Confirming Orders

(After-the-fact orders)
Definition of a Confirming Order
 A purchase, letter of intent to purchase, or
request for scheduling in advance of an
order that is made by an individual,
without having a valid purchase order
number, p-card or approved payment
request form.
University and Purchasing Policies
 Use of confirming Requisitions and
Purchase Orders without an approved
University payment method to authorize
retroactively commitments to vendors by
personnel are a violation of University
policy.
 Delegation of Procurement
The President, through the Senior Vice
President for Finance and Administration,
has delegated the procurement function to
the Director of Purchasing. Any acquisition
of a commodity or a service made before
the Purchasing Department issues a
purchase order may become the personal
obligation of the individual obtaining the
commodity or service.
 Delegation of Procurement
The requirements stated herein apply to all purchases of commodities
and contractual services regardless of the funding source.

It is the responsibility of the Purchasing Department to determine the

price and secure the source of supply (vendor) for the purchase.
Requisitioning departments shall never assume that their
recommended vendor will be the vendor/contractor to whom the
purchase order will be issued.

Requisitioning departments are urged to contact the Purchasing

Department prior to preparing a requisition to secure information
about specifications, sources of supply, terms and prices.

A contractor should never be allowed to provide a service or deliver a

commodity before a requisition is prepared and a purchase order
issued.
 Delegation of Procurement
Even when legal authority exists via a power of
attorney, all contracts and agreements require
review and approval by the Purchasing
Department prior to the signing of the contract
document, and a Requisition must be submitted,
and a Purchase Order issued, before any
contract documents are released to the
contractor/vendor. If this policy is not followed,
the individual signing the contract may be
personally liable for any costs incurred.
 Audit for Fiscal Year 2005-06
 An audit for FSU for fiscal year 2005-06 by the
State of Florida, Office of the Auditor General
recommended:

 “The University should ensure that University

personnel do not enter into written contracts
that exceed their authorized limits, and that
contracts are reviewed first by Purchasing, and
then if necessary, Purchasing will obtain
approval by the Office of the General Counsel
prior to executing written contracts, as required
by University policy.”
Unauthorized signing of Contracts
 March 2006 memorandum by John
Carnaghi to all DDD’s advising Faculty and
Staff who purchase equipment, supplies or
services before obtaining FSU Purchasing
Department approval assume the risk of
personal liability for payment.
Prohibited Purchasing Practices
 Placing orders for goods or services directly with
vendors, instructing the vendor to invoice Florida
State University before the Purchasing
Department has issued a purchase order to that
vendor.
 Using a personal credit card or personal funds to
purchase goods or services for the department,
with the expectation of being reimbursed by
FSU, unless the amount is less than $25.00.
 Prohibited Purchasing Practices
IMPORTANT

Please post this notice and advise all faculty

and staff, including graduate staff of the
following policy:
 Prohibited Purchasing Practices
Any individual who engages in a prohibited purchasing
practice is hereby notified that he or she is risking their
personal funds only, and not the funds of Florida State
University. This policy applies to all funds on deposit
with Florida State University, regardless of the source.
Lack of knowledge of proper procedures, or a perceived
lack of time to follow them, when circumstances do not
indicate that a true emergency existed, will result in the
return of all payment requests, expense reimbursements
or requisitions for handling by the individual making the
charge, or the individual approving it after the fact
within the department.
 Applies to:
 Requisitions
 Expense Reimbursements (especially over
$25)
 Payment Request Forms for
unencumbered payments
 Expense Reimbursements
 Anything over $25.00 requires a justification
 Employee must be considered in Travel Status
Acceptable Reimbursements: (i.e. at a
conference and you need to purchase a book
but they don’t take p-card or out in the field
performing research at a more remote location
and you need to purchase something for that
research but vendor doesn’t take p-card and no
access to the OMNI system)
 Expense Reimbursements
 Sales Tax: The University is sales tax
exempt for purchases made in Florida.
When using a purchase order or p-card we
don’t pay sales tax. When making a
personal purchase and you are charged
sales tax, if approved, the University
reimburses you back the full cost of the
purchase including the sales tax but the
University never recoups sales tax. As you
can imagine this can add up over time.
 Payment Request Forms
 Goods and Services should all come through FSU Purchasing,
however, there is an allowable Unencumbered Disbursements list
for certain things that can be purchased using a payment request
form (PRF). For a complete listing, contact Accounts Payable.

 Items being paid via a PRF should not be after the fact and thus a
check would be cut to the vendor and the vendor would be shipping
the merchandise, not the other way around.

 PRF’s can be used when a vendor doesn’t take purchase orders or

p-card. If possible the University should consider other vendors that
do accept purchase orders before using the payment request
method.
 Authority to Sign Contracts
 Only certain individuals have the authority to
sign contracts (the President, Vice Presidents,
Director of Purchasing and certain Deans up to a
particular dollar amount). Purchasing requires a
power of attorney to be kept on file for anyone
that has signature authority.

 Even with signature authority, all Federal and

State laws and University policies and
procedures must be followed.
 Authority to Sign Contracts
 Contracts over $10,000 require legal
review and must be either stamped or
signed off by General Counsel.

 All contracts or agreements must be

reviewed first by Purchasing and then if
necessary will be reviewed by legal. Again,
if over $10,000 legal must review after
Purchasing reviews.
 Authority to Sign Contracts
 If at all possible this language is preferred for all
engagement letters, contract documents or agreements:

“If the conditions are satisfactory with you, please sign

below and return a copy of this letter to me. Upon
receipt of the signed agreement, the University will
create a purchase order, which will serve as the
contract”.

The purchase order should be the contract and any

agreement or contract document should be
supplemental to the purchase order.
 Examples of Recent Confirming
Orders
 Catering at the University Center Club
*unaware of the cost of the catered
services or the service charges.

 Blanket orders not issued as services are

required and then submitted 7-8 months
later.
 Examples of Recent Confirming
Orders
 Printing or design work submitted after
the work was completed.
 Copies
 Charter buses secured 2 days prior to
departure.
 Clothing (i.e. uniforms, shirts, etc.)
 Computer or A/V supplies
 Adverse Effects of Confirming
Orders
 Vendor assumes risk by providing
goods/services.

 FSU employee assumes risk by requesting

goods/services without having an
established payment method.
 Adverse effects of Confirming
Orders
 Insufficient funds
 Budget closed or grant ended or grant
may not allow the purchase
 Overpayment for goods/services
 Potential Liability
 EH&S Issues
 Construction/Facilities Issues
 Property Tag / Asset Management Issues
 Adverse Effects of Confirming
Orders
 Lack of Administrative Approvals
 By-passing State Law for procurement methods
 By-passing Legal Review
 Taxation Issues – Conflict of Interest (Employee
Employer relationship)
 Interest penalties / University Credit rating
 Supplier Diversity Initiative
 Lack of Internal University Approvals
 Risk of Audit write-up
 If it continues, and University continues to support it, we
would be granting inherent authority to continue the
practice
 Internal University Approvals
 Computing Equipment (over $20,000)
 Security Systems and Fire Alarms
 Renovations
 Copiers
 Printing and Copying
 Telephones and Telephone Equipment
 Radiological Material
 Uniforms or clothing for employees
 Legal Services
 Signs, exterior (permanent)
 Controlled Substances
 Fans, Heaters, air circulators, etc.
 Hazardous Waste
 Traffic control & Personal Safety Devices / Law enforcement
 Contract and Grant Requisitions
Acceptable Purchasing Methods
 FSU Visa Purchasing Card (“the p-card”) if
allowable by the p-card program. Newly revised
policies and procedures have expanded the
flexibility of the p-card, so that its use can be
more closely tailored to the needs of the
department.
 Submission of a requisition to Purchasing via
OMNI.
 Payment Request Form if allowable per the
allowable Unencumbered Disbursements list.
 Emergencies
 If you have a bona-fide emergency and
the University is closed or your in travel
status and do not have a p-card or vendor
doesn’t accept p-card, document the
nature of the emergency and turn in your
paperwork by the next business day to
Purchasing for review. If it’s a true
emergency then Purchasing will approve
the request.
 Confirming Order Log
Purchasing keeps a confirming order log which is reviewed
by the Provost, and the Sr. V.P. for F&A.

We check for reoccurrences from the same department,

same individual and same vendor.

Vendors are sent a letter putting them on notice that if it

happens again, they will not be paid and they must
obtain a University payment method (i.e. valid PO
number, P-card number or University check).
How to Prevent Confirming Orders?
 Plan Ahead

 Call Purchasing for help or expediting orders, obtaining price quotes,

bidding, or contract information.

 Know or read the University and Purchasing policies and procedures.

 Use a p-card for allowable p-card purchases when you can.

 Enter a requisition in a timely manner to allow Purchasing to be able to

obtain competitive pricing, vendor information, missing requisition
information, etc.

 Lack of knowledge or saying someone was new is not sufficient for

approval.
How to Prevent Confirming Orders?
 When watching for the PO number in
OMNI, make sure that the PO is in
“Dispatched” status before providing the
PO number to the vendor. Dispatched
status means that the purchase order has
passed budget checking. If not in
dispatched status the PO could be in
budget error.
How to prevent Confirming Orders?
 Remember, it takes more time to do it the
wrong way than the right way. If in doubt
our your not sure the correct way to
handle something, please contact
Purchasing.
How to Prevent Confirming Orders?
 FSU Purchasing Department Main Phone Number: 644-6850
Website: www.purchasing.fsu.edu

 To apply for a p-card contact Nancy Milburn at 644-9725 or

nmilburn@admin.fsu.edu
P-card web page: http://www.purchasing.fsu.edu/Purchasing-Card-
Information

 Confirming Orders: contact Karen Gibson, Associate Director of Purchasing,

at 644-9729 or kgibson@admin.fsu.edu
Confirming Order Justification Form
And
Reimbursement Justification Form (routes to AP for approval):
http://www.purchasing.fsu.edu/DEPARTMENTAL-INFORMATION/Forms

 On-site training can be made available to discuss compliance and

procedures by contacting Karen Gibson or Nancy Milburn in Purchasing
Services, at 644-6850.