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Chapter 01B – Government Purchase Card for Micro-Purchases

Volume XVI - Charge Card Programs

Date Approved: November 7, 2024

Financial Documents

Volume XVI - Charge Card Programs

Chapter 01B – Government Purchase Card for Micro-Purchases

Questions concerning this policy chapter should be directed to:

0101 Overview

This chapter establishes the Department of Veterans Affairs’ (VA) financial policies and procedures regarding the procurement of goods and services under the micro-purchase threshold using Government Purchase Cards.

Key points covered in this chapter:

  • Government purchase cards will only be used to purchase goods and services in support of the Department’s mission;
  • Purchase cardholders will adhere to the micro-purchase thresholds for goods and services as defined by Federal Acquisition Regulation (FAR) 2.101;
  • Purchase cardholders will not split a requirement into multiple purchases to avoid exceeding their delegated purchase or the micro-purchase threshold;
  • Government purchase card orders must be recorded in the appropriate VA-approved automated system within one business day of making the purchase;
  • Intentional misuse of a Government purchase card may result in a bill of collection for funds that cannot be recouped, disciplinary action, and criminal and/or civil actions; and
  • Responsible officials in VA Administrations and Staff Offices are accountable for ensuring compliance with the Government purchase card program and implementing internal controls over Government purchase card activities.

0102 Revisions

Section Revision Requesting Office Reason for Change Effective Date
Various Completed full review. OFP Full review. Updated and reorganized chapter. November 2024
0103 Added new and updated existing definitions. OFP General update for consistency with other policy chapters. November 2024
0106 Updated references and links. OFP General update. November 2024
Appendix A Added appendix for Revision History. OFP Reformatting of chapter and realignment of appendices. November 2024
Appendix C Added appendix. OFP Provided examples of scenarios which are not considered to be a split purchase. November 2024

For a complete list of previous policy revisions, see Appendix A.

0103 Definitions

Charge Card Portal (CCP) – VA’s internet-based system, which provides a variety of features intended to assist in the effective management of the Purchase Card Program, including training logs and electronic storage of supporting documents related to purchase card transactions.

Electronic Access System (EAS) – The charge card servicing bank’s internet-based system which provides a variety of reports and assists in the effective management of the purchase card.

Goods – Supplies, materials, equipment, and all other tangible commodities, except real property.

Government Purchase Card (GPC) – A card that is similar in nature to a commercial credit card that is used to make financing and delivery payments for goods and services. The purchase card is an EFT (Electronic Funds Transfer) method, and it may be used as a means to meet the requirement to pay by EFT, to the extent that purchase card limits do not preclude such payments.

Government Purchase Cardholder – A VA employee who possesses a GPC and is delegated the authority to obligate funds on behalf of the Government and has successfully completed all mandatory training requirements.

Internal Controls – Systematic measures which include periodic and continuous monitoring, checks and balances, policies, procedures, and segregation of duties implemented to reduce the risk of error, fraud, waste, and abuse.

Merchant Category Code (MCC) –A four-digit number used to classify the business by the type of goods or services it provides.

Misuse – Use of the purchase, travel, fleet and/or integrated charge card in violation of the Federal Acquisition Regulation (FAR), Defense Federal Acquisition Regulation Supplement (DFARS), Federal Travel Regulation (FTR), Agency Supplements, or Agency Policies/Procedures. These actions can be the result of ignorance and/or carelessness, lacking intent, to include honest mistakes.

Open Market – Items for sale which are not available for purchase from a Government contract vehicle, including Federal Supply Schedules (FSS), Blanket Purchase Agreements (BPA), Contract Team Arrangement (CTA), Government Wide Acquisition Contract (GWAC), etc.

Purchase Order (PO) – A Government offer to buy supplies or services upon specified terms and conditions using simplified acquisition procedures; see FAR 2.101, FAR 13.302 (binding when executed).

Receiving Report – Internally generated documentation that provides evidence the Government received goods or services.

Reconciliation – The process by which the cardholder, using the VA servicing bank’s electronic access system and/or other VA-approved automated systems, reconciles transactions. The Approving Official (AO) must certify the reconciliation of the transactions under his/her purview.

Requirement – Total quantity and price known at the time of each purchase.

Service Contract Labor Standards – 41 U.S.C. Ch. 67, formerly known as the Service Contract Act of 1965; the principal purpose of which is to provide standards that companies must adhere to when providing services that are other than bona fide executive, administrative, or professional in nature.

Simplified Acquisition Procedures (SAP) – Methods prescribed in FAR Part 13.3 for purchasing goods or services. SAPs are designed for relatively simple Government requirements, and their use is subject to designated micro-purchase thresholds in FAR Part 2.101 and 41 U.S.C § 1901 for goods or services.

Split Purchase – A split purchase occurs when a cardholder intentionally modifies a known requirement into two or more purchases or payments to avoid exceeding their delegated purchase or the micro purchase threshold.

Strategic Sourcing – The collaborative and structured process of critically analyzing an organization’s spending and using this information to make business decisions about acquiring commodities and services, more effectively and efficiently.

Unauthorized Commitment – An agreement that is not binding solely because the Government representative who made it lacked the authority to enter into that agreement on behalf of the Government.

Wage Rate Requirements (Construction) (formerly known as the Davis-Bacon Act) – 40 U.S.C. § 3142 requires that any contract involving either the United States or the District of Columbia for the construction, alteration, or repair of public buildings or works must contain a clause setting forth the minimum wages to be paid to the classes of workers involved in such projects.

0104 Roles and Responsibilities

Assistant Secretary for Management and Chief Financial Officer (ASM/CFO) oversees all financial management activities relating to the direction, management, and administration of the VA Purchase Card Program.

Under Secretaries, Assistant Secretaries, and Other Key Officials are responsible for ensuring that the offices within their authorities are in compliance with the policies and procedures set forth in this chapter.

Office of Acquisition and Logistics and Construction (OALC) is responsible for establishing acquisition policy and working across the Department to make strategic sourcing decisions that maximize its purchasing authority.

VHA Procurement and Logistics Office (PLO) The Chief Procurement Officer (CPO), as designated by the Under Secretary for Health, is responsible for the oversight of the Purchase Card Program within VHA.

Responsible Officials are the highest-ranking officials (senior executives or GS-15) of any individual offices that hold purchase cards. They are responsible for ensuring that their cardholders and AOs are complying with the policy as well as preventing and mitigating non-compliance.

Supervisors are responsible for ensuring that cardholders, Approving Officials (AOs,) or Agency/Organization Program Coordinators (A/OPCs) in their line of authority are in compliance with this policy and for assessing appropriate disciplinary actions.

Agency/Organization Program Coordinators (A/OPCs) oversee the card program(s) for his or her agency/organization; establish purchase card accounts in the servicing bank’s Electronic Access System (EAS); serve as liaison between the cardholder and the servicing bank; provide on-going advice; review purchase card account activity; maintain necessary account information; monitor and track card program participants that violate policy; and ensure that the offices take appropriate action to address any instances of policy violations.

Level 1 A/OPC The Financial Services Center (FSC) Charge Card Services Division serves as the Level 1 A/OPC.

Level 2 A/OPC provides technical advice and guidance to the lower-level A/OPCs and reports within 5 days any policy violations and resulting corrective actions to the Level 1 A/OPC. Also provides oversight of the Purchase Card Program at the Administration level for the Veterans Health Administration (VHA), Veterans Benefits Administration (VBA), National Cemetery Administration (NCA), Office of Information and Technology (OI&T), Office of the Inspector General (OIG), and VA Central Office (VACO).

Level 3 A/OPC serves as a liaison between Level 2 A/OPC and Level 4 A/OPCs. Level 3 A/OPCs are currently only utilized by VHA. Level 3 A/OPCs, also known as Purchase Card Program Managers, are responsible for:

  • Providing technical advice and guidance to Level 4 A/OPCs;
  • Validating initial and refresher training and guidance to Level 4 A/OPCs;
  • Reporting violations and disciplinary actions to the next level A/OPC within 5 days;
  • Providing oversight of the Purchase Card Program under his/her hierarchy;
  • Providing technical guidance for all cardholders and AOs under his/her hierarchy;
  • Analyzing the effectiveness, efficiency, and productivity of the Purchase Card Program under his/her hierarchy;
  • Investigating potential violations and fraud indicators; and
  • Managing and responding to external oversight organizations.

Level 4 A/OPC is responsible for the following:

  • Entering the cardholder’s account application in the servicing bank’s EAS;
  • Monitoring and tracking policy violations;
  • Ensuring that supervisors take appropriate actions to address violations;
  • Reporting violations and disciplinary actions to the next level A/OPC within 5 days;
  • Providing oversight of the Purchase Card Program at the station-level;
  • Ensuring mandatory purchase card training is completed and up to date for cardholders, AOs and AAOs;
  • Providing technical guidance for cardholders and AOs under his/her hierarchy;
  • Analyzing the effectiveness, efficiency, and productivity of the Purchase Card Program at the station-level;
  • Investigating potential violations and fraud indicators; and
  • Managing and responding to external oversight organizations.

Approving Officials (AOs) and Alternate Approving Officials (AAOs) areresponsible for the following:

  • Working with direct line supervisors to identify qualified employees to be cardholders;
  • Recommending single purchase and monthly purchase thresholds in conjunction with the A/OPC, Fiscal Office, and the delegating authority;
  • Providing guidance to cardholders in response to issues they raise related to use of the purchase card;
  • Ensuring that only authorized purchases are made;
  • Ensuring timely reconciliation of charges made by cardholders;
  • Reporting to the Level 4 A/OPC whenever purchase cards are lost, stolen, or compromised;
  • Monitoring and reporting to the A/OPC when cardholders transfer, retire, are terminated, or for any other reason have no further need of a purchase card;
  • Monitoring and reporting disciplinary actions resulting from cardholder misuse within 5 days to the Level 4 A/OPC;
  • Reviewing spending thresholds and the need for cards annually in accord with 41 U.S.C. §§ 1902, 1909; and
  • Completing mandatory training related to their approving official duties.

Cardholders ensure proper adherence to purchase card policies, and are limited to acquisition, logistics, finance, prosthetics, and other such personnel approved on a limited basis by the level 2 A/OPC. Cardholdersareresponsible for the following:

  • Completing mandatory training related to their purchase card duties;
  • Surrendering the purchase card upon termination of employment, retirement, or transfer to a new position;
  • Being knowledgeable of purchase card policies, hierarchy of purchases, and the limitations on spending thresholds and vendor selection;
  • Reporting to the AO, Level 4 A/OPC, and servicing bank whenever purchase cards are lost, stolen, or compromised;
  • Making authorized purchases; and
  • Uploading documentation related to purchases to an approved automated imaging system.

0105 Policies

010501 General Policies

  1. VA will adhere to OMB Circular A-123, Appendix B, A Risk Management Framework for Government Charge Card Programs, for guidance on the management and use of a purchase card.
  2. VA will comply with 48 C.F.R Part 13 and 41 U.S.C. §§ 1902-1904 when making purchases.
  3. VA’s Government Purchase Card program was established, in participation with the General Services Administration (GSA) SmartPay Program, to reduce the administrative costs related to the acquisition of goods and services.
  4. Government purchase cards will only be used to purchase goods and services in support of the Department’s mission.
  5. Purchase card program participants should adhere to the guidance published in FSC’s Purchase Card Handbook. The most current version of the handbook is located on FSC’s SharePoint site.
  6. Government micro-purchases of electronic and information technology items must be compliant with Section 508 of the Rehabilitation Act of 1973, which states that Federal agencies must make their electronic and information technology accessible to people with disabilities (see FAR Subpart 39.2). An exception to this requirement is permitted if the technology is located in spaces frequented only by service personnel for maintenance, repair, or occasional monitoring of equipment, or if it would impose an undue burden (significant difficulty or expense).
  7. Government purchase cardholders will purchase green products and services to the maximum extent practicable (including construction) to meet the requirements of the Green Purchase Program consistent with FAR part 23 and Subpart 39.2.
  8. Purchases of goods and services that exceed the micro-purchase threshold will only be made by warranted contracting personnel, in compliance with Veterans Affairs Acquisition Regulations (VAAR) and FAR. Purchases over the micro-purchase threshold fall under the purview of the Office of Acquisition, Logistics, and Construction (OALC) and must be made using a valid contracting document such as a contract or purchase order, unless specifically allowed by legislation.

010502  Purchase Card Thresholds

  1. In accordance with FAR 2.101, VA’s micro-purchase thresholds are:
    • Up to $10,000 for goods and services, not subject to the Service Contract Labor Standards (SCLS) or the Wage Rate Requirements (Construction);
    • $2,500 for services subject to the Service Contract Labor Standards (see paragraph B of this section;
    • $2,000 for construction (see paragraph C of this section); and
    • $50,000 for arbitrator services (see paragraph E of this section).
  2. SCLS (41 U.S.C. Chapter 67), formerly known as the Service Contract Act of 1965, establishes that when services are for amounts greater than $2,500, the services must be procured via contract and standard wages must be paid. Services generally covered by this Act include:
    • Maintenance, overhaul, repair, servicing, rehabilitation, salvage, modernization, or modification of supplies, systems, or equipment;
    • Routine recurring maintenance of real property;
    • Housekeeping and base services;
    • Laboratory analysis services;
    • Operation of Government-owned equipment, real property, and systems;
    • Drafting and illustrating;
    • Special mode transportation and related services; and
    • Computer services.
  3. Construction Wage Rate Requirements statute 40 U.S.C. Chapter 31 (formerly known as the Davis-Bacon Act) mandates that construction projects that have a purchase threshold greater than $2,000 must be procured by contract. Construction covered by this law includes alteration and/or repair, painting, and decorating of public buildings or public works.
  4. A “micro-purchase” can include the acquisition of both goods and services in a single purchase, the aggregate amount of which may not exceed the micro-purchase threshold applicable to the type of purchase being made. The FAR specifies that the aggregate amount (i.e., the total purchase price), should be used to determine if the purchase is below the applicable threshold. Furthermore, when the purchase of goods and services are combined, VA’s Office of General Counsel (OGC) has found no authority indicating that the threshold only applies to the value of the services. For example, ABC company is hired to do routine maintenance of a door mechanism and to install a new front door for a medical facility, the estimated cost of the requirement is $2,600 ($2,000 labor and $600 for the door), as the total cost exceeds the SCLS threshold of $2,500 this purchase cannot be made via purchase card.
  5. In accordance with Office of Acquisition and Logistics, Federal Acquisition Regulation (FAR) Class Deviation memorandum dated May 3, 2024, (see copy of deviation in Appendix F), arbitrators assigned to a matter by the Federal Mediation & Conciliation Service (FMCS) pursuant to a collective bargaining agreement, may be paid up to $50,000 using a Government purchase card. A separate purchase card account must be established using VA Form 0242 (Governmentwide Purchase Card Certification Form) before these payments can be made. For information on completing VA Form 0242, see Volume XVI, Chapter 1A, Administrative Actions for Government Purchase Cards. This deviation expires when the Enterprise Standards related to Arbitration Services Payments is developed and implemented or is otherwise rescinded.

010503  Strategic Sourcing

  1. In order to enhance VA’s purchasing authority, VA must utilize strategic sourcing for the routine purchase of goods and services using the Government purchase card. AOs, A/OPCs, and cardholders must review their purchases and determine when it is in the best interest of the Government to utilize strategic sourcing for particular goods or services.
  2. FSC will issue a quarterly listing of the top 1,000 vendors who received purchase card payments to OALC, Assistant Secretaries, Under Secretaries, Other Key Officials, and their related contracting and logistical offices for identification of areas for strategic sourcing.
  3. OALC, Assistant Secretaries, Under Secretaries and Other Key Officials will review the top 1,000 vendors to determine which vendors and procurement actions warrant the issuance of nation-wide contracts to leverage the Government’s buying power through consolidation of requirements.
  4. OALC will work across the Department to make the most of available budgetary resources by ensuring that strategic purchasing decisions are made at all levels of the Department.
  5. FSC will forward the top 1,000 vendors list to all A/OPCs for review and determination of the need for local contracts.

010504  Split Purchase and Single Purchase Threshold

  1. A split purchase occurs when a cardholder intentionally modifies a known requirement into two or more purchases or payments to avoid exceeding their delegated purchase thresholds. Cardholders must not split a requirement into smaller parts to avoid formal contracting procedures. See FAR 13.003(c)(2) for additional details.
  2. A single purchase may not exceed the cardholders authorized single purchase threshold. Cardholders will not divide or modify a requirement into multiple purchases in order to stay within their single purchase threshold.
  3. Cardholders and AOs who split purchases, commit an unauthorized purchase, make or certify a purchase exceeding his/her delegated or appointed level of authority may be subject to disciplinary action and/or personal financial liability. See VAAR Subpart 801.602-3.
  4. If the requirement is for an on-going repetitive order of goods or services and the total value of the requirement exceeds the micro-purchase threshold, the requirement for the goods or services must be communicated to the organization’s servicing contracting office for procurement.
  5. Any cardholder or AO who makes or certifies a purchase exceeding the micro-purchase threshold has created an unauthorized commitment that must be ratified. See VAAR Subpart 801.602-3 and FAR 1.602-3 for the process to follow in order to ratify an unauthorized commitment over the micro-purchase threshold.
  6. If there is any uncertainty as to whether a purchase can or should be made using a Government purchase card, cardholders will contact their AO, supervisor, and A/OPC. AO and A/OPCs may contact FSC via email to purchasecardops@va.gov, or OALC Procurement Policy via email to VACOvaproc@va.gov. For information on split and allowable purchases, see Appendix B and C.

010505  Purchases Below the Micro-Purchase Threshold

  1. Agency personnel requesting purchases of goods or services must provide written and/or electronic requests for the items. Documentation must clearly indicate a valid business need for the goods or services being requested.
  2. Government purchase cardholders must obtain prior approval from their supervisor or AO before making any purchase, including those that are initiated by the cardholder.
  3. Documentation may vary in form and content. Some examples include e-mails, requisitions, memos, consults, or notes. Regardless of the form the documentation must contain a certification from the requestor that the proposed purchase is for a legitimate Government need, not for personal benefit, as well as a list of all items to be purchased. A copy of the approval must be retained as supporting documentation.
  4. Before purchases are made, cardholders must verify that funds are available within the line of accounting that is to be charged.
  5. Government purchase cardholders purchasing non-expendable IT equipment must comply with the Office of Information and Technology (OI&T) requirements, see VA Handbook 7002, Logistics Management Policy and VA Directive 6008, Acquisition and Management of VA Information Technology Resources for more details.
  6. The purchase card may be used for Veteran (Beneficiary) Travel expenses. When a VA facility chooses to use a purchase card to pay for Veteran travel expenses, the cardholder must:
    • Obtain appropriate written authorization from the AO or supervisor prior to making purchase;
    • Document and maintain transaction details (traveler name, travel dates, location, purpose of trip, amount, merchant name, date and description of purchase); and
    • The VA facility will ensure that the Veteran does not receive a travel reimbursement if a purchase card was used to pay for their travel expenses.
  7. Contracts must be considered when bulk travel arrangements can be anticipated for Veteran Beneficiary Travel, and the total cost will exceed the micro-purchase threshold.
  8. To ensure that VA receives the best possible pricing for goods and services, prior to selecting a vendor, every effort should be made to locate the items on a Government-wide or Departmental contract. (e.g., Federal Supply Schedules (FSS), Blanket Purchase Agreements (BPA), Contract Team Arrangement (CTA), Government Wide Acquisition Contract (GWAC)). Open market orders are used as a last resort when a cardholder is unable to satisfy requirements for goods/services using an existing Government contract. When making open market purchases cardholders must document the non-availability of the goods/services from a Government contract vehicle.
  9. Once a merchant has been selected, prior to placing the order, the cardholder must verify that the merchant accepts purchase cards as a form of payment. If the merchant does not accept purchase cards, the cardholder must attempt to find another merchant that does accept purchase cards. If no other merchant is available to provide the goods or services, the purchase may be made using a convenience check. The use of convenience checks is strongly discouraged, and every effort should be made to find a vendor that accepts the purchase card. See Volume XVI, Chapter 1C – Government Convenience Checks.
  10. Government purchase card orders must be recorded in the appropriate VA-approved automated system within one business day of making the purchase.
    1. Government purchase card orders entered into VA accounting systems, such as, Integrated Financial and Acquisition Management System (iFAMS), or the Integrated Funds Distribution, Control Point Activity, Accounting, and Procurement (IFCAP) system serve as documentation for:
      • Obligation of VA appropriated funds;
      • Ordering information; and
      • Supporting documentation for audits.
    2. The purchase order must include detailed information such as type of product or service, quantity, price (including any shipping and handling fees), and if applicable, contract or Blanket Purchase Agreement (BPA) number.
    3. Cardholders shall select the appropriate fund control point, cost center, and budget object code (BOC) that best matches the items being procured to ensure transactions are properly recorded and accounted for in the accounting system.
  11. Cardholders will not:
    • Purchase items for personal use or the personal use of other employees. See Government Accounting Office (GAO) decision B-327146;
    • Accept cash for returned merchandise or credit;
    • Allow other employees to use or have access to their issued Government purchase card(s); or
    • Circumvent appropriate contracting requirements.
  12. The Government purchase card may not be used for:
    • The purchase of food and beverages, except in certain circumstances as provided for in law, see Volume II, Chapter 4 – Awards, Ceremonies, Food or Refreshments, Gifts or Mementos;
    • Long-term rental or lease of land or buildings of any type see General Services Administration Acquisition Manual/Regulation (GSAM/R) Part 570, and VA Handbooks and Directives 7815 and 7816;
    • Employee travel, including local travel or travel-related expenses. Local transportation includes items such as metro fare cards, subway tokens, toll passes, and ferry tickets. Employees must seek reimbursement for these expenses through the VA Travel System. See 41 C.F.R § 301-51.1. Toll passes may be paid using a Fleet Transponder Card. See Volume XVI, Chapter 3 – Transportation Expenses for further guidance on paying for toll passes;
    • Items to be given away, presented as a gift, or disposed of where the Government loses title without legislative authority (excludes items authorized by Volume II, Chapter 4 – Awards, Ceremonies, Food or Refreshments, Gifts or Mementos); or
    • Gift cards, except for “patient only” purchases from the General Post Fund, which directly benefit the Veteran.
  13. Cardholders will not use third-party payers (e.g., CashApp, E-Money, E-Account, Google Checkout, and VenMo), unless there are no other available vendors. Cardholders will justify in writing if a third-party payer is used and keep documentation identifying the actual vendor providing the item(s). Use of third-party payers is discouraged because third-party payers do not always disclose the actual merchant’s name fulfilling the request, which can mask the purchase and lead to circumvention of Merchant Category Code (MCC) blocks. Additionally, disputes involving third-party merchants are more challenging to resolve because billing discrepancies must be addressed directly with the merchant or supplier. Amazon Marketplace and PayPal are acceptable for purchases due to the actual seller’s name not being masked.
  14. Federal purchases are exempt from state and local sales taxes in accordance with GSA and FAR 29.302. The cardholder must inform the merchant prior to placing an internet order, telephone order, or making an over-the-counter purchase (Point of Sale) that the purchase is exempt from state or local sales taxes.
  15. Prior to finalizing an order, the cardholder should:
    • Determine if there are any applicable discounts;
    • Verify that the vendor has removed state and local sales taxes from the order (if applicable);
    • Verify shipping fees and include them in the total amount being charged, to avoid charges over the single purchase threshold; and
    • Verify that the sales amount agrees with the quoted price.
  16. For purchases from vendors that do not have an authorized MCC code, a manual authorization is required to process the transaction. Cardholders must contact their local A/OPC and provide them with the name of the vendor and the amount of the purchase. The A/OPC will contact the servicing bank to initiate the manual authorization. The vendor will contact the servicing bank to obtain the authorization code needed to process the transaction.
  17. In some limited instances (e.g., prosthetics, subscriptions and training), it is acceptable to issue payment in advance of receiving the goods or services. In these instances, the cardholder will:
    • Obtain approval of the justification to issue payment in advance from the AO or supervisor prior to making the purchase; and
    • Document and maintain transaction details (person requesting goods or services, date of request, source of supply, amount, reason for payment being made in advance, and description of goods or services).
  18. Government purchase cardholders must not place orders for backordered goods that do not have a delivery date.

010506  Receiving

  1. The receipt of goods or services should be documented. Some acceptable documentation methods include signing and dating either the packing slip, receipt/invoice, or completing an electronic receiving report.
  2. Receiving reports should be generated, when possible, in one of VA’s approved systems (e.g., IFCAP or iFAMS).
  3. When items are shipped or delivered directly to a Veteran, the cardholder will obtain confirmation of delivery and retain for audit purposes.
  4. For goods or services that are obtained by an individual other than the cardholder who placed the order; the individual verifying receipt should document the date the goods or services were received.
  5. For goods and services received by the cardholder who placed the order, confirmation of delivery shall be verified and documented by another VA employee other than the cardholder, the AO or the supervisor.
  6. Cardholders are responsible for maintaining documentation proving that the goods or services were received.
  7. The ordering of goods and services for remote locations or during emergency or urgent conditions does not alter the requirement for the documentation of the receipt.

010507  Reconciling a Purchase Card Transaction

  1. Transactions must be reconciled by the cardholder and approved by the AO in the servicing bank’s EAS or other Office of Finance-approved automated system.
  2. Transactions must be reconciled and approved no later than the 15th calendar day of the month (e.g., July 15th), after the closing of the previous month’s billing cycle. Accounts not reconciled within 30 days of the due date will have their single purchase threshold lowered to $1.
  3. In the event a transaction is being disputed, it must be marked in the EAS system as a “dispute” during the reconciliation process.
  4. Cardholders and/or AOs that fail to reconcile, as stated in policy, will be considered for disciplinary action up to and including termination of employment.
  5. When approving transactions, an AO must ensure the transaction is legal, proper, mission essential, and the Government purchase cardholder has provided sufficient documentation needed to complete the reconciliation in compliance with this section. An AO’s due diligence in this area will aid in:
    • Identifying fraudulent or erroneous charges within the servicing bank’s dispute deadline;
    • Identifying unauthorized commitments; and
    • Identifying the need for training or other corrective action early.
  6. When approving reconciliations, the AO is required to review the supporting documents in a VA-approved document imaging system, (e.g., Advanced Prosthetics Acquisition Tool (APAT), SharePoint, or the CCP).

010508  Record Retention for Purchase Documentation

  1. Record retention must be in accordance with National Archives and Records Administration (NARA) 410, General Schedule 6 and FAR subpart 4.805, Charge card documents and receipts are required to be maintained for a minimum of 6 years.
    Documentation applicable to a purchase includes:
    • Approved purchase request;
    • Vendor invoice;
    • Receipt;
    • PO or electronic request;
    • Packing slip or receiving report;
    • Food Approval form or memo; and/or
    • Any other documentation.
  2. In the event an invoice, receipt, or other supporting document is lost, misplaced, or not received, the cardholder must obtain a replacement document, or prepare a written explanation which explains why the invoice, receipt, or other supporting document is missing. This written explanation will be included with the purchase documentation.
  3. Cardholders should upload and store original, unaltered supporting documents electronically to the appropriate document imaging system (e.g., iFAMS, CCP, etc.).

010509  Standards of Conduct

  1. Cardholders may not solicit or accept a gratuity, gift, favor, entertainment, loan, or anything of monetary or non-monetary value from any party doing business with or seeking to obtain business with VA (5 C.F.R. § 2635.202). Should questions arise, employees may seek ethics advice from their regional counsel or an ethics official at the Office of General Counsel.
  2. Cardholders will not obtain, retain, or personally benefit from any merchant rewards, points, memberships, benefits, free items included with a purchase, gifts as a result of multiple purchases, or other promotional items, including coupons in connection with the use of the Government purchase card.
  3. VA personnel (e.g., AOs, Supervisors, Directors, Senior Executive Service (SES), Clinicians) may not pressure or direct a cardholder to:
    • Pay for unauthorized goods or services;
    • Purchase goods or services that do not meet a bona fide need;
    • Exceed their delegated authority; or
    • Make a card purchase when a contracting action is required (e.g., a purchase in excess of the micro-purchase threshold).
  4. Each employee has a duty to protect and conserve Government property and will not use a Government purchase card, allow its use, or direct its use, for other than authorized purposes.
  5. Failure to adhere to the standards of conduct may result in disciplinary actions.

010510  Violations of Policy

  1. Any VA employee who misuses a Government purchase card may be prohibited from using a purchase card or serving as an AO. This prohibition is in addition to any other applicable penalties and is in accordance with 41 U.S.C. § 1909.
  2. All VA Employees with knowledge or information about actual or possible violations of VA policy or criminal law may report the instance (refer to 38 C.F.R. Chapter 1, PART 1 – General Provisions, §1.201). Employees may choose to either report a case to their Supervisor, FSC, or directly to the VA OIG via the VA OIG Hotline website, or to any other formal investigative agency. In addition, employees may send reported violations to the FSC via email to VAFSCChrgCardReview@va.gov.
  3. Misuse of a Government purchase card may result in a bill for collection for funds that cannot be recouped, return of merchandise, debt collection fees, disciplinary action and criminal and/or civil actions. In addition:
    1. AOs and others who conspire with cardholders to misuse the card, commit fraud, and/or use their position of authority to cause misuse of the Government purchase card will also be subject to disciplinary and criminal and/or civil actions.
    2. At the discretion of the FSC Director, and/or the Office of Finance, cases may be referred to the VA Office of the Inspector General, or Federal prosecutors for criminal charges.
    3. Any VA employee referred to the VA Office of the Inspector General by the FSC Executive Director shall be prohibited from future use of a charge card or serving as an AO. All current charge cards will be immediately cancelled related to the VA employee involved in a case referred to the Office of the Inspector General, unless directed otherwise by VA OIG, or until such time the VA employee is absolved of any wrongdoing.
    4. Any VA employee referred to the VA OIG by someone other than the FSC Executive Director may be suspended pending the outcome of any investigation and may be removed/prohibited from future use.
  4. Supervisors may consider disciplinary actions when misuse, fraud, repeated abuse, or direct violations of regulations or policy occur. Disciplinary actions will be based upon the circumstances surrounding each instance and will be designed to ensure that the violations are not repeated. VA Handbook 5021/15, Part I, Appendix A (I-A-9, Nature of Offense 41), Employee-Management Relations (JULY 19, 2013), contains guidance on disciplinary actions related to the Government purchase card program. Disciplinary actions may include:
    • Counseling – 1st offense or minor offenses;
    • Suspension from duty (requires legal review) – Facility discretionary action; and
    • Removal from duty (requires legal review) – Facility discretionary action; requires legal review.
  5. A /OPCs must report policy violations and subsequent actions to FSC via email at VAFSCChrgCardReview@va.gov.
  6. Appendix E contains a listing of administrative actions that may be taken by the FSC when the cardholder misuses the purchase card.
  7. Cardholders and AOs with three or more policy violations within the last 365 days may be removed from functioning as a cardholder or AO and will be considered for disciplinary action.

010511  Disputed Transactions

  1. Cardholders and AOs will investigate any questionable/suspicious charges to their account.
  2. Cardholders must attempt to resolve any questionable/suspicious charge directly with the vendor. If the purchase cardholder does not receive a response from the vendor within 30 days, they should dispute the charge with the servicing bank no later than 90 days from the transaction date.
  3. A dispute occurs when the cardholder contacts the bank and formally questions a transaction posted to their account.
  4. The purchase cardholder must contact the servicing bank online (or by phone if online service is not available). Copies of dispute forms shall be sent to the AO and A/OPC.

010512  Internal Controls

  1. In accordance with OMB Circular A-123 Appendix B, responsible officials in the Administrations and Staff Offices are accountable for ensuring compliance with the Government purchase card program and for implementing internal controls over Government purchase card activities.
  2. VA requires that the duties of the cardholder, AO, requesting official, and receiving official be segregated. An A/OPC cannot be a cardholder or an AO. No one person may order, receive, certify funds, and approve his/her own purchase card purchase.
  3. A supervisor or certifying official does not have the authority to approve or certify their own purchase card activities, that of an immediate family member, other close relative, or other individual whose relationship may create the appearance of a conflict of interest. To evaluate potential conflict of interest, consider the prospect of personal relationship information being exposed to public scrutiny (see 5 C.F.R. § 2635.501).
  4. Reviewing or auditing of purchase card activities must be assigned to individuals independent of the purchase card transactions being reviewed.
  5. Individuals that have a responsibility for overseeing, auditing, and reporting cannot be issued a purchase card. For example, a cardholder cannot also be the A/OPC or AO for his/her account(s).
  6. Employee conduct must meet the highest ethical standards. Cardholders and AOs have a duty to protect and conserve Government property and will use purchase cards only for authorized purposes. The standards of conduct, which apply to all VA employees, further state that employees may not solicit or accept any gratuity, gift, favor, entertainment, loan, or anything of monetary value from any party doing business with or seeking to obtain business with VA (5 C.F.R. § 2635.202). Employees may seek ethics advice from their regional counsel or an ethics official at the Office of General Counsel.
  7. Cardholders must safeguard their purchase cards in a secure location, such as a locked drawer, to protect against theft, loss, and forgery.
  8. Program participants must comply with requests for information regarding purchases, audits, unauthorized commitments, or questionable transactions. Failure to reply to requests within the timeframe specified will result in the single purchase threshold being lowered to $1 until the request has been satisfied.
  9. AOs must review spending thresholds and the need for cards annually in accordance with 41 U.S.C. §§ 1902, 1909.
  10. To evaluate the effectiveness of internal controls, A/OPCs and FSC will conduct periodic reviews (at least annually) to:
    • Ensure that purchases are supported by approved purchase requests, purchase orders, and proof of receipt of ordered goods or services;
    • Evaluate purchase transactions by program participant with prior policy transgressions to assure remediation actions are effective;
    • Identify and examine potential split purchases;
    • Analyze spending patterns to identify and report potential fraud waste and abuse;
    • Identify and report unauthorized commitments; and
    • Determine whether cardholders are optimizing purchasing power and cost savings by utilizing strategic sourcing techniques. FSC’s spend analysis will aid in completing this review.
  11. FSC will track unauthorized commitments until ratified.

0106 Authorities and References

0107 Rescissions

Volume XVI, Chapter 1B, Government Purchase Card Program for Micro-Purchases, March 2024.

Appendix A:  Previous Policy Revisions

SectionRevisionOfficeReason for ChangeEffective Date
010502Added exception to micro-purchase threshold for arbitrator payments.OFPFederal Acquisition Regulation (FAR) Class Deviation to FAR 2.101(b)June 2024
Appendix EAdded Appendix E for reference to FAR Deviation Memo.OFPFederal Acquisition Regulation (FAR) Class Deviation to FAR 2.101(b).June 2024
010505Added documentation requirement for open market purchases.OFPLeadership directed.March 2024
010509Added language to include free item or gift with purchase.OFPLeadership directed.March 2024
010505Deleted MCC code 5941 and Amazon Marketplace.OFPLeadership Change.May 2023
010505Added fleet transponder card reference.OFPLeadership Change.May 2022
0103Updated definition.OFPUpdated definition of Split Purchase.July 2021
010504Internal Controls.OFPClarified Split Purchase.July 2021
010508Internal Controls.OFPChanged documentation language for iFAMS.July 2021
Appendix CRevised Appendix C.OFPFSC’s Table of Remedial Actions was revised.July 2021
Appendix CAdded Appendix C.OFPFSC’s Table of Remedial Actions was added.August 2019
010510Violations of Policy.OFPLanguage was added regarding serious violations of purchase card policy.February 2019
010512Internal Controls.OFPUnanswered requests will result in single purchase threshold going to $1.February 2019
Appendix AUpdated Example.OFPThe example was changed from Nursing example to an Engineering one to avoid confusion.February 2019
AllNew Policy.OFPTo improve readability and to simplify the presentation of the information, the original policy chapter is being separated into three separate chapters.June 2018
VariousReformatted to new policy format and completed 5 year review.OFPReorganized chapter layout.June 2018
VariousRoles and Responsibilities.OFPStrengthened Internal Controls and updated language on accountability to be more clear and concise.June 2018
VariousUpdate Threshold.OFPMicro-purchase threshold increased to $10,000.June 2018

Appendix B:  Examples of Split Purchases

The following scenarios are examples of Government purchase card use where the specific requirement was inappropriately split.

  1. A Nursing Service requests to host a class for twelve (12) VAMC nurses to obtain training on a specific nursing technique the Veterans Administration Medical Center (VAMC) is adopting. VA contacts a vendor with subject matter expertise and requests a 12-person class on a specific date. The vendor agrees to develop and schedule a course and notifies VA that the charge will be $10,500 or $875 per participant. In this scenario, the VA requirement is to buy an entire class to train nurses on a new technique to meet a changing or emerging need in the VAMC. This is one requirement for the VAMC and not 12 individual requirements. If the VAMC splits the requirement by making 12 separate purchases, it will incur an unauthorized commitment.
    The proper course of action is to forward the request to the contracting office for purchase.
  2. A purchase cardholder was sent an electronic request to have three offices painted at the station. The cost to paint the three offices will be $2,000 each for a total of $6,000. The purchase cardholder processes three separate transactions at $2,000 each because the purchase cardholder believed these were three separate requirements. Since the total requirement was known at the time of the purchase and the total purchase exceeds the Davis-Bacon  Act threshold of $2,000, this constitutes a split purchase.
    The proper course of action is to forward the requirement to the contracting office for purchase.
  3. A purchase cardholder received a request to buy two identical surgical instruments each for $5,500. The purchase cardholder purchased the item from two different merchants on the same day for a total of $11,000, which exceeded the micro-purchase threshold. The total requirement was known at the time of the first purchase, and the purchase cardholder split the order between the two vendors to circumvent the micro-purchase threshold for goods. This constitutes a split purchase.
    The proper course of action is to forward the request to the contracting office for purchase.
  4. A purchase cardholder received requests for 5 identical products, each costing $2,050 each and available from the same vendor but needing delivery to 5 different locations. The purchase cardholder elects to process 5 separate purchases from the vendor. The transactions are split to prevent exceeding the micro-purchase threshold for goods. Shipping to multiple destinations is not a valid reason to split a requirement into multiple transactions.
    The proper course of action is to consolidate the requirements and forward to the contracting office for purchase.
  5. A purchase cardholder received an email requesting to purchase a service for disposing of medical waste costing $4,021. The order was placed, consisting of two separate transactions that occurred on the same day, for $2,000 and $2,021. The requirement to dispose of medical waste is a single requirement, and since the total cost of service was known at the time of purchase, these transactions constitute a split purchase as the cost of the requested service exceeded the micro-purchase threshold for services.
    The proper course of action is to forward the service request to the contracting office for purchase.
  6. Telecommunications service hires a cable company to run wires in 7 offices in 3 different buildings on the VAMC campus. The orders are based on individual work orders created on different days. The cost for each office varies (from $450-$2,950), but when added together, exceeds the single purchase threshold of the cardholder and the FAR Subpart 22.10 Service Contract Labor Standards threshold. The cable company sends employees out to do the jobs on the same day and bills the work orders as separate invoices. These transactions constitute a split purchase since the total cost of the requested service, which exceeds the micro-purchase threshold for services, was known at the time of purchase.
    The proper course of action is to forward the service request to the contracting office for purchase.
  7. Engineering service needs to order 10 window air conditioner units for various offices around the campus. Each a/c unit is similar, and they cost $1,500 each. The total amount ($15,000) will exceed the micro-purchase threshold. The cardholder creates two separate purchase card orders for 5 a/c units each in order to obtain the desired number of units without exceeding his/her single purchase threshold. The cardholder split a single requirement to avoid the micro-purchase threshold for goods.
    The proper course of action is to forward the request to the contracting office for purchase.
  8. On Monday, a purchase cardholder receives a purchase request to have the second floor office area painted for $2,000. The vendor is scheduled to come on Friday. On Tuesday of the same week, the purchase cardholder is notified by the requesting service that the hallway outside the office will also need to be painted. The purchase cardholder contacts the vendor, who states the price to paint the hallway is $1,600. Although the vendor has already been scheduled to paint the office on Friday, the station has now identified a total requirement for painting services of $3,600. Since the total requirement is known before the first purchase is made (scheduling the work is not making a purchase), the station may not separate the purchases for the office and hallway painting.
    The proper course of action is to cancel the scheduled work and forward the request to the contracting office for purchase.

Appendix C: Examples of What is not a Split Purchase

Sometimes transactions appear to be a split purchase, but they do not meet the definition and are allowable, for example:

  1. Multiple purchases to the same vendor which do not exceed the single purchase limit or micro-purchase threshold.
    1. A cardholder makes two separate $100 purchases from the same vendor on the same day. This situation is not a split purchase because the combined total of $200 is below the micro-purchase threshold.
    2. Twelve (12) VA employees from a local Veterans Affairs Medical Center (VAMC) requested approval to enroll in an appropriations law course being held at Management Concepts, a private company that provides finance, acquisitions and HR training to Government agencies and employees. The course cost $1,275 per person and the training will begin on June 4th and end on June 5th. In this scenario, the VAMC is dealing with training requests which have specific rules for determining the known requirement. Specifically, each training request would be considered a separate requirement since the training course was not specifically developed for VA and is available to all Federal agencies to enroll (this would not be the case for goods and services). As a result, the VAMC will be able to use the GPC to cover the cost for each employee and this would not be considered a split purchase.
  2. Multiple purchases to the same vendor when the cardholder makes purchases as requirements are received.
    1. A cardholder receives a $4,000 purchase request in the morning. The cardholder obtains funding and approval and places the order. In the afternoon, the cardholder receives an $8,000 purchase request to buy items from the same vendor. The cardholder obtains funding and approval and places a second order to the same vendor. This situation is not a split purchase, because the cardholder was unaware of the second request when they made the initial purchase. Even though the total cost of both purchases exceeded the $10,000 micro-purchase threshold, the total known requirement at the time of each purchase was below the micro-purchase threshold.
    2. A cardholder receives a $6,000 purchase request on Monday. The cardholder obtains funding and approval and places the order. On Wednesday, the cardholder receives a purchase request from the same customer to buy additional items from the same vendor for $5,000. The cardholder obtains funding and approval and places a second order to the same vendor. This situation is not a split purchase, because the cardholder was unaware of the second request when they made the initial purchase.

Appendix D: Types of Disputed Transactions

The table below provides several examples of reasons to dispute a transaction.

Type of Dispute  Explanation  
Merchandise or service not receivedThe purchase card account has been charged for a transaction(s), but the merchandise or service has not been received. 
Merchandise returnedThe purchase card account has been charged for a transaction(s), but the merchandise has been returned. If a vendor does not authorize a credit for returned goods and/or involves a restocking fee, the charge cannot be disputed. 
Unauthorized purchasesA charge on the purchase card account that the purchase cardholder did not authorize. 
Duplicate processingA charge on the purchase card account that represents multiple billings to the account for the same purchase. 
Unrecognized chargeA charge on the purchase card account that is not recognized. A copy of the documentation received from the merchant to certify the charge (sales draft) must be requested by the purchase cardholder.

Appendix D: A/OPC Level 1 Administrative Actions

The table below contains examples of charge card offenses and their corresponding remedial actions. Level 2 AOPCs will report instances of misuse to Level 1 A/OPCs.

Government Charge Card Program MisuseA/OPC Level 1 Administrative Actions
Splitting purchases or ratification needed (per procurement)1st offense: Complete refresher training, reduce account spending limit, and/or removed as a Government Charge Card Program participant.  
2nd offense: Issue bill of collection, including debt collection fees, and removed as a Government Charge Card Program participant.
Exceeding applicable charge card limits or thresholds1st offense: Complete refresher training, reduce account spending limit, and/or removed as a Government Charge Card Program participant.  
2nd offense: Issue bill of collection, including debt collection fees, and removed as a Government Charge Card Program participant.
Purchasing unauthorized items1st offense: Complete refresher training, issue bill of collection, including debt collection fees, and/or removed as a Government Charge Card Program participant.  
2nd offense: Issue bill of collection, including debt collection fees, and removed as a Government Charge Card Program participant.
Using a Government charge card without being an authorized cardholder1st offense: Issue bill of collection, including debt collection fees, and removed as a Government Charge Card Program participant.
Violating VA policy or Federal regulations governing the Government Charge Card Program. 1st offense: Complete refresher training, reduce account spending limit, and/or removed as a Government Charge Card Program participant.
Violating ethics standards1st offense: Revoke purchasing authority, issue bill of collection, including debt collection fees, and removed as a Government Charge Card Program participant.
  • Cardholders and AOs must be aware that one violation may be reason enough to be removed from functioning as a Government Charge Card Program participant and that administrative action will be considered dependent on the egregiousness of the violation.
  • At the discretion of the FSC Executive Director, cases may be referred to VA Office of the Inspector General (VA OIG), or Federal prosecutors for criminal charges.

Appendix F: Federal Acquisition Regulation (FAR) Class Deviation to FAR 2.101

Vol-XVI-Ch-01B-FAR-Class-Deviation-MemoDownload

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