10-08-2002 Special Called Regular Meeting

Browse Search

• Audit Committee Minutes -October 8, 2002 -Page 5 administrative background policies and documentation associated with the ordinances to carry out the staffl s functions. There is probably going to be some good discussion about the corporate account with American Express, the way it was originally set up, there is probably a better way to arrange this. The corporate account went to one location, involving three or four cardholders, making responsibility and assembling documentation more difficult. Mrs. Alexander and I briefly discussed a different issuance of working with American Express regarding individual corporate cards, with individual responsibility, and with better documentation and policy control. Financial Director .Cynthia Alexander stated there are issues that we need to be concerned with. Before we can initiate anything, Mrs. Alexander has two drafts related to credit card usage. One draft regards use of the credit card as a credit card, i.e., travel and entertainment card. The other draft regards use of the credit card as a procurement card or purchasing card. Before we progress further, a decision needs to be clarified on usage of credit cards. Mrs. Alexander's recommendation is to have a credit card program and not a procurement card program. Usage of this card would be for travel and business meals, this will be encouraging for our employees and officials, with this type of expenditures being easier to control and monitor. Mrs. Alexander assembled a purpose clarifying the cards are not to be used to circumvent or replace existing policies, but to supplement those policies. She believes there is a direct and safe way to pay for hotel expenses, meals, airline tickets, rental cars and other travel related expenses; also, offsetting the need of the individual to have pre-paid travel funds. Our purpose of developing policy is to ensure proof of management and administration of the cards, and to protect the City against misuse of public funds. We also want to provide assurance that disbursements have been made only for authorized purposes and have been properly recorded. The City will use this document to establish policy, procedures and guidelines for the use of the cards. One of the problems we had with attempting to obtain American Express card receipts; we were not able to obtain anything from them. The cards were not set up as a corporate account. At this point, we may obtain cards through a depository; therefore, Mrs. Alexander suggests not using the American Express card program. Another type of card can be used (Visa, Mastercard, etc.) through a depository, with no fee. The total payment would be paid in full each month, therefore, not costing the City any interest. Committee Member James Warren questioned the credit card policy and responsibility for overseeing usage of the credit cards. Mrs. Alexander explained the new credit card policy will establish guidelines for everything; who is eligible to receive a card, what type of authorization, who can issue the card, who can approve issuance of the card, who is the program administrator, who will establish responsibility for the card, which individual has the "buck stopping" at them, within the organization. There will be definitions of what is the City of La Porte credit card, what is the bank card, and what is the program administrator. Most of our manuals, policies and procedures are very indepth, we attempt to write step-by-step instructions (at the eighth grade level) which are easy to understand. Everything is defined, everything will be authorized, forms that will have to be approved, and forwarded to the employee's personnel file. Everybody will understand they will receive a copy of the credit card policy and attend an orientation with the program administrator. This person will be responsible for ensuring that the person receiving the credit card understands