106 - Unauthorized & Prohibited Purchases

Procurement Services 106: Unauthorized & Prohibited Purchases

Purpose

To prevent inappropriate purchases

Reference

University of Alaska Procurement Manual (not available online) 

Definitions

Unauthorized Purchase: An agreement, a commitment, an order for goods or services, or changes to existing contracts by any person who does not have the delegated authority to bind the university. Procurement transactions in excess of a person's delegated threshold authority or that fail to meet the requirements of small value purchases are also considered unauthorized. Small Value Purchase: Purchases of goods or services by one of the following methods:

  • Petty Cash

  • Direct Payment

  • Employee Reimbursement

  • Procurement Card

Prohibited Purchase: Items or services that departments are restricted from purchasing Appropriated Funds: Funds appropriated by the legislature for general operating use. Includes the unrestricted funds budgeted to university departments.

Policy

General
Unauthorized purchases are not binding on the university. Individuals who violate this policy may be subject to personal liability for the value of the purchase. However, the purchase may be ratified in accordance with delegated authority if funds are available, if it is the best interest of the University, and the commitment would otherwise had been proper.

Unauthorized Purchase Examples
  1. Making commitments with grant money without the required approval of Grants & Contracts or Procurement Services.
  2. Placing an order after submitting the requisition on the assumption that a purchase order has or will be approved.
  3. Coercing a vendor to initiate an order on the promise that a purchase order will be forthcoming.
  4. Using personal funds to make a purchase of goods or services that would normally require Procurement Service's involvement to secure competition, to approve sole source or to otherwise comply with procurement regulations. The university is not obligated to reimburse an employee who takes such action. 
  5. Failure to timely submit a requisition for renewal of ongoing services such as maintenance agreements, etc.
  6. Making a small value purchase that does not conform to the requirements for such a purchase.
Prohibited Use of Appropriated Funds
Appropriated funds may not be used for extravagant or personal purchases, or for items or services that are not prudent or necessary to carry out university business. Examples of prohibited expenditures include, but are not limited to:
  • Personal letterhead or stationery
  • Christmas cards
  • Personal photographs, pictures or frames
  • Elaborate business cards
  • Office area coffee pots or coffee makers
  • Plants, flowers, or vases for decorating individual offices or classrooms
  • Gifts other than approved awards
  • Coffee, pastries or foodstuffs for consumption by the staff except in approved conference settings
  • Personal or social memberships to clubs, organizations, associations (institutional or approved individual professional memberships are acceptable)
Waivers of such restrictions must be approved in advance by the chancellor or vice chancellor, campus director, or designee.

Related Policies: Finance 103: Personal Use of University Resources

Effective: 10/25/2005