REVIEW: 12 MONTHLY

DISTRIBUTION: REFER DOCUMENT REGISTER HELD BY SCHOOL ADMINISTRATOR

REFERENCES: A. PURCHASE REQUEST FORM

ISSUE STATUS

ISSUE
DESCRIPTION
DATE

01 First Draft Issue JAN 05
02 Draft APR 06
03 Draft NOV 10

POLICY

Facilitate the purchasing, payments, payment allocation of equipment, materials, services or one-off items and debt collection in an appropriate and timely manner so that adequate resources remain available to support educational excellence, annual budgets are achieved and the College remains a viable operation.

SCOPE

• Authorised purchasers and delegation limits
• Petty Cash
• Purchasing procedure
• Payment of invoices
• Allocation of expenditure
• Debt collection
• Tax Status
• Tendering
• Disposing of Assets
• Buy Local

PROCEDURES

Authorised Purchasers and limits of delegation

The Principal is authorised to approve any expenditure up to $5,000 in line with the approved annual budget of the College. The Principal may authorise budget variations up to $500 of the line item allocation.

For any amount over $5,000 or un-budgeted amounts exceeding $500 the prior approval of the Board will be sought.

The School Administrator and teaching staff are authorised to approve petty cash expenditure in line with approved College and/or program budgets

Decisions about expenditure should be based on need for the item of equipment or materials, budget allocation and the best price obtainable.

Any expenditure authorised by the Principal or the School Administrator is subject to the scrutiny of the Board.

Petty Cash

The College Book Keeper should ensure a Petty Cash float of $500 is available to the College for one-off cash purchasing up to $50.

The float should be reconciled and topped up on a monthly basis or when available cash depletes to fifty dollars ($50).
All petty cash expenditures must be covered by a receipt and/or a signed Petty Cash voucher.

The Book Keeper should ensure that Petty Cash is stored in a lockable tin and is secured at all times.

Purchasing Procedure

The need for the material or equipment can be identified by any person in the organisation and referred to the Principal on a Purchase Request Form. The Principal should verify the requirement, its urgency, its budget status and price competitiveness.

When verified, the Principal should authorise the Purchase Request, allocate the program area and date the request.

The following information should appear on a Purchase Request Form before it is forwarded to the Administrator:

• Suppliers Details including Name, address, phone number, fax number
• Item name/number, quantity, net price, GST amount
• Delivery details
• Principal’s signature
• Program name
• Date

Receiving Goods/Services and Payment of Invoices

When the original, official Order Form is authorised by the Principal, it is sent to the supplier.

One copy of the official Order Form is retained by the College Administrator to match to the suppliers invoice when received.

The order is filled and delivered to the site listed on the order form. Usually, when goods are delivered to the site, the signature of the employee receiving the goods or services will be required on a supplier’s delivery docket. A copy of the delivery docket should be forwarded to the College Administrator. The employee receiving the goods/service and signing the delivery docket does not have to be an authorised officer.

In cases where an invoice is delivered with the supplied goods, the invoice should be forwarded to the College Administrator as soon as possible.

Payment of invoices usually occurs at the prescribed time, for example a 30 day account is paid 30 days after receipt.

In cases where goods or services are not delivered or are on back order, an employee’s signature may be required to verify when the goods or services have been received. Usually, the supplier will batch these invoices together with a covering statement and send the statement to the College Administrator for payment.

Please advise the College Administrator of any backorders.

Allocation of Expenditure

It is important that the expenditure be correctly allocated to a special program area or general operations on the Purchase Request form. This correct allocation is vital for accurate financial reporting.

Tax Status

The School is approved as a Not for Profit entity by the Australian Tax Office.
Our ABN is 91 058 554 776.

• Stamp Duty – the Association is exempt from this tax.
• Payroll Tax – the Association is exempt from this tax.

Tendering

All purchases over $500 in value should be offered to three suppliers for quotes except where the College enters into arrangements with a preferred supplier for a period of time.

The preferred supplier method of operation has not been fully installed within the College. You will be advised of preferred suppliers.

When quotes are received from suppliers, choice should be made on the basis of price. It is assumed that the product quality and back-up service elements are established as similar prior to inviting tenders from three suppliers.

Disposing of Assets

Assets purchased by official order may be disposed of after two years of use by the College. In the case of vehicles owned by the College, they may be disposed of two years after purchase or 40,000 km, whichever comes first.

Assets may be disposed of as a trade-in on upgrading equipment or offered for sale publicly. Any asset sale or movement should be advised to College Administrator in writing.

Delegation for Debt Collection

The College Administrator is delegated to coordinate debt collection activities

Any activation of a debt collection procedure must first be approved by the Board of Directors

Invoicing Regular Customers

As a general rule, regular College customers may be issued with a tax invoice/statement on the basis of a credit application.

A Credit Application Form will be issued upon request by the College Administrator and returned for scrutiny to that section.

When a College customer successfully meets the criteria of the credit application, a fourteen day invoice/statement may be issued.

Reminding Customers

Where a regular customer has been issued with an Invoice/Statement and no payment has been received the following steps are to be taken:

• at 30 days a friendly reminder is issued.

• at 37 days a reminder account is stamped “OVERDUE” in red on the lower part of the account and is issued.

• at 44 days a friendly phonecall is made.

• at 51 days a further phonecall is made and explanation sought.

• at 58 days if no explanation has been offered and payment is not received, stationery and uniform credit is frozen until payment is received.

At this point the Principal should be advised.

Due to individual circumstances the Principal may reduce debt accumulated due to tuition but the College will expect uniforms, stationery and other charged to be repayed.

In the case where the customer is struggling to make payment, alternative payment arrangements may be negotiated.

In the case where the customer is unhappy with the College, the Principal should quickly take up the matter.

In the case where a family leaves with outstanding debt, the account will be written off as a bad debt.

Reporting on debt

Reports on current debt will be circulated to the Board on a monthly basis, with budget reports.

Receipts

Receipts should be issued from the location at which the cash or cheque is received. In most cases, the College Book Keeper will receive payments made to the College.

Buy Local

As much as possible, goods and services should be purchased locally.

DOCUMENTATION

Purchase Request Form
Preferred Supplier List (when available)

Attachment	Size
Purchasing and Debt Collection_05 v2006.doc	56 KB