PURCHASING PROCEDURES

Page Sections

Authorized Purchasers

Authorized Expenses

Regulating Authorities

Procurement Instruments

Full, Fair, and Open Competition

Use of Small, Minority, Women Owned, and Disadvantaged Businesses

Sole Source Basis

Code of Conduct

Use of Company Purchasing (Bank) Cards

All employees, especially those involved with purchasing or recommending the purchase or procurement of goods or services on behalf of AvaCon, should be sure to read the full Purchasing Procedures policy. But for the sake of brevity and as quick reminders, here are a few highlights that all employees should remember:

The only authorized purchasers for AvaCon are Officers or members of the Executive Board. No other employees are authorized to make purchases or sign contracts or agreements on behalf of the company.

Purchase Orders must be used to request purchases of supplies, equipment, or services, and must be approved by the Executive Board.

Transactions completed with a Purchasing Card must be reported within five business days of the transaction (or within ten business days for travel expenses), and the corresponding itemized receipts and supporting documentation uploaded to the appropriate file share directory.

AvaCon employees shall not engage in conduct resulting in a real, potential, or apparent conflict of interest. A conflict of interest may arise when any action by an AvaCon employee is to the direct financial advantage of the employee, of their spouse, partner, parent, or child.

AvaCon employees must at all times provide full disclosure of their actions or relationships with prospective vendors, contractors, or consultants. If any family member is to be employed or contracted, then prior approval from the Executive Board is required.

AvaCon employees shall neither solicit nor accept gratuities, favors, or anything of monetary value from contractors, sub-recipients, parties of project contractors, or other entities doing business with AvaCon. AvaCon employees are, however, allowed to accept gifts at of a nominal face value not to exceed $25, so long as a written disclosure of the gift and giver are submitted.

In order to ensure good business practices, compliance with all laws and regulations, and the timely and efficient procurement of goods and services for AvaCon, the following procedures govern all purchases on behalf of the company.

Authorized Purchasers

The only authorized purchasers for AvaCon are Officers or members of the Executive Board, as identified in the AvaCon, Inc. By-Laws in Article VIII. FINANCIAL POLICY:

Section 8.02 An individual officer may approve an unbudgeted expenditure up to $200.00. An unbudgeted expenditure greater than that amount requires approval by the Executive Board.

Section 8.03 Any officer or agent responsible for a budgeted item that exceeds its budget by ten percent (10%) or more must receive approval by the Executive Board.

Section 8.04 A member of the Executive Board may, in an emergency situation, make or approve the making of any expenditure or obligation exceeding the limit specified in Section 8.02, under the following conditions:

(a) The matter must be of such an urgency that it cannot wait until the next regular meeting of the Membership or until a special meeting can be held.

(b) The member of the Board shall report the action taken by them to the next meeting of the Executive Board for approval. If the Executive Board refuses to approve, the action shall be reversed by the Corporation insofar as possible, but the officers shall not be personally liable for such action, provided that they have, in good faith, followed the procedures set forth in this section.

(c) Whenever the provisions of this section are invoked, whether or not any action is actually taken, the Board shall record the opinions obtained by them from the General members and the circumstances of every unsuccessful attempt to reach a General member, and they shall make such information available to any member on request. They shall also record and report to the Membership a summary of the opinions obtained, as well as the vote of each officer on the proposal, and shall inform the Membership of their rights to request further information pursuant to this subsection.

Section 8.05 It is one of the founding principles of this Corporation to return to the virtual worlds and metaverse community as much as it is able. Since accumulating enough capital to purchase real estate runs counter to this purchase, the Corporation shall not purchase real property.

Authorized Expenses

As of the time of this writing, authorized expenses include the following:

Payment of contracts or contractors authorized by the Executive Board, provided the contractors have performed the work to the satisfaction of the Board;
Payment of ongoing or regularly recurring expenses of the organization, including, but not necessarily limited to, annual filing fees, insurance fees, post office box fees, professional services fees, and web hosting fees;
Purchases of office supplies, postage, and other expendable items as needed in the ordinary course of business;
Payment of salaries or wages to any and all employees of the organization, as approved by the Executive Board;
Reimbursement of expenses incurred by organization employees, contractors, volunteers, or members of the Executive Board in performance of duties directly related to the work of the organization, provided that proper documentation is supplied;
Purchase of equipment or services necessary for the operation of the organization;
Purchase of equipment or services that further the public charity mission of the organization;
Any other incidental purchases as may arise for the orderly operation of the organization.

Regulating Authorities

1. AvaCon Purchasing Procedures. The policies set forth in this manual will be followed, except as it is deemed necessary to adhere to certain rules set forth by a specific donor or federal agency. In the case of a conflict, the AvaCon Executive Board will defer to a donor’s or agency’s policies except if it could prejudice or liable AvaCon by such action. In such a situation, the Executive Board will make a determination about what further course of action to take.

2. Federal Acquisition Regulations (FARs). AvaCon will adhere to the FARs, as appropriate and whenever AvaCon receives a contract from a federal agency.

3. Office of Management and Budget (OMB) Circulars. As a non-profit organization and potential recipient of federal grants, AvaCon will adhere to and incorporate into its policy manuals, the following OMB Circulars:

A-110, Uniform Administrative Requirements for Grants and Agreements with Institutions of HIgher Education, Hospitals, and Other Non-Profit Organizations.
A-122, Cost Principles for Non-Profit Organizations.
A-133, Audits of States, Local Governments, and Non-Profit Organizations.

Procurement Instruments

AvaCon uses three basic instruments for the procurement of goods and services:

1. Purchase Orders. AvaCon will use Purchase Orders to procure small quantities of office supplies and equipment and other goods and services. Purchases will be made from vendors offering the best value in price, support services, and delivery procedures. Purchase Orders are not used for consultant services and subcontracts, travel advances and reimbursements, monthly or periodic bills, minor recurring expenses, and items paid from petty cash. Purchase Orders will be prepared by the Officer, Director, Board Member, or Employee initiating the request, and will clearly describe the item(s) being purchased, the estimated purchase amount, and the purpose of the purchase.

2. Consultant Agreements. Consultant agreements are contracts with individuals (i.e. consultants or independent contractors in business for themselves, not bona fide companies and not AvaCon employees) for specialized services that cannot, either because of time or skill level, be performed by AvaCon employees. AvaCon will use a consultant agreement when the individual is performing a specialized type of work under a contract that clearly specifies the scope of work, rate and terms of compensation, time period of performance, deliverables, and the terms of the agreement.

3. Project Contracts. Project contracts are contractual relationships for project-related services. AvaCon will use a project contract when none of the other procurement instruments are appropriate and when the contract will have very specific responsibilities for a major component of AvaCon’s services. Normally, a project contract is for large dollar amounts where each party is seeking terms and conditions that will protect both parties. The project contract should clearly describe the scope of work, the rate and terms of compensation, the period of performance, deliverables, and terms of the agreement. AvaCon’s standard contract will generally be used in establishing project contracts, although a simple letter contract, which specifies the scope of the work, the rate and terms of compensation, the period of performance, deliverables, and terms of the agreement, may also be used in certain cases, (i.e. short term or lower cost contracts).

Full, Fair, and Open Competition

AvaCon strives to ensure full and open competition, guarantee the objective performance of all contracts, and eliminate the possibility of unfair competitive advantages. Proposal selection shall be based on responsiveness to the solicitation, price, quality, deadlines of delivery, warranties, accountability, and fulfillment of the services and other relevant factors.

Use of Small, Minority, Women Owned, and Disadvantaged Businesses

AvaCon will make positive efforts to utilize small, minority business enterprises (MBE), women’s business enterprises (WBE), and disadvantaged business enterprises (DBE), whenever possible.

Sole Source Basis

AvaCon reserves the right to award purchase orders, consultant agreements, or project contracts on a sole source basis when there is a predominate capability, significant prior knowledge of AvaCon’s programs and program philosophy, and a prior history of fulfilling similar agreements in a successful and timely manner. A written justification will be prepared and kept on file for any sole source procurement.

Code of Conduct

AvaCon requires full and open disclosure when dealing with purchasing and procurements. As such, AvaCon employees and members of the Executive Board must avoid strictly any conflict of interest or the appearance of conflict of interest. AvaCon employees and members of the Executive Board must at all times provide full disclosure of their actions or relationships with prospective vendors, contractors, or consultants. If there is the slightest doubt as to the propriety of a procurement action, then the issue must be communicated to the Executive Board immediately.

Additionally, Officers, Directors, and members of the Executive Board must annually review and sign the AvaCon Conflict of Interest Policy, to be included in personnel files.

1. AvaCon Employees. AvaCon employees shall not engage in conduct resulting in a real, potential, or apparent conflict of interest. A conflict of interest may arise when any action by an AvaCon employee, whether isolated, recurring, or continuous, is to the direct financial advantage of this employee, of their spouse, parent, or child. Employees shall not participate in the selection, final choice, or management of a contract, covered by donor funds, if a real, potential, or apparent conflict of interest would be involved. Such a conflict of interest would arise when any employee or any member of their family, or an organization which employs or is about to employ any of the parties indicated herein, has a financial or other interest in the firm/organization selected for a final contract. AvaCon employees must at all times provide full disclosure of their actions or relationships with prospective vendors, contractors, or consultants. If any family member is to be employed or contracted, then prior approval from the Executive Board is required.

AvaCon employees shall neither solicit nor accept gratuities, favors, or anything of monetary value from contractors, sub-recipients, parties of project contractors, or entities regulated by its member states. AvaCon employees are, however, allowed to accept gifts at of a nominal face value not to exceed $25, so long as a written disclosure of the gift and giver are submitted. As appropriate, the Executive Board will be responsible for determining the disciplinary action that will be imposed for any conflict of interest violations.

2. Members of the Executive Board. The Executive Board shall not engage in conduct resulting in a real, potential, or apparent conflict of interest. A potential conflict of interest may arise when action by a Broad member, whether isolated, recurring, or continuous, is to the direct financial advantage of this individual, or their spouse, parent, or child. As appropriate, the Executive Board will be responsible for determining the disciplinary action that will be imposed for any code of conduct violations.

Policies Related to the Procurement Process

1. Purchasing Necessary Items

Only items that are necessary for the efficient and effective operation of AvaCon, or that further the public charity mission of the organization, will be purchased. This pertains both to items purchased for the direct or indirect operations of the company.

2. Lease versus Purchase Analysis

Where appropriate, an analysis will be conducted as to whether it is more cost effective or practical to purchase or lease a necessary item. This analysis will be performed by an appropriate member of the executive staff or Executive Board.

3. Procurement Authority

The authority to approve and execute procurement transactions on behalf of AvaCon, Inc. is as follows:

A. Purchases and Contracts

Specific procurement responsibilities are identified in the AvaCon, Inc. ByLaws, including the following sections:

Section 5.02 The Executive Board has general control and management of the property and affairs of the Corporation and has the powers of corporate directors pursuant to Massachusetts General Laws, Chapter 180, Section 6A. It may designate persons to sign contracts or other instruments on behalf of the Corporation, determine the location of the principal office of the Corporation in the Commonwealth, and has other powers as may be delegated to it by the Membership.

Section 5.07 The Executive Board or the Membership may authorize any officer or other person in the name or on the behalf of the Corporation to enter into any contract or execute under Corporate Seal and deliver and deed, note, or other instrument, and such authority may be General or confined to specific instances. Unless so authorized, no officer or other person has the power or authority to bind the Corporation by any such contract or instrument to render it financially liable for any purpose or to any amount.

Section 8.02 An individual officer may approve an unbudgeted expenditure up to $200.00. An unbudgeted expenditure greater than that amount requires approval by the Executive Board.

Section 8.03 Any officer or agent responsible for a budgeted item that exceeds its budget by ten percent (10%) or more must receive approval by the Executive Board.

Section 8.04 A member of the Executive Board may, in an emergency situation, make or approve the making of any expenditure or obligation exceeding the limit specified in Section 8.02, under the

following conditions:

(a) The matter must be of such an urgency that it cannot wait until the next regular meeting of the Membership or until a special meeting can be held.

B. Prior Approval

Before proceeding with certain project purchases of goods or services, prior written approval may be required by the donor. For example, the federal government requires prior approval for all equipment purchases, and any subcontracts and subgrants that are awarded under a grant or contract. Prior written approval is considered to have been provided if the item of cost requiring prior approval has been detailed in the proposal’s project description and budget, and it is incorporated into the budget of the final award. (2 CFR 230.25(b)). Supplies, materials and general support service contracts, of a recurring, administrative nature, do not require prior approval. (2 CFR 215.25(c)(8)). Requests for prior approvals, when required, are submitted to the awarding federal agency by appropriate personnel under direction by the Executive Board. No procurement will occur without the required prior approval.

4. Procurement Records

For each procurement action, the appropriate personnel under direction of the Executive Board shall maintain a procurement file with the following information:

Signed copy of the procurement instrument (e.g., contract or purchase order);
All amendments to the procurement instrument;
Copies of all bids and offers;
All purchase specifications including delivery requirements;
Cost/price analysis that was the basis for the award cost or price;
As applicable, a written justification as to why sole source or minimum competition was used;
Written explanation as to why the winning contractor was selected; and
Upon completion of the contract, written comments regarding the quality of the vendor’s services and guidance and recommendations regarding potential future work.

The appropriate personnel under direction of the Executive Board shall maintain a property control log.

5. Cost/Price Analysis

A cost/price analysis will be conducted for each procurement action. The cost analysis shall consist of a review and evaluation of each element of a cost proposal to determine its reasonableness, allocability, and allowability. The price analysis shall consist of comparing price quotations, market prices, and similar information.

6. Formal Solicitation Process

A formal solicitation must be conducted for each procurement greater than (or equal to) $100,000. This solicitation will be performed in accordance with the following steps:

A. Prepare Request for Proposals (RFPs).

Upon approval by the Executive Board, the appropriate personnel shall prepare RFPs. Each RFP will contain the following information:

RFP Abstract – A brief statement of purpose or intent;
RFP Details – Clear statement of the products or services required in sufficient detail to allow the preparation of a responsive bid;
Contracting Agency – Clear statement that the contracting agency will be AvaCon, Inc.;
Due Date – Date and time by which proposals must be returned;
Compliance Requirement – Statement that all procurements will be in accordance with 40 CFR Part 30, a copy of which will be provided on request;
Competition – If applicable, statement that public and quasi-public agencies will be allowed to submit bids in competition with private firms;
Evaluation Criteria – A description of the criteria by which proposals will be evaluated; and
Any other information which it may be necessary or desirable to provide.

B. Distribute RFPs.

AvaCon will post RFPs to its public website and send RFPs by facsimile, mail, electronic mail, or hand delivery to all firms who request details. RFPs will also be sent to any other firms, non-profit organizations, or public agencies which express an interest in submitting a proposal; show evidence of sufficient qualifications and experience to submit a serious proposal; and meet the criteria for contractors as set forth in 40 CFR Part 30.

C. Review Proposals.

All proposals will be reviewed by the Executive Board or their designated representative and/or appropriate personnel using standard evaluation criteria, such as price, quality, delivery terms, contractor integrity, financial and technical resources, accessibility to other necessary resources, and record of past performance. Any reviewer who has been an employee of any of the organizations submitting proposals, or who is directly related by blood or marriage to a senior employee of any organizations submitting proposals, shall notify the Executive Board of this immediately, and, at the discretion of the Executive Board, may be excluded from participation in the review process. All reviewers will submit a written review of each reviewed proposal based on the evaluation criteria. At its discretion, the Executive Board may interview one or more of the applicants.

D. Contractor Selection.

The Executive Board, in consultation with the appropriate personnel, will be responsible for selecting a contractor. Written documentation of the review process, including all review reports, and the basis for contractor selection shall be prepared by the Executive Board or their designated representative and maintained with AvaCon, Inc.’s business records. If the recommendation does not represent a consensus, then any minority positions shall be recorded.

No procurement will be made from a contractor identified on the General Services Administration maintained “List of Parties Excluded from Federal Procurement and Non-procurement Programs.”

E. Contracting.

Once the selection has been made, the Executive Board or their designated representative will negotiate a contract with the selected organization. The contract will adhere to the requirements of 40 CFR Part 30, and will be signed by a duly authorized officer or representative of the contracting organization and by an authorized member of the Executive Board.

Prior to forwarding the procurement instrument for signature, the Executive Board or their designated representative shall verify that funds are available to cover the costs of the procurement, and review the reasonableness of the payment provisions. The Executive Board or their designated representative is responsible for obtaining the appropriate signatures and forwarding a final, original, signed copy to the contracting organization.

F. Monitoring Performance.

The Executive Board or an appropriate member of the executive staff shall be responsible for monitoring the implementation of the procurement instrument and shall ensure the fulfillment of all written requirements. If the contracting organization violates any of the terms or conditions of its award, then AvaCon Inc.’s responsible party shall notify the Executive Board immediately. The Executive Board is responsible for taking appropriate corrective action.

The Executive Board or their designated representative shall provide AvaCon, Inc.’s responsible party with sufficient advance notice about the date and hour of each delivery of goods, and shall prepare

all the necessary conditions for receiving a delivery. Upon delivery, AvaCon, Inc.’s responsible party shall check the type and amount of delivered goods or services by noting them on the back of the delivery form. If a delivery is not in compliance with the terms of the procurement instrument, unless it is within normal commercial practices and there is no evidence of violation of any policies, then the Executive Board shall be advised. The Executive Board is responsible for taking appropriate corrective action.

Use of Company Purchasing (Bank) Cards

Authorized Officers, Directors, or members of the Executive Board of AvaCon, Inc. may be issued a Company Purchasing (Bank) Card (“Purchasing Card”) to provide a convenient means with which to make purchases and reduce the costs and administrative overhead associated with initiating and paying for purchases. The Purchasing Card allows the authorized employee (“Cardholder”) to charge work-related expenses directly to the appropriate bank account.

1. Responsible Parties.

The Executive Board is responsible for managing the issuance and use of Purchasing Cards and each Cardholder is responsible for managing his or her use of the card.

2. Obtaining a Purchasing Card

All prospective Cardholders must be an authorized Officer, Director, or member of the Executive Board of AvaCon, Inc. To request a card, an employee will need to complete and sign an AvaCon, Inc. Purchasing Card Set-Up Form and an AvaCon, Inc. Purchasing Card Cardholder Agreement Form. Upon approval by the Executive Board, the prospective Cardholder may need to complete other bank forms as required by the issuing financial institution as necessary or required.

3. Information Maintenance.

Whenever any of the information contained on the AvaCon, Inc. Purchasing Card Set-Up Form changes, the Cardholder is responsible for alerting the Executive Board so that a new, revised form may be completed.

4. Card Security.

It is the Cardholder’s responsibility to safeguard the physical security of the Purchasing Card and the Purchasing Card account number at all times. Purchasing Cards must be kept in a secure location and should only be used to process transactions by the respective Cardholder. Under no circumstances may a Cardholder give the Purchasing Card account number, expiration date, or Cardholder Verification Code (CVC) to any other person to process a transaction. Transactions may only be performed by the Cardholder him or herself. In order to prevent exposure to fraud, the full Purchasing Card number should not be recorded electronically or on paper, except for the purpose of processing an online purchase, which must be done through a properly encrypted and secured web form. If a Purchasing Card number must be recorded, it should be truncated to the last 4 digits.

5. Card Expiration.

A Purchasing Card will expire at the end of the month shown on the card. For example, a card with the expiration date of 02/14 will expire on the last day of the month of February. The Cardholder will receive a replacement card through postal mail during the first or second week of the month prior to the expiration date. If a replacement card is not received by the end of the second week, the Cardholder should alert the Executive Board or their designated representative for assistance. Once the replacement card has been activated, the Cardholder must physically destroy the old card by cutting the card into many pieces and disposing of the remains in multiple trash receptacles.

6. Lost, Stolen, or Damaged Purchasing Card.

If a Purchasing Card is lost, stolen, or damaged, the Cardholder must notify the Executive Board or their designated representative immediately so it can be reported to the bank. Fraudulent transactions must be reported to the bank within 60 days of the date of the occurrence in order for AvaCon, Inc. to recover losses. Replacement cards should not be requested from the bank. If an account is closed through direct contact with the bank, the Cardholder should contact the Executive Board or their designated representative to request a replacement. Only after the above notification procedures have been completed will a replacement Purchasing Card be issued. If a Purchasing Card is found or located after it has been reported lost or stolen, the card must be physically destroyed by cutting the card into many pieces and disposing of the remains in multiple trash receptacles. The same procedure applies to a damaged card.

7. Preauthorized Charges.

If arrangements have been made for preauthorized periodic charges to a Cardholder’s card, such as a monthly subscription or service fee, and the Cardholder leaves AvaCon, Inc.’s employment, the vendor must be notified that the account has been closed and all preauthorized charges should stop. Failure to notify the Executive Board or their designated representative of preauthorized charges associated with a card or failure to contact the vendor regarding a closed account number that a vendor has on file may result in continued unauthorized charges. These charges will be the responsibility of the former Cardholder and may be recovered from unpaid salary or wages, or may be recovered through the assistance of a debt collector.

If a card is reported lost, stolen, or damaged and has preauthorized charges associated with it, it is the responsibility of the Cardholder to either notify the vendor or merchant or to notify the Executive Board or their designated representative so that the merchant can be supplied with the new replacement card information so that there is no interruption in service.

8. Separation from AvaCon, Inc.

Prior to separation from AvaCon, Inc., Cardholders must surrender their Purchasing Card(s) and corresponding support documentation to the Executive Board or their designated representative. It is the responsibility of the organizational unit and the Cardholder to assure the return of the Purchasing Card(s) during the exit interview process and to notify the Executive Board or their designated representative of the separation so that the card may be immediately cancelled.

9. Use of the Purchasing Card.

The Cardholder must ensure that s/he has appropriate purchase approval (if required) prior to making a purchase with the Purchasing Card.

When applicable, the Cardholder must make purchases from term contract vendors in order to fulfill AvaCon, Inc.’s contractual obligations.

In addition, the Cardholder must confirm that the selected merchant accepts VISA. If not, another vendor should be chosen. If a selected vendor does not accept VISA and another vendor that does accept VISA cannot be found, a request must be submitted using a Purchase Order so that the purchase can be made through another means.

When making purchases in person, the Cardholder must sign the charge receipt and retain the customer copy, as well as an itemized receipt when the two documents are separate. The Cardholder is responsible for verifying that the charge or sales receipt complies with the requirements for supporting documentation. The Cardholder must retain all original copies of the signed receipt and/or itemized receipt for seven years, even if this period extends beyond separation from AvaCon, Inc.

When making purchases via telephone, mail, mail order, or online, Cardholders must secure a receipt, shipping label, or packing slip that contains:

The Cardholder’s full name;
The Cardholder or AvaCon, Inc.’s mailing address;
An itemized list of all items purchased;
A total amount of the purchase;
The date and time the purchase was made;
The words “VISA Purchase” or other identification that the purchase was made with the Purchasing Card.

For shipped items, regardless of who receives or signs for a package, the Cardholder is responsible for obtaining all documentation including receipts, packing slips, shipping labels, order forms, etc. related to the purchase and verifying that the documentation complies with all requirements for supporting documentation.

10. Personal Purchases.

PERSONAL PURCHASES MAY NOT BE MADE WITH THE PURCHASING CARD. Personal purchases made with the card subject the Cardholder to disciplinary action up to and including card cancellation, termination of employment, and criminal prosecution.

11. Compliance with Purchasing Policies.

All transactions placed on the Purchasing Card must comply with AvaCon’s Purchasing Procedures Policy and should not conflict with any of the violations or restrictions contained therein.

12. Unauthorized Card Use.

Purchasing card violations include abuse, misuse, negligence, and fraud. Abuse, misuse, and negligence are violations for which no personal gain results. Fraudulent violations are those in which deception was deliberately practiced for unfair or unlawful gain.

The following purchases are not permitted with a Purchasing Card under any circumstances and will be considered violations of the Purchasing Card policy:

Any transaction that violates AvaCon, Inc.’s Purchasing Procedures Policy;
Goods and services that require a contractual agreement, excluding certain software licenses as described below;
Items for personal use or items for non-work related purposes;
Personal cash advances;
Alcoholic beverages;
Radioactive materials;
Prescription drugs or controlled substances;
Weapons or ammunition;
Hazardous chemicals;
Biological select agents (CDC guidelines);
Laboratory animals;
Any purchases prohibited by company policies or not related to company business;

Additional restrictions and notes:

Only the Cardholder whose name is embossed on the Purchasing Card is authorized to use the card and is responsible for ensuring that all charges made with the card are in compliance with these Policies and Procedures.
Pyramiding charges, the practice of performing multiple transactions to circumvent per-transaction limitations, is strictly prohibited.

13. Fraudulent Card Use.

Fraudulent violations are those in which deception was deliberately practiced for unfair or unlawful gain. Fraudulent use of the Purchasing Card for personal or non-work related purchases will result in termination of the card and the cardholder may be subject to disciplinary action up to and including termination of employment and criminal prosecution. All reports of personal use of the Purchasing Card will be reported to the Executive Board immediately, and following an investigation, the Executive Board will determine which circumstances warrant disciplinary action and which cases warrant criminal prosecution.

In addition, a Cardholder found to have fraudulently used a Purchasing Card is personally liable for any fraudulent charges, and if successfully prosecuted, is also personally liable for all legal or attorney fees and shall be required to reimburse AvaCon, Inc. for all such charges.

14. Use of the Card to Purchase Software or Software Licenses.

Software or software licenses that have electronic terms and conditions may not be purchased with a Purchasing Card unless the software or software licenses meet the following low-risk circumstances:

The total cost of the software is $1,000.00 USD or less;
The software is downloaded from the web and the only agreement to be executed is associated with an “I Accept” button or checkbox necessary to initiate the download and/or installation of the software. Any other form of agreement that requires an actual signature must be executed via a Purchase Order, a Purchase Card cannot be used;
The Cardholder is not aware of any claims for intellectual property infringement against the seller;
There is no risk to human life or safety by using the software or software license;
There is no risk of property damage by using the software or software license;
The use of the software does not involve processing, storing, or compiling confidential information, defined as information proprietary to AvaCon, Inc. or a third party or information that is held confidential for any reason such as contract provisions, federal regulations, Social Security Numbers, trade secrets, or research data;
To the best of the Cardholder’s knowledge, the software or software license is not covered by US Export controls and regulations.

If any of these conditions are not met, the software or software license may not be purchased via a Purchasing Card without the written approval of an authorized member of the Executive Board. In the event that such a software or software license purchase is to be made by exception to this policy by a member of the Executive Board, that member of the Executive Board may not approve his or her own purchase, and must secure written authorization by another authorized member of the Executive Board. All such written authorizations will be kept on file with AvaCon, Inc.’s business records.

15. Merchandise Credit or Exchange.

The Cardholder is responsible for contacting the merchant when merchandise purchased with the Purchasing Card is not acceptable (incorrect, damaged, defective, etc.) and for arranging a return for credit or exchange of goods or services. If merchandise is returned for credit, the Cardholder is responsible for obtaining a credit receipt from the merchant and retraining and submitting a copy of that receipt with the supporting documentation for that purchase.

RECEIVING CASH OR CHECKS TO RESOLVE A CREDIT IS PROHIBITED. THE VENDOR MUST CREDIT THE PURCHASING CARD ACCOUNT.

If merchandise is to be exchanged, the Cardholder is responsible for returning the merchandise to the merchant and obtaining a replacement as soon as possible. Documentation showing the proper resolution of the exchange is to be retained and a copy submitted with the supporting documentation for that purchase.

16. Charge Dispute Resolution.

In the case of a disputed charge, the Cardholder should try to resolve the dispute directly with the merchant. If the dispute cannot be resolved, the Cardholder should report the dispute and provide all necessary documentation to the Executive Board, and then follow the instructions located on the bank statement and return the completed form to the bank. A copy of the form must be submitted to the Executive Board and retained for the Cardholder’s records. When the dispute is resolved, the nature of the dispute and documentation about the final resolution must be submitted to the Executive Board and retained for the Cardholder’s records.

17. Vendor Rebates.

Cardholders should take advantage of rebates when offered by vendors, however, the rebate must benefit AvaCon, Inc. and never the individual employee. If the vendor sends a check, rebate card, coupon, prepaid debit card, or other item of value to the individual Cardholder, the Cardholder must endorse the check if applicable or otherwise transfer the item of value or rebate to AvaCon, Inc. All such checks or other items of value thus surrendered to AvaCon, Inc. must be used only for company business or work-related purchases, and must adhere to all applicable Purchasing Procedure Policies, and itemized receipts retained, submitted, and filed in accordance with purchasing policies.

18. Travel and Meals.

If authorized, the Purchasing Card may be used for travel expenses. Travel expenses include hotel reservations, airline tickets, ground transportation, and meals purchased while travelling on company business. The Purchasing Card may not be used for personal purchases, alcohol, or excessive meal costs during travel, and all itemized receipts incurred during travel must be retained and submitted as described elsewhere in this policy.

19. Taxes.

As a 501(c)(3) public charity, AvaCon, Inc. may be exempt from certain sales and other taxes. It is the Cardholder’s responsibility to ensure that a merchant or vendor does not charge sales or other taxes on purchases from which AvaCon, Inc. is exempt. The Cardholder should advise the merchant or vendor of AvaCon, Inc.’s tax exempt status BEFORE making a purchase. The merchant may require AvaCon, Inc.’s Federal Employer Identification Number (FEIN) or other supporting documentation, which can be requested from the appropriate AvaCon, Inc. business unit.

20. Documentation.

A. Receipts.

All receipts for Purchasing Card purchases must be detailed, itemized, and legible. Receipts must show itemized purchases, not just a total or final amount of the purchase. Sales receipts that only show a total or final amount and the Cardholder signature are not considered proof-of-purchase for auditing purposes, therefore, all transactions must be accompanied by the vendor’s itemized receipt.

To document online purchases, the Cardholder should make a copy or print to PDF a copy of the screen that indicates the purchase was paid with the Purchasing Card. The screen print should show the following information:

The Cardholder’s full name;
The Cardholder or AvaCon, Inc.’s mailing address;
An itemized list of all items purchased;
A total amount of the purchase;
The date and time the purchase was made;
The words “VISA Purchase” or other identification that the purchase was made with the Purchasing Card.

B. Record Retention.

The Cardholder is responsible for obtaining all related purchase documentation from the merchant to support any and all purchases made with the Purchasing Card, and verifying that the documentation complies with the requirements for supporting documentation. Original receipts and supporting documents must be retained for a period of seven years, even if this period extends beyond separation from AvaCon, Inc.

C. Business Expense Report.

The Cardholder must submit an online Business Expense Report, and submit an electronic copy of all itemized receipts and other supporting documents related to the purchase to the designated online file repository, within five business days of completing a transaction, or within ten business days of completing a transaction made during travel.

D. Failure to Provide Documentation.

Failure to provide any required documentation, or failure to complete either the Business Expense Report or to submit the itemized receipt and other supporting documentation in a timely fashion, will result in a written warning for the first offense. For the second offense, disciplinary actions up to and including cancellation of the Purchasing Card may be considered. For the third offense, the Purchasing Card will be terminated, and other disciplinary actions may be considered.

21. Verification of Charges.

Cardholders are responsible and accountable for all charges made with their Purchasing Cards, and are responsible for checking that all transactions and supporting documentation match the corresponding monthly bank statements, and to verify their accuracy and compliance with all policies and procedures. If the Cardholder disputes a charge, the nature of the dispute and the final resolution must be documented as described in “Section 16. Charge Dispute Resolution” of this policy.

22. Independent Review of Cardholder Transactions.

The transactions on a Cardholder’s Statement of Account or other monthly bank statements will be periodically reviewed by an independent, non-subordinate reviewer, or in the case of members of the Executive Board, by another designated independent reviewer, to ensure compliance with these policies and procedures. The designated independent reviewer is authorized to request all necessary supporting documentation, including inspection of original receipts or documents, to verify the accuracy and and propriety of all transactions, and to ensure compliance with record retention policies. The independent reviewer will document the results of all such reviews and will report any questionable transactions to the Executive Board for investigation. If any other serious irregularities are detected, the independent reviewer must notify the Executive Board immediately so that appropriate actions may be taken.

23. Audits.

Internal or external auditors may conduct periodic audits of each Cardholder’s transactions. Cardholders must comply with all requests for supporting documentation, including inspection of original receipts or documents, to satisfy all legal and other financial or policy requirements.