8.12.5 Inappropriate PCard Use

Policy Statement

Proper PCard use is required at all times and requires compliance with all state and federal laws, University of Illinois System policies, and good business practices.

Reason for the Policy

PCard users and those responsible for reconciling and documenting purchases must use PCards appropriately by not engaging in inappropriate uses of the PCard and reconciling and documenting purchases properly.

Applicability of the Policy

Use of the PCard and the reconciling and documenting of PCard purchases.

Procedure

Violations of PCard policies, such as the examples listed in Auditing Your Unit's PCard Program, or failure to reconcile and document purchase details in the designated software can result in consequences for Cardholders as well as for units.

Auditing Your Unit's PCard Program

University Payables (UPAY) Card Services, as well as internal and/or external auditors, conduct periodic reviews of unit's PCard use for compliance. Requests for transaction details and receipts can be submitted to a Cardholder and/or Department Card Manager (DCM) for review. Noncompliant activity discovered during a review or reported to UPAY Card Services may impact Cardholder's and/or unit card program privileges. PCard activity can be audited for the following reasons including, but not limited to:

• Using the card for prohibited purchases.
• Failing to provide documentation of purchases.
• Providing unacceptable documentation.
• Late submission of purchase documentation.
• Failing to reconcile transactions.
• Allowing the PCard to be used by individuals other than the Cardholder.
• Splitting/“Stringing” successive purchases to circumvent the single transaction limit or avoid the competitive bid requirement.

Cardholders who misuse or fraudulently use the PCard are subject to investigation, disciplinary action, termination of employment, and may also be subject to criminal prosecution. The system can deduct any personal or non-system related PCard charges from the Cardholder's wages.

Inappropriate PCard Use and/or Processing

Violations of PCard policies, such as the examples listed in Auditing Your Unit's PCard Program, or failure to reconcile and document purchase details in the designated software can result in consequences for Cardholders as well as for units.

Unit Due Diligence

When policy violations by a Cardholder are identified during the reconciling, approval, and/or the DCM review processes, the following procedures must be followed by the DCM and Unit Head, with discretion given to bypass the first and second incident notification and immediately cancel a card if warranted:

• First incident of noncompliant activity - a written warning notification is issued by the DCM to the Cardholder and copied to the Unit Head; a copy is placed in the file with the receipt(s) for the transaction(s); and a copy is emailed to UPAY Card Services. The notification must include details of the incident(s) along with the document identification number(s) for the transaction(s).
• Second incidence of noncompliant activity* - a written warning notification is issued by the DCM to the Cardholder and copied to the Unit Head; a copy is placed in the file with the receipt(s) for transaction; and a copy is emailed to UPAY Card Services. The notification must include details of the incident(s) along with the document identification number(s) for the transaction(s). UPAY Card Services will suspend the Cardholder's PCard for the remainder of the current billing cycle through the next full billing cycle.
• Third or more incidence noncompliant activity* - a written warning notification is issued by the DCM to the Cardholder and copied to the Unit Head; a copy is placed in the file with the receipt(s) for the transaction(s); and a copy is emailed to UPAY Card Services. The notification must include details of the incident(s) along with the document identification number(s) for the transaction(s). Upon receipt and verification of continued non-compliance UPAY Card Services will suspend the Cardholder's PCard for up to one year, or the PCard account may be canceled.

*Second or more incident notification is applicable if the activity is of the same type as the first. Example: Cardholder is issued a non-compliance notification for using the PCard to rent an item. If Cardholder rents another item after receiving notification that the activity is not allowable, then additional notifications can be issued and the PCard suspended or canceled accordingly.

UPAY Card Services Due Diligence

When a Cardholder's noncompliant activity is discovered, UPAY Card Services may impose the same actions cited in Unit Due Diligence above, including immediate suspension or cancellation of the Cardholder account. UPAY Card Services notifies the Cardholder and the DCM when a PCard is canceled due to noncompliant activity. The DCM should notify the Unit Head accordingly. University Audits is also notified immediately if the situation warrants.

The system reserves the right to forgo any of these steps at any time and pursue the matter criminally.

In addition to Cardholder regulations for non-compliance, UPAY Card Services can impose restrictions on a unit's PCard program for any of the following:

• Repeated incidences of noncompliance with any university, system, or business and finance policy by Cardholder(s) in the unit.
• Unreconciled transactions.
• Improper documentation of purchases by Cardholder(s) in the unit.
• Failure of the DCM to perform due diligence by reporting or addressing noncompliant activity.

The following actions may be initiated by UPAY Card Services upon discovery or reporting of repeated occurrences of noncompliant activity:

• UPAY Card Services will schedule a meeting with the DCM and/or the Unit Head to review the issue(s).
• Retraining employees who function in any of the PCard Emburse Enterprise processes will be conducted by UPAY Card Services at the unit level when necessary.
• The university Controller's office will be notified of the issue(s) and University Audits will also be engaged if the situation warrants.
• Failure to cease noncompliant activity will result in UPAY Card Services notification to the DCM and the Unit Head, and possible suspension of PCards for the entire unit for at least one full billing cycle, or cancellation of unit's card program.