9.  **NOAA's Purchase Card Policy**

**Who:** Cardholders and Approving Officials

**What:** Identifies Requirements applicable to the Purchase Card
Program

**When:** Requirements and utilization to nominate and appoint
Cardholders and Approving Officials

**Discussion:\
**

**(a) Justification to Request and be considered for a Purchase Card
Account**

A written justification for issuance of a purchase card must accompany
the cardholder application, which shall be submitted in accordance with
the application procedures detailed in CAM 1313.301, Section 2, along
with applicable training certificates identified under Paragraph (i) of
this policy and proposed spending limits. Requests should also include:
whether or not the proposed cardholder will have COOP responsibilities
and the number of other cardholders, other than the new card request,
assigned to the Approving Official (AO).

The Agency Program Coordinator (APC) will review the request and provide
a recommendation with support for that recommendation, to the servicing
Head of the Contracting Office (HCO) in the regional acquisition offices
for NOAA offices serviced by a regional acquisition office or to the
Senior Bureau Procurement Official (SBPO) in Headquarters for NOAA
offices served by a Headquarters acquisition office prior to processing
the application for the purchase card. (NOTE: Wherever HCO/SBPO appears
in this policy, it refers to actions the HCO will take for regional
cardholders and the SBPO will take for Headquarters cardholders.)

The HCO/SBPO's determination is final.

**(b) Personal Liability**

It is the responsibility of Cardholders and AOs to ensure that purchases
made with their purchase card are in accordance with all acquisition
policy and regulations relevant to the agency.  Cardholders and
Approving Officials may be held personally liable for any action deemed
by the reviewing official to be not in accordance with such policy and
regulation, an inappropriate use of government funds or in excess of
cardholder's purchasing authority.  In addition, if it is determined the
transaction(s) is made with the intent to commit fraud or constitutes
waste or abuse, the cardholder/approving official may face disciplinary
action.

**(c) Approving Officials Responsibilities**

The Purchase Card Program requires each cardholder to have an AO. The AO
is normally someone serving in a management capacity, and at least one
level above the cardholder. The AO ensures that all purchases are
appropriate and that the cardholder is following the proper procedures.
In addition, the AO has the authority to review purchases as often as
he/she deems necessary. The AO also serves as the liaison between the
cardholder, and the APC. Failure to properly monitor purchases and/or
adhere to the laws and agency policies may result in the removal of the
AO from that role. Additionally, disciplinary action may be taken
against the AO in such cases where it is determined the purchases were
made with the intent to commit fraud or constitute waste or abuse as
determined by the HCO/SBPO.

AOs are responsible for the timely approval of their cardholder's
monthly statement of transactions. Failure to timely review and approve
these transactions will result in suspension of the cardholders'
authority and repeated instances of delinquent reviews/approvals will
result in rescission of the cardholders' authority.

**(d) Span of Control**

The span of control refers to the extent of review responsibilities
placed on a single AO for the purchase card transactions of one or more
cardholders. The number of cardholders and the volume of transactions
for which an AO is responsible need to be reasonable so that the AO may
conduct reviews to ensure detection of possible cases of misuse and or
fraud. The number of cardholders assigned to an AO should be reasonable
considering the volume of cardholder activity and the organizational
structure. The AO should have direct knowledge of the cardholder's role
within NOAA and the ability to verify receipt of goods and or services.
In accordance with the recommendations of the GAO Audit Guide dated
November 2003, all Approving Officials shall have a maximum of 7
cardholders unless authorization is received in writing from the
HCO/SBPO. When requesting an individual be issued a purchase card, the
request is required to document who the AO will be and for how many
other cardholders that AO currently has responsibility.

**(e) Purchase Cards and the Micro-purchase Threshold**

It is NOAA's intention to promote the use of the purchase card to the
maximum extent practical while maintaining consistency with the Federal
Acquisition Regulation (FAR).  In accordance with FAR 13.301(c), the
Government-wide commercial purchase card  may be used to make
micro-purchases; place a task or delivery order (if authorized in the
basic contract, basic ordering agreement, or blanket purchase
agreement); or make payments, when the contractor agrees to accept
payment by the card. 

> \(1\) Cardholders [without]{.underline} Delegated Procurement
> Authority (Delegated Procurement Authority refers to those individuals
> who possess a Contracting Officers Level I Warrant) shall have
> authority to make micro-purchases with the purchase card.  The dollar
> value of a cardholder's limit shall not exceed the micro-purchase
> threshold and shall be set forth in their Letter Of Delegation (LOD)
> for utilization of the Purchase Card.
>
> \(2\) Cardholders having Delegated Procurement Authority may use their
> purchase card as:
>
> (a)   A method of purchase up to the micro-purchase threshold;
>
> (b)   A means to place task orders and delivery orders in accordance
> with the terms and conditions of existing contractual vehicles up to
> either the maximum amount of their warrant or the Simplified
> Acquisition Threshold (SAT), whichever is lower; and
>
> (c)   A method of payment on a written purchase order up to either the
> maximum amount of their warrant or the Simplified Acquisition
> Threshold (SAT), whichever is lower.
>
> Only individuals with delegated procurement authority or with higher
> level warrants will be considered for issuance of a purchase card over
> the micro-purchase threshold.

**(f) Documentation for Micro-Purchases**

Every Purchase Card Transaction requires documentation. This
documentation must be maintained in either an individual transaction
file or in a consolidated monthly file with individual transaction data
consolidated and clearly identified for each individual transaction
processed during the month. NOAA cardholders shall maintain back up
documentation as follows:

-   Itemized Receipts

-   Evidence that required sources of supply were checked.

-   A funding document is in file (an e-mail with funds availability
    approval or other document executed by the appropriate individual
    with funds commitment authority)

-   If the cardholder questions the reasonableness of the pricing
    information received from the planned vendor, the file should
    contain what steps were taken to verify the fairness and
    reasonability of the pricing (e.g., evidence of competitive quotes,
    vendor catalogs, etc.)

-   A copy of Form CD-509, Property Transaction Request for all
    accountable personal property

-   Approved CD-464, signed by the NOAA CFO, when purchasing food for
    conferences; evidence of advance approval by the HCO when food is
    acquired under the Government Employees Training Act (GETA) or
    Government Employees Incentive Awards Act (GEIAA); or documentation
    of compliance with Acquisition Alert 06-06 for food/beverages
    acquired in emergency situations

-   EIT Procurement Checklist for Section 508 compliance

**(g) Cardholder Usage and Transactions**

In order to reduce the risk of fraud, accounts with no activity for 18
months will be closed, unless the cardholder has COOP responsibilities.
It is recommended that cardholders with COOP responsibilities regularly
use their purchase card to maintain their competency level and
familiarity with regulations and process.  Additionally, accounts with
low activity shall be reviewed periodically for determination of
continued need and reduced or closed.  

Cardholders shall have their Single Purchase Limit (SPL) reduced to \$1
until remedies as recommended by the APC are satisfied or closed
indefinitely in the following situations:

-   Failure to provide training certificates for required courses, both
    initial and refresher courses.

-   Purchasing items/services prohibited by federal appropriations law,
    acquisition policies, and procedures.

-   Splitting purchases to stay beneath the micro-purchase threshold.

-   Allowing other individuals to use their purchase card.

-   Failure to follow required file documentation procedures (discussed
    in Paragraph (f)).

-   Failure of cardholders to validate bankcard statements timely or AO
    failure to timely approve bankcard statements (delinquent
    cardholder/AO reconciliations/approvals will result in the
    suspension of the cardholders authority and repeated instances of
    delinquent reconciliations/approvals will result in cancellation of
    the cardholders authority)

Additionally, there are very strict procedures associated with the
purchase of food with appropriated funds. The card may only be used to
purchase food for conferences that have been authorized in advance via a
CD-464 (Request for Authorization by Primary Operating Unit for Official
Entertainment or Representation) and signed by the NOAA CFO. 
Acquisitions for food or refreshments associated with the GETA or GEIAA
must be coordinated and approved in advance by the servicing HCO and
documentation of that approval must be included in the file
documentation. A copy of the signed CD-464 shall be provided to the
servicing Acquisition Office. Individuals are prohibited from using the
card to purchase food or meals for any other purpose except as outlined
in Acquisition Alert 06-06 which outlines the procedures for purchasing
food during emergency situations.

h.  **Requests for Single Purchase and Cycle Limit Increases**

For those cardholders whose SPL is less than the micropurchase
threshold, requests to increase a cardholder's SPL will not normally be
allowed. Should such cardholder need to exceed their SPL as originally
issued, their AO must submit documentation supporting such an increase
to the servicing APC. If the APC determines that the justification
provided does not fully support a SPL increase, the AO and Cardholder
will be advised to generate and submit a requisition through C-Request
to their servicing acquisition office to execute the procurement. SPLs
will not be increased above the micropurchase threshold unless the
cardholder is a Field Delegate.

Cycle limit requests for increases must be submitted in writing to the
APC with adequate justification for the increase from the AO. Lack of
proper acquisition planning will not constitute adequate justification
for a cycle increase.

A cycle increase when issued will be the exception and not the norm.
Only in extreme situations and after evaluation by the APC will a cycle
limit be increased.

(i) **Required Training and Refresher Training**

> **[Required Training]{.underline}**
>
> Training for the Micro-purchase level includes the following courses:
> "GSA Smartpay Purchase Card" located at: www.fss.gsa.gov/webtraining,
> "Micro-purchases and Section 508" located at: www.section508.gov, and
> a one-hour Government Ethics Training Course located at:
> [http://learning.doc.gov](http://learning.doc.gov/).
>
> Training for Field Delegates is detailed in NOAA Acquisition Handbook,
> Part 1.8.
>
> **[Refresher Training]{.underline}**

On-line GSA Smartpay Purchase Card Training and Government Ethics
Training for Cardholders, Approving Officials and Agency Program
Coordinators are required every three years.

**NOTE:** It is the responsibility of the Cardholder and AO to maintain
the currency of their training. It is the Cardholder's and AO's
responsibility to track this information and ensure that they obtain
necessary refresher training and provide that to AGO in a timely manner.
The Cardholder's Letter of Delegation expiration date will be tied to
expiration of their training.

**(j) Merchant Category Restrictions**

NOAA APCs shall place Merchant Category Code restrictions on
cardholders' accounts where they deem it necessary to block spending.
Using the appropriate MCC directory and working with the Commerce
Bankcard Center to effect the restrictions on the card will be necessary
to accomplish this end. Where there is a justifiable need to utilize a
merchant in one of these Merchant Category Codes, the approving official
shall provide an e-mail explanation to the APC for a one-time exception.

The below list contains the current MCCs that are blocked. Other
categories may be added in the future at the APCs discretion.

Veterinary Services

Steamship and Cruise Lines

Travel Agencies

Package Tour Operators

Precious Stones and Metals, Watches & Jewelry

Security credit

Wig and toupee shops

Music stores-musical instruments, Pianos, and sheet music

Eating places and restaurants

Drinking places (Alcoholic Beverages)

Express payment service merchants -- Fast food restaurants

Package Stores -- beer, wine, and liquor

Stamp and Coin Stores

Religious Goods Stores

Cosmetic Stores

Cigar Stores and Stands

Securities -- Brokers and Dealers

Insurance -- Sales & Underwriting

Savings Bonds

Timeshares

Sporting and Recreational Camps

Trailer Parks and Campgrounds

Photographic Studios, Portraits

Beauty and Barber Shops

Funeral Services and Crematories

Dating and Escort Services

Tax Preparation Service

Counseling Services -- Debt, Marriage, & Personal

Buying and Shopping Services and Clubs

Clothing Rental -- Costumes, Uniforms, and Formal Wear

Massage Parlors

Health and Beauty Spas

Watch, Clock and Jewelry Repair Shops

Video Tape Rental Stores

Dance Halls, Studios, and Schools

Theatrical Producers

Bands, Orchestras, Entertainers

Billiard and Pool Establishments

Bowling Alleys

Commercial Sports, Pro Sports Clubs, Athletic Fields

Public Golf Courses

Video Amusement Game Supplies

Video Game Arcades & Establishments

Betting

Amusement Parks, Circuses, Carnivals, and Fortune Tellers

Membership Clubs

Aquariums, Seaquariums & Dolphinariums

Child Care Services

Automobile Associations

Court Cost including Alimony & Child Support

Fines

Bail and Bond Payments

Tax Payments

**(k) Purchase Card Warrant**

Effective with the issuance of this policy, Purchase Card Warrants will
no longer be issued. Cardholders will be issued a Letter of Delegation
(LOD), which identifies the cardholder's acquisition limits. Individuals
(Field Delegates) who have Delegated Procurement Authority Level I
warrants can also be delegated authority to use the government-wide
purchase card upon submission of the necessary documentation (see NAHB
1.8). Their authorities, including purchase card authorities, will be
specified on their warrant.

All existing Purchase Card warrants that exceed the micropurchase
threshold will expire with the issuance of a new letter of delegation
reflecting the reduction of their purchasing authority to the
micropurchase threshold. New LODs will be issued upon receipt of
documentation of satisfactory completion of the required refresher
training.

**(l) Purchase Card Audits**

In accordance with Part 4.1(c) of the NOAA Acquisition Handbook there
will be an internal post-award Acquisition Management Review (AMR)
performed on all acquisitions including those actions utilizing the
Purchase Card. There may be situations when the HCO/SBPO, at his/her
discretion, would require cardholders and approving officials to submit
their records to the APC in lieu of an onsite review.

The Purchase Card AMR shall consist of a review of 80% (minimum) of the
preceding 12-month period purchase card transactions. This means the
reviewer will review a minimum of 80% of the purchase card transactions
for the current FY for the cardholder being audited. The reviews will be
performed by the HCO/SBPO, or acquisition personnel appointed by the
HCO/SBPO, on a rotational basis among the various client sites.

The Client must provide funding for travel by the servicing acquisition
office to the client's site(s) whenever an audit must be conducted (once
every 6 years or more frequently as determined by interim oversight
activities) or unless the determination is made by the HCO/SBPO to
require all purchase card transaction records to be submitted to the
HCO/SBPO for review.

An AMR In Brief meeting will be conducted with the client's appropriate
personnel to discuss audit objectives and methods used for the review.
In addition, upon completion of the review, an AMR Out Brief will be
conducted to address the review findings (strengths and problem areas).
The Purchase Card Annual Review Checklist is shown in Exhibit 6 and
shall be used when conducting audits.

The HCO/SBPO shall prepare and issue a formal AMR audit report as shown
in Exhibit 2 within 30 working days after completion of review and
request the Client to respond to recommended remedial actions within 30
days.

**Exhibit 1**

**Purchase Card Annual Review Checklist**

Cardholder Name: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Date of Review:
\_\_\_\_\_\_\_\_\_\_\_\_\_

Period Covered: Onsite or Electronic: Review

<table>
<colgroup>
<col style="width: 7%" />
<col style="width: 0%" />
<col style="width: 54%" />
<col style="width: 4%" />
<col style="width: 0%" />
<col style="width: 5%" />
<col style="width: 5%" />
<col style="width: 0%" />
<col style="width: 10%" />
<col style="width: 11%" />
</colgroup>
<tbody>
<tr class="odd">
<td>No.</td>
<td colspan="9"><strong>Specific Review Criteria</strong></td>
</tr>
<tr class="even">
<td></td>
<td colspan="2"></td>
<td colspan="3">Yes</td>
<td colspan="3">No</td>
<td>N/A</td>
</tr>
<tr class="odd">
<td colspan="10"><strong>A. Card Usage Requirements: Used to determine
proper use of Card by Cardholder</strong></td>
</tr>
<tr class="even">
<td>1.</td>
<td colspan="2">Has any other individual other than the Cardholder used
his or her card?</td>
<td colspan="3"></td>
<td colspan="3"></td>
<td></td>
</tr>
<tr class="odd">
<td>2.</td>
<td colspan="2">Have any purchases exceeded the Cardholder’s single
purchase limit (SPL)? The Cardholders SPL is
________________________.</td>
<td colspan="3"></td>
<td colspan="3"></td>
<td></td>
</tr>
<tr class="even">
<td>3.</td>
<td colspan="2">Has the Cardholder split requirements to stay under
his/her single purchase limit (SPL)? (Look for repeated order during a
short time period for the same goods or services).</td>
<td colspan="3"></td>
<td colspan="3"></td>
<td></td>
</tr>
<tr class="odd">
<td>4.</td>
<td colspan="2">Did the Cardholder check Required Sources of Supplies or
Services prior to ordering on the open market (i.e. Agency Inventories
or Excess Property, FPI or UNICOR, NIB/NISH or JWOD, GSA Supply
programs, Federal Supply Schedules)?</td>
<td colspan="3"></td>
<td colspan="3"></td>
<td></td>
</tr>
<tr class="even">
<td>5.</td>
<td colspan="2">Were all purchases made by the Cardholder for official
Government business only?</td>
<td colspan="3"></td>
<td colspan="3"></td>
<td></td>
</tr>
<tr class="odd">
<td>6.</td>
<td colspan="2">Was the Purchase Card used to purchase any of the
following?</td>
<td colspan="3"></td>
<td colspan="3"></td>
<td></td>
</tr>
<tr class="even">
<td></td>
<td colspan="2">a. Rental or lease of land or building</td>
<td colspan="3"></td>
<td colspan="3"></td>
<td></td>
</tr>
<tr class="odd">
<td></td>
<td colspan="2">b. Travel or travel-related expenses, including gas or
oil for Department owned or leased vehicles</td>
<td colspan="3"></td>
<td colspan="3"></td>
<td></td>
</tr>
<tr class="even">
<td></td>
<td colspan="2">c. Cash Advances</td>
<td colspan="3"></td>
<td colspan="3"></td>
<td></td>
</tr>
<tr class="odd">
<td></td>
<td colspan="2">d. Personal/Convenience Items</td>
<td colspan="3"></td>
<td colspan="3"></td>
<td></td>
</tr>
<tr class="even">
<td></td>
<td colspan="2">e. Food/Beverages Was there a completed CD-464 (Request
for Authorization by Primary Operating Unit for Official Entertainment
or Representation) and signed by the NOAA CFO in the file?</td>
<td colspan="3"></td>
<td colspan="3"></td>
<td></td>
</tr>
<tr class="odd">
<td></td>
<td colspan="2">f. Gift Cards</td>
<td colspan="3"></td>
<td colspan="3"></td>
<td></td>
</tr>
<tr class="even">
<td></td>
<td colspan="2">g. Are printing requirements being satisfied within
regulations.</td>
<td colspan="3"></td>
<td colspan="3"></td>
<td></td>
</tr>
<tr class="odd">
<td></td>
<td colspan="2">h. Personnel recruitment, paid newspaper advertisement,
leasing of motor vehicles, meals at conferences, printing and
duplicating/publication of scientific/research articles in professional
journals, and furniture.</td>
<td colspan="3"></td>
<td colspan="3"></td>
<td></td>
</tr>
<tr class="even">
<td>7.</td>
<td colspan="2">Did the Cardholder use the card for repetitive buys to
the same vendor for the same product or service? If an item is not
available through required sources of supply, did cardholder use
different vendors as frequently as possible? (Except subscriptions, cell
phones, utilities, etc.).</td>
<td colspan="3"></td>
<td colspan="3"></td>
<td></td>
</tr>
<tr class="odd">
<td>8.</td>
<td colspan="2">Did the Cardholder pay any U.S. State taxes and if so,
how much? (Examine receipts to verify if any taxes are included).</td>
<td colspan="3"></td>
<td colspan="3"></td>
<td></td>
</tr>
<tr class="even">
<td>9.</td>
<td colspan="2">Are all required personal property items purchased by
the Cardholder properly tracked in the accountable property records (see
DOC Personal Property Management Manual)?</td>
<td colspan="3"></td>
<td colspan="3"></td>
<td></td>
</tr>
<tr class="odd">
<td colspan="10"><strong>B. Actual Card Activity: Used to determine
extent of card usage by Cardholder</strong>.</td>
</tr>
<tr class="even">
<td>1.</td>
<td colspan="2">What level of activity has the Cardholder had on his/her
card over the past 6 months?</td>
<td colspan="3">No Usage</td>
<td colspan="3">Number of Transactions</td>
<td>Is Card used for COOP?</td>
</tr>
<tr class="odd">
<td>2.</td>
<td colspan="2">What level of activity has the Cardholder had on his/her
card over 12 months?</td>
<td colspan="3">No Usage</td>
<td colspan="3">Number of Transactions</td>
<td>Is Card used for COOP?</td>
</tr>
<tr class="even">
<td colspan="10"><strong>C. Cardholder Documentation Requirements: Used
to determine if purchases are supported by proper fiscal and purchase
documentation.</strong></td>
</tr>
<tr class="odd">
<td></td>
<td colspan="3"></td>
<td colspan="4">Yes</td>
<td>No</td>
<td>N/A</td>
</tr>
<tr class="even">
<td>1.</td>
<td colspan="3"><p>Are purchases supported by a CD-435</p>
<p>Or email with fund availability approval?</p></td>
<td colspan="4"></td>
<td></td>
<td></td>
</tr>
<tr class="odd">
<td>2.</td>
<td colspan="3">Is the Cardholder’s monthly Statement of Account
supported by proper purchase documentation including:</td>
<td colspan="4"></td>
<td></td>
<td></td>
</tr>
<tr class="even">
<td></td>
<td colspan="3">a. An itemized receipt and/or cash register tape
supporting the purchase. There needs to be a corresponding description
on each line item purchased. If there is no receipt, then a statement
indicating why a receipt and/or cash register tape are not available
(i.e. telephone orders, electronic transactions).</td>
<td colspan="4"></td>
<td></td>
<td></td>
</tr>
<tr class="odd">
<td></td>
<td colspan="3">b. Proof of delivery of completion of performance.
Receipts should be signed and dated to indicate the material was
received and in good condition.</td>
<td colspan="4"></td>
<td></td>
<td></td>
</tr>
<tr class="even">
<td>3.</td>
<td colspan="3">Did the cardholder enter the purchases in the Purchase
Card Buying Log each time the card was used (Ensure the Cardholder is
not constructing the log from the monthly Purchase Card statement i.e.
note if purchases on the log and on the statement are in identical
order).</td>
<td colspan="4"></td>
<td></td>
<td></td>
</tr>
<tr class="odd">
<td>4.</td>
<td colspan="3">Does the Cardholder have an up to date copy of their
Certificate of Completion on file for their GSA Purchase Card web-based
training?</td>
<td colspan="4"></td>
<td></td>
<td></td>
</tr>
<tr class="even">
<td></td>
<td colspan="3"></td>
<td colspan="4"></td>
<td></td>
<td></td>
</tr>
<tr class="odd">
<td colspan="10"><strong>D. Security Requirements: Used to determine if
cards and related information are being properly
safeguarded.</strong></td>
</tr>
<tr class="even">
<td></td>
<td colspan="3"></td>
<td colspan="4">Yes</td>
<td>No</td>
<td>N/A</td>
</tr>
<tr class="odd">
<td>1.</td>
<td colspan="3">Is the Cardholder’s Purchase Card kept adequately
secured? For example, is the card kept locked up in the office when not
in use?</td>
<td colspan="4"></td>
<td></td>
<td></td>
</tr>
<tr class="even">
<td>2.</td>
<td colspan="3">Has the Cardholders card been lost or stolen, if so, how
many times in the last year?</td>
<td colspan="4"></td>
<td></td>
<td></td>
</tr>
<tr class="odd">
<td></td>
<td colspan="3"></td>
<td colspan="4"></td>
<td></td>
<td></td>
</tr>
<tr class="even">
<td colspan="10"><strong>E. Statement Review &amp; Approval
Requirements: Used to determine if statements are being reviewed and
approved in a timely manner.</strong></td>
</tr>
<tr class="odd">
<td colspan="2"></td>
<td colspan="3"></td>
<td colspan="2">Yes</td>
<td colspan="2">No</td>
<td>N/A</td>
</tr>
<tr class="even">
<td colspan="2">1.</td>
<td colspan="3">Does the Cardholder reconcile his/her statement within
20 days of the statement date, which is the 3<sup>rd</sup> of each
month?</td>
<td colspan="2"></td>
<td colspan="2"></td>
<td></td>
</tr>
<tr class="odd">
<td colspan="2">2.</td>
<td colspan="3">Are Cardholder records being retained for a minimum
period of 6 years, 3 months from the date of final payment?</td>
<td colspan="2"></td>
<td colspan="2"></td>
<td></td>
</tr>
<tr class="even">
<td colspan="10"><strong>F.</strong> <strong>Requirements for Purchases
over the micro-purchase threshold: Used to determine proper use of card
for transactions exceeding the micro-purchase threshold.</strong></td>
</tr>
<tr class="odd">
<td colspan="2"></td>
<td colspan="3"></td>
<td colspan="2">Yes</td>
<td colspan="2">No</td>
<td>N/A</td>
</tr>
<tr class="even">
<td colspan="2">1.</td>
<td colspan="3">Is there evidence of competition, and supporting
documentation for transactions exceeding the micro-purchase threshold?
If competition was not obtained, is there a valid sole source
justification in the file?</td>
<td colspan="2"></td>
<td colspan="2"></td>
<td></td>
</tr>
<tr class="odd">
<td colspan="2">2.</td>
<td colspan="3">Have awards over the micro-purchase threshold been
set-aside for small business? If not, is there a valid justification in
the file?</td>
<td colspan="2"></td>
<td colspan="2"></td>
<td></td>
</tr>
<tr class="even">
<td colspan="2">3.</td>
<td colspan="3">Were the Required Sources of Supply or Services checked
prior to ordering on the open market?</td>
<td colspan="2"></td>
<td colspan="2"></td>
<td></td>
</tr>
<tr class="odd">
<td colspan="2">4.</td>
<td colspan="3">Was a purchase order or previous order put in place with
the purchase card listed as the method of payment?</td>
<td colspan="2"></td>
<td colspan="2"></td>
<td></td>
</tr>
<tr class="even">
<td colspan="2">5.</td>
<td colspan="3">Was the purchase order prepared in CSTARS and then the
award recorded in FPDS-NG?</td>
<td colspan="2"></td>
<td colspan="2"></td>
<td></td>
</tr>
<tr class="odd">
<td colspan="2">6.</td>
<td colspan="3">In the absence of competition, were prices determined by
the Cardholder to be fair and reasonable? (The file must contain
documentation substantiating this evaluation was performed.)</td>
<td colspan="2"></td>
<td colspan="2"></td>
<td></td>
</tr>
<tr class="even">
<td colspan="2">7.</td>
<td colspan="3">Do individual procurements over the micro-purchase
threshold comply with all applicable FAR requirements, Acquisition
Alerts, and Procurement Memorandums?</td>
<td colspan="2"></td>
<td colspan="2"></td>
<td></td>
</tr>
</tbody>
</table>

**COMMENTS:**

Exhibit 2

PURCHASE CARD MANAGEMENT REVIEW REPORT FOR

*(insert field office)*

**I.** **[INTRODUCTION]{.underline}**

A Purchase Card Management Review was conducted at *(insert field
office)* on *(insert date(s))*, by *insert name(s) of those performing
audit and the acquisition office)*. The purchase card program at this
location consists of *(insert number of Approving Officials and number
of cardholders)*. The current single purchase limits of the cardholders
are as follows: *(insert how many cardholders have up to the
micro-purchase limit and how many have over the micro-purchase limit and
what their single purchase limit is)*. *(Insert the number of files
reviewed)* purchase cardholder files were reviewed. The purpose of this
review was to evaluate the effectiveness and efficiency of the purchase
card program and provide suggestions to improve any noted weaknesses or
deficiencies. The review offers a baseline assessment of current
strengths and weaknesses within the office. *(Insert the percent of the
files reviewed, for example:* *One hundred percent of the 277 available
files were reviewed)* available files were reviewed for the period of
*(insert period of the files reviewed)*. The rating elements that were
used were obtained from the Commerce Acquisition Manual 1313.301, page
38, attachment G. The elements were then listed under three specific
areas, in which one of the five possible ratings was applied to each
area. The rating criteria are as follows:

> Distinguished: Develops and implements innovative approaches in the
> purchase card program; produces and demonstrates improvements in the
> program; and develops internal control procedures to identify fraud,
> waste and abuse.
>
> Commendable: Actions within the program that often exceed the norm and
> offers considerable value.
>
> Satisfactory: Complies with applicable statutory and regulatory
> procedures; which are outlined in the Federal Acquisition Regulation
> (FAR) and Commerce Acquisition Manual (CAM).
>
> Needs Improvement: One-time occurrences or borderline violation(s) of
> elements.
>
> Unsatisfactory: Circumvents or often does not comply with purchase
> card policies and procedures.

A.  [Statutory, Regulatory and Procedural Compliance:]{.underline}
    Consists of thirteen elements and are as follows:

    i.  Did any other individual other than the cardholder use his or
        her card?

    ii. Did purchases exceed the Cardholder's limit?

    iii. Did the cardholder split requirements to stay under their
         single purchase limit?

    iv. Were Required Sources of Supplies or Services checked prior to
        making a purchase?

    v.  Were purchases for official Government business?

    vi. Were the following items purchased using the purchase card:
        long-term rental or lease of land or building, travel or travel
        related expenses; cash advances; personal/convenience items; and
        were printing, personnel recruitment, newspaper advertisements,
        leasing of motor vehicles, meals at conferences purchased with
        the proper justifications and approvals?

    vii. Was the card used for repetitive buys to the same vendor?

    viii. Did the Cardholder pay any U.S. State taxes?

    ix. Was personal property items properly tracked?

    x.  Was there evidence of competition and supporting documentation
        for transactions exceeding the micro-purchase threshold?

    xi. Were domestic transactions exceeding the micro-purchase
        threshold per transaction set-aside for small business?

    xii. Were prices determined to be fair and reasonable in the absence
         of competition and

    xiii. Did procurements over the micro-purchase threshold comply with
          all applicable FAR requirements?

B.  [Business Practices and Judgment:]{.underline} consists of 6
    elements and are as follows:

    i.  Does the cardholder reconcile their statement by the 21^st^ of
        each month?

    ii. Are cardholder records being retained for a minimum of 6 years,
        3 months?

    iii. Is there a valid written authorization that describes what is
         to be purchased and signed by someone with authorized
         requisitioning authority?

    iv. Are there valid receipts and/or cash register tapes supporting
        the purchase, if not is there a statement why a receipt and/or
        cash register tape is not available?

    v.  Is there proof of delivery or completion of performance?

    vi. Were transactions entered in the Purchase Card Buying Log at the
        time of purchase (ensure that the cardholder is not constructing
        the log from the monthly purchase card statement)?

C.  [Management Effectiveness:]{.underline} consists of two elements and
    are as follows:

    i.  Does each cardholder meet the required training requirements?

    ii. Are acquisition references readily available?

The overall rating for your office resulting from this Purchase Card
Program Review is: *(Insert the applicable rating the office should
receive based upon the five levels discussed in Part I)*

The reviews consisted of the following findings:

#  STATUTORY, REGULATORY AND PROCEDURAL COMPLIANCE

*Overview:* This rating is based on compliance with procurement rules,
regulations and procedures. Weaknesses are considered a violation in
statutory, regulatory and procedural requirements. If a violation was a
repeated occurrence, it was consolidated and considered a weakness under
that particular element. The resultant rating assigned to this area was:
*(Insert the applicable rating for this section based upon the five
levels discussed in Part I)*

A.  *Strengths:*

    1.  *List all strengths that are applicable to this specific area.*

> *EXAMPLE:*
>
> *1.* 95% of the purchases were for official Government business and
> were not purchases of restricted items or items requiring approvals
> prior to purchase.

2.  *Personal Property was properly tracked in the accountable property
    records.*

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B.  *Weakness:*

    1.  *List all weaknesses that are applicable to this specific area
        as well as justification to support your rationale.*

> *EXAMPLE:*
>
> *1. One of the four cardholders paid state tax resulting in a total of
> \$182.14 for the year and half reviewed.*
>
> *While this is a small amount of tax, the Government is tax exempt and
> therefore it is the responsibility of the cardholder to ensure that
> there is no tax charged to purchases. Each card has the tax exempt
> number embossed directly on the card. Should any of the cardholders
> have older cards without the number, they can provide the vendor with
> the tax-exempt number 19030214. There is also a complete list of
> states, which have agreed to tax-exempt status. Only four states have
> not agreed. A copy of these tax-exempt letters can be obtained on-line
> at:*
>
> [*http://apps.fss.gsa.gov/services/gsa-smartpay/taxletter/*](http://apps.fss.gsa.gov/services/gsa-smartpay/taxletter/).

2.  *100% of the files lacked documentation stating whether the Required
    Sources of Supply or Services were checked prior to ordering on the
    open market.*

> *CAM Section 3, Paragraph 3.1 (c) states that Cardholders are required
> to adhere to the requirements of FAR 8.001, which require agencies to
> acquire supplies and services from designated sources if they are
> capable of providing them. Cardholders must review the required
> sources of supply prior to placing an order with a commercial vendor.*

3.  *Clothing with agency insignia was purchased almost monthly for the
    employees to wear while attending conferences. It appeared the
    jackets, shirts, and parkas were also being purchased for contract
    personnel. Quantities purchased seemed excessive since there are
    only four permanent employees.*

> *Federal Appropriations Law Chapter 4, section 13 Personal Expenses
> and Furnishings, Part H, Wearing Apparel, page 4-220 states, "there
> are three statues under which purchase of wearing apparel may be
> authorized -- 5 U.S.C. § 7903 (Special clothing for hazardous
> occupations), 5 U.S.C. § 5901 (uniform allowances), and OSHA
> (protective clothing). If none of these applies, then the rule of 3
> Comp. Gen. 433 continues to govern, which states, "In the absence of
> specific statutory authority for the purchase of personal equipment,
> particularly wearing apparel or parts thereof, the first question for
> consideration in connection with a proposed purchase of such equipment
> is whether the object for which the appropriation involved was made
> can be accomplished as expeditiously and satisfactorily from the
> Government's standpoint, without such equipment. If it be determined
> that use of the equipment is necessary in the accomplishment of the
> purposes of the appropriation, the next question to be considered is
> whether the equipment is such as the employee reasonably could be
> required to furnish as part of the personal equipment necessary to
> enable him to perform the regular duties of the position to which he
> was appointed or for which his services were engaged. Unless the
> answer to both of these questions is in the negative, public funds can
> not be used for the purchase."*
>
> *Federal Appropriations Law Chapter 4, section 8 Gifts and Awards,
> part C Awards, page 4-137 & 4-138 states, "Awards under the Act may
> take forms other than cash" and lists \$50 jackets bearing agency
> insignia as an authorized expense. Additionally, it's stated, "the
> Government Employees Incentive Awards Act is limited to government
> employees." The employees indicated the clothing purchases was not a
> part of their awards program.*

4.  *90% of the orders reviewed over \$2,500 lacked documentation of
    price reasonableness and/or sole source justifications.*

> *The CAM 1313.301, Section 3, Paragraph 3.2(b)(2) states that in
> accordance with FAR 13.104, competition must be promoted to the
> maximum extent practicable. FAR 13.106-3 states that the cardholder
> must determine that the proposed price is fair and reasonable before
> making award.*

5.  *100% of the orders reviewed over the \$2,500 threshold, lacked
    documentation of award to small businesses.*

> *The CAM 1313.301, Section 3, Paragraph 3.2(b)(1) and FAR 19.502-2(a)
> states that all Government purchases over the micro-purchase threshold
> up to the Simplified Acquisition Threshold (\$100,000) are by law
> reserved for small businesses. This included purchases made with the
> purchase card. Any purchase over \$2,500 placed with a large business
> must be supported with a written justification that a small business
> could not be located that was able to satisfy the requirements of the
> purchase. The justification must describe efforts taken to locate
> small business sources and must be maintained with the purchase card
> documentation.*
>
> *6. Cell phone service is being provided to a government contractor.
> This in itself is not a violation; however, the preferred method for
> accomplishing this would be to list the cell phone in the contract as
> government furnished equipment.*

C.  *Recommendations:*

> *Provide recommendations for the above weaknesses.*
>
> *EXAMPLE:*
>
> *1. All cardholders should take the purchase card course offered by
> GSA or other commercial sources prior to the close of the third
> quarter in FY 07.*
>
> *2. Provide the servicing HCO/SBPO with your plan of action on how you
> will comply with statutory, regulatory, and procedural requirements no
> later than (Insert Date response should be received by).*

II. **[BUSINESS PRACTICES AND JUDGEMENT]{.underline}**

*Overview:*

This rating is based on the overall quality of the purchase card files
and business decisions by using the six elements that were listed. If a
violation was a repeated occurrence, it was viewed as a trend and
considered a weakness under that particular element. The resultant
rating assigned to this area is: *(Insert rating from the five levels
discussed in part I)**.***

A.  *Strengths:*

> *List all strengths that are applicable to this specific area.*
>
> *EXAMPLE:*
>
> *1. Credit card statements were centrally located making them readily
> accessible.*

2.  *Purchase Card statements were reconciled within the required
    timeframe*.

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B.  *Weakness:*

> *List all weaknesses that are applicable to this specific area.*
>
> *EXAMPLE:*

1.  *A procurement request or similar document was not consistently used
    to demonstrate funds availability, required source of supply
    availability, etc. prior to making purchases.*

> *FAR Part 32.702 states, "No officer or employee of the Government may
> create or authorize an obligation in excess of the funds available, or
> in advance of appropriations (Anti-Deficiency Act, 31 U.S.C. 1341),
> unless otherwise authorized by law. Before executing any contract, the
> contracting officer shall obtain written assurance from responsible
> fiscal authority that adequate funds exist."*

C.  *Recommendations:*

> *Provide recommendations for the above weaknesses.*
>
> *EXAMPLE:*

1.  *A purchase request of some type shall be completed for each
    transaction to indicate funds availability.*

**IV. [MANAGEMENT EFFECTIVENESS]{.underline}**

*Overview:*

This area included an assessment of the organization's structure, along
with a review of the tools provided to purchase card personnel. The
resultant rating assigned to this area is: *(Insert rating for this area
based from the five levels discussed in Part I)**.***

A.  *Strengths:*

> *List all strengths that are applicable to this specific area.*
>
> *EXAMPLE:*
>
> *All purchase card holders have had the required mandatory GSA
> Smart-Pay training and copies of the training certificates are on
> file.*

B.  *Weakness:*

> *List all weaknesses that are applicable to this specific area.*

1.  *One of the cardholders, with purchase card authority over the
    micro-purchase threshold, has not completed Simplified Acquisition
    Procedures, which is required as per CAM 1313.301, Section 2,
    Paragraph 2.A-2.*

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C.  *Recommendations:*

> *Provide recommendations for the above weakness.*
>
> *EXAMPLE: The cardholder shall complete the Simplified Acquisition
> Course to ensure compliance with the CAM no later than April 29, 2005.
> Simplified Acquisition Procedures is available online at no cost
> through Defense Acquisition University. The web site is: www.dau.mil
> .*

**V. [SUMMARY]{.underline}**

> The overall rating for your office resulting from this Purchase Card
> Management Review is: *(insert rating).*
>
> This was based on the ratings received for each of the following
> elements:
>
> Statutory, Regulatory and Procedural Compliance: (insert rating)
>
> Business Practices and Judgment (insert rating)
>
> Management Effectiveness (insert rating)
>
> The review was conducted using all available resources and guidance,
> especially in the area of risk management and oversight. This is the
> focus of the DOC Purchase Card Program Risk Management Team, of which
> *[\[insert servicing acquisition office\]]{.underline}* is an active
> team member and one of the NOAA Representatives. The recommendations
> that we have made are to improve and ensure that your purchase card
> program adheres to the policies and regulations.
>
> Please provide your plan of action to comply with these
> recommendations no later than *(insert date)*.