# Presentation: 591937

## U.S. ARMY MATERIEL COMMAND

- U.S. ARMY MATERIEL COMMAND

** ****HQ US Army Materiel Command’s Smart Pay Purchase Card Program **

**Helen Richards ****23 April 2003**

***  ******ESSENTIAL IN PEACE, INDISPENSABLE IN WAR***

## AGENDA

**BENEFITS OF THE PURCHASE CARD PROGRAM**
**AMC PURCHASE CARD STATISTICS**
**GOVERNMENT PURCHASE CARD RULES **
**GAO REVIEWS  & NEGATIVE PUBLICITY**
**GAO’S FINDINGS AT AMC**
**IMPROVING CONTROLS (WHAT’S NEW)**
**DOD PURCHASE CARD STATISTICS -1ST QTR ‘03**
**DOD STATISTICS (IN PROCESS FOR FY ‘03)  **
**REFERENCE MATERIAL**

***  ******ESSENTIAL IN PEACE, INDISPENSABLE IN WAR***

## BENEFITS OF THE PURCHASE CARD PROGRAM

**USERS PURCHASE THEIR OWN  SERVICES/SUPPLIES**
** **
**SERVICES/SUPPLIES CAN BE OBTAINED FASTER**
**MUCH CHEAPER PROCESS THAN A PURCHASE **
**          ****ORDER (PROCESS SAVES MILLIONS OF $)**
**SPREADS  RESPONSIBILITY THROUGHOUT THE**
**         ****ORGANIZATION**
**USERS LIKE USING THE PURCHASE CARD**

***  ******ESSENTIAL IN PEACE, INDISPENSABLE IN WAR***

## GOVERNMENT PURCHASE CARD “RULES”

**SPENDING LIMITS ESTABLISHED**
**$2,500 for a single purchase (micro-purchase) $25,000 for placing orders against BPA’s**
**$9.9 M for payments against contracts**
**PAYING THE BILL (US BANK STATEMENT)**
**5 workdays established for paying US Bank**
**Delinquent payments monitored to increase rebates**
**PURCHASE CARD MANDATORY TRAINING **
**Training required prior to appointment**
**Refresher training required every two years**

***  ******ESSENTIAL IN PEACE, INDISPENSABLE IN WAR***

**Transactions and Dollars**
**FY 98 - 268,181 Transactions - $198M**
**FY 99 - 335,487 Transactions - $210M**
**FY 00 - 336,392 Transactions - $229M**
**FY 01 - 443,386 Transactions - $256M **
**FY 02 - 372,003 Transactions - $281M**
**FY 03 -   25,723 Transactions - $28M (1ST QTR)**
**Reductions in Number of Cardholders/Billing Officials****   **
**Number of Cardholders reduced from 6,840 in FY 02 to 3,813 in FY 03**
**Number of  billing officials reduced from 2,555 in FY 02 to 1,469 in FY 03**

***  ******ESSENTIAL IN PEACE, INDISPENSABLE IN WAR***

**PURCHASE CARD STATISTICS FOR AMC**

## GAO REVIEWS & NEGATIVE PUBLICITY  

**GAO REVIEWS REVEALED MUCH NEGATIVE **
**    ****PUBLICITY CONCERNING THE GOVERNMENT**
**    ****PURCHASE CARD PROGRAM THROUGHOUT DOD **
**GAO REVIEWS DETERMINED WASTE, FRAUD AND**
**   ****ABUSE & LACK OF APPROPRIATE CONTROLS**
**   ****THROUGHOUT DOD**
**NEGATIVE PUBLICITY NOT TEMPERED WITH THE**
**   ****GOOD NEWS**
**ACTUAL ABUSE VERY MINIMAL  **
**   **

***  ******ESSENTIAL IN PEACE, INDISPENSABLE IN WAR***

## GAO’s FINDINGS AT AMC

***  ******ESSENTIAL IN PEACE, INDISPENSABLE IN WAR***

**GAO REPORT (JUN 02)**
**IDENTIFIED FEW QUESTIONABLE PURCHASES**
**IDENTIFIED NO FRAUD **
**QUESTIONABLE PURCHASES DETERMINED TO**
**   ****BE EXAMPLES OF “POOR JUDGEMENT”**
**REQUIRED EXPLANATIONS AND LEGAL OPINIONS**

## NO MORE THAN 7 CARDHOLDERS ASSIGNED TO A CERTIFYING OFFICIAL (MORE REQUIRES A WAIVER)

NO MORE THAN 300 CARDHOLDERS/BILLING OFFICIALS ASSIGNED TO AN AGENCY PROGRAM COORDINATOR (APC) (THERE CAN BE MORE IF APC HAS AN ASSISTANT)

ESTABLISHED SPENDING LIMITS MUST BE CONSISTENT WITH ACTUAL AMOUNTS SPENT

CARDS SHALL BE ISSUED ONLY TO INDIVIDUALS WITH A CONTINUING BONA FIDE NEED

**NO MORE THAN 300 CARDHOLDERS/BILLING OFFICIALS ASSIGNED TO AN AGENCY PROGRAM COORDINATOR (APC) (THERE CAN BE MORE IF APC HAS AN ASSISTANT)**
**ESTABLISHED SPENDING LIMITS MUST BE CONSISTENT WITH ACTUAL AMOUNTS SPENT**
**CARDS SHALL BE ISSUED ONLY TO INDIVIDUALS WITH A CONTINUING BONA FIDE NEED**

***  ******ESSENTIAL IN PEACE, INDISPENSABLE IN WAR***

-  IMPROVING INTERNAL CONTROLS( WHAT’S NEW SINCE GAO REPORT)

## IMPROVING INTERNAL CONTROLS (CONT’D)(WHAT’S NEW SINCE GAO REPORT)

**28 DAY GOAL ESTABLISHED FOR “FILE TURN” (PAYMENT) TO **
**MAXIMIZE REBATES  FROM US BANK**
**100% GOAL ESTABLISHED FOR ELECTRONIC PAYMENT TO US  BANK **
** ****FOR ELIGIBLE BILLING OFFICIAL ACCOUNTS **
**USE OF DOD E-MALL MANDATED EARLY 2003 FOR PURCHASES  TO:**
**GATHER SMALL BUSINESS STATS./ ENSURE JWOD TRANSACTIONS **
**REVIEW OF US BANK REPORTS  ANNUALLY TO DETERMINE: **
**TRANSACTIONS  WITH JWOD, UNICOR, DOD E-MALL, DAPS**
**REBATES RECEIVED AND LATE PAYMENT PENALTY INTEREST**
**TRANSACTIONS  MADE WITH PROHIBITED  VENDORS**

***  ******ESSENTIAL IN PEACE, INDISPENSABLE IN WAR***

## DOD PURCHASE CARD STATISTICS  1st QTR 2003

**Total no. of employees with purchase cards - 138,543**
**Total no. of active accounts - 166,777**
**Percentage of DOD employees with cards - 4.7%**
**Total no. of purchase cards cancelled - 51,963**
**Total no. of new purchase cards activated - 18,040**
**Ratio of billing officials to cardholders - 1 to 3**
**Average number of billing official transactions**
**    ****per Qtr - 34**
**Total dollars spent - $1.6B**
**Total rebate earned - $7.8M **

***  ******ESSENTIAL IN PEACE, INDISPENSABLE IN WAR***

## DOD PURCHASE CARD STATISTICS   IN PROCESS FOR FY 2003 

**Data to be collected for FY 2003 (not yet available):**
**No. of cardholders with contracting officer warrants**
**         ****with spending limits greater than $2,500**
**No. of cardholders with delegations other than contracting officer warrants with spending limits greater than $2,500**
**No. of cases reported to the IG or APC for possible**
**     ****fraudulent use**
**No. of disciplinary actions taken for fraudulent, improper **
**    ****or unauthorized use **

***  ******ESSENTIAL IN PEACE, INDISPENSABLE IN WAR***

##  RESOURCE MATERIAL

**DOD E-MALL:  HTTP:DODEMALL.DLA.MIL/**
**GSA:  HTTP://WWW.GSAADVANTAGE.GOV**
**JAVITS-WAGNER O’DAY:  HTTP://WWW.JWOD.COM**
**DOD PURCHASE CARD PM OFFICE WEB SITE**
**    ****HTTP://PURCHASE CARD.SAALT.ARMY.MIL**
**HQAMC DIRECTOR OF CONTRACTING PURCHASE CARD SOP**
**    ****HTTP://WWW.AMC.ARMY.MIL/AMC/RDA/RDA-AP/IMPACTUT.HTML**
**AMC’s INTERACTIVE PURCHASE CARD TUTORIAL:**
**    ****HTTP://WWW.APGEA.ARMY.MIL/GPCTRAIN/INDEX.HTM **
**DOD’S PURCHASE CARD TUTORIAL AT DEFENSE ACQUISITION    UNIVERSITY (DAU) WEBSITE:**
**    ****HTTP://CLC.DAU.MIL/KC/NO_LOGIN/PORTAL.ASP**

***  ******ESSENTIAL IN PEACE, INDISPENSABLE IN WAR***