Rescinded [2009-10-01] - Policy on Acquisition Cards

1. Departments may designate regional or branch acquisition card co-ordinators to meet operational needs and ensure that the appropriate monitoring information is maintained department-wide. Nonetheless, departments should try to minimize the number of people dealing directly with the credit card companies.
2. Within a responsibility centre, a manager who normally has expenditure initiation authority may also have been delegated some purchasing authority (e.g. local purchase order authority). In this case, within the limits delegated to the manager, he or she may authorize the cardholder to make purchases. For those cardholders with delegated purchasing authority (e.g. within a procurement or materiel management group), the cardholder would still require authorization of the request by an officer with expenditure initiation authority. The authorization to make the purchase must be documented (e.g. a signed requisition to purchase or authorization reflected in an automated procurement system).
3. The manager with expenditure initiation and purchasing authority should set the credit limit for each acquisition card issued. The credit limit must take into account the forecasted use of the acquisition card for purchasing and the overlapping billing and payment periods. These limits and any other restrictions must be communicated to the cardholder.

1. The Departmental Co-ordinator (or designate) fills out the card issuer's application form, providing the following information for each card that is requested:
   1. name of the individual;
   2. maximum value in dollars and credit limit;
   3. other case-by-case restrictions (such as merchant category);
   4. name of the department and responsibility centre;
   5. billing address;
   6. statement address; and
   7. financial code.
2. The card issuers have set up a card activation service. Upon receiving their cards, cardholders will be required to call a 1-800 number and correctly identify themselves. Cards will not be usable until that time.
3. Cards will be delivered to the cardholder or to a designated departmental official, depending on the instructions, within 10 working days from receipt of the relevant application, and in emergency cases, within 24 hours.
4. The cards do not enable their holders to access automated teller machines and withdraw funds and therefore no personal identification numbers (PIN) are issued.
5. If a card is lost or stolen, the card issuer must be informed immediately. The card issuer can then provide a new card with a new account number, which will be delivered to the cardholder within 72 hours.
6. The card issuer cancels cards according to the instructions received from individual cardholders or Departmental Co-ordinator (or designate).
7. The card issuers will not undertake, or have undertaken on their behalf, credit checks on cardholders or applicants, either before or after the cards are issued.

1. Acquisition cards must always be kept in a secure, controlled-access location.
2. Cardholders must advise the Departmental Co-ordinator (or designate) of changes to their business address or telephone number.
3. Cardholders must return their acquisition cards to the Departmental Co-ordinator (or designate) when requested to do so.
4. If cardholders are transferred or leave the department, they must return their acquisition cards to the Departmental Co-ordinator (or designate) for immediate cancellation and action to pay the outstanding balances.
5. Every acquisition card is issued to an employee and can only be used by that employee.
6. Every card has a credit limit determined by the department and transactions will be refused at the point of sale if they would result in exceeding the monthly credit limit on the card. The Departmental Co-ordinator (or designate) will be able to authorize changes to the credit limits.
7. Disputes must be resolved without delay. To this end, cardholders are asked to provide the assistance and information required by the card issuer.
8. The policy on the Goods and Services Tax (GST) and the Provincial Sales Tax (PST) must be observed for all purchases made with acquisition cards.
9. Purchases made with acquisition cards are subject to the Materiel Management Policy.

Departments have the choice to:

1. ask the card issuer to provide detailed monthly statements, which are mailed, as directed, to the individual cardholder's business address. If this is done, the following procedure applies:
   1. The statements are in either English or French (or bilingual), as requested by the cardholder. If the department wishes, the card issuer will establish a single billing cycle for all accounts.
   2. Billing statements are issued monthly in Canadian dollars and provide the following information:
      • purchases (date, name and location of the supplier, amount), other credits and debits, and other fees assessed, if any;
      • amount of interest payments or late payment charges, if any;
      • closing balance from the previous month;
      • payments made during the previous month;
      • payment due date; and
      • total amount due.
2. ask the card issuer to provide an electronic version, in the format required by the department, of the statement described in IV) a) above and then distribute the information to the cardholders. The statement will be sent to the client department's electronic mailbox at no extra cost.
3. ask the card issuer to provide an electronic version of the statement referred to in (b) above and send a copy of it directly to the cardholder.

1. All information is provided in electronic format unless otherwise requested by the department. The database will be made available in the format required by the department.
2. All management information is provided in either English or French, (or bilingual) as requested by the Departmental Co-ordinator (or designate).
3. The card issuer provides each department with management information on a monthly basis in accordance with the hierarchy identified by the department.
4. The list of cards to be renewed is sent to the Departmental Co-ordinator (or designate) at least 90 days before the expiration date of the cards.
5. The management information includes summary and detailed information about current month activity (by cardholder, including his or her name and the card number) as follows:
   1. purchases (transaction date, name and location of the supplier, amount and related totals);
   2. payments made;
   3. other credits and debits;
   4. previous and current balances; and
   5. amount of interest charges.

The management information also includes other items such as:

1. a complete list of all the cards issued to the department with information such as the cardholder's name, card number, card expiration date, credit limit, reference number (if applicable) and any other information that might help the Departmental Co-ordinator (or designate) to manage all the departmental credit cards provided by the card issuer;
2. lost or stolen cards;
3. cards inactive for the last six months;
4. cards to be renewed in the next 90 days;
5. cash advances; (Note that as per Policy, cash advances may not be authorized via acquisition cards. Reports should therefore be NIL at all times or if there is an entry, then a follow-up action is required.)
6. purchases in foreign currencies;
7. other information by supplier and merchant category;
8. other exception reports as identified by the department;
9. cardholders who did not arrange for payment within the deadline prescribed in the agreement. The information should be aged by time interval, for instance accounts that are thirty (30) days past due, sixty (60) to ninety (90) days past due, over ninety (90) days past due; and
10. the exception reports requested by project management for the purposes of monitoring and verification, for example cash advances, particular suppliers or merchant categories, and foreign currency purchases.

1. The card-issuing company will not, under any circumstances, hold the cardholder liable for the transactions. Personal employee information, including home address and telephone number, will not be provided to the contractor under any circumstances.
2. The maximum government liability for unauthorized use of the card is $50. Unauthorized use refers to cases that do not benefit the government and are initiated by someone other than the cardholder.
3. The government is not responsible for any purchases made with lost or stolen cards after the card issuer has received notification of loss, theft or cancellation.
4. Interest will only be paid if the government is responsible for late payment to the card issuer.

1. Accounting entries are made for acquisition card purchases when the monthly card account is paid.
2. The payment and allocation of year-end transactions on acquisition cards must comply with the concept of receipt of goods and services. Departments must, therefore, ensure that allocations to the accounts of a given year reflect economic activity in that year. Below are a few suggestions for reducing the problems associated with year-end transactions on acquisition cards.
   1. The bill is dated April with purchases from the previous year and the current year. The proper procedure is to pay the entire bill in the current year and to use the process for accounts payable at the end of the financial year to enter in the previous year purchases made in that year when the goods or services were received before March 31.
   2. The bill is dated March 31 for purchases made exclusively in the previous year. A problem arises here if some goods were not received by March 31. In this case, the bill is paid in the current year and the charges are allocated to the previous year by means of the accounts payable at the end of the financial year.

Transactions in foreign currencies are converted to Canadian dollars at exchange rates at least as favorable as those, which the Bank of Canada had in effect at noon on the day the transaction was credited or debited on the account. No transaction or other fees are charged for this service.

1. The card issuer provides a specific system for customer service, including a separate, toll-free telephone number where government cardholders can get answers to their inquiries about billings and card acceptance, emergency assistance, card replacement and other services. This system is available to them 24 hours a day, 365 days a year, at no cost to the individual cardholders.
2. Cardholders and Departmental Co-ordinator (or designate) can report the loss or theft of cards and cancel these cards automatically by telephone 24 hours a day.
3. Cardholders or the Departmental Co-ordinator (or designate) can also get answers to their billing inquiries by dialing toll-free telephone numbers. This service is available from 7 a.m. to 5 p.m., Ottawa time, Monday to Friday inclusive. The Departmental Co-ordinator (or designate) can also ask questions and get assistance on the acceptance and replacement of cards as well as other matters.

1. Disputed items may arise as a result of a number of situations, such as errors in addition, altered amounts, incorrect account number, credit posted as debit and vice versa, incorrect transaction amount, multiple processing, missing signatures on over-the-counter orders or a missing card-imprint on over-the-counter orders. These are transactions that are incorrectly reported on the monthly statements. In cases such as these, the card issuer must be informed of the situation immediately and there are no interest charges on the disputed items. The amount payable, therefore, is the total amount noted on the monthly statement less the amount charged for disputed items.
2. The existence of disputed items will not result in an account being in default. Notification by Her Majesty of an objection under the method of payment conditions contained herein will be deemed to constitute a disputed item under this clause.
3. Should the department have chosen a payment option where the card issuer may assess delinquency charges on overdue amounts, interest will not be charged for items included on the monthly statement which do not accurately reflect a cardholder's transaction with a supplier (i.e. disputed items).
4. Some departments may choose a payment option that requires the department to pay within a shorter period than the 30 days specified in the standard terms of payment. Departments will be able to report disputed items up to 60 days from the billing date and claim credit on the next billing until the item is resolved.
   • Disputed items will be settled as follows:
     1. Disputes with a supplier, such as shipment delays, shipment errors, product quality concerns, etc., are not considered to be disputed items and must be settled directly with the supplier.
     2. If the dispute does not relate to a supplier, the cardholder may contact the card issuer directly to settle disputes related to charges on his or her statement, or the cardholder may bring the matter to the attention of the Departmental Co-ordinator (or designate), who will contact the National Co-ordinator or the local responsible official, depending on the case.
5. Each card issuer will provide detailed procedures for resolving disputed items. The detailed dispute settlement procedure includes the following steps:
   1. The cardholder or the Departmental Co-ordinator (or designate) identifies the disputed item on the account and informs the card issuer.
   2. The card issuer asks the supplier's financial institution to provide it with a copy of the bill. This procedure can take up to 45 days (it is understood that if the bill is not received by this time, there is a charge-back to the supplier).
   3. The card issuer examines the item in order to determine whether the transaction was incorrectly recorded. If so, the card issuer will cancel the charge and any interest incurred on a subsequent statement. If the correction will not appear on the next statement, the card issuer will so inform the Departmental Co-ordinator (or designate) and indicate why the credit will not be recorded or when it will be.
   4. If the transaction was not incorrectly recorded, the card issuer will send a copy of the bill to the Departmental Co-ordinator (or designate) and, if necessary, the Departmental Co-ordinator (or designate) or the cardholder will deal directly with the supplier to resolve the dispute.
   5. After steps i) through iii) have been performed and a cancellation issue still has not been settled, the card issuer will ask the cardholder to provide a letter describing the situation in order to settle the dispute in the appropriate manner.