303: Purchase Orders
Procurement and Contract Services Policy & Procedures Manual
Section 300: Purchasing
The purchase authority dollar threshold indicates from where an authorized Purchase Order may be issued. The unit issuing the Purchase Order is responsible for all aspects of the Purchase Order including but not limited to:
- Obtaining the required approvals;
- Setting up the appropriate commodity or document level accounting in Banner;
- Ensuring the appropriate terms and conditions are indicated on the Purchase Order document and that any attached Vendor quotes do not reference the Vendors terms and conditions;
- Making any changes, cancelations or modifications to the Purchase Order including liquidating the Purchase Order as necessary; and
- Keeping and maintaining the official archival records.
Purchase Orders can be issued for purchasing standard goods or services that are “off the shelf” or fairly typical. For more complex purchases, a different form of Contract should be contemplated.
303-001: PaCS Purchase Orders
PaCS is responsible for issuing Banner Purchase Orders for purchases that exceed $25,000. Departments and Business Centers are not authorized to issue procurements that exceed $25,000. Purchases may not be fragmented in order to circumvent the necessary processes associated with issuing purchases over the $25,000 threshold, see PaCS Policy and Procedure 103-002.
303-002: Business Center Purchase Orders
Except for purchases subject to BOLI PWR, Business Centers will issue OSU Purchase Orders for purchases between $5000 and $24,999.99 referencing the appropriate terms and conditions on the PaCS website. Exceptions include those allowed in PaCS 303-012.
303-003: Departmental Purchase Orders
Except for purchases subject to BOLI PWR, Departments may issue Departmental Purchase Orders or Banner Purchase Orders for purchases at and under $4999.99.
303-004: Purchase Order Terms and Conditions
Purchase Orders $5,000 and greater will be issued through Banner and reference the appropriate Standard Terms and Conditions listed on the PaCS website at: http://pacs.oregonstate.edu/terms-and-conditions. Business Centers should contact PaCS if unsure about which terms and conditions apply to their purchase. OSU Purchase Order Standard Terms and Conditions prevail over Vendor terms and conditions. Under no circumstances should Department or Business Center staff allow or agree to make changes to OSU Purchase Order Terms and Conditions. If a Vendor requests changes to the terms and conditions, submit request to PaCS for review.
303-005: Purchase Order Changes and Cancellation
Purchase Order changes and modifications should be initiated by the unit that initiated the Purchase Requisition by sending their request for the change or cancelation to PaCS. Only PaCS may cancel or change a Banner Purchase Order. PaCS will review requests for changes and cancelations to determine feasibility prior to making any changes or cancelations. In some cases, changes or cancellations may not be allowed.
303-006: Purchase Order Completion
Banner has an automatic function that disallows the completion and encumbering of a Purchase Order greater than $25,000 for Business Centers. If a Department or Business Center requests completion of the Purchase Order, the unit completing the Purchase Order must review the signed Purchase Requisition, ensure any applicable approvals or processes have been completed and keep a record of the purchase.
303-007: Purchase Order Encumbrances
When a Purchase Order is approved in Banner an encumbrance is created against the Index. When an invoice is entered into Banner and is not linked to the original Purchase Order, the Purchase Order encumbrance remains open. Purchase Order encumbrances must be monitored by the Purchase Order issuer and the encumbrance deleted by the Purchase Order issuer before the end of the fiscal year.
303-008: Purchase Order Capital Assets
A capital asset is generally described as a single asset with a minimum value of $5,000 except in special cases approved by Property Management. All Capital Assets shall be purchased according to the Property Management Polices and Procedures: Software, consumables, minor equipment not permanently affixed to the equipment and maintenance cannot be considered part of the asset value. Freight, training, and set up can be a part of the asset value. The proper transaction account code must be used as indicated below:
- 40101 Equipment
- 40102 Livestock
- 40103 Art/Museum Collections
- 40104 Vehicles
- 40199 Asset under Construction
- 40201 Vessels
303-009: Purchase Order Trade-Ins
When an asset involves a trade-in, the original purchase order should reflect the original value of the asset without consideration of the trade-in credit. The intent to make a trade-in and the value, which will be received for the trade-in, should be covered in item text. The trade-in value will be given during invoice payment by using journal voucher processing. When a trade-in is referenced, the department should be reminded they must check with Surplus Property and Inventory Control and complete a Property Disposition Request (PDR) before the purchase. All Trade-Ins shall follow the Property Management Policies and Procedures. A copy of the PDR and the Purchase Order shall be provided to Inventory Control.
For additional information related to Purchase Order Trade-In’s see PCC 301-008.
303-010: Exchange of OSU Goods or Services for Discounts
Generally, an exchange of OSU goods or services for a Vendor’s goods or services in whole or at a discounted rate is not allowable. This practice unfairly eliminates Vendors who may not wish to accept OSU goods and services and disproportionately lowers or eliminates the overall price of the goods without accounting for the trade or discount.
303-011: Purchase Order Discounts
When an asset involves a “discount” from a vendor, the purchase order should reflect the actual discounted cost paid rather than the inflated cost prior to discount.
303-012: Purchase Order Exception List
The following is a list of commodities and payees that do not require issuance of a Purchase Order prior to payment. The following excludes procurement of items that are capitalized equipment:
- Conference Fees for OSU employees to attend work related conferences
- Departmental or Institutional Accreditation, Certification or Assessment Fees and related Maintenance
- Doctor or Dentist Bills for OSU Student Athletes
- Dues and Memberships for OSU employees work related dues and Memberships
- Food purchased for University Dining and Memorial Union resale
- Gasoline, diesel fuel, heating oil, lubricants, natural gas, and electricity and the associated transportation thereof
- Insurance or service contracts as provided for under ORS 414.115, 414.125, 414.135 and 414.145 for purposes of source selection
- Offset printing under $25,000 for Printing and Mailing Department
- Payments made in accordance with a Contract or agreement executed by an authorized OSU Contracts Officer
- Payments related to overpayments made to OSU
- Payments to the PAC-12 or National Collegiate Athletic Association that are required through the OSU Athletics membership in those organizations
- Payment to OSU Bookstore by Intercollegiate Athletics for books for OSU athletes
- Payroll, health benefits, retirement and life insurance payments
- Royalty payments requested by the Research Office
- Travel Advances or Travel Reimbursements as allowed by OSU travel policies
- Tuition Reimbursements
- Utilities - when governed by federal, state or local regulatory agencies
- When the following vendors are the payees:
- Any State of Oregon Agency
- OSU Foundation
- OSU Beaver Athletic Student Fund (BASF)
- United States Post Office
For procurements under $25,000: Business Centers may pay using a Banner invoice.
For procurements over $25,000: unless granted Banner unrestricted invoice access by the Procurement and Contract Services Chief Procurement Officer and Business Affairs, Business Centers must request an invoice completion from PaCS (see PaCS 304).
Banner FIS unrestricted invoice access may be used for payments only as allowed on the Purchase Order Exception list or as approved by PaCS. For audit documentation purposes, written justification for not issuing a Purchase Order should be stated in the document text of the Banner Invoice document. When referencing use of a Contract, the contract number should be:
- included in the document text, or
- indicated on the invoice document image, or
- a legible document image of the contract signed by an Institution Contract Officer should be linked to the Banner invoice document in Nolij
Unrestricted invoice access utilized in a manner that falls outside of this policy, procurement Oregon Administrative Rules or related PaCS policies and procedures may be rescinded by the Procurement and Contract Services Chief Procurement Officer and Business Affairs.