# AFARS PART 5113

Subpart 5113.2 -- Actions at or Below the Micro-Purchase Threshold

- 5113.201 -- General.

- 5113.202-90 -- Purchase guidelines.
- 5113.270-90 Use of the Governmentwide commercial purchase card.

Subpart 5113.3 – Simplified Acquisition Methods

- 5113.302 -- Purchase orders.

- 5113.302-3 -- Obtaining contractor acceptance and modifying purchase orders.

- 5113.303 -- Blanket purchase agreements (BPAs).

- 5113.303-1 -- General.
- 5113.303-2 -- Establishment of BPAs.
- 5113.303-6 -- Review procedures.

- 5113.306 -- Standard Form 44, Purchase Order -- Invoice --Voucher.

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Subpart 5113.2 -- Actions at or Below the Micro-Purchase Threshold

5113.201 -- General.

(a) Delegation of micro-purchase authority.

(i) Principal Assistants Responsible for Contracting (PARC) at the Army Commands, the Army Service Component Commands, the Direct Reporting Units are responsible for the overall implementation and administration of the purchase card program at their subordinate commands and installations.

(ii) Installation Commanders or activity directors shall appoint the purchase card approving official as the certifying officer for purposes of certifying payments to the paying office (disbursing officer) for purchase card issuer invoice. Certifying officers are pecuniary liable for erroneous payments resulting from the performance of their duties in accordance with Title 31, United States Code, section 3328.

(iii) Chiefs of Contracting Offices shall:

(A) Develop internal operating procedures and incorporate appropriate controls in the Command or Installation Internal Control Program. Procedures and controls shall be written to place minimum burdens on cardholders while still maintaining the integrity of the program.

(B) Designate an Agency/Organization Program Coordinator (AOPC).

(C) Issue delegations of authority to cardholders. (This authority may be redelegated in writing to the AOPC.)

(D) Approve training course content and instructor qualifications.

(E) Ensure prescribed training of cardholders and approving officials.

(F) Ensure appropriate functional participation in the development and administration of the program (e.g., Finance and Accounting, Director of Logistics, Director of Public Works, Legal, etc.).

(G) Perform oversight reviews on approving officials to ensure cardholder adherence to policy and procedures. Reviews will be conducted not less frequently than annually. Accounts with significant dollar or transaction volume should be reviewed on a more frequent basis.

(H) Ensure convenience checks are safeguarded to ensure good stewardship, discourage, and detect fraudulent actions with the checking accounts. Checking accounts must be audited on a quarterly basis. Audits will be conducted by a duly appointed, disinterested third party under the guidance of the local internal Review (IR activity). The quarterly audit requirement must be added to the management control checklist of Government Purchase card.

(iv) Agency/Organization Program Coordinators (AOPC) shall:

(A) Serve as the purchase card focal point at each activity.

(B) Establish, and maintain current, cardholder and approving official accounts.

(C) Coordinate with resource managers, spending limits and finance and accounting data to be used in establishing cardholder and approving official accounts.

(D) Ensure accounts are not established or billing officials certify invoices until required letters of delegations and appointment letters have been issued to cardholders and approving officials /certifying officials.

(E) Perform oversight and surveillance of all accounts under the purview of that AOPC.

(v) Approving officials shall:

(A) Ensure that the transactions meet the legal requirements for authorized purchase card purchases.

(B) Ensure that adequate documentation is available for individual transactions.

(C) Ensure the facts presented in documents for payment are complete and accurate.

(D) Take appropriate action to prevent two or more payments for the same transaction.

(E) Ensure proper implementation of dispute procedures when transactions are questioned.

(F) Provide copy of certifying officer appointment letter with signature card to the AOPC.

(G) Certify and forward the official invoice to the paying office within 5 days of receipt. Electronic invoice is considered received on the first day following the end of the billing cycle.

(vi) Cardholders shall:

(A) Reconcile purchases actually made within 3 working days of receipt of their monthly statement of account. Electronic statement of account is considered received on the first day following the end of the billing cycle.

(B) Maintain a log of purchases. The log shall be the cardholder log within the banks electronic access system.

(c) Training Requirements.

(i) Cardholders and billing/certifying officials shall receive training and orientation covering the use of the card prior to being delegated authority under the program. The Defense Acquisition University purchase card course is mandatory for all cardholders and billing officials. Training may be locally developed, but specifically designed to cover federal, defense, and departmental regulations, policies and procedures pertaining to micro-purchases and simplified acquisition procedures, as applicable. Orientation shall address GSA, Card-Issuing Bank and installation-unique policies.

(ii) Cardholders shall receive procurement ethics training. Cardholders and Certifying Officials shall be advised of pecuniary liability under the program for certifying and accountable officials

(iii) The Chief of the Contracting Office may require additional training depending on the thresholds and circumstances established for the card’s use.

[AFARS Revision #21, dated May 22, 2007]

5113.202-90 -- Purchase guidelines.

(a) Micro-purchase authority should be delegated to the lowest possible level. Purchase cards shall be issued only to individuals who have received the orientation/training on the purchase card program as required in these procedures.

(b) Contracting Officers shall not issue cards to contractors. If contractors working on cost type contracts request cards, their request shall be forwarded to the contracting officer for the cost-reimbursable contract. If that office determines that they are eligible, the contractor will then file a Request for Eligibility Determination with the GSA SmartPay Contracting Officer.

(c) Cardholders may be authorized to utilize the Government Purchase Card as a payment instrument for orders exceeding $3,000 made against Federal Supply Schedule contracts, calls written against a Blanket Purchase Agreement (BPA) or orders placed against Indefinite Delivery/Indefinite Quantity (IDIQ) contracts that contain a provision authorizing payment by purchase card.

(d) The purchase card may also provide a streamlined way of paying for contracts other than those above. Prior to using the card this way, the contracting office shall determine that use of the card for payment is in the best interest of the Government. The determination shall address any increase in price and/or administrative costs to use the card versus the costs of processing the payment without the card.

(e) The purchase card may also be used to pay for government-owned materiel or government-performed services received from other government sources (i.e., DAPS, GSA, DLA).

[AFARS Revision #21, dated May 22, 2007]

5113.270-90 Use of the Governmentwide commercial purchase card.

Use of the purchase card must meet the following conditions in addition to conditions imposed by the General Services Administration Federal Supply Schedule:

(a) Each transaction should involve a single delivery and payment. Receipt of the item should be within the billing cycle or by the time the monthly report is received to simplify monthly reconciliation.

(b) Cardholders shall not break down (split) requirements aggregating more than the micro-purchase threshold into several purchases merely to avoid any requirement that applies to purchases exceeding the micro-purchase threshold.

(c) Cardholders shall advise Merchants/Vendors at the time the transaction(s) is/are made that items purchased with the card are “For Official United States Government Use.” Most states will exempt purchases made by the Government from state and local taxes.

(d) Cardholders shall initially attempt to settle disputes with the merchant. If the merchant refuses to work with the cardholder, or if 45 days has passed without resolution since receipt of the statement containing the questionable transaction, the cardholders shall formally dispute the transaction with the card-issuing bank.

(e) When using the purchase card to pay for services/supplies received from other government sources (i.e., Document Automated Printing Service (DAPS), General Services Administration (GSA) stores or depots, Defense Logistics Agency (DLA), procurement thresholds do not apply. Payment with the card is mandatory for services obtained from the DAPS.

(f) Army organizations are authorized to use the Governmentwide Purchase Card (GPC) up to micro-purchase thresholds at DOD Non-appropriated fund instrumentality (NAFI), including Army and Air Force Exchange Service (AAFES) facilities, provided the resale activities are within scope of the particular NAFI’s charter. Purchases up to $50,000 maybe made from exchanges only (vice NAFI’s) by overseas organizations and the purchase card can be used as a method of payment.

(g) The purchase card shall be used as a method of payment for all commercial training $25,000 and below for the following:

(1) DD Form 1556, Request, Authorization, Agreement, Certification of Training, and Reimbursement in accordance with United States Code 41 for civilians.

(2) DA Form 2171, Request for Tuition Assistance Army Continuing Education System, provides financial assistance for voluntary off-duty education Programs in support of soldiers professional and personal self development. Supporting the GPC that utilizes payment for all education (payment vouchers) valued at or below $25,000. The DA Form 2171 is the obligation document for education programs and services authorized under Title 10, United States Code 2007 and AR 621-5 Army Continuing Education System. Advance payments are authorized under the Tuition Assistance (TA) Program IAW AR 621-5. All course enrollments must be approved prior to start of class.

(3) Military Tuition Assistance. The GPC will be used as the method of payment for soldiers tuition when the request, funding, approval and enrollment verification of the specific course is processed through Centralized Tuition Assistance Management (CTAM) in GoArmyEd. Single purchase limits will be set commensurate to the level of the consolidated GPC invoice submitted by each university or college.

(h) Dollar limits.

(1) For stand alone purchases, the single purchase limit is the micro-purchase threshold except for the following:

(i) $2,000 for purchases covered by the Davis-Bacon Act.

(ii) $2,500 for purchases covered by the Services Contract Act.

(2) For payment against existing contracts, the limit is as identified in the contract.

(3) The threshold for all convenience checks and drafts is $3,000 plus the above exceptions.

(4) For contingency or humanitarian operations as authorized by a specific appropriations act or an Executive Order, the micro-purchase threshold may be adjusted in accordance with the applicable act or the order.

[AFARS Revision #21, dated May 22, 2007]

Subpart 5113.3 – Simplified Acquisition Methods

5113.302 -- Purchase orders.

5113.302-3 -- Obtaining contractor acceptance and modifying purchase orders.

(b) It is not necessary to modify a purchase order to document a shortage in the final shipment, provided the shortage is negligible.

5113.303 -- Blanket purchase agreements (BPAs).

5113.303-1 -- General.

(S-90)

(a) It is preferable to have multiple BPA’s for similar items and to establish prices using reverse auctions between BPA holders. If quantities are too small and not conducive to using a reverse auction, then when practicable, contracting officers should establish pre-priced BPAs by negotiating firm unit prices for specific periods of time or by incorporating supplier’s price lists or catalogs in BPAs.

(b) Blanket purchase agreements should not be established for supplies or services for which unpriced purchase orders should be used (FAR 13.302-2).

[AFARS Revision #21, dated May 22, 2007]

5113.303-2 -- Establishment of BPAs.

(S-90) Contracting Office Responsibilities.

(a) The contracting officer shall:

(1) Ensure that those individuals authorized to place calls under BPAs have received training and orientation in accordance with (b).

(2) Provide a copy of the BPA to individuals authorized to place BPA calls.

(3) Ensure that individuals have ready access to price lists or catalogs incorporated in BPAs [The use of reverse auctions to determine pricing between BPA’s is the preferred method.].

(4) Ensure that suppliers are provided the names of individuals authorized to place calls.

(5) Inform individuals authorized to place calls that the authority may not be redelegated to others.

(b) Training for use of BPAs is the same as that required for the use of purchase cards. Orientation must focus on the BPA process, except that if the same individual will also be a purchase cardholder, BPA orientation must be in addition to the Purchase Card Program orientation. The chief of the contracting office is responsible for approving training course content and instructor qualifications when training is provided by someone outside the contracting office.

[AFARS Revision #21, dated May 22, 2007]

5113.303-6 -- Review procedures.

(b) In addition to the review procedures in FAR 13.303-6, contracting officers who authorize individuals to place calls under BPAs shall:

(i) Ensure that individuals equitably distribute calls among suppliers with BPAs.

(ii) Ensure that individuals do not split requirements to evade monetary limitations.

(iii) Require that individuals refer all cases where prices are not considered reasonable to the contracting officer for determination.

(iv) Maintain continuing surveillance over individuals to ensure compliance with acquisition regulations and that the authorizations at FAR 13.303-5 continue to be essential.

[AFARS Revision #21, dated May 22, 2007]

5113.306 -- Standard Form 44, Purchase Order -- Invoice --Voucher.

(S-90)

(a) The contracting officer signature constitutes certification of fund availability under the appropriation cited on the order. The contracting officer is responsible for ensuring that funds are available and for entering the proper accounting classification on the order.

(b) When the bulk funding concept defined at FAR 13.101 is used, the contracting officer must inform the finance and accounting officer at the close of each accounting month of the amount of all purchases made from the bulk funding accounting by use of the Standard Form 44.

(c) If the supplier agrees, the contracting officer may hold completed Standard Forms 44 until the end of a month and prepare Standard Form 1034 as the payment voucher with the Standard Forms 44 attached as sub-vouchers. In such cases, the contracting officer signature on Standard Form 1034 will be sufficient in place of a signature on each Standard Form 44 attached. If the supplier does not agree to use this procedure, or if a time payment discount offered cannot be taken because of this procedure, the individual Standard Form 44 must be processed without delay to take the time payment discount.

[AFARS Revision #21, dated May 22, 2007]