, there are many individuals who simply include only one transaction per report as a preferred practice. Additionally, some approvers have advised users that they prefer to see one transaction per report. This practice results in additional work for all individuals in the workflow and in additional costs to the University. The UA Concur Team will begin reaching out to individuals with a high number of reports submitted within one month with only one transaction included per report.

Focus Group Volunteers Needed

Contract Management is seeking at least one volunteer from each department on campus that uses the Procurement Contracts Portal. Volunteers would attend a training session on the use of the portal and provide valuable feedback to our department regarding how the end user experience could be improved.

Dates are TBA. If your department is interested in participating please email Jlove@fa.ua.edu and provide the contact information for your representative(s).

Procurement Year-End News December 2019

FY19 Accomplishments

Thank you for being one of our campus partners.

 

In lieu of our usual newsletter format, we would like to take a moment to reflect on the past fiscal year. For everything you did and for working with us along the way, we would like to extend our gratitude and share some FY19 accomplishments! Your hard work and support have made the difference in our year.

  1. Accounts Payable, P-Card, and Procurement Training worked with OIT to create the Concur-P-Card User Access Form to streamline the process for requesting access to Concur, a P-Card, a supervisor update, or any combination of the three.
  • The average “life span” of a Concur Expense Report from the first submit to the final approval in Procurement Services is currently 3.8 days.
  • Purchasing issued 126 competitive bids. Due to the competitive bid process, Purchasing was able to negotiate an estimated $508,000 in cost savings for FY19 and received $1.5M in rebates for the University.
  • There were 16,341 catalog orders were completed through buyBAMA totaling $11.7M in spend which is the most since buyBAMA’s implementation 4 years ago.
  • Purchasing reviewed 2,722 Branding & Licensing Approval Forms in FY19 for Purchasing compliance, which is the most since the form’s implementation approximately 3 years ago.
  • Contract Administration is currently working with Finance and Operations IT Support to create a new construction change order process. Change orders under the new system will be easier to prepare, faster to complete and have fewer mistakes.
  • Contract Management and Procurement Training worked with departments on campus to streamline the Permissive Use Agreement process. This will make submission of PUAs faster and easier for campus users.
  • The Procurement Contract Portal is now the only accepted method for contract submission. Contract Management and Procurement Training have created both a written instructional guide and a video with step-by-step instructions to assist our campus users. These training materials can be found on the Contract Submittal webpage.
  • Furnishings and Design began a project for Event Management to serve as a collaboration space during events such as inclement weather, campus security events, football traffic, etc. Special thanks to the campus partners that helped!
  • Furnishings and Design worked along with campus partners from all corners of the state to successfully complete a unique project at the GulfQuest Maritime Museum site in Mobile, Alabama for The University of Alabama’s Office of Research and Economic Development.

FY19 Stats

It is truly a pleasure to work with you all!

 

Campus submitted 3,295 Purchase Orders to Purchasing totaling approximately $81.5M in spend.

In FY19, Contract Administration bid 99 projects, resulting in 86 construction contracts worth a combined $183.8M.  We also processed 2,348 designer agreements, purchase orders, pay applications, and other construction-related documents.

Campus submitted 40,674 Expense Reports including 82,000 out-of-pocket transactions and 54,000 P-Card transactions totaling over $27M that were processed in Accounts Payable.

Accounts Payable processed over 20,000 Concur Invoices submitted by our campus partners totaling almost $154M and approximately 7,000 invoices on purchase orders totaling almost $75M.

Board of Trustees Approval Threshold Change Reminders

At the June 06 – 07, 2019 Board of Trustees Meeting, several expenditure thresholds requiring Board of Trustees approval were revised. See summary of revisions below:

  • The purchase or lease of equipment threshold increased from $500,000 to $750,000.
  • Technology acquisitions threshold, not included in the annual technology plans, increased from $500,000 to $750,000. The revised rule also clarifies technology as inclusive of all aspects – hardware, software, associated services, upgrades and expansions.
  • Previously, all consulting and professional service agreements over $250,000 and goods and services over $1,000,000 if not competitively bid were subject to the System Office Heightened Review process. Now, those same thresholds are subject to Board of Trustees approval, further clarified as follows: Goods over $1,000,000 unless competitively bid; Consulting and professional services over $250,000 regardless of whether the contracts result from a competitive process.
  • Capital projects that involve construction, demolition, or renovation of University facilities threshold increased from $750,000 to $1,000,000.

The above threshold changes became effective immediately upon approval at the June meetings.  The System Office is in the process of updating the Board Manual which can be referred to for full context once updates are complete.

What is the role of Procurement Services in these changes?

Procurement is the conduit for all purchases/contracts.  By starting with Procurement, we can help navigate the process.

What do the submission requirements include?

  • Complete the Contract Summary Term Sheet, which will be provided by Contract Management. The Contract Summary Sheet will request information such as:
    • What is the rationale for not bidding this agreement?
    • Justification/How does this Contract promote the Campus Strategic Plan & UA System’s Core Principles?
    • Contractor Selection Process/Explain how the offered price was determined to be a reasonable one?
    • Please list other higher education clients, if any, the vendor had contract(s) with during the past five years.
    • Please list other organizations in the State of Alabama the vendor had contract(s) with during the past five years.

What are the deadlines for items to be submitted for upcoming Board Meetings?

  • February 6-7, 2020 Meeting
    • must be submitted to Procurement by November 22, 2019.
  • April 9-10, 2020 Meeting
    • must be submitted to Procurement by February 7, 2020.
  • June 4-5, 2020 Meeting
    • must be submitted to Procurement by April 3, 2020.

Fiscal Year-End 2019

With FY19 ending in a few short weeks, it is important to note the below dates to ensure that Procurement Services can process all orders and post all transactions to Banner within the Financial Accounting deadlines:

  • buyBAMA Purchase Orders must be created and approved by Monday, September 23, 2019, at 5 p.m.
  • buyBAMA Receiving must be completed by Monday, September 30, 2019, at 5 p.m.
  • Concur Invoices must be submitted, approved by all approvers, and to Accounts Payable for processing by Monday, October 7, 2019, at 5 p.m.
  • Concur Expense Reports must be submitted, approved by all approvers, and to Accounts Payable and P-Card for processing by Monday, October 7, 2019, at 5 p.m.
  • Banner Encumbrances will roll forward on Friday, October 18, 2019

Property and Inventory Management: Account Code Reminders for Property Subject to Inventory Control

Account code range 791XXX should be used for purchases of equipment that are moveable (not permanently affixed to a building or structure) with a life expectancy of more than one (1) year and have an acquisition value of $5,000 or greater that are subject to inventory control. Examples typically include office equipment, lab equipment, scientific equipment, tools and machinery, recreation equipment, kitchen equipment, maintenance/janitorial equipment, vehicles, and other general equipment. Do not use 791XXX account codes for purchases that are not subject to inventory. Please see the Property and Inventory Management Policy for additional information.

Please contact Tracy Cameron for questions about Property subject to inventory control.

Financial Accounting and Reporting: Account Code Reminders for DTAs and Journal Entries

Credits:

  • Departments providing a good or service should credit Cost Recovery (780111) or a revenue account code with the ‘INTERNAL’ designation in the 506XXX and 508XXX account codes unless the transaction is between UA and one of the foundations, in which case, a revenue account code may be used.
  • If the transaction is a reimbursement, the department receiving the reimbursement should credit Cost Recovery (780111) or the account code where the reimbursable expense was originally charged.
  • Revenue account codes in the 507XXX range should only be used by Auxiliary Funds (18XXX)

Debits:

  • Account code 700001 is not valid for DTAs or journal entries. This account code is used for budget purposes only.
  • Student scholarship activity should be expensed to 7812XX account codes.
  • Account codes in the 795XXX range should only be used in construction project funds.
  • Cost Recovery (780111) is only used as a debit when correcting an error.

Please contact Candace Holliday for questions about DTAs and Journal Entries.

Why Use Your P-Card for Purchases?

Campus partners are encouraged to use their P-Card whenever accepted by vendors for all allowable purchases in compliance with Procurement Services policies.  Please note that P-Cards should not be used for payment of professional services.  See common questions / comments below related to using P-Cards and clarifications from Procurement for each.

  1. I prefer to issue a PO, it’s easier for me.
  • While it may seem easier for you, it is a much more time-consuming process for the University as a whole. Per National Association of Purchasing Card Professionals research, when the payment method is switched from the traditional process (e.g. purchase order) to a P-Card process, efficiency savings range from 55% to 80% of the traditional process cost.  The primary efficiency is time saved – It takes far less time to make a P-Card payment, reconcile the transaction and audit the transaction than the purchase order issuance, receipt, payment and closeout process.
  1. The charge exceeds my single purchase limit.
  • Temporary increases to the single purchase limit outside of the University’s e-procurement system, may be granted on a case by case basis. The Supervisory or Budgetary Approver may request a temporary increase by emailing P-Card Services with an explanation of the circumstances and a copy of the itemized invoice/quote.
  1. The charge will push me over my monthly P-Card limit.
  • Monthly limits are based on department need and set by the Budgetary Approvers when the initial request for a p-card is made, but these limits can be increased on a temporary or permanent basis. All that is needed to process a monthly limit increase is the amount to increase to, the length of the increase if temporary and approval from the Supervisory or Budgetary Approver.
  1. The charge is for property costing $5,000 or more which requires tagging by Property Management.
  • P-Card can be used for the purchase of property that requires tagging by Property Management. Property Management receives reports that provide all information needed from all payment method types (p-card, purchase orders and Concur Invoice).  See Equipment Purchases and Your Departmental Responsibilities for associated information.

So, maybe the real question should be – Why Not Use Your P-Card for Purchases?

Please contact Purchasing with any questions regarding the appropriate method of payment at 348-5230 or uapurchasing@fa.ua.edu, or P-Card Services at pcard@fa.ua.edu to discuss monthly and single purchase limits.