Finance & Procure to Pay. Business Forum September 15, 2014

Finance & Procure to Pay

Business Forum

September 15, 2014

Signature Authority &

Subdelegations

Business Forum

September 15, 2014

Delegation of Authority

•

Board Resolution 2011-3245 ( dated 11/18/2011)

–

Board of Trustees authorized President “to sign on behalf of the

university all contracts and other documents in which the

University incurs or discharges a legal obligation.”

•

President’s directive (dated 11/30/11)

–

President delegated to VPFA authority “to sign (i) all agreements

in which the University pays or receives money or other

consideration and (II) all contracts involving the payment or

receipt of amounts greater than $1,000,000 that were not

previously approved as part of a university budget, as cosigner

with the President.”

•

VPFA subdelegation (dated 9/2/2014)

–

http://www.ohio.edu/finance/procuretopay/upload/vpfa_signat

Delegation of Authority to CFAOs

Procurement of leasing of goods, supplies, and services,

including consulting services, identified below:

Independent Contractor (IC):

Honorarium Agreement

RC CFAO

IC Agreement (EZ Form)

RC CFAO

CFAOs may not further delegate signature authority.

See

http://www.ohio.edu/finance/procuretopay/upload/PU_contacts-2.pdf

Independent Contractor Process

Business Forum

September 15, 2014

The Objective

•

Create a process that:

•

meets regulatory requirements;

•

is user friendly, intuitive, and simple;

•

facilitates prompt payment;

•

allows for delegated signature authority

(Honorarium and Independent Contractor EZ) by

planning unit CFAO.

Independent

Contractors

Tier 1

(less than $1,500 excluding travel)

DELEGATED SIGNATURE AUTHORITY TO UNIT CFAO •Speaker •Panelist •Artist/Musician •Conductor/Director •Workshop/Seminar •Lecturer

Tier 2

DELEGATED SIGNATURE AUTHORITY UNIT CFAO

•Actor

•Editorial/Writing/Indexing Services •Entertainer

•Guest Artist/Director/Conductor (Above $1500) •Interpreter/Translation Services

•Photographer/Videographer •Speaker Panelist (Above $1500)

•Sports Officials (referees, timekeepers, etc.) •Transcriptionist •Workshop/Seminar

Tier 3

Supplier Provided

Contracts

Regulatory Requirements

• IRS Independent Contractor Guidelines

– Establishes “Common Law Rules” for determination of employees versus independent

contractors.

• OPERS - Ohio Revised Code 145.036, 145.037, 145.038 (Effective June 30, 2013)

– Requires a clause regarding Ohio Public Employees Retirement System (OPERS) to be present in all contracts.

– Requires reporting all independent contractors to OPERS monthly. • Ohio New Hire Reporting Center- Ohio Revised Code 3121.89

– Requires reporting all new hired employees and independent contractors to the State

within 20 days of hire.

• Ohio Revised Code 3345.29

– Outlines specific contract management and documentation requirements for state universities.

Template Agreements

3-Tiered Approach

1. Incorporate an independent contractor determination step to the “Add Supplier” process in BobcatBUY to aid unit in pre-determination.

2. Create process that

A. Streamlines procurement, contract requirements;

B. Adds Invoice component (Ok to Pay) for Honoraria and IC EZ for submission for payment post services rendered;

C. Provides users’ training resources.

3. Introduces template agreements that can be used by colleges and departments at Supplier Add or at Requisition for existing suppliers.

Tier 1

Honoraria

DELEGATED SIGNATURE AUTHORITY TO UNIT CFAO

Tier 2

Independent

Contractor EZ

(Frequent Services)

DELEGATED SIGNATURE AUTHORITY TO UNIT CFAO

Tier 3

Comprehensive

Services

Yes -Contractor N o -E m p l o y e e E. P2P reviews D. College obtains paperwork (recommended): -SUBW9 -Contract -Insurance C. College submits Request to Add or Modify Supplier/Payee in BCB and answers IC questions. B. College uses provided checklist to make initial determination for

supplier set up. A. College identifies

need for service provider ensuring competitive bid requirements are met.

Independent Contractor

Determination Process

HIRE AS EMPLOYEE

Combined Insurance and Contract Guide

In Development

Honorarium Agreement

Delegated Signature Authority To Unit CFAO

•

Amount does not exceed $1,500

excluding travel

•

No contractual liability on either

party

•

Must be a token of appreciation or to

cover expenses

•

Some federal restrictions on

honorariums to non-resident aliens

•

Is reportable income

•

No scope attachment required

•

‘Payment Approval’ on executed

contract allows for contract to be

used as ‘Invoice’

IC EZ Agreement

Delegated Signature Authority Under Bid Threshold To Unit CFAO

•

Strictly defined roles

•

No scope attachment

required

•

‘Nature of Service’ must

be on form to be used

•

‘Payment Approval’ on

executed contract

allows for contract to be

used as ‘Invoice’

Comprehensive IC Agreement

•

Used for payee performing

a service for compensation

as an independent

contractor on those services

or thresholds not specified

on Honoraria and IC EZ.

•

An Exhibit A must be

attached detailing service

provided, such as proposal

or statement of work.

•

Invoice must be created by

supplier/payee

EXHIBIT A

Statement of Work,

Or

Questions?

Please Contact:

Finance Customer Care Center

Email:

financecustomercare@ohio.edu

Travel & Expenditure Reviewer

Checklist

Business Forum

September 15, 2014

About the Checklist

www.ohio.edu/finance/procuretopay/upload/Reviewer_checklist.pdf

The purpose of this checklist is to provide

guidance to decentralized reviewers and

approvers for all expenditures.

This list is not meant to be all inclusive.

It is the responsibility of each employee to

understand and comply with the policies and

procedures of the University. Periodic audits will be

conducted to ensure compliance with policy.

Criteria for determining allowable

expense:

•

Necessary to perform a valid business purpose fulfilling

the mission of the University; and

•

Reasonable in that the expense is not extreme or

excessive, and reflects a prudent decision to incur the

expense; and

•

Appropriate in that the expense is suitable and fitting

in the context of the valid business purpose; and

•

Allowable according to the terms of any regulations,

sponsor or donor agreements, or University policy.

Definition of IRS Accountable Plan

1. Your expense must have a business purpose;

2. You must adequately account to your employer

for expenses within a reasonable period of time;

3. You must return any excess reimbursement or

allowance within a reasonable period of time.

If the Accountable Plan rules are not followed,

reimbursements will be treated as taxable to the

employee (and subject to income and withholding

taxes).

Grant Awards

The items shown on the checklist consistently point to

the importance of knowing and understanding the terms

and conditions of your awards and the sponsoring

agencies.

Be aware that there are agencies that require the use of

different per diem rates, mileage rates, and receipt

requirements.

This is routinely the case with awards from: Ohio Department

of Transportation, Ohio Development Services Agency

The following grid specifies the types of

expenses that will continue to be 100% audited

by Finance:

Expenditure Category Grants Foundation Other University

Other Professional Services-including

research subject payments X

Subcontracts X

Equipment X

Student travel X

Student Payment Release forms X