FY 2001

DATE:	July 14, 2000
SUBJECT:	Revised Reference Materials Pertaining to Employee Travel Reimbursement
EFFECTIVE DATE:	July 15, 2000
A & R CONTACT:	Audit Services Team - Randy Kennedy	(785) 296-2125	(Randy.Kennedy@state.ks.us)
	Leroy Charbonneau	(785) 296-2255	(Leroy.Charbonneau@state.ks.us)
	Shirley Gilchrist	(785) 296-2882	(Shirley.Gilchrist@state.ks.us)
	Mark Handshy	(785) 296-7021	(Mark.Handshy@state.ks.us)
APPROVAL:
SUMMARY:	Notification that the Employee Travel Expense Reimbursement Summary (travel tri-fold), and On-line Employee Travel Expense Reimbursement Handbook, and Policy and Procedure Manual Filing 3,903 have been revised to reflect the revised private vehicle mileage reimbursement rates effective July 15, 2000 and the new Business Travel Card Program vendor.

The Employee Travel Expense Reimbursement Summary (travel tri-fold) has been revised to reflect the revised private vehicle mileage reimbursement rates that are effective July 15, 2000. This document is available at http://www.da.ks.gov/ar/employee/travel/. Please destroy any remaining copies of the previous document. You may copy this document and distribute to your employees as you choose.

The On-line Employee Travel Expense Reimbursement Handbook has also been revised to reflect the revised private vehicle mileage reimbursement rates and the new Business Travel Card Program vendor. Policy and Procedure Manual Filing 3,903 continues to include a link to the on-line version of this document. You may access these two documents at http://www.da.ks.gov/ar/employee/travel/travbk.htm and http://www.da.ks.gov/ar/ppm/ppm03903.pdf and distribute throughout your organization as you choose.

DB:jr 

DATE:	August 4, 2000
SUBJECT:	Credit Card Acceptance Questionnaire
EFFECTIVE DATE:	N/A
A & R CONTACT:	Jerry Serk	(785) 296-2318	(Jerry.Serk@state.ks.us)
APPROVAL:
SUMMARY:	Credit Card Acceptance Questionnaire

Bids have been received on a contract to provide a credit card acceptance program for all state agencies. A Procurement Negotiating Committee (PNC) comprised of representatives from the Office of State Treasurer, Division of Purchases and the Division of Accounts and Reports is currently studying the bid proposals.

A survey was mailed to all state agencies in September 1999 to determine their credit card needs. The results of that survey disclosed 13 agencies currently accepting credit cards and an additional 27 agencies with a desire to implement credit card programs. However, the 2000 Legislative Session enacted a law (House Bill No. 2323) that makes it mandatory for all state agencies to accept credit cards after June 30, 2001. This law also allows agencies to impose a fee to recover the actual amount of any cost incurred for accepting credit card payments. Because of this law, the Credit Card Acceptance PNC needs to obtain additional information to assist us in determining how to structure the State's response to the bid proposals.

We would appreciate your taking the time to complete the following questions as they pertain to your agency.

Note: Due to limited time constraints, please submit your response to these questions no later than August 9, 2000

.

Agency Number or Name:

Question 1

House Bill 2323 allows, but does not require, the imposition of a fee to recover the cost of accepting credit cards.  Would your agency be willing to absorb a 2 - 3% discount fee for the convenience of accepting credit cards? If you have more than one program or source of fees, tuition or other charges, please list them separately if the response is different for different programs.

Question 2

Do you currently have, or are you planning to develop a website or interactive voice response (IVR) system to allow your customers to pay fees or charges in a non face-to-face environment? If so, please describe.

DB:js

DATE:	August 28, 2000
SUBJECT:	Business Travel Card Program
EFFECTIVE DATE:	Immediately
A & R CONTACT:	Nickie Roberts	(785) 296-7917	(nickie.roberts@state.ks.us)
	Tim Hund	(785) 368-6347	(tim.hund@state.ks.us)
APPROVAL:
SUMMARY:	Business Travel Accounts

Use of Business Travel Accounts

• As stated in Informational Circular No. 00-A-020, Business Travel Accounts (BTAs) are restricted to the purchase of transportation tickets when purchased from the State Travel Center for official travel.

• BTAs may not be used for the purchase of transportation tickets from Internet vendors.

• Please distribute this information to all appropriate individuals in your organization who may have access to the BTA number.

Payment Information 

• Please use the following vendor number when paying UMB Bank's monthly BTA billing(s):

  - The vendor number for UMB Bank per the STARS vendor file

  - Vendor suffix "06" for all BTA billings

• Agencies are strongly encouraged to use the ACH payment option. Please note that if your agency uses the ACH payment option, it is important that only one control account be paid per voucher. In other words, if your agency receives multiple monthly billings from UMB Bank, it is important that billings not be combined on one payment voucher.
• To ensure correct application of electronic payments by UMB Bank, remittance information must be included in the first STARS funding line in the "invoice" field. The format for the invoice field should be:
  
  BTA 12345678
  
  "12345678" represents the last 8 digits of your agency's VISA BTA number to which the payment is to be posted.

Questions

Please refer to the Business Travel Card website (http://www.da.ks.gov/ar/genacct/audit/BTC.htm) for answers to commonly asked questions about BTAs. Also, feel free to contact our staff if you have additional questions.

DB:th

DATE:	September 27, 2000
SUBJECT:	Warrant Images
EFFECTIVE DATE:	October 1, 2000
A & R CONTACT:	Bill Perry	(785) 296-7217	( bill.perry@da.state.ks.us)
APPROVAL:
SUMMARY:	Requesting Warrant Images From the Federal Reserve

Agencies have requested warrant images directly from the Federal Reserve Bank of Kansas City (FRB) since October 1997. During fiscal year close, it came to our attention that the FRB had significantly increased the cost to the Division of Accounts and Reports for each warrant image provided to state agencies based on the service level selected nearly three years ago.

In seeking a more cost-effective service option for the warrant image retrieval service, the Division of Accounts and Reports has requested that the service schedule be amended for warrant image retrievals effective October 1, 2000. Under the new agreement, all FAX image requests received by 2:00 P.M. will be returned to the requestor by the end of the next business day. While this means the warrant images will not be received in exactly the same time frame that agencies have become accustomed, we believe that selection of this service option will allow the State of Kansas to retain the convenience of the FRB image retrieval service while taking advantage of a significant cost savings with only a slight change in the service level.

Agencies should continue to use Form AR-70, Request for Warrant Image. All requests must be made by FAX to the number shown on the form - no telephone calls will be accepted by the FRB.

The following information must be completed on each request:

Date - The date you are requesting the warrant image.

Agency Number - Your three-digit STARS agency number.

Agency Name - The name of your agency.

Agency Contact - The name of the person making the request. This is the person who will be contacted for additional information or clarification if problems are encountered in retrieving the warrant image.

Phone (Voice) - This is the agency contact's telephone number.

Please return images to the following FAX number - This is the fax machine number to which the FRB should transmit the images. You may use a different FAX number on each request submitted, but all images requested on a form will be returned to the same FAX number shown on the form.

Warrant Number - This is the warrant type followed by the seven digit warrant number. A list of the valid warrant types is shown at the bottom of Form AR-70. In order to retrieve a warrant image, this field must be eight digits, and must be shown with the warrant type first.

Warrant Amount - The amount of the warrant.

Warrant Paid Date - This is the date the warrant was redeemed by the State Treasurer.

DIN Number - This is the Document Identification Number.

The Warrant Paid Date and the DIN Number may be obtained using the State Treasurer's Web Site, State Agency Warrant Search Page (http://www.treasurer.state.ks.us/quiklook.htm). Please remember that the FRB can retrieve images of only those warrants paid on or after July 1, 1996. Copies of warrants paid prior to that date should continue to be requested from the Central Accounting Services Section.

DB:bp 

DATE:	November 9, 2000
SUBJECT:	Statewide Credit Card Acceptance Contract
EFFECTIVE DATE:	N/A
A & R CONTACT:	Jerry Serk	(785) 296-2318	(jerry.serk@da.state.ks.us)
	Chris Howe	(785) 296-2374	(chris.howe@da.state.ks.us)
APPROVAL:
SUMMARY:	Informational Meeting for Implementing Credit Card Acceptance

Most of you are familiar with House Bill 2323 of the 2000 Legislative Session and its provisions requiring the acceptance of credit cards by all state agencies after June 30, 2001. A statewide contract has been awarded to Paymentech, LLC to process credit card transactions for the State of Kansas. Paymentech, LLC is the second largest processor of credit cards in the country and it is their only business. There have been many questions asked about why we need a statewide contract instead of letting agencies use their local banks or existing contracts. The fee structure for processing credit cards is extremely complex and can be quite expensive. By awarding a statewide contract, the State can obtain further discounts as most credit card fees are based on the number of transactions and the average dollar value of each charge transaction. With the statewide contract, all charges and transactions are aggregated on a statewide basis by all agencies instead of on an agency by agency basis. The statewide contract also includes contracts with Official Payments Corp., Discover Card and American Express.

To assist in implementing a credit card acceptance program at your agency, representatives from each of these companies have been asked to attend the November 29th ASTRA meeting. The ASTRA agenda has been blocked from 1:00 - 4:00 P.M. for the vendors to discuss their portion of the contract and to answer any questions you may have for them about implementing a credit card acceptance program at your agency. In addition, the vendors will remain in Topeka and be available from 9:00 - 12:00 on the morning of November 30th for additional questions or discussions as may be required. The reason for having contracts with four vendors rather than one will be apparent to you after attending this meeting.

We strongly urge your agency to send a representative to this meeting. Before attending, it would be beneficial to put some thought into discussing and writing down answers to the following questions:

• What applications will your agency have for credit card payments
• How will customers access your agency's services
  • Walk-in (face-to-face)
  • Website
  • Interactive Voice Response (IVR) system
  • Mail
  • Telephone
  • FAX
• Is your agency willing to absorb the fees associated with accepting credit cards
• Is your agency going to charge a convenience/surcharge fee for accepting credit cards (require the customer pay the fee for the convenience of using a credit card)
• What kind of equipment do you need (swipe machine, printer, PC software, telephone line, what brand, etc.)
• How many pieces of equipment will you need
• Are you going to purchase or lease the equipment
• How many employees will have to be trained to accept/process the transactions
• How will you market your policy for accepting credit card payments
• Do you have insurmountable problems involving the acceptance of credit cards

For more information and to register for the ASTRA meeting, please visit the ASTRA website at:

http://www.da.ks.gov/ar/forum/astra/

DB:js 

DATE:	November 13, 2000
SUBJECT:	Expenditure/Receipt Object Classification-Federal Aid to Other State Agencies
EFFECTIVE DATE:	Immediately
A & R CONTACT:	Financial Integrity Team Pam Karns Mike Lovich	(785) 296-2660 (785) 296-2131	(pam.karns@da.state.ks.us) (mike.lovich@da.state.ks.us)
APPROVAL:
SUMMARY:	Consistent Usage of Expenditure Classification for Federal Aid between Agencies

It has come to our attention that agencies are not recording transfers in a consistent manner. This is to remind everyone of the policy established by Informational Circular No. 1084 effective with fiscal year 1992 business.

All Federal Aid to Other State Agencies should be classified as expenditure sub-object 7310 (Inter-Agency Transfer [Federal]) by the paying agency. Receiving agencies should classify the receipt of moneys using receipt sub-object 6605 (Operating Transfers In - Federal Aid from Other State Agencies). Journal voucher requests should be submitted to the Audit Services Section of the Division of Accounts and Reports to correct any transactions which have already processed as fiscal year 2001 business using the other codes.

DB:pk:lmm

DATE:	February 23, 2001
SUBJECT:	Statewide Credit Card Acceptance Contract
EFFECTIVE DATE:	N/A
A & R CONTACT:	Jerry Serk	(785) 296-2318	(Jerry.Serk@da.state.ks.us)
APPROVAL:
SUMMARY:	Credit Card Acceptance Processing

The deadline for having a credit card acceptance program in place is quickly approaching. This informational circular is intended to assist you in the implementation of your program.

Those agencies choosing to absorb the cost of credit card fees can accept the four major credit cards in their operations. Credit cards may be accepted face-to-face, by website, over the telephone, mail-in, or through interactive voice response systems (IVR). We have been advised that an agency may accept credit cards through one or more of these modes and meet the requirements of K.S.A. 75-30,100 (H.B. 2323 of the 2000 Legislative Session).

Those agencies obligated to charge a fee for accepting credit cards due to budgetary or statutory reasons are more limited in their credit card acceptance policy. As a general rule, if the agency charges an additional fee to recover credit card costs to all customers, licensees or clients, including cash and check payments, any credit card may be accepted. On the other hand, if an agency at a minimum simply wants to comply with the law, Discover Card may be accepted and a convenience or surcharge fee may be charged only to those customers, licensees or clients who pay with the Discover Card.

The procedure for processing credit card transactions through the STARS system will require the creation of a Credit Card Clearing Fund in some agencies. In most cases, this procedure will not apply to those agencies having a fee bank account. Credit card transactions will settle through the fee bank accounts when possible rather than the Office of State Treasurer. Please bear in mind the provisions of K.S.A. 75-4215(b) pertaining to the frequency of depositing state moneys if you process credit card transactions through your fee bank account.

Under this procedure, agency officials may request the establishment of a Credit Card Clearing Fund in their agency. In most situations, where the agency charges a convenience fee for accepting credit cards, this clearing fund will enable agencies to pass on their credit card fees without requesting additional budget authority. The fund will be in the 9XXX series of fund numbers. The fund would only be used for processing credit card transactions and would work as follows:

1. As often as daily, the State Treasurer will process an electronic receipt voucher to deposit revenue from credit card transactions to the Credit Card Clearing Fund.

   • The transaction will use a transaction code (T/C) 606 (Due to other funds and appropriations) and revenue sub-object 6700 (Suspense).

2. Each agency will be responsible for reconciling this deposit with their credit card transaction report and processing a journal voucher to transfer these receipts out of the Credit Card Clearing Fund to the proper budgetary fund(s) within the agency.

   • The journal voucher will use T/C 606R and revenue sub-object 6700 to move the credit card receipts out of the clearing fund and T/C 602 (fund level deposits) or T/C 604 (account level deposits) with the applicable revenue sub-object (example - 2110), to deposit the credit card receipts into the correct fund of the agency.
   • For those agencies charging a convenience fee, a balance sufficient to pay the monthly credit card fees and charges should remain in the clearing fund to allow for the monthly debit processed by the State Treasurer.
   • For those agencies choosing to absorb the credit card fees and for those agencies whose surcharge fee deposits are not sufficient to cover the credit card fees, a journal voucher must be processed. This journal voucher will charge expenditures to the agency's budgetary accounts and transfer cash to the Credit Card Clearing Fund (see Step D).

3. Once each month the Treasurer will debit the Credit Card Clearing Fund to charge each agency the credit card fees debited to the state bank account by each of the three credit card processors - Paymentech, American Express and Discover Card.

   • The transaction is a negative receipt voucher and will use a T/C 609R with expenditure sub-object 2691 (Credit Card Fees and Charges) to charge the credit card fees to your agency Credit Card Clearing Fund.
   • This expenditure will not affect your agency appropriations or expenditure authority.

4. An agency without a sufficient balance in its clearing fund to cover the credit card fees must process a journal voucher to make a balance available.

   • The expenditure portion of the transaction will use T/C 733 and expenditure sub-object 2691. This will be charged to one or more agency funds depending on the allocation of agency credit card convenience fees.
   • The receipt portion of the transaction will use T/C 606 and revenue sub-object 6290 (Other Reimbursements and Refunds) to increase cash in the clearing fund.

5. It is conceivable that those agencies charging a convenience fee will allocate the fee among their cash, check and credit card customers. In other words, if the agency knows it is going to cost them $3.00 to accept a credit card, and they have estimated that one third of their customers will pay by credit card, all customers will pay $1.00 in additional fees to recover those costs. This is because credit card payments cannot be disadvantaged against cash or check payments. When these payments are deposited into the Treasury, the agency will have the choice of depositing the convenience fee portion of the payment directly into the Credit Card Clearing Fund, or into agency budgetary accounts.

   • Convenience fees received in the form of cash, checks or credit cards and deposited to a fund, other than the Credit Card Clearing Fund, should be deposited using revenue sub-object 5912 to identify the fees as convenience fees.
   • If deposited directly to the Credit Card Clearing Fund, the convenience fees should be deposited using T/C 606 and revenue sub-object 6700.
   • When the clearing fund has to be subsidized from the convenience fees directly deposited to budgetary accounts, a journal voucher must be processed.
   • The receipt reduction transaction of the journal voucher will use T/C 602R or T/C 604R (depending on the type of fund) and revenue sub-object 5912 to reduce convenience fee revenue in the budgeted account(s) of the agency.
   • The transaction to increase convenience fee revenue in the Credit Card Clearing Fund will use T/C 606 and revenue sub-object 6700 thus increasing the amount available for the payment of the debit charge processed by the State Treasurer each month.
   • In those instances where sufficient convenience fees are not available in the budgeted funds of the agency, process a journal voucher as outlined in "Step D". When an agency has not collected enough convenience fees to pay its credit card fees, then the agency must use operating moneys to pay the credit card fees.

Please bear in mind the concern of the Legislature for agencies to recover as closely as possible the exact costs for using credit cards. To the extent that the balance in revenue sub-object 5912 for an agency is greater than $0.00, you have collected too much in convenience fees.

The State Treasurer's Office and the Division of Accounts and Reports are partnering in developing an internet journal voucher system similar to the State of Kansas Interactive Internet Interfund (SOKI3+) System. It is anticipated that this system will be available prior to July 1, 2001, in time to expedite the processing of your credit card journal voucher transactions.

The Division of Purchases is conducting informational sessions to answer questions and assist with decisions on the type of equipment best suited to your credit card program needs. Please contact Chris Howe at (785) 296-2374 or e-mail him at chris.howe@da.state.ks.us.

If you would like to contact the vendor in charge of administering the statewide credit card acceptance program, please contact Sylvia Dunham at (303) 399-6985 or e-mail her at sdunham@paymentech.com.

Questions regarding the functions of the State Treasurer's Office in this process may be directed to Peggy Hanna at (785) 296-5464 or e-mail her at peggy@treasurer.state.ks.us.

For questions pertaining to the establishment of a Credit Card Clearing fund or the STARS transactions process, please contact Jerry Serk at (785) 296-2318 or e-mail may be sent to jerry.serk@da.state.ks.us.

DB:JS 

DATE:	April 5, 2001
SUBJECT:	Establishment of Additional and Revision of Revenue Sub-object for Grants
EFFECTIVE DATE:	Immediately
A & R CONTACT:	Financial Integrity Team Pam Karns Mike Lovich	(785) 296-2660 (785) 296-2131	(pam.karns@da.state.ks.us) (mike.lovich@da.state.ks.us)
APPROVAL:
SUMMARY:	According to Governmental Accounting Standard Board (GASB) Statement 34, revenues from grants should be classified as operating or capital.

These changes are based on a survey sent to agencies who receive large amounts of grant money. This survey revealed that most of the revenues received for grants were for operating grants. In those situations where grant revenues are received for capital projects, additional revenue sub-object codes are being established to report these capital grant revenues. The reporting of operating and capital grants is necessary to comply with Generally Accepted Accounting Principles (GAAP) and GASB Statement 34.

The following revenue sub-object codes for grants have been revised to report operating grants. Operating grants are defined as grants used for the operation of a specific program. The following changes in descriptions for operating grants are effective immediately:

The following federal grants revenue sub-object codes are being established to report capital grants revenues. Paragraph 50 of GASB Statement 34 states that a capital grant is used to purchase, construct or renovate a capital asset associated with a specific program. The following additions for capital grants are effective immediately:

These revisions will be reflected in the Uniform Receipt Classification Revenue Sub-object Codes filing (PPM Filing Number 6,002) on the Division of Accounts and Reports web site http://www.da.ks.gov/ar/ppm/ppm01001.htm.

DB:PK:lmm 

DATE:	April 11, 2001
SUBJECT:	Capitalization of Buildings and Building Improvements
EFFECTIVE DATE:	July 1, 2001
A & R CONTACT:	Financial Integrity Team Pam Karns (785) 296-2660 ( Pam.Karns@da.state.ks.us) Mike Lovich (785) 296-2131 (Mike.Lovich@da.state.ks.us) Gail Barnhart (785) 296-3314 (Gail.Barnhart@da.state.ks.us)
APPROVAL:
SUMMARY:	Increasing limitation on Capitalization of Buildings and Building Improvements to $100,000

Current policy requires agencies to capitalize any building or building improvement greater than $2,000. In order to reduce the capitalization of small amounts, the Division of Accounts and Reports is increasing the building and improvement limitation to $100,000 effective July 1, 2001. This limit should be applied to an entire building or improvement project, not each individual payment on the building or improvement. Policy and Procedure Manual Filing No. 7,002 will be updated to reflect this change as follows:
 

Professional judgment should be used by the agency to determine whether an improvement is a normal maintenance repair, paid using expenditure sub-object code (ESO) 2440, or an improvement paid using ESO 4200 or 4209. Generally, an addition or improvement either enhances the assets functionality (effectiveness or efficiency), or extends the assets expected useful life.

All payment vouchers submitted to the Division of Accounts and Reports must clearly indicate if the payment is a maintenance repair or a capital improvement. Please state on the face of the voucher "Total improvement amount less than $100,000" when applicable.

Any payments charged to ESO 4209 will not be included on your monthly Capital Outlay Expenditure Report (DAFR 8460) nor should they be included on Form DA-80A Inventory General Reconciliation worksheet submitted at year-end.

DB:GB:lmm 

DATE:	June 21, 2001
SUBJECT:	Capital Outlay Policy Raising Capitalization Threshold to $5,000 and Policy for Safeguarding Assets
EFFECTIVE DATE:	July 1, 2001
A & R CONTACT:	Bill Perry	(785) 296-7217	(bill.perry@da.state.ks.us)
	Gary Bond	(785) 296-2287	(gary.bond@da.state.ks.us)
APPROVAL:
SUMMARY:	Raise the capitalization threshold to $5,000 for inventory purposes and establish requirement for agencies to establish a policy for safeguarding assets.

Effective with fiscal year 2002 business, the capital outlay/inventory items will be defined as any item with a useful life expectancy of one year or more and costing $5,000 or more. These items must be coded to the sub-object 4XX0 series. Items purchased in fiscal year 2002 and costing between $500-$4,999.99 will be considered as "non-inventory capital outlay."

Agencies have the option of coding items costing between $500-$4,999.99 to either sub-object 4XX0 or 4XX9. If coded to 4XX9 these items will not appear on the Capital Outlay Report (DAFR8460). If your agency wishes to use this report as a tool to track items with a unit cost between $500 and $4,999.99 for internal purposes, you may do so by coding the items to 4XX0.

Note: Only those items with a useful life expectancy of one year or more and costing $5,000 or more are to be (1) maintained on the agency's inventory listing that is used by the Division of Accounts and Reports during the periodic physical inventory inspections and (2) included in the inventory summary totals submitted annually to the Division of Accounts and Reports.

The capitalization policy for buildings and building improvements (sub-objects 4200 and 4209) remains as stated in Informational Circular 01-A-018.

Although the threshold for reporting capital outlay/inventory items has been raised, agency managers are reminded that they continue to be responsible for safeguarding all assets for which they are responsible. In order to make employees aware of this responsibility, and also to ensure that there is one person in each agency responsible for the tracking of agency assets, all agencies should establish a policy for the safeguarding of state assets. Each agency should also appoint a property management officer to serve as the lead person within the agency for all asset management issues. As the Division of Accounts and Reports conducts the periodic agency reviews of inventory, we will be verifying that the agency has such a policy in place. The policy on the safeguarding of assets should address the topics listed on the attachment to this informational circular.

When submitting encumbered items for DA-118 transactions for fiscal year 2001, agencies should continue to use the current capital outlay coding policy to record these items in STARS.

Note: Items under $5,000 may be deleted from the agency inventory listing immediately and should not be included in the FY 2001 summary totals provided to the Division of Accounts and Reports. Items that appear on your Capital Outlay Report (DAFR8460) in amounts less than $5,000 for the remainder of FY 2001 should be disregarded and not added to the agency inventory listing used by the Division of Accounts and Reports during the periodic physical inventory inspections.

These revisions will be updated in the Uniform Expenditure Classification of Expenditure Sub-object Codes filing (P.P.M. No 7,002) on the Division of Accounts and Reports web site (www.da.ks.gov/ar/ppm/ppm01001.htm) in the future.

DB:JR

Attachment