Financial Authorisation Levels and Procurement Procedures

Transcription

1 Financial Authorisation Levels and Procurement Procedures 36

2 Document Name: SOLAS Financial Authorisation Levels and Procurement Procedures. Prepared By: Contributors Date: Mar 2017 Document location: Procurement Shared Drive Doc. Version No: V2.0 Revision History Version no. Version date Revised by Description V1.0 20/08/2014 Procurement/Finance Director Final Draft V1.1 02/09/2014 SOLAS Board Approved Final Version V2.0 18/04/2017 Finance Manager/Director DRAFT V2.1 01/05/2017 SOLAS Board Approved Final Version 1

3 Table of Contents 1 INTRODUCTION FINANCIAL AUTHORISATION LEVELS FINANCIAL APPROVAL LEVELS PROCUREMENT PROCEDURES PROCUREMENT RESPONSIBILITIES & ROLES AMENDMENTS APPLICATION / REVOCATION OF AUTHORISATION AND APPROVAL LEVELS DEROGATION FROM PROCEDURES FINANCIAL AUTHORISATION LEVELS AUTHORISATION DEFINITION AUTHORISATION LEVEL TABLES FINANCIAL APPROVAL LEVELS APPROVAL DEFINITION AUTHORITY TO PROCESS PAYMENTS ALREADY APPROVED AUTHORISATION OF INVOICES WITH NO PURCHASE ORDER APPROVAL LEVEL TABLES PROCUREMENT PROCEDURES PUBLIC PROCUREMENT REQUIREMENTS NON-COMPETITIVE PUBLIC PROCUREMENT EXCEPTIONAL CIRCUMSTANCES FRAMEWORK AGREEMENTS STATEMENT OF POLICY STAGES OF THE PROCUREMENT PROCESS TENDER SPECIFICATIONS AND DOCUMENTATION TENDER PROCESS NATIONAL & EU > 25, TENDER PROCESS OGP FRAMEWORKS MINI COMPETITIONS TENDER PROCESS SOLAS FRAMEWORKS MINI COMPETITIONS AGENCY STAFF PROCUREMENT QUOTATION PROCESS ITEMS < 25,000 > QUOTATION VARIANCES ITEMS < 25,000 > ITEMS NOT REQUIRING A PURCHASE ORDER PERSONAL WORK ITEMS PURCHASE ORDER VALUES AMENDMENT PURCHASE ORDERS EXTENDING OVER A LONG PERIOD OUTLINE AGREEMENT PURCHASE ORDERS FOR STAFF DEVELOPMENT PURCHASE ORDERS FOR CAPITAL/ASSET ITEMS NON-CONFORMANCE PURCHASE ORDERS ROLE OF THE PROCUREMENT DEPARTMENT RECEIPT & OPENING OF TENDERS (NON CONTRACTED TRAINING) EVALUATION OF TENDERS TENDER VARIANCES TAX CLEARANCE PROCURE TO PAY PROCESS PURCHASE REQUEST PURCHASE ORDER ISSUE GOODS/SERVICE RECEIPT INVOICE PROCESSING PURCHASE ORDER CANCELLATION SOLAS PROCUREMENT CARD INTRODUCTION TYPES OF GOODS/SERVICES PERMITTED ON THE PROCUREMENT CARD

4 7.3 BENEFITS OF A PROCUREMENT CARD CARD MANAGEMENT ASSETS/CAPITAL PROCUREMENT AND DISPOSAL PURCHASE OF CAPITAL/ASSETS DISPOSAL OF LAND & BUILDINGS DISPOSAL OF ITEMS > 15, DISPOSAL OF ITEMS > 1,000 < 15, DISPOSAL OF ITEMS > 100 < 1, WRITING-OFF OF ASSETS FROM ASSET REGISTER REPORTING ON DISPOSALS DISPOSAL OF COMPUTER EQUIPMENT APPENDIX 1 - AGGREGATION/DE-AGGREGATION APPENDIX 2 IT SUPPORT HELP DESK (SAP) APPENDIX 3 - SAMPLE QUOTATION ANALYSIS SHEET APPENDIX 4 - TRANSACTIONS NOT REQUIRING A PURCHASE ORDER APPENDIX 5 - USEFUL WEB SITES APPENDIX 6 - PURCHASE ORDER TYPES APPENDIX 7 - SOLAS PROCUREMENT CARD CARDHOLDER DAILY LOG

5 Index of Tables & Figures Page TABLE 1 LAND/BUILDINGS/LONG-TERM CONTRACTS..7 TABLE 2 CAPITAL EXPENDITURE (except Land/property/leasing of property)... 8 TABLE AUTHORITY TO INCUR NORMAL OPERATING EXPENDITURE.. 8 TABLE 4 TABLE 5 TABLE 6 TABLE 7 TABLE 8 TABLE 9 TABLE 10 TABLE 11 TABLE 12 TABLE 13 TABLE 14 TABLE 15 TABLE 16 TABLE 17 TABLE 18 FURTHER EDUCATION & TRAINING GRANTS..9 SOLAS NATIONAL PROGRAMMES..9 APPROVAL OF PROGRESS PAYMENTS/CYCLICAL EXPENDITURE..10 APPROVAL OF ACCOUNTS FOR PAYMENT..11 APPROVAL OF ELECTRONIC FUNDS TRANSFERS..11 APPROVAL TO WRITE-OFF BAD DEBTS 12 APPROVAL OF CAPITAL WRITE-OFFS 12 APPROVAL TO WRITE-OFF IRRECOVERABLE OVERPAYMENTS 13 AUTHORITY TO APPROVE REPRESENTATION EXPENSES.13 AUTHORITY TO MAKE AN EX-GRATIA PAYMENT.13 ANNEX XIV (EU DIRECTIVE 2014/24) TITLE III SERVICES..18 QUOTES/TENDER THRESHOLDS & PROCEDURES.19 TENDER TIME LIMITS 20 TENDER VARIANCES..21 LIST OF TRANSACTION TYPES NOT REQUIRING A PURCHASE ORDER.32 FIGURE 1 FIGURE 2 PROCUREMENT PROCESS..25 GOODS/SERVICE RECEIVED TO PAYMENT PROCESS 26 4

6 1 Introduction This document combines the Financial Authorisation & Approval levels and the Procurement Procedures for the SOLAS organisation. These levels and procedures are available on the SOLAS intranet and may be revised and updated from time to time. This document does not cover the procedures for the disbursements of Grants to FET bodies, however it does outline the Financial Authority levels for such disbursements. 1.1 Financial Authorisation levels Tables 1 to Table 5 outline the authorisation levels appropriate to each grade for various types of expenditure applicable to SOLAS business, including Further Education Training (FET) grants. 1.2 Financial Approval levels Tables 6 to Table 13 outline the various approval levels for various transaction types such as, progress payments; bank signing mandates; approval of accounts for payment; transfer of funds electronically; writing off bad debts; capital write offs and writing off of irrecoverable overpayments. 1.3 Procurement procedures Sets out the steps to be followed when conducting an appropriate competitive procurement process whether under EU; National or SOLAS specific rules. In line with DPER circular 13/2014 the overall principle is that there must be transparency and accountability in the management of public money in line with economy, efficiency and effectiveness. Both EU and National procedures are published on which will be the principal means of guidance dissemination. Up-to-date procedures may be viewed or downloaded at any time from the above site and the SOLAS Intranet. Tender templates and procurement forms are available on the intranet at: Procurement Responsibilities & Roles While the main responsibility rests with line management to ensure compliance with Procurement Procedures, the Procurement Department and the Financial Accounting Department in SOLAS have a specific responsibility and authority to refer back to line management any transaction that does not fully comply with Procurement Procedures. Any breaches of Procurement Procedures outlined in this document and identified by a staff member must be brought to the attention of the CEO and the Head of Internal Audit by that staff member. All steps should be taken to ensure that Procurement Procedures are fully observed. Please note that under section 8.16 of the Code of Practice for the Governance of State Bodies effective from 1/9/2016, non-competitive procurement should be reported in the Chairperson s comprehensive report to the Minister. 1.5 Amendments In order to keep up to date with current directives/legislation, the authorisation levels and procedures set out herein may at any time be altered, revised or amended by the Board of SOLAS in respect of the powers and functions reserved to the Board. Authorisation levels below the rank of Director can be set as required by the Executive of SOLAS. 1.6 Application / Revocation of authorisation and approval levels The authorities vested in any grade of staff or in any individual staff member do not confer any particular right on, or give an advantage to the grade or to the individual. Authority may, at any time, be revoked at the discretion of the Chief Executive Officer or the Board of SOLAS. A Higher Officer can authorise what a lower officer can authorise. Powers of authority can only be delegated in special circumstances and for a period of short duration. Such circumstances will usually relate to short periods of absence from duty, such as holidays and attendance at courses. Delegation in these circumstances must be notified in writing to the person s superior and to the following Departments: Procurement Manager Financial Accounting Manager Internal Audit Manager 5

7 2 Derogation from procedures As an organisation SOLAS recognises that exceptional circumstances can sometimes arise where derogation from the strict application of procurement procedures may be required to deal effectively with particular and generally isolated emergency or default situations, in the best interests of SOLAS. In such circumstances, any Manager/Director seeking such derogation must: 1. For the first derogation, submit a case for same to the Executive Director (ED) Resources and one other ED who shall review the matter and approve such derogation by signing off the proposal. This covers the first instance for any Manager in any given calendar year. 2. Should the same Manager/Director require a second derogation for the same service in the same calendar year, the second submission must be signed off by the Chief Executive Officer (CEO) and the ED Resources. 3. Any further derogation by the same Manager must be signed off by the CEO and the ED Resources and must trigger an Internal Audit Review of the efficiency of the area involved. In a similar vein, should an ED seek a derogation, they must: 1. For the first derogation, submit a case to the CEO and the ED Resources (or one other ED if the ED Resources is looking for the derogation) who shall review the matter and approve such a derogation by signing off the proposal. This covers the first instance for any ED in any given calendar year. 2. Should the same ED require a second derogation for the same service in the same calendar year, the second submission must be signed off by the CEO and the Chairman of the Board. 3. Any further derogation by the same ED must be signed off by the CEO and the Chairman of the Board and must trigger an Internal Audit Review of the efficiency of the area involved. All copies of all approved derogations must be submitted annually to the Director of Internal Audit and advised to the Chairman of the Audit Committee. 6

8 3 Financial Authorisation Levels 3.1 Authorisation definition The term "authorisation" is defined as an established power to acquire finances, invest monies, or incur expenditure for and on behalf of SOLAS or to commit SOLAS financially in a contractual or otherwise binding agreement. This means that subject to the various thresholds outlined in Table 1 and 2 below, an individual has the authorisation to enter into transactions that commit the organisation into honouring such transactions. For the purposes of these procedures, the term authorisation is distinct from the term approval which only applies when authorisation has already been given. 3.2 Authorisation Level Tables The Authorisation levels specified in Tables 1 to 5 apply to the authorisation of all expenditure by SOLAS. These authorisation levels are INCLUSIVE OF VALUE ADDED TAX (VAT) Table 1 LAND/BUILDINGS/LONG-TERM CONTRACTS INCLUSIVE OF VALUE ADDED TAX (VAT) Purchase/Disposal of Land/Property Authorisation Level Authority to purchase or sell real estate and property (land and buildings) Leasing of Property Relevant Gov. Dept.*/Board Authority to lease property (land and buildings) where the duration of the lease or the annual rent payable under the lease is: Period Over 10 Years or over 150,000 per annum Between 5 years and 10 years or between 75,000 and 150,000 per annum between 1 year and 5 years or between 25,000 and 75,000 per annum Between 0 and 1 year or less than 25,000 per annum Authorisation Level Board Chief Executive Officer Executive Director Director The above limits also apply to rollover and rent reviews of existing leases. * Approval of the relevant Minister and the Minister for Public Expenditure & Reform required for any material acquisition or disposal of Land/Buildings/Material Assets/Long Term Leases. See sections DPER Code of Practice for the Governance of State Bodies Long Term Contracts Period Authority to award contracts operating for more than 5 years 7 Authorisation Level Board

9 Table 2 CAPITAL EXPENDITURE (except Land/Property/Leasing of Property) INCLUSIVE OF VALUE ADDED TAX (VAT) Expenditure Value Authorisation Level Over 250,000 Board Up to 250,000 Chief Executive Officer Up to 200,000 Executive Director Up to 150,000 Director Up to 75,000 Manager Grade 6 Up to 30,000 Asst. Manager 7 Table 3 AUTHORITY TO INCUR SOLAS NORMAL OPERATING EXPENDITURE OR ENGAGE NORMAL SERVICES (any one transaction) INCLUSIVE OF VALUE ADDED TAX (VAT) Expenditure Value Authorisation Level Over 250,000 Board Up To 250,000 Chief Executive Officer Up To 200,000 Executive Director Up To 150,000 Director Up To 75,000 Manager Grade 6 Up To 30,000 Assistant Manager Grade or Grade 7 In the case of leases of equipment or contracts operating for 1 to 5 years, then three times the annual cost must be taken to determine the level at which Authorisation should be given. Note that the Procurement Card may be used to conduct some transactions within this expenditure level. Please be aware that there is a limit of 5,000 per transaction. However, in exceptional circumstances these limits may be exceeded with pre-approval of the Chief Executive Officer. See section 7. Solas Procurement Card, for further details. 8

10 Table 4 FURTHER EDUCATION & TRAINING GRANTS Contract Fee Value Authorisation Level Over 1.5million Up to 1.5million Up to 750,000 Up to 500,000 Board Chief Executive Officer Executive Director Director Up to 250,000 Manager Grade 6 Table 5 SOLAS NATIONAL PROGRAMMES INCLUSIVE OF VALUE ADDED TAX (VAT) Contract Fee Value Authorisation Level Over 500,000 Up to 500,000 Up to 300,000 Up to 200,000 Board Chief Executive Officer Executive Director Director Up to 100,000 Manager Grade 6 Up to 5,000 (EGF grants) EGF Project Officer Grade 8 Expenditure provided for under Table 5 includes authority to authorise contracts for Training Programmes for e.g. Apprenticeship; Momentum; e-college, Technology Enhanced Learning and EGF (European Globalisation Fund). 9

11 4 Financial Approval Levels 4.1 Approval definition The term "approval" is defined as an established power to certify and sanction the payment of accounts in respect of expenditure that has been authorised in accordance with SOLAS Financial Authorisation Levels (see section 3). In SOLAS this function is carried out by the Financial Accounting Department and Senior Management. 4.2 Authority to process payments already approved The authority to make payments by means of electronic fund transfers is confined to situations where the payment is in respect of expenditure that has received the appropriate authorisation and where the supporting documents show that the account is already approved for payment. 4.3 Authorisation of Invoices with no Purchase Order Invoices being presented for payment that are not covered by purchase orders, must be authorised at the appropriate level as per section 3 above and clearly state the correct cost centre (e.g. SLXXX) for overhead expenditure or internal order/programme code for direct costs and account code. 4.4 Approval Level Tables Tables 6 to 11 below outline the approval levels required for various transaction types. The thresholds for authorisation of representation expenses and ex-gratia payments are set out in the in Tables 12 and 13 respectively. TABLE 6 Approval of Progress Payments/Cyclical Expenditure INCLUSIVE OF VALUE ADDED TAX (VAT) Payment Value Approval Level Over 500,000 Chief Executive Officer Up to 500,000 Executive Director Up to 250,000 Director Up to 150,000 Manager Grade 6 Up to 60,000 Assistant Manager/Grade 7 Payment values outlined above provide for the authority to approve progress payments or cyclical payments in respect to contracts already correctly authorised as per section 3 Authorisation Levels 10

12 TABLE 7 Approval of Accounts for Payment INCLUSIVE OF VALUE ADDED TAX (VAT) Payment Value Over 500,000 Up to 500,000 Up to 250,000 Up to 150,000 Up to 80,000 Up to 20,000 Approval Level Chief Executive Officer Executive Director Resources Director Finance Manager Financial Accountant Assistant Accountant Exceptions: Payments to Government Departments/Agencies Payroll Approval Payments relating to Payroll Deductions Finance Manager TABLE 8 Approval of Electronic Fund Transfers (EFT) Payment Value Over 15 Million Approval Level Chief Executive Officer or Executive Director jointly with the Chairman 7.5 Million - 15 Million Chief Executive Officer or Executive Director jointly with an opposite Panel Member 800, Million Director jointly with an opposite Panel Member Up to 800,000 Two opposite panel members Inter Bank Transfers Finance Manager Inter SOLAS Bank Transfers Payment values outlined above provide for the authority to approve EFT s in respect of contracts already correctly authorised. Details of signatories on panels are available from the Treasury Dept., Finance 11

13 TABLE 9 Approval to Write-Off Bad Debts Debt Value Over 50,000 (any one debt) Up to 50,000 (any one debt) Up to 25,000 (any one debt) Up to 10,000 (any one debt) Approval Level Board Chief Executive Officer Executive Director Director The above table details approval limits for writing off bad debts arising from non-payment of money owed to SOLAS for services incurred in any one financial year. TABLE 10 Approval of Capital Write-Offs Write-Off Value Over 75,000 Up to 75,000 Up to 15,000 Approval Level Chief Executive Officer Executive Director Director The Write-Off value applies to the net book value (NBV) of the Asset 12

14 TABLE 11 Approval to Write-off Irrecoverable Overpayments (Training Programmes) Value Any one financial year: Over 50,000 Up to 50,000 Up to 25,000 Up to 10,000 Any one case: Over 10,000 Up to 10,000 Up to 7,500 Up to 5,000 Approval Level Board Chief Executive Officer Executive Director Director Board Director General Executive Director Director TABLE 12 Authority to approve Representation Expenses INCLUSIVE OF VALUE ADDED TAX (VAT) Value Approval Level Over 10,000 Chief Executive Officer Up to 5,000 Executive Director Up to 1,000 Director Up to 250 Manager Grade 6 Representation expenses are those expenditures whose primary purpose is representational or entertainment related activities. TABLE 13 Authority to Make an ex-gratia payment Value Over 1,500 Up to 1,500 Approval Level Board Chief Executive Officer 13

15 5 Procurement procedures SOLAS being a public service body funded by the tax payer must comply with current Public Procurement guidelines and the Code of Practice for the Governance of State Bodies issued by the Department of Public Expenditure & Reform (current document effective from 01/09/2016). 5.1 Public Procurement requirements There is a requirement to have a competitive quotation and tender process in most cases of public procurement > 1,000 (ex VAT) unless there are justifiably exceptional circumstances. (See 5.2 below). All contracts that are awarded by a public body involving an economic activity to a third party, whether covered by secondary legislation or not, must be examined in the light of the national rules and principles of the EU Directives. At all times there must be an awareness of the principles of transparency, equal treatment, proportionality and mutual recognition. In addition SOLAS is required under circular 16/13 issued by DPER on 28/9/2013, where possible, to use frameworks and contracts established by the Office of Government Procurement (OGP) which are designed to optimise benefits to the Public Service through the strategic aggregation of its buying power. If relevant OGP frameworks/contracts are not used then a Value for Money Justification must be provided taking into account the full costs of running a Public Procurement competition. Please refer to Office of Government Procurement Publications: for further information. 5.2 Non-competitive Public Procurement exceptional circumstances Examples of non-competitive circumstances would be in the case of: (1) Sole/Tied Supplier, situations where only one supplier of particular services or goods is found (see Sole Supplier/Tied Supplier forms at: - evidence must be retained showing efforts to source a minimum of three quotes; (2) Derogation (see section 2 Derogation from Procedures, pg 6 above) (3) Emergency Orders in the case of unforeseen circumstances which would generally arise in the area of Facilities Management. 5.3 Framework Agreements European Directives provide for the use of Framework Agreements. EU member states may prescribe that contracting authorities purchase supplies or services from a central purchasing body, in our case the OGP. Frameworks provide a transparent and competitive mechanism whereby SOLAS can place contracts with suppliers on the framework without having to carry out onerous tendering procedures for individual requirements that are covered by the SOLAS or OGP framework. Framework agreements can be established as Single Supplier frameworks or as Multi-supplier frameworks. It is the policy of SOLAS to run mini - competitions between parties to the framework agreement. However a contract may be awarded to one party if the terms of the agreement so permit. (See Figure 1 follow SOLAS/OGP Framework Mini competition stream and section OFP Frameworks and SOLAS Frameworks). 5.4 Statement of Policy All SOLAS requests for purchase must be authorised in accordance with the authorisation levels set out in section 3 of this document and the principle of segregation of duties must apply i.e. more than one person is involved at various stages in the procurement process. 5.5 Stages of the Procurement Process As part of the Business Planning process the business unit will plan for their expected major procurement requirements for the following year. Any planned purchases > 25,000 (ex VAT) will be required to be included in the SOLAS Corporate Procurement Plan which is submitted annually to the Board for approval and will follow the process in to below: The stages of the procurement process form a continuum as follows (see Figures 1 & 2 ): a) Initiating/determining the need for goods, services or repairs/maintenance b) Considering when the item is required and noting the required timelines under public procurement rules. (See note d) below re types of tenders and Table 16 for timelines). 14

16 c) anticipating all future costs of the item to include the TCO (total cost of ownership)*. In the case of services, if T&S expenses are permitted they must also be included. d) agreeing the procurement route, via Tenders (Open/Restricted/Competitive Dialogue/Competitive procedure with Negotiation - National or EU; OGP Framework; Mini competition) which will require a Request for Tender document RFT or specification, or via Quotations. e) identifying a supplier/contractor (based on the selection and award criteria in the RFT ) f) placing a contract and in the case of services obtaining a signed Service Level Agreement (SLA) with the supplier. g) executing of the contract h) payment in accordance with the contract. * The calculation of the estimated TCO of goods or services shall be based on the total amount payable by SOLAS ex VAT and incl. VAT, up to a total of 4 years (for ICT projects the total number of years is 5, if contract term not specified, ref. circular DPER 2/16, section 8), including any form of option and/or any renewals of a contract. The estimation of contract values must be realistic and ensure that all planned purchases are aggregated so that the EU thresholds are not inadvertently exceeded; please refer to EU thresholds at (current threshold 209,000 ex VAT and for light touch regime contracts known as Annex XIV contracts - social and other specific services, the threshold is 750,000 ex VAT see Table 14 at the end of this section). If purchasing from outside of Ireland, please note that although thresholds exclude VAT, VAT is part of the cost to SOLAS and we must self-account for the VAT and make a payment to the Irish Collector General. If a contract, not advertised in the Official Journal of the European Commission (OJEU), attracts tenders in excess of the EU thresholds (see Table 15 at the end of this section) there is a risk that the award could be subject to infringement proceedings. In such an event SOLAS would be required to justify the original estimation. No contract or purchase may be sub-divided with the intention of avoiding the application of the procedures in this manual. (See Appendix 1 - Aggregation/De-aggregation). Competitive tendering or other forms of open competition e.g. soliciting quotations (see Table 15 for thresholds) shall be the normal practice, except in exceptional circumstances such as genuine emergencies (see 5.2(3) above). The procurement policies and procedures in this manual ensure openness to all compliant offerings, non-discriminatory award procedures, transparency and fairness in dealing with suppliers Tender Specifications and documentation Please note that tender specifications must not be biased in any way that would confer upon the purchaser an unrestricted or limited freedom of choice. Furthermore, all contract award procedures must include a verifiable audit trail. In the case of Services > 25,000 ex vat, a signed service contract will be required with the supplier, in addition to the Purchase Order document issued. Procurement Dept can supply a standard SLA (Service Level Agreement) document which can be modified by the business unit to the specific service Tender Process National & EU > 25,000 When the process involves a tender (i.e. purchases > 25,000), an RFT form must be completed by the requesting Business Unit and duly authorised in accordance with Table 2. If the estimated costs necessitate Board approval and the item had already been included in the Corporate Procurement Plan noted by the Board (see section 5.5 above), then an Executive Director s signature is only required. This form briefly describes requirements and estimated costs and is used by Procurement Unit to initiate the tender process. Following this a Request for Tender document (RFT) must be developed by the Business Unit (please see standard tender templates for EU and National open tenders on the intranet at Based on the units requirements they may opt for any of the following procedures if going the National or EU tender route: Open Restricted Competitive Dialogue Competitive procedure with Negotiation Under the EU Procurement Directives, contracts for certain services > 209k and < 750k are not subject to the full rigours of the procurement directive. These include Education & Training services and examples are listed in Table 14 below. They still are required to be advertised nationally on etenders.ie and on OJEU to allow suppliers in other member states the opportunity to express an interest or submit 15

17 tenders. Please note that when going out to tender it is essential that you factor in the required lead times for the procurement process to be completed, especially in the case of contracts with expiry dates. Lead times can be reduced by the issuing of a PIN (Prior Information Notice) on etenders. See Table 16 at the end of this section Tender Process OGP Frameworks Mini competitions SOLAS as a public service body are required to use the framework agreements for various goods and services negotiated by the OGP. These can be viewed on the OGP procurement.ie website. SOLAS staff can register as a Buyer on this site to obtain information. When using an OGP framework different templates will apply for the varying types of goods/services. These can be supplied by the Procurement Dept. to the Business Unit if required. Procurement will liaise with the OGP and the Business Unit when completing the required documents Tender Process SOLAS Frameworks Mini competitions If a SOLAS framework previously negotiated for a particular service or goods is still active, then the names of the relevant suppliers and contact detail can be obtained from the Procurement Department. All companies on the framework must be invited to tender for the goods/service. Care should be taken when compiling the selection and award criteria which will generally select the supplier using M.E.A.T (most economically advantageous tender). There must be no minimum score on price Agency Staff procurement When SOLAS requires the use of Agency staff a mini competition may be initiated (if an existing SOLAS or OGP framework in place, see & above) where the relevant Service Providers will be asked to tender for services within their category. No mini competitions can take place without the prior approval of the Senior Management Team (SMT). Any subsequent RFP for Agency staff following a mini competition or tender process must be approved by the ED Resources. Contracts awarded for Agency staff require a signed Service Level Agreement (SLA) between the business unit and the service provider. Please note that Board authorisation is required when the aggregate value of the service from the mini-competition exceeds 250, Quotation process items < 25,000 > 500 For items required under the threshold of < 25,000 written quotations must be sought from suppliers. ed quotations are acceptable from a verifiable source. See Table 15 at the end of this section for the relevant number of quotes at all threshold levels. Items within these thresholds can also be sourced via the OGP available frameworks. Other suppliers invited to submit quotations can be firms known to the SOLAS but should be capable of providing a competitive quote to ensure value for money. The invitation document must state clearly: a) Specification of requirements (if a service, the period covered; whether expenses relevant etc) b) Award criteria (price or quality & price) c) Closing date d) Method of submission e) General terms, other statutory requirements A Quotation Analysis Form must be completed when submitting an RFP (Request for Purchase) to Procurement, with accompanying written quotes. See sample form on Appendix 3. Form also available at Quotation Variances items < 25,000 > 500 In all situations where the lowest quote is not being accepted, a full written justification is required if the variance on the bid between the lowest quote and the recommended quote is 25% or greater. Note that the justification must be authorised at Director Level on the Quotation Analysis Form (see Appendix 3) Items not requiring a Purchase Order As noted in Table 15 below, items costing less than 500 do not require a Purchase Order to be issued, however they must be authorised for payment in line with Table 2 in section 3 of this document. On Appendix 4 - Table 18 lists other items not requiring a Purchase Order but must follow a proper 16

18 procurement procedure. Additional items can be added to the List of Procurement Excluded Vendors/Transactions with the approval of the Executive Director Resources Personal Work Items When authorising officers are procuring items that could be considered as personal work items or services, a more senior authorising signature must be obtained on the relevant document Purchase Order Values amendment Purchase Orders once issued will not be increased in value once goods/services have been received or time has elapsed since issue to the supplier. If additional commitments are required, aggregated with the existing PO and comply with procedures, a new PO will be raised referencing the previous PO. Requests to increase the value of a purchase order in a material way will only be carried out in exceptional circumstances and must be approved at a higher level from the original authorising signature. It is however recognised that immaterial amendments/adjustments may be required to facilitate matching with invoiced charges not known at time of procurement which the Procurement Manager must sign-off on Purchase Orders extending over a long period Outline Agreement Please note that in the case of contracts over a considerable period when it is not appropriate to issue the full order value to the supplier, an Outline Agreement document can be issued to the supplier. This in no way commits the organisation to the full value of the agreement. Subsequent purchase orders can be called off in stages against this Outline Agreement and ensures that the outline amount is not exceeded. This can be requested using the current RFP form Purchase Orders for Staff Development The documentation required in order to process purchase orders for staff development purposes must include confirmation of the cost from the training provider; details of the duration/dates of the training/development and the internal staff development form duly authorised. Please note that this form must also be copied to Account Payable to facilitate subsequent payment. Only those courses with Category A designation (100% funding) will be processed through the PO system. Please note that requirement threshold for Tied/Sole Supplier form for staff development requests is 3,000 or greater compared to the existing threshold of 1,000 for other purchases Purchase Orders for Capital/Asset items All equipment over 1,000 (inclusive of VAT) must be treated as Capital and submitted on a CAR (Capital Appropriation Request) form. Forms are available from Procurement. In addition certain ICT equipment (to include Desktop Computers, Notebooks/Laptops/Tablets etc.) under this value must also be capitalised. Board approval is required on an annual basis authorising the Capital Budget. Capital budget allocations can be submitted to the Finance Dept. Budget approval details must be completed on the CAR before it is processed by Procurement. Procurement can provide information relating to current agreed prices for certain standard IT equipment Non-Conformance Purchase Orders A non-conformance order will be processed by Procurement Dept when goods or services have been procured outside of procurement procedures. A non-conformance order request will be completed on a Non-conformance form. This form will act in lieu of a request for purchase form. Forms available at Non-conformance orders are prefixed by the number 49. Non-conformance Purchase Orders will be reported annually to the ARMRC for the second and subsequent instances by an authorising official. Non-competitive procurement for items greater than 25,000 must also be included in the Chairman s report to the Minister as per 8.16 in the Code of Practice for the Governance of State Bodies. (See section 1.4) 17

19 Tables referred to in section 5.5 above. Table 14: Annex XIV (EU Directive 2014/24) Examples of Title III Services Educational, Administrative and Cultural Services (i.e. not subject to the full scope of EU procurement Directives, see section above) Item Service OJEU CPV code 1 Education and training services Technical and vocational secondary education services Higher education services Youth Education services Safety education services E-learning services Operation of an educational centre Training services Specialist training services Staff training services Training programme services Vocational training services Industrial & technical training services Computer training services Safety training services Tutorial services Hotel & Restaurant services etc 16 Legal services (excluding those under point (d) Article etc Directive) 17 Provision of services to the community etc 18 Investigation and security services etc These types of Services are not subject to the full rigours of the EU procurement Directives if under the 750k threshold. Due to their nature they are considered to be of less cross-border interest. However it is recommended that they are published in OJEU and that the notice indicates they are being published on a Voluntary Basis. B 18

20 Table 15: Quotes/Tenders thresholds & procedures EXCLUSIVE OF VALUE ADDED TAX (VAT) Threshold (EXCLUSIVE OF VAT) Type of Contract Procedure NORMAL PURCHASES < 500 Goods or Services A receipt or invoice is required. Transaction does not necessarily require a purchase order 500 & < 1,000 Goods or Services At least ONE written quote* is required. PO required 1,000 & < 5,000 Goods or Services At least TWO relevant and written quotes* to be solicited PO required. 5,000 & < 25,000 Goods or Services THREE relevant and written quotes* to be solicited PO required 5,000 &< 50,000 Works FIVE Relevant Quotes * to be solicited. PO required EMERGENCY PURCHASES 1,000 & < 5,000 Goods or Services ONE Written Quote is Sufficient. PO required 5,000 & < 25,000 Goods or Services TWO Written Quotes are Sufficient. PO required TENDERS BELOW EU THRESHOLDS > 25,000 ICT Projects as per DPER 02/16 circular etenders note DGOU** prior specific approval required before tendering 25,000 up to 135,000 Goods or Services etenders (Open - Non OJEU~) 135,000 up to OJEU Threshold currently 209,000 50,000 up to OJEU Threshold currently 5,186,000 Goods or Services etenders (Open or Restricted Non OJEU~) Works TENDERS ABOVE EU THRESHOLDS etenders (Open Non OJEU~) Supplies & Services Works Procedure 209,000 5,186,000 OJEU~ * An from a verifiable source is an acceptable quotation document ~ OJEU - Official Journal of the European Union ** Digital Government Oversight Unit POPurchase Order document 19

21 Table 16 Tender Time limits (in calendar days) DAYS MINIMUM Procedure Details EOI * Tenders Tenders electronic OPEN > 25,000 (Goods/Services incl ICT) > 50,000 (Works) Up to OJEU thresholds OPEN Above OJEU RESTRICTED > 25,000 (Goods & Services incl ICT) 50,000(Works) up to OJEU thresholds RESTRICTED Above OJEU COMPETITIVE DIALOGUE Above OJEU COMPETITIVE PROCEDURE WITH NEGOTIATION Above OJEU Time for receipt of tenders from contract notice sent date Time for receipt of tenders from contract notice sent date 1 st Stage EOI Time for receipt of requests to participate from contract notice date 2 nd Stage Time for receipt of tenders from the date invite sent 1 st Stage EOI Time for receipt of requests to participate from contract notice date 2 nd Stage Time for receipt of tenders from the date invite sent Time for receipt of tenders from contract notice sent date Time for receipt of tenders from contract notice sent date Tenders with PIN# n/a 21 n/a 25 n/a n/a n/a n/a n/a n/a n/a 30 n/a n/a n/a n/a None None None * EOI - Expressions of interest # PIN Prior Information Notice - must be published at least 35 days and no more than 12 mths in advance of the contract notice and contains all relevant information See section for the requirements to initiate a tender process There may be a further lead time to the process if authorisation by the Board of SOLAS of the RFT form is required, in line with the SOLAS Authorisation Levels outlined in section 1 above. If the item has already been included in the Annual Corporate Procurement Plan noted by the Board then RFT form authorisation for this item is not required. 5.6 Role of the Procurement Department The Procurement department s role in the procurement function is an advisory role, i.e. to assist business units when seeking goods or services they require to carry out their work as outlined in the options under 5.5 above. Procurement will advise on the processes which must be followed. The department files the documentation provided at Purchase Order release stage and makes it available/accessible for query and audit purposes. All services > 25,000 ex VAT, must have a Services Contract or SLA signed by both parties and a signed soft copy of this must be given to the Procurement Dept by the Business Unit with the RFP form before the issue of the Purchase Order. It is the business unit s responsibility to ensure that the terms of the agreement are being adhered to Processing of Purchase Orders Procurement will process an official Purchase Order (PO) on foot of a properly authorised Request for Purchase document or Capital Appropriation Request in line with the authorisation tables outlined in this document and coded to the unit authorising the request. There may be some instances when certain units process POs on behalf of another unit. Prior approval must be evident in this case. Coding will be reviewed by Procurement prior to release and they will determine which type of Purchase Order will be issued to the supplier. For Purchase Order types please see Appendix 9. 20

22 5.7 Receipt & Opening of Tenders (Non Contracted Training) SOLAS is obliged to ensure that proper procedures are in place for opening tenders to prevent abuse or impropriety at this stage. To ensure probity the following steps must be followed: a) All tenders received by courier/hand are logged at reception and Procurement notified of receipt and passed onto the dept. A note must be made on the tender log of the date and time that each tender is received. All National and EU tenders are currently submitted by either registered mail or by courier/hand delivery. (Note from 2018 OJEU tenders will required to be received electronically and an audit trail will ensue). b) All tenders must be kept in a cabinet, under the control of the Procurement Department until the agreed date and time of opening by authorised officers. Any tender received after the closing date and time may not, under any circumstances, be considered. Such tenders should be returned to the sender and details noted on the tender log. c) Each tender relating to a specific competition must be opened as soon as possible after the set closing date for receipt of tenders. The opening of tenders must take place in the presence of one procurement staff member and at least one official representing the Communications & Secretariat Dept. d) Details of bids must be recorded on a Tender Opening Control Sheet. The summary of the original bid document that contains a price figure must be witnessed, dated and initialled by all present. This demonstrates that the bid has not been altered in any way. Any alterations (e.g. type-over or crossings-out) must be highlighted and initialled by all openers. If the tenderer has not identified a copy as the original, the Manager Procurement or his/her nominee must select one and mark it up as such. Electronic copies of the tenders will always be under the control of the Procurement Department however it is advisable that the originating department also retain a copy of same. 5.8 Evaluation of Tenders The business unit for which the goods/services are required will nominate the personnel to evaluate the tender and arrange the meeting in conjunction with Procurement. At least one representative of Procurement will attend this meeting. Please note the following procedures: a) If the value of the highest bid is > 100k then the meeting must be chaired by the Director of the Business Unit and > 250k by the relevant Executive Director. b) All information received by the evaluation team is confidential until the process is concluded. c) The tender charter must be signed by the evaluation team prior to the scoring of the tender. d) Once the supplier passes the Selection Criteria they can be considered under the Award Criteria. e) The team can only score the tender using the Award Criteria outlined in the RFT (Request for Tender) document issued to the bidders. f) Clarifications can be sought from bidders in relation to their submissions. g) The team must outline and agree in writing their rationale for the scoring of the tender and sign the score sheet 5.9 Tender Variances In all situations where the lowest cost tender is not the winning tender, a full written justification is required if the variance on the bid between the lowest and the recommended tender is 25% or greater. If the tender outcome is not subject to approval by the SOLAS Board, then the justification for the variance must be authorised at the next highest level or as per the tender variance levels outlined in Table 17 below: Table 17: Tender Variances Variance Over 250,000 Up to 250,000 Up To 200,000 Up To 150,000 Approval Level Board Chief Executive Officer Executive Director Director 21

23 5.10 Tax Clearance It is not necessary to produce a tax clearance certificate when soliciting quotations/tenders. But it is necessary to state that it will be a condition for the award of a contract that the winning contractor must comply with Tax Clearance requirements. A Tax Clearance Certificate is confirmation from Revenue that a person's tax affairs are in order. Tax Clearance is required when the purchases from the supplier exceed 10,000 in a rolling 12 month period. In order to verify tax clearance status, qualifying suppliers are requested to provide their tax number and access code which must be passed by the unit to the SAP Support, who maintain the supplier file in SAP. You can provide this information to SAP Support through the IT helpdesk, see Appendix 2. They will check the tax status on the Revenue web site and update SAP. Supplier s tax status is then checked on an ongoing basis through the Revenue site once the access code provided by the supplier does not change. 22

24 6 Procure to Pay process The following outlines in narrative form, the steps in the Procure to Pay process followed by Figures 1 Procurement Process and Figure 2 Goods/service received to payment process. 6.1 Purchase Request a) Determine the need anticipate and plan all potential expenditure under this purchase, e.g. ongoing maintenance costs; total cost of ownership (TCO). b) If the item is greater than 25,000 has it been included in the Annual Corporate Procurement Plan noted by the Board? c) Ensure that budget allocation has been made for the goods/service to be procured. Check with your Manager who can check with Management Accounting for clarification. d) Ensure that the cost centre (e.g. SLXXX for overheads, 5 characters) and internal order (programme costs, 6-8 characters) and numeric account code (5 characters) are set up on SAP. e) Check if there is an existing procurement arrangement in place e.g. OGP framework; a SOLAS framework. See section to above. f) Determine which procurement method (see 5.5 above) is to be used by reference to the type of purchase and/or estimated value of the purchase whether written quotations; a framework, a tender process national or OJEU. Submit RFP, duly authorised in accordance with Table 2, to Procurement with accompanying quotation documentation and Quotation analysis sheet (if amount > 5,000). Ensure that the total cost is included on the RFP. In the case of services enter the value in the quantity field at a price of 1. RFP forms can be obtained from Procurement. or g) Initiate a tender process by submitting a Request for Tender form to Procurement. See Table 16 above for types of tender options and associated time lines. or h) For Capital equipment complete a CAR form (Capital Appropriation Request), duly authorised in accordance with Table 2. See section above. Ensure that a capital budget allocation has been approved by Finance before submission. i) Complete a Sole or Tied Supplier Form when it is necessary to deal with a sole or tied supplier and submit with the relevant RFP/CAR form to both the Procurement Manager and the Finance Director. This form is required for all purchases > 1,000. However see item above re Staff Development threshold. If the estimated purchase is greater than the OJEU threshold then ED Resources signature is also required on the Sole/Tied Supplier form. 6.2 Purchase Order issue a) The CAR/RFP is processed by the Procurement Dept. and a PO issued from the Financial System to the supplier either in paper or e-format. a) An official Purchase Order must be used for all purchases of goods and services where the expected value is over 500. b) However, there are exceptions which are noted on Table 18, Appendix 4. c) Where separate documents form part of the contract e.g. Supplier Contracts, Service Level Agreements then these must be referenced on the RFP and noted on the Purchase Order being issued to the supplier. 6.3 Goods/Service receipt Within SOLAS a GIN (Goods Inwards Note) is an important document and an integral part of a three way matching system on SAP. It is matched against the Purchase Order and Invoice before payment is made: a) Goods receipt by Stores When goods are delivered to SOLAS Stores dept., a GIN (Goods Inwards Note) is processed by the Storesperson on the Financial system following inspection and a signature obtained when goods are delivered to the requesting section. b) Service receipts/goods received directly - When an end user receives a service or goods directly through the post it is appropriate to request a GIN by . All such requests must be sent to HOGINS@solas.ie and must be copied to the end user s superior, stating the PO no; the quantity/amount of the service received (ex VAT) for each line of the PO. c) Call-offs against service Purchase Orders When a unit requests a Service Purchase Order which is being called off/ginned in stages over a period of time, the unit must keep a record of their call-offs to ensure no duplication in their GIN requests to procurement. 23

25 d) Contracted Training receipt of services - In the case of contracted training orders e.g. Momentum contracts (41 order series), ginning (referred to as confirmations) is carried out by contracted training staff through the SRM module and follow separate approval procedures not part of this manual. e) Forecast Log of expected goods/services To assist units to determine Purchases in the system, a report is issued periodically to requisitioners/managers outlining items not received in part or full to date. The valuation of these items are listed in the Commitments column in Management Reports. 6.4 Invoice processing Suppliers are notified to address invoices from Purchase Orders to the following address: Accounts Payable, SOLAS, Block 1, Castleforbes House, Castleforbes Road, Dublin 1 or send by to: accountspayable@solas.ie and must reference the relevant PO no. for matching purposes. a) Invoices once matched for quantity and value with the appropriate PO and GIN will be posted to the supplier s account and available for payment at the next payment run. b) Queries arising from Invoices must be communicated to the supplier within the time frame permitted under Prompt Payment regulations. d) Invoices are required to be paid within 30 days from receipt of invoice by SOLAS or goods/service receipt date whichever is the latter. If outside this period then prompt payment interest levies and interest accrue. These charges will be charged to the business unit s budget area. e) All payments to suppliers must be approved in accordance with the levels outlined in Section 4 of this document. f) Payment to suppliers is by way of EFT (Electronic Funds Transfer). There are separate procedures for the verification of supplier s bank details. Bank details are generally requested from suppliers at supplier setup stage on the Financial System. 6.5 Purchase Order cancellation If a Purchase Order issued is no longer required or has been delivered in part (i.e. partly Ginned) but no remaining items are due, then a request must be made to HOGINs account, or a Procurement staff member, copied to the relevant manager, to have the Purchase Order closed. See section 6.3 e) above for more information in relation to outstanding POs and identification of same. 24

26 FIGURE 1 Procurement Process - for detailed procedures refer to section 5 & 6 of this document (Note amounts quoted below ex VAT) Unit Responsible Process BUSINESS UNIT Determine need and estimate potential exp i.e. Expenditure Life Cycle If total > 25,000 ensure item included in Procurement Plan to the Board (requests due end Feb annually to Procurement) If new ICT Project seek DPER approval through IT Dept Ensure Budget allocation against Cost Centre/Internal Order BUSINESS UNIT & Accounts Payable No Is item < 500? Yes Obtain good/service Have invoice coded & authorised Pass to Accounts for payment BUSINESS UNIT Is there an existing SOLAS/ OGP Framework in place? Check with Procurement No If Tied/Sole Supplier Yes Complete Tied/Sole Supplier Form, obtain signatures and attach to RFP with Backup docs. Send RFP with all docs to Procurement Procurement Review doc before processing PO PO Issued to supplier BUSINESS UNIT & Procurement Determine which method to be used. Tender/Fwork/quote. Liaise with Procurement If > 500 < 25,000 Quotations * In some cases the OJEU Threshold is 750,000. Check with Procurement If > 25,000 < 209,000 Complete RFT form and send to Procurement If > 209,000* Complete RFT form and send to Procurement SOLAS/OGP Framework mini-competition National tender/ etenders.gov.ie OJEU Tender Ted.europa.eu BUSINESS UNIT BUSINESS UNIT Seek Quotations (See table 15) Use OGP Panel or known suppliers Complete RFP with Quotation Analysis Sheet/Backup doc. Send to Procurement Prepare tender spec using SOLAS template i.e. RFT Document Prepare tender spec using OGP SRFT template Choose which process, Open/Restricted/ Competitive Dialogue. Liaise with Procurement Prepapre tender spec using SOLAS template or OJEU template i.e.rft doc If Evaluation criteria in quote, score bid from Supplier and include with RFP Send RFT document to Framework companies. Answer clarifications Tenders received. Arrange meeting to evaluate tender bids Send SRFT document to Procurement for review Procurement sends SRFT to OGP and act as liaison with Business Unit and OGP. Answer clarifications. Send RFT doc to Procurement for review Procurement enter details in etenders and upload RFT doc BUSINESS UNIT & Procurement Evaluate tender bid based on award criteria, score and complete doc Tenders received. Arrange evaluation meeting with OGP/ Procurement Clarifications answered. Tenders received BUSINESS UNIT & Procurement Procurement reviews documentation before Processing PO Complete RFP and attach relevant docs. Send to Procurement Business Unit Ensure Board approval sought where relevant Arrange meeting with Procurement to evaluate tender bids and score PROCUREMENT/OGP PO Issued to supplier Obtain SLA signed by both parties for any Service contracts Procurement/OGP issue successful and regret letters to bidders 25

27 FIGURE 2 Goods/Service Received to payment process - for detailed procedures refer to section 6.3 and 6.4 of this document Unit Responsible Process STORES/BUSINESS UNIT Goods received by the Stores Goods/service received directly Service Call-off from PO BUSINESS UNIT request sent quoting PO No.to HO GINS copied to superior Unit determines element of service received and keeps a record PROCUREMENT GIN entered by Storesperson on SAP GIN entered by Procurement staff on SAP ACCOUNTS PAYABLE Invoice received from Supplier by Accounts Payable and entered on SAP SAP performs 3 way matching of PO/ GIN/Invoice Do all 3 match NO Invoice awaits GIN entry YES GIN awaits Invoice receipt Invoice posts to Supplier a/c ACCOUNTS PAYABLE Invoice available for payment in next payment run ACCOUNTS PAYABLE Finance Manager approves payment to Supplier 26

28 7 SOLAS Procurement Card 7.1 Introduction Procurement Cards are a payment tool designed to make the business purchasing process more efficient by reducing paperwork, providing greater control over spending and visibility into spending patterns. 7.2 Types of goods/services permitted on the Procurement Card In certain circumstances goods/services may only be procured from the supplier using a Credit/Debit Card (Procurement Card). Although not exhaustive the following are examples of goods/services that can only be facilitated through a card payment method: Various Online software products/licenses, e.g. Copyright Free Images, Database Visualiser. Online mock exam providers, e.g. Ethuware who provide mock exams for Java. Online travel, e.g. Booking through Airlines sites thus eliminating third party administration fees. Online books, e.g. Amazon. Targeted online promotional tools, e.g. Google Ad words; Facebook advertising. Online Direct Applications, e.g. Campaign Monitor. Credit Checks on third party providers. 7.3 Benefits of a Procurement Card A simplified purchasing and payment process. A reduction in procure-to-pay (P2P) transaction costs. A reduction in the P2P transaction cycle time. Improved supplier relations as suppliers can receive payment within 2-5 days. A reduction in the number of supplier invoices, which could lead to a reduction in staff overheads. With proper controls, procurement cards can restrict maverick buying as well as buying nonauthorised categories of goods and services. Clear reports of how money is being spent through the elimination of one-off vendor accounts. 7.4 Card Management The Procurement Card will be managed by an appropriate Officer of SOLAS for identified spending categories. The card administrator(s) will ensure that the agreed single transaction limits and monthly spend limit are not breached. A daily transaction log will be maintained which will be approved on a monthly basis by the Executive Director, Resources, see Appendix 7 below Card Limit (See Table 3) Note that there is a limit of 5,000 per transaction. However, in exceptional circumstances these limits may be exceeded with pre-approval by the Chief Executive Officer. A maximum limit of 50,000 applies to any one transaction on the Procurement Card Governance Normal Financial Authorisation Levels and Procurement Procedures will apply when seeking payment using the Procurement Card. At the end of each month a detailed report will be issued by the card administrator and will include the following: a) Statement of Account - for each cost centre or internal order, detailing all transactions. This can be used for reconciliation with any purchasing record kept by the cardholder, e.g. a daily log which can be completed by the cardholder with details of the supplier, description of goods and cost on each occasion a purchase is made. b) Group Level Statement - the total amount payable for the organisation. c) Itemised Charges Analysis - showing the costs for use of the service, e.g. transaction charges, card fees, etc. d) Merchant Category Detail Report - breakdown of spend with each supplier e) Merchant Category Summary Report - breakdown of spend in each of merchant categories f) Commodity Code Detail Report - shows total spend for each commodity code with details of suppliers used, transaction amounts, number of transactions and average spend in each category. 27

29 8 Assets/Capital Procurement and Disposal It is the responsibility of management to account for the assets assigned to their unit. An annual stocktake of equipment on the SOLAS Asset Register is carried out and unaccounted assets are notified to management for follow-up and action. A register of all assets sold during the year will be maintained by the Assets co-ordinator showing details of the asset, price paid and name of the buyer, including items sold to Board members, staff or their families. 8.1 Purchase of Capital/Assets For procedures relating to capital/asset procurement see section and 6.1 (g) above. 8.2 Disposal of Land & Buildings The authority to sell real estate property (land and buildings) rests with the Board of SOLAS. However prior agreement must be sought from our parent Department before any building or piece of land can be sold. 8.3 Disposal of items > 15,000 The disposal of items of equipment with an anticipated disposal value of 15,000 must be by auction or a competitive tendering process initiated by the Finance Manager, SAP Support/GL/Procurement. Any asset with a disposal value > 150,000 not the subject of an auction or competitive tendering, must be reported to the Board and included in the Chairpersons Annual report to the Minister. 8.4 Disposal of items > 1,000 < 15,000 Individual assets with an anticipated value between 1,000 and 15,000 may not be disposed of without the approval of the Finance Manager, SAP Support/GL/Procurement. After consultation, the Finance Manager will decide the method that is likely to achieve a fair, market-related price. 8.5 Disposal of items > 100 < 1,000 Individual assets with an anticipated value between 100 and 1,000 may not be sold without the approval of the Finance Manager, SAP Support/GL/Procurement. 8.6 Writing-off of Assets from Asset Register An Asset write-off form authorised by in line with Table 10, must be completed for all assets requiring write-off on the Asset Register, irrespective of current net book value and submitted to the Assets Co-ordinator for processing. In the case of a Sale a separate form must be completed with the write-off authorised in line with Table 10 above and the sale value authorised by the Finance Director. 8.7 Reporting on Disposals A report will be made annually to the Board of items sold. Any individual asset with a disposal value > 5,000 must be itemised separately. 8.8 Disposal of computer equipment All computer equipment requiring disposal and write-off must be passed to the IT department and confirmation received that the data has been cleared down before the write-off processed. The IT department will be responsible for the physical disposing of this equipment. 28

30 APPENDIX 1 - AGGREGATION/DE-AGGREGATION Aggregation Summary The purpose of Aggregation is twofold: 1. The bringing together of same services/goods in order to achieve a better supply of goods/services at a more economic and efficient price. 2. To prevent the deliberate circumvention (De-aggregation) of authorisation thresholds whereby the same service/good is being supplied by a number of suppliers so that it appears that threshold levels are being adhered to. There are aspects of Aggregation that need to be considered: The main level of aggregation in SOLAS would be Organisational Aggregation (e.g. Single arrangement to purchase Stationery/ Electricity/Telecoms). Aggregation is tied to the service/goods and not the supplier. For example a facilities management company providing catering, pest control and security. These are three distinct services and aggregation applies to the service and not the supplier. There is a need to consider how to prevent negative outcomes from aggregated arrangements since there is a potential to stifle competition and reduce value for money results for public purchasers. Large scale aggregation with significant value or volume of service/goods can discourage small businesses from competing for business. Aggregation can lead to the creation of dominant or incumbent suppliers, who could use their contract experience to become the preferred supplier for a public sector body for certain goods or services. Where possible the purchaser should endeavour to plan for their annual requirements at the beginning of each year following their Business Planning process. All planned purchases > 25,000 must be included in the organisation s annual Corporate Procurement Plan which must be noted by the Board. See section 5.5 above. However there may be instances where the thresholds are reached and breached due to Creep up Aggregation that was unforeseen. Creep up aggregation can also occur where goods/services are ordered throughout the year and consequently breach the tendering thresholds as a result of unforeseen demand. This unforeseen innocence of purchase is recognised by SOLAS and this expenditure should not be included when producing aggregate figures. 29

31 30 APPENDIX 2 IT Support Help Desk (SAP)