- To ensure that a purchase of goods or services is made only when there is a legitimate need and in accordance with the Center’s procurement policies and Board approved budget.
- To ensure that materials, supplies and services purchased are of acceptable quality standards acquired at the most economical cost with the most favorable payment terms.
- To ensure suppliers deliver at the right time in accordance with the requirements of the Center.
- To ensure purchase orders and contracts comply with applicable laws and regulations.
The Purchasing Section of the Finance and Administration Services division (Purchasing) is responsible for the sourcing of goods and services (other than services of Consultants). Their responsibilities include, among others, initiating the canvassing and negotiating of prices with suppliers; choosing a supplier and awarding of bids based on their ability and capability to meet the Center’s requirements; recording and evaluating the performance of the suppliers; maintaining a professional business relationship with suppliers and the Center’s functional departments.
The Center’s purchasing staff is specifically authorized by the Center to commit up to certain value limits, in commercial arrangements, and should be the primary Suppliers’ contact for the Center. No other Center employee, unless specifically granted such authority, should negotiate with suppliers or Center either verbally or otherwise.
In unusual circumstances, Purchasing will commit the Center to buy through a verbal agreement without consulting the using unit. This commitment will be made only when there is a justified need for a prompt decision which prevents consultation and when there is a history of similar purchases. When this kind of commitment has been made, Purchasing will secure requisitions or other written approval from the using unit as soon as possible.
Procurement of services of Consultants is regulated under Section 6.2. Procurement through Subgrants is regulated under Section 7.4 herein.
Procurement for goods and services refers to the purchase of goods and services necessary to facilitate the general administration of the Center such as the purchase of office supplies, equipment, general administrative services such as security, janitorial, etc. and the purchase of goods and services required by the technical divisions other than services of Consultants.
Telephone Order
In emergency situations (e.g., when the purchase is needed because time is of the essence), Purchasing may authorize to provide a purchase order number so that a telephone order may be placed. In such cases, the issuer should promptly send the purchaser a properly authorized requisition.
Purchasing for Personal Use
No employee will use the Center’s name to purchase merchandise or service for personal use.
Consolidation of Purchases
If several units or locations need to purchase the same material, every reasonable effort should be made to consolidate orders and/or purchases.
Gifts from Supplier
No employees shall accept gifts from suppliers in relation to their performance of work. If gift is offered, for example during holiday season or complimentary hotel accommodation and travel mileage incentives, this should be turned over to HR Department for raffle. In case the gift is perishable, this should be shared with co-employees.
Purchasers will neither solicit nor accept money, loans, credits, discounts, entertainment or gifts/favors that could influence purchasing decision from suppliers or potential suppliers. A promotional material of little commercial value (such as calendar or paper weights) which may bear the supplier’s advertising is acceptable.
Before accepting offers of travel or lodging from a supplier or prospective supplier, employees should obtain approval from the Executive Director (Deputy Director). The reason for accepting such travel or lodging should be justified as being sound for business reasons and should not obligate the Center.
Performance Review of Suppliers
Periodic review (at least once a year) shall be conducted to ensure that major suppliers consistently meet the Center’s standards. The review shall be based on service, quality and price.
Confidentiality of Supplier’s Information
All information about the supplier’s operations given by him in confidence will be handled confidentially and should not be disclosed to other suppliers prior to opening of bids or selection. Prior to opening of bids or selection, all quotations offered to the Center are presumed to be confidential and shall not be disclosed in specific terms to other suppliers or other parties who are not parties to the transaction.
Quotation Addressee
All quotations shall be addressed to the Executive Director or Deputy Executive Director. Quotations addressed to a different person shall not be honored.
Arms-length Transaction
All purchasers should maintain arms-length relationship with the Supplier and exercise discretion in their personal relationship with the Supplier’s representatives.
Objectivity
No relationship should exist between the purchaser and supplier which could influence the objectivity of the purchase. This includes the companies or any business establishments in which the purchaser or other officers and staff of the Center and their family members (up to the 4th degree of relationship by consanguinity or by affinity) has a significant or indirect financial interest. Also, the purchaser shall separate his personal interests and feeling from their selection of suppliers to assure that purchasing decisions are based on service, quality and price.
Compliance with Policies and Procedures
Purchasing shall direct all their activities so that interests of the Center are served in all transactions and that all said transactions are carried-out in compliance with established policies and procedures.
Fair Treatment and Equal Opportunity
Purchasing shall promote supplier relationship by treating them courteously and impartially. Purchasing shall extend every practicable opportunity to small companies so that they can participate in the supply of products and services to the Company.
Compliance with Laws
All laws and regulations governing buying and selling shall be observed. No purchases shall be made if Purchasing has any doubt about the legality of the transaction, the source of the goods or the identity of the counter party.
Lowest Bidder Exception
When all things are equal other than price quoted, the lowest bidder shall always be selected. If the lowest is not selected, the reason for that decision will be documented and kept with the Purchase Order to the successful supplier.
Separation of Incompatible Duties
Requisitioning, purchasing and controlling should be done by a separate organizational unit/s or at least by different individuals from those in charge of receiving and paying of purchases, so that separation of responsibilities will assure the desired level of internal control.
Transparency
The Center will use all those mechanisms that encourage transparency in purchase management, especially in negotiations with suppliers and in decision-making when awarding purchases.
Short-term Service Engagements
Procurement of short-term services such as for lay-outing of logo, editing, proof-reading, and the like shall be covered by the Center’s procurement policies and procedures and the cost shall be treated as part of operating expenses.
Requests for the purchase of goods and services shall be covered by a Purchase Requisition Form (PR) (see Annex 24). Only duly approved PRs shall be processed by the purchasing section.
The approval limits for Purchase Requisitions are as follows:
Division Heads - up to US$2,000
Executive Director / Deputy ED - up to US$50,000
Executive Director co-signed by the
Treasurer of the Board of Trustees - over US$50,000 up to US$150,000
Executive Director co-signed by the
Treasurer and the President/
Chairman of the Board of Trustees - over US$150,000
Breaking down or splitting purchase requisitions into small amounts to override signatories is strictly not allowed.
Responsibilities of Requisitioner:
1. Sets clear specifications that will ensure that materials and services ordered will fulfill the need.
2. Keeps specifications as broad as practicable so that more than one vendor can compete for the business. Normally, brand detailed specifications are challenged, if better alternative exists.
3. Requisitions are made in advance of need to permit timely supplier selection and delivery.
4. Notifies purchasing promptly when materials are unsatisfactory or not needed.
5. Analyzes the quotations with regards to technical and quality issues.
All purchases should pass through canvassing procedures. The following guidelines should be followed:
If amount is = US$101 to US$200 - Telephone canvassing from 1 to 2 suppliers. Details of the telephone canvassing should be recorded in writing by the staff.
If amount is = US$201 to US$1,000 - Telephone canvassing from at least two (2) suppliers. Details of the telephone canvassing should be recorded in writing by the staff.
If amount is = US$1,001 to US$2,000 - Written quotation from at least two (2) suppliers
If amount is = US$2,001 to US$15,000 - Written quotation from at least three (3) suppliers
If amount is = US$15,000 and above - Written quotation from at least three (3) suppliers administered directly by the Purchasing Committee (see below)
A single quotation/or a single supplier shall be acceptable under the following conditions:
- When economic quantities justify a single supplier.
- When estimated purchase cost of a requested item is less than or equal to US$200.
- The service sought cannot be adequately described by specification or requires a unique skill.
- When the supplier is the sole agent/distributor of a certain product or service.
- When repeat order (e.g. the order is only an additional order from a past order from the same supplier) Provided, however, that the price quoted is the same as the original quote and/or favorably compares with quotations from other suppliers.
Exception to the above shall be approved by the Executive Director.
A Purchasing Committee in the Center who shall administer the procurement process related to purchases over US$15,000 shall be established. The Purchasing Committee shall be composed of the following, at a minimum:
a. Executive Director or Deputy ED
b. Head of FAS
c. Purchasing Officer
The functions of the Committee are as follows:
a) Updates the policies and procedures covering the procurement function.
b) Determines the most applicable procurement method to be used.
c) Establishes the activities to be followed in conducting the bidding or selection process.
A Purchase Order (PO) (see Annex 25) shall be prepared for the winning bidder or selected supplier. The PO is a contract whose general terms and contents are approved in advance by the Center’s legal counsel.
The PR, Summary of Quotations Received and individual supplier quotations shall be attached to the PO (PO package) before forwarding the PO to the signatories.
The signatories for Purchase Orders are as follows:
Division Heads - up to US$2,000
Executive Director / Deputy ED - up to US$50,000
Executive Director co-signed by the
Treasurer of the Board of Trustees - over US$50,000 up to US$150,000
Executive Director co-signed by the
Treasurer and the President/
Chairman of the Board of Trustees - over US$150,000
1. Requisitioner prepares a PR and details of specifications and obtains necessary approvals.
2. Purchasing receives the PR, reviews the request for general and specific information and verifies the authorized signatories.
3. Purchasing initiates canvassing/shopping, negotiates the commercial terms and obtains quotations from suppliers.
4. Purchasing determines the chosen supplier based on final quotations received and in accordance with canvassing policies and procedures. The details of the quotations received (including those from telephone canvassing) such as the item to be purchased, detailed product specifications, quantity, price, discounts, warranty, terms of payment, conditions, among others, are summarized and documented in a Summary of Quotations Report where these items are presented in a table and wherein the selected supplier is clearly identified or indicated.
5. Purchasing prepares the Purchase Order, secures required signatories and transmits it to the selected supplier.
6. Purchasing tracks the status of the Purchase Order and ensures delivery of the goods or services as agreed.
7. Upon delivery, purchasing ensures that goods and services delivered conform to specifications and acknowledges receipt. For capital expenditure/fixed asset items, purchasing shall ensure that a property tag or sticker is placed before the property is sent to the requesting party. An Administrative staff shall encode the property details and the corresponding property tag/sticker into the Fixed Asset listing or inventory maintained by the Administrative staff. A complete inventory count of the Center’s Fixed Assets and other inventory properties shall be made at least once every year.
8. When goods or services received are in order, purchasing initiates the payment processing and prepares a Request for Payment (see Section 11.2). The corresponding supplier’s invoice, supplier’s delivery receipt, billing statement or statement of account and other documents are attached to the Request for Payment before these are sent to Finance section for check preparation.
Subgrants refer to subgrant/subcontract arrangements to undertake an entire project/program or activity on behalf of the CAI-Asia. A Subgrant is covered by a subgrant agreement between CAI-Asia and the Subgrantee.
The Executive Director authorizes and approves the granting of all projects/program or activities to Subgrantees. It is the responsibility of the Executive Director to select and qualify subgrantees.
1. The division manager shall produce a Subgrant Agreement (Subagreement) that ensures the technical requirements of the main Grant Agreement are met. The Subagreement shall include among others, the roles and responsibilities of the grantee, the related financing, financial management and reporting.
2. The draft Subagreement shall be reviewed and approved by the Executive Director for review by other parties. The Subagreement shall be reviewed by the Center’s legal counsel to ensure that the terms and conditions are consistent with applicable laws and regulations. The legal counsel shall approve or modify the draft Subagreement to legally acceptable language, coordinating such changes with the division manager of the sponsored project/program or activity.
3. The division manager shall coordinate additional reviews with appropriate parties when the Subagreement contains non-standard language that may be in conflict with the Center’s policies or government regulations.
4. The division manager of sponsored project/program or activity shall secure the appropriate signatures of the subgrantee and shall execute or cause to be executed the Subagreement on behalf of the Center, under authority delegated by the Executive Director.
5. The division manager of the sponsored project/program or activity shall initiate a Request for Payment to FAS in accordance with the payment modalities of the Subagreement. The signed Subagreement document shall be attached to the Request for Payment. The purpose of this transaction is to insure that funds are properly available in the Subagreement and that said funds are properly reserved and obligated.
6. The division manger shall be responsible for monitoring and ensuring the technical performance of the subgrantee and shall certify to this performance prior to the payment of any invoices by the FAS. The division manager shall retain the supporting documentation for the subgrantee’s performance.
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