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Policies and Procedures

Policy 1227 – Unauthorized Purchases

Effective
March 1, 1998
Last Updated
June 28, 2016
Last Reviewed
December 11, 2015
Responsible University Officer
Director of Purchasing Services
Responsible Unit
Purchasing Services

Policy Statement

All purchase contracts entered into on behalf of the University are the exclusive responsibility of Procurement Services. Additionally, all expenditures of University funds for goods and services must adhere to the regulations established by the North Carolina State Legislature and enforced by the Office of State Budget Management (OSBM). These funds are managed at the University by Finance and Accounting, which is required to monitor, approve and report all expenditures on a monthly basis to OSBM. The Purchasing Services division of Procurement Services processes the purchases of all goods and services except for those listed in the Exclusions section below.

The University has multiple procedures in place for procuring goods and services which eliminate the need for individual faculty, staff and students to expend their personal funds. If a purchase is deemed by Purchasing Services to be unauthorized, a misuse notice will be sent to the department contact. This notice allows the purchaser to justify the purchase and provide any additional details pertinent to the purchase. Purchases charged against University funds not made in accordance with University policies as stated in the Finance Policies and Procedures Manual will be the personal responsibility of the individual placing the order.

Reason for Policy

This policy is to ensure that all purchases of goods or services made by faculty and staff at the University are in compliance with state statute as enacted by the legislature and implemented by the State Department of Purchase and Contract. It is a violation of State statute and University policy for an individual to be reimbursed for any merchandise or service acquired for their own personal benefit.

Exclusions

Purchases that fall under the Small Order Policy 1251
Rental or purchase of real property, administered through the University Property Office
Construction projects, administered through Facilities Planning Office

Special Situations

None

Procedures

  • None

Additional Information

Frequently Asked Questions

Q: I am a researcher here on campus with my own grant money. Why can’t I spend it as I choose? Why do I have to go through Purchasing Services for permission?
A: All funds received by the University are considered the property of the University and are subject to State purchasing regulations.

Q: I accepted a piece of equipment for evaluation and now the vendor wants to be paid. The cost of the equipment is $8,000. Why is this considered an unauthorized purchase?
A: Any equipment brought onto campus must first have an established purchase order that specifies the terms and conditions of the evaluation/purchase. See Policy 1278, Departmental Evaluation of Equipment.

Q: I ordered some equipment online and didn't realize that the shipping and handling charge would make the order exceed $5,000. Is it necessary to do a requisition now that the order is placed and the items received?
A: You must submit a requisition to pay for the equipment and include an explanation. All charges must be taken into consideration when placing orders to ensure that the overall cost will not exceed $5,000.

Q: If my dean or director ordered me to purchase equipment, why is this considered an unauthorized purchase?
A: The rules and regulations of the State of North Carolina require the procurement to be handled by the purchasing division of a state agency for any order in excess of $5,000.

Q: Can we buy flowers for a staff member of our department to congratulate his/her newborn baby?
A: Any kind of employee gift (including flowers) that has a value of more than $100.00 is additional compensation and is not permitted. The only exception is “employee recognition awards” which require an approved OHR plan.

Q: I have a professor who wants the University to purchase Google Glass for his research.  How do I purchase this?
A: Google Glass is considered a personal device and as such cannot be purchased by the University.

Q: A professor in my department/school purchased a laptop computer for work at an Apple store using his personal funds. Is this purchase allowed, since it was not purchased with University funds?
A: No, this type of purchase is not allowed because it was not purchased using the appropriate procurement process for work-related purchases. Additionally, the purchaser is not eligible for a University discount, nor will they receive a reimbursement for sales tax.

Q: May I be reimbursed for parking while I work at the University?
A: No, purchasing a permit to park at the University or paying for parking elsewhere is not required as a condition of your employment.

Q: I am required to attend a conference on behalf of the University that requires I attend in business attire each day for seven days. I need to purchase new clothes and wish to be reimbursed since I have no choice about the trip. May I be reimbursed?
A: No, clothing purchases are a personal expense since the University derives no benefit from the purchase, nor does the University take ownership of the clothing.

Q: I am required to maintain an office in my home; may I be reimbursed for a portion of my utility bills and a portion of my mortgage for the square footage?
A: No.

Q:  May an employee be reimbursed for home internet expenses?
A:  No, this is a personal expense. The state budget manual allows for internet connectivity while traveling, but not from home. If a Dean believes that reimbursement is permissible due to health reasons or if regular on campus work space has been temporarily unavailable (such as in a remodel), this would be allowable. A memo justifying this reason from the Dean specific to the individual and stating the time period permitted must be attached to every voucher.

Related Data

North Carolina General Statute 143-58 - Contracts contrary to provisions of Article made void 
North Carolina General Statute 143-58.1
- Unauthorized use of public purchase or contract procedures for private benefit
1278 - Departmental Evaluation of Equipment
1280 - Equipment Rental and Leases

Contacts

SUBJECT CONTACT TELEPHONE FAX E-MAIL
Unauthorized Purchases/Reimbursements Purchasing Services 919-962-3774 919-962-0636 Purchasing_team@unc.edu

History

Revised:
June 28, 2016: Added FAQ about home Internet expense.
December 11, 2015: Clarified information in FAQ section about parking purchases.
October 1, 2014: Revised naming of requisitions.
August 10, 2014: Added information to Policy Statement about reporting to OSBM; added to FAQ section.
March 27, 2014: Added information in FAQ section about personal purchases for work purposes.
January 29, 2014: Added information in FAQ section about purchase of Google Glass.
January 26, 2012
July 12, 2010
November 12, 2003