Welcome to Fast Track Training

Provided by BYU Purchasing

Douglas W. Buhler CPSM, C.P.M.

Part 1: Introduction & Overview

Class Roll Handouts

Sample Form Sample Category List Payment Tools Charts Independent Contractor Agreement Template & Guidelines Associate Buyer Application

Slides posted on http://purchasing.byu.edu

Today’s Objectives

To Review Payment Processes, with emphasis on Fast Track, describing: What Fast Track is Why Fast Track Was Developed Who Can Use Fast Track What Can (and Can’t) Fast Track Be

Used For

Today’s Objectives (cont.)

Show you how to process a fast-track requisition.

Help you understand things you need to be aware of as an Associate Buyer.

Increase your understanding of what we actually do in Purchasing—how and when we can help you.

What is Fast Track?

A Payment Method: Has Replaced Check Requisitions Has Replaced Independent Contractor

Check Requisitions An On-line Method, Replacing Pre-

printed Forms: On Purchasing’s Web Page Available Only to Associate Buyers

Payment Tools for Goods and ServicesOver $2,500

Do Not Negotiate with Vendor. Use other Payment Tools, or

Purchase Requisition

Purchase Requisition

No Fast Track category, or greater than $2,500

•Help needed to locate the vendor, good or service

•Restricted commodity

DO NOT negotiate with vendor in advance of submitting requisition

Fast Track•Services within approved categories•Purchasing has already established vendor•Any amount

Y Expense Travel

Reimbrsmnt (including Corp.

Travel Card)

•Expenses while in travel status

•Conference registration

•Hosting

RarelyOver $500

Under $2,500

Purchasing Card

•Goods or Services

COD Check (Convenience Check)

•Corporate vendor who will not accept credit card & will not invoice BYU (e.g Costco, Sam’s Club)

•Penalty for misuse

•Goods less than $2,500 where Purchasing Card cannot be used

•Vendor already established by Purchasing

Under $500

Business Non-Travel Reimbrsmnt• Used only

when other payment tools

were not available at the time of a True Emergency Penalty for misuse.

Payment Tools for Research Subjects, Royalties, Refunds, Academic Reimbursements

Temporary Petty Cash Fund

Payments in cash to individuals for:•Research subjects who must remain anonymous

College Controller Requests and Approves

Payments are expected to be small amounts (e.g. $5, $10)

AP Upload

Payments to individuals for:•Royalties•Refunds•Research subjects

Payments expected to be smaller amounts (e.g. under $1,000)

Campus should try to group uploads to 5 or more people

Y Expense

Payments to individuals for:•Refunds•Reimburse students for their own academic program costs

No dollar limitation

Travel Dept will audit all such transactions

Fast Track

Payments to Corporations for:•Royalties•Refunds

No dollar limitation

Note: Refunds pay back to customers amounts they paid to BYU. Reimbursements pay others for items paid by them on behalf of BYU.

Purchasing Charge The policy we operate under

states:

“Goods and services are to be acquired by or under the direction of the Purchasing Department.”

Why Fast Track?

Why Fast Track?

Not every expenditure is a purchase of Goods and Services.

Purchasing’s staff is not large enough to personally transact all purchases of Goods and Services.

Some purchases of Goods and Services can be more effectively handled directly by departments

History of Payments that Don’t Involve Purchasing Originally check requisitions were

approved for five low-risk categories; however, over the years the number of categories expanded. This ultimately created a reported $7.9 million of unauthorized purchases in 2001.

Use of Check Requisitions was not “under the direction of Purchasing.”

Fast Track vs.Check Requisitions

Two controls that Check Requisitions lacked keep Fast Track Requisition Purchases “under the direction of Purchasing:”

1. Must be handled by trained “Associate Buyers” Associate Buyers are trained by Purchasing so

they can properly execute transactions as an extension of Purchasing within their departments.

2. Fast Track is valid only for specific, limited categories

Principles of Fast Track Requisition Usage

Fast Track Requisitions are approved by a trained “Associate Buyer” and an Approver from your department.

Fast Track Requisitions are valid only for certain categories that—

Have lower risk Do not generally represent opportunities for

Purchasing to add value to the transaction. Commitments to Suppliers for Fast Track transactions

may be properly made by Associate Buyers without involving Purchasing’s staff.

How to Become an Associate Buyer

1) Attend this training Session.(Monthly sessions like this are scheduled for others to attend).

2) Submit an Associate Buyer Application, documenting approval from your department to represent them as an Associate Buyer, and your agreement operate in compliance with Purchasing’s controls.

3) Your authorization will be activated by Purchasing.

As an Associate Buyeryou will—

See that University Policy is followed. See that those in your department who

make Agreements with Vendors and Independent Contractors receive training and follow University Policy.

See that any Independent Contractor Agreements are made and documented before work begins—not after the fact.

What Can I Use Fast Track For? Everything in the Fast Track Codes List, including:

Non-negotiable Services, Fees and other Payments.

Independent Contractors that fit under one of the Fast Track Codes (without a Dollar limitation).

Independent Contractors where the contract is for less than the “small dollar purchase” limit = $2,500.

Purchases of Goods totaling less than $2,500 when P-Cards are not accepted, and there is no value to be added by Purchasing.

What Can’t I Use Fast Track For?

Anything that does not fit a Fast Track Category Code.

Anything that can be paid with a Visa Purchasing Card

Any Reimbursement that should be made through Y-Expense

Anything that requires Purchasing to make commitments or place the order.

Buying Through Purchasing?

… to be acquired by or under the direction of Purchasing…

Purchasing Helps You by: Handling higher-value / higher-risk transactions that

are not eligible for Fast Track. Focusing on managing the highest value Supplier

Relationships—creating Agreements to govern transactions whether they are done with a Purchase Order, P-Card or Fast Track payment.

Which Process to Use?

Q: Pay $800 to “Los Hermanos” musical group (identified with the band leader’s SSN), to provide entertainment at a conference we are hosting.

Which Process to Use?

Q: Pay $800 to “Los Hermanos” musical group (identified with the band leader’s SSN), to provide entertainment at a conference we are hosting.

A: Fast Track, category ICO 7929.

Which Process to Use?

Q: Pay for Snow Removal Service at Cougar Haven. (Paid to individual with SSN, amount is $330.)

Which Process to Use?

Q: Pay for Snow Removal Service at Cougar Haven. (Paid to individual with SSN, amount is $330.)

A: Fast Track, category ICO 8993. Some sort of attached Agreement should detail expectations.

Which Process to Use?

Q: Reimburse an employee’s purchase of a rare book for the University Collection. The book cost $780.

Which Process to Use?

Q: Reimburse an employee’s purchase of a rare book for the University Collection. The book cost $780.

A: Best process is to have bought from the dealer with P-Card. As a reimburse-ment through Y Expense it would be audited and require justification to avoid a penalty.

Which Process to Use?

Q: Pay a Publisher or book dealer for 20 copies of a book at $49.95 each (= $999)

Which Process to Use?

Q: Pay a Publisher or book dealer for 20 copies of a book at $49.95 each (= $999)

A: Purchase using P-Card. (If not a sole-source you may want to have Purchasing try to buy it wholesale, by sending us a Purchase Requisition.)

Which Process to Use?

Q: Reimburse a student for “gear” purchased at Costco, in the amount of $254.62.

Which Process to Use?

Q: Reimburse a student for “gear” purchased at Costco, in the amount of $254.62.

A: Can be done with Y Expense as a Business Non-Travel reimbursement, but will require justification. Should have used C.O.D. Check to pay Costco directly.

Which Process to Use?

Q: Engage a clinician / adjudicator for a Jazz Festival.

Which Process to Use?

Q: Engage a clinician / adjudicator for a Jazz Festival.

A: Fast Track, category ICO 8000 (or ICO 7929). Attach a Letter of Agreement spelling out duties and expectations.

Which Process to Use?

Q: Pay Prime Recordings $1540 in License fees to record, manufacture and distribute a copyrighted song on a Compact Disc album we are producing.

Which Process to Use?

Q: Pay Prime Recordings $1540 in License fees to record, manufacture and distribute a copyrighted song on a Compact Disc album we are producing.

A: Fast Track, category ROY 8999.

Which Process to Use?

Q: Purchase two custom, exquisitely made Presentation Gifts, totaling $4,318.

Which Process to Use?

Q: Purchase two custom, exquisitely made Presentation Gifts, totaling $4,318.

A: Purchasing needs to handle this transaction. Send us a Purchase Requisition and work with us to get just what you want.