Press

 

Not-for-Profit Enews Update: Purchasing Cards (P-Cards)

by Scott Prentice, CPA, CFE - Audit Manager

March 27, 2014


Email Article




Purchasing cards can present a risk for all organizations. While they are convenient, it is imperative for organizations to monitor the activity of purchasing cards and even assess the necessity of their use. If purchasing cards are used then proper controls must be in place. Unnecessary waste, fraud and abuse could result from the use of purchasing cards. A responsible and appropriate member of management should review the activity of purchasing cards. Below are questions to consider when reviewing and approving purchasing card activity.



1. What is the business purpose of the charge? Is it reasonable for the person making the claim?

2. Are original receipts or other support attached for every item claimed (as required by policy)?

3. Is the expense allowable under organization policies?

4. Are the costs claimed 'reasonable' considering the organization's culture, policy, locations?

5. Does the receipt show the name, address and phone number of the vendor?

6. Were any costs split to avoid the allowable maximum?

7. Would this type of purchase normally require the issuance of a Purchase Order?

8. Could the item purchased be used in the home? If so, verify location of item.

9. Was the purchase date or time unusual - for example weekends, evenings or just prior to a holiday?

10. Was the quantity purchased reasonable?

11. Was the item returned for store credit?

12. Is P-Card spending in line with supervisor expectations and budget?

13. Does the purchase location make sense?

14. Where appropriate, verify that the place of business actually exists (for example, call the phone number printed on the receipt).

15. If the charge is unfamiliar, consider entering SKU codes from receipts into the website of the vendor.

16. For fuel purchases, review total charges over a period of several weeks or months. Compare to vehicle mileage.


If you have any questions regarding the article above or any other issue affecting your not-for-profit organization please contact your Blue & Co. advisor or e-mail us at blue@blueandco.com or call us at 800-717-BLUE.