** PRIVATE ** Okay, here are two questions for those of you who have moved into extensively using credit cards for small-dollar, but high-volume purchases. But first, a little background so you'll understand why we're asking. (Note: Okay, so the explanation is a little long. But the questions - and hopefully your answers - are pretty short.) We're on the brink of launching credit cards on an organization-wide basis. We have a few VISA credit cards now, but they are "generic," and we "check them out" on a case-by case basis. We are proposing to issue as many City credit cards as departments request (in the employee's name, subject to department head approval and a bunch of other conditions I won't bore you with right now). While I don't know how many of these we will issue, let's assume we issue at least 50 of them. (We have 342 regular employees; by comparison, Santa Maria has a comparable number of employees, but they've issued about 200 cards). So here are my questions: KEEPING PAYMENTS STRAIGHT With 50 cards, and the potential for a LOT of small charges, we see getting the Bank of America to correctly post payments to each account as a real problem. If we have 50 active accounts, and each account has just 10 charges each month (and there could easily be many more than this), that will be at least 500 separate "invoice" entries (assuming we use the credit card account number as the "invoice" number) on the remittance advice if we issue one check (which would be our "normal" practice). We are concerned that the Bank of America will never get this right (maybe I'm putting myself in their moccasins too much here, since I'm not sure we would get this 100% right if the roles were reversed!) To resolve this, we're thinking about setting up each individual account as its own separate B of A vendor. In this way, each account will be automatically summed up for B of A, and match directly to their statement. This "one-to-one" matching (which would eliminate their having to correctly enter 500 separate entries; there would be just one entry for them for each account) should virtually eliminate this potential for error. Also, once we create the separate vendor, it will significantly reduce our data entry in having to enter the long (16 digit) account number for each charge. On the other hand, conventional "finance" wisdom tells me I'm supposed to consolidate vendor payments on one check, not issue 50 separate checks to essentially the same vendor. QUESTION: Is getting the bank card vendor to correctly post credit card payments per account a problem for you? If not, how have you addressed the problem described above? Does the solution result in more work for Finance (like preparing supplemental reports) than you used to do before you expanded credit card use? LOSS OF VENDOR INFORMATION If we use cards extensively instead of open purchase orders, it seems to us that the card vendor (in our case the B of A) becomes one of our largest vendors, from a volume perspective. This means we will lose detail in our system on purchases from specific vendors (and potentially other detail about the purchase; this depends on other decisions we make about how we enter charge data). Right now, the operating departments (and Finance) make extensive use of on-line inquiry, and we're concerned we'll lose valuable on-line information about our purchases. QUESTION: Is this a problem for you? If not, how have you addressed the problem described above? Does the solution result in more work for Finance (like preparing supplemental reports) than you used to do before you expanded credit card use? Okay, a little more info so I can do some "apples to apples" comparisons: o About how many regular employees do you have? o About how many cards have you issued? I'm really hoping to avoid a false start here by benefitting from others' experience - and not promising our departments more than we can really deliver. So, your thoughts by Monday, April 3 will really be appreciated. (Note: Pleasanton, Santa Maria and Paso Robles: No need to reply to this - you've already given us great help - and much food for thought, since you all three do this differently!) As always, I'll post the results. (And I'll put our finalized credit card policy in the "'resource room" along with Pleasanton and Murrieta's). Thanx much! Bill Bill Statler, Director of Finance City of San Luis Obispo 990 Palm Street San Luis Obispo, CA 93405 Phone: (805) 781-7125 Fax: (805) 781-7401 Email: [EMAIL PROTECTED]
