Procurement Policy

VICKSLY FOUNDATION

June 2018
 PROCUREMENT OF GOODS

PURPOSE OF PROCUREMENT

The overall purpose of procurement regulations is to ensure that VICKSLY FOUNDATION gets
the highest quality of desired goods and services at the best price possible. Further, the
regulations are aimed at streamlining the process of procurement while maintaining adequate
controls. These procurement procedures apply to all staff involved in the procurement process
and to all types of procurement.

THE PROCUREMENT COMMITTEE

The VICKSLY FOUNDATION] procurement committee shall be composed of [Executive Director
or Representative, finance, and administration representatives].
The committee shall meet when there is need to deliberate on issues pertaining to
procurement.

The key terms of reference for the committee shall be to:

i) Award tenders
ii) Approve orders
iii) Award contracts
iv) Approve variation of contracts conditions

SEPERATION OF DUTIES

There shall be proper separation of duties between:

i) The person who orders a purchase from a vendor.

ii) The person who satisfies that the goods supplied are satisfactory.
iii) The person who accepts goods into store.

iv) The person who authorizes payment.

PROCUREMENT PLANNING
Procurement planning is part of the annual budgeting process. Each departmental head is
responsible for planning his/her project’s estimated procurement needs on an annual basis
using the annual procurement plan (APP), which indicates the items to be bought in the various
quarters of the year. The procurement officer will use the APP to plan for requisitions. It is
crucial that the procurement committee discuss the APP at the beginning of each year and as
need may arise within the year. The APP will also require the final approval of the project
coordinator, who will share it with the executive director for comments before approval.

PROCUREMENT REQUISITION (PR)

Each specific procurement procedure process shall be initiated by procurement requisitions to
the procurement officer from the requesting department and should show detailed
specifications and
requirements for the item(s) being requested. They should also indicate that the item is
budgeted for. The PRs allows the departments flexibility within the overall annual plans
regarding specifications, exact quantities, delivery dates, etc. They are also used to cater for un-
planned or emergency procurement.
The PR form will show the following:
i) Items required.
ii) Quantities.
iii) Delivery dates and locations.
iv) Accounting information.
v) Whether procurement is within APP/budget or emergency or unplanned.
vi) Signature of the preparing person.
vii) The departmental head.

Some donors do prescribe some conditions or restrictions required to be observed during

procurement pertaining to the project they fund. It is the responsibility of the procurement
committee to ensure that such donor requirements and restrictions are observed in the
procurement of goods and services but within the framework of [name of organization]
procurement guidelines.
All requisitions must be signed by the departmental heads or designate, who should ensure
that the item(s) are in APP or should seek authority to procure as per policy. Any persons
designated to authorize requisitions in acting capacity must have the authority given in writing
clearly stating the period authorized.

CONTROLS ON PROCUREMENT
Goods and services will only be procured within approved budgets except in case of
emergencies, which must be approved by the executive director. Thus, in addition to being
responsible for preparing the APP/budget, the departmental heads should ensure that actual
procurement throughout the year remains within the budget. Each requisition should reference
the APP line bearing the item or requisition and if need, be attached to the page of the APP
where such line is contained.
The financial officer shall assist the procurement officer in conducting periodic checks on
procurement activities to ensure that they conform to APPs, donor procurement requirements,
and [name of organization] policies and procedures.
It is the responsibility of the person who signs the local purchase order (LPO) to verify that the
following have been, done whether he/she collects the goods concerned.
(i) That the correct quantity has been received and signed.
(ii) That the quality and price of goods is as agreed.
(iii) That all goods delivered have been securely and inventory records appropriately updated.
(iv) That the delivery note is checked, signed, and forwarded to the financial officer to await
the invoice.

Purchases under petty cash must not exceed the maximum amount established and
documented by the financial officer.
Procurement staff and all members of the procurement committee will be required to sign a
‘conflict of interest’ document stating that they will not purchase goods or services from a
company they have a vested interest.
THE PROCUREMENT PROCESS REPORT
Upon receipt of requisitions, the procurement officer will first verify that the requisition is
properly approved according to the signing authority. He/she will then enter the requisition
details into the procurement report worksheet. After this, he/she will begin the process of
sourcing for the goods.
The procurement report worksheet is updated to reflect requisition as they are received. It also
includes information on status of each procurement requisition, complete with expected
delivery date. This is to be submitted to projects department on a monthly analysis.
The procurement officer is required to present a monthly financial and narrative report on
procurement to the executive director, through the administrative assistant and a copy
forwarded to the financial officer.

VENDOR SELECTION
Careful selection of vendors should be done to ensure that best possible price, quality and
delivery time available within the markets is obtained. A list of suitable vendors (the list of pre-
qualified vendors), for each type of goods and services based on letters of introduction and past
performance shall be maintained. This will make the process of vendor identification much
faster. The vendor list shall be reviewed and updated periodically to ensure that current known
factors are taken into consideration.
Once the previous year’s list of vendors has been updated and approved by the procurement
committee, procurement of goods, and services can be effected. Vendor selection for inclusion
on the list of pre-qualified vendors will take place once per year and will be done by the
procurement committee.

VENDOR SELECTION CRITERIA

The following set of criteria is essential for deciding on choice of vendors:
i) Price
ii) Quality of goods/services. Such a justification must be verifiable.
iii) Availability of goods/services within the required delivery time.
iv) After sale services, including availability of parts/supplies.
v) Bidder’s previous records of performance and service.
vi) Ability of bidder to render satisfactory service in this instance.
vii) Financial stability of the vendor.
viii) Availability of bidder’s representatives to call upon and consult with
ix) Payment terms
x) Warranty offered.
xi) Ability to provide samples

PROCEDURE FOR TENDER

The procurement office and the heads of the various departments may recommend potential
vendors but the selection of those invited will be left to the discretion of the procurement
committee. The procurement officer will send an invitation to tender to each supplier listed to
be invited. The vendors will pick up tender documents at [name of organization] offices
specifying the goods and details, or any relevant information needed to get accurate bids. All
suppliers must receive the same information.

USE OF DEALERS AND SOLE SUPPLIERS

In the interest of ensuring quality, reliability and timeliness, the procurement officer may
establish purchase agreements or contracts with main dealers of regularly purchased goods.
Where possible due to other factors, the procurement office will negotiate rates and discounts
with the supplier or a method to determine price for invoice justification. These agreements
and prices (net of discounts) should be reviewed annually to ensure that they are competitive .

LOCAL PURCHASE ORDERS (LPO) WITH VENDORS

The LPO is a contract with vendors should include all information regarding the goods and
services being procured as well as standard terms of delivery, payment and arbitration in case
of dispute. If contracts are precise and clear, possibilities of disputes will be reduced and [name
of organization] will stand far greater chance of receiving the goods and services as expected.
Upon selection of a vendor, a legally binding contract or work order should be drawn-up for the
goods and services in question and signed by both parties prior to procurement. Detailed
specifications; quantities, unit prices, delivery deadlines, locations, and payment schedules
must be specified in such contracts.

ORDER FOR RECURRING REQUISITION

Procurement of a recurrent nature, i.e. where the same goods and services may be issued
several times a year, one vendor may be selected for a period of up to one year. In some cases,
particularly for services, contracts for the goods or services can be drawn up once, which may
then be reference every time those goods or services are required without requiring separate
quotations and contracts on each occasion. In other cases, particularly for regularly purchased
goods, vendors can be selected once, but separate contracts drawn-up on each occasion the
vendors are used.

CERTIFYING DELIVERY OF GOODS AND SERVICES

The procurement process cannot be completed without certification that the goods and
services procured have been received entirely to [name of organization] satisfaction to the

satisfaction of the requisition. The procedure for receiving goods and services is therefore
important in ensuring that vendors have entirely met their obligations. Once [name of
organization] has certified that goods and services have been received to their satisfaction, it
has little further resources to complain about a vendor’s performance; and payment can then
be made.
In all cases, the certification of receipts of goods and services is pre-requisite to [name of
organization] and the following guidelines are essential for that purpose.
i. The procurement office should ensure that goods and services are checked against
contracts, waybills, invoices, or delivery notes.
ii. Requisition department at the time of delivery will facilitate the receiving and
checking of goods and services whereby the receiving person will have to sign the
delivery notes or any other documents during delivery.
iii. Physical checking should be done by the requisitioning department and not by the
procurement office.
iv. iv. In some cases, receiving of goods and physical checking of goods or services may
be delegated to other [name of organization] officers who are so authorized by the
procurement officer. Such might include cases where goods of services are delivered
directly to a project field location; or where specialist’s technical certification is
required.
v. Any differences between documents done physical checks should be noted and
reported to the procurement officer for action.

PAYMENT-PROCESSING PROCEDURE
The recipient department is responsible for preparing payment requisition which then it
forwards to the procurement office for checking and certifying. The document is then sent to
the finance department for further checking and necessary approval and authority to pay. All
payments must be made in accordance to the contractual terms between the vendor and
VICKSLY FOUNDATION and about the financial policies.
PROCUREMENT OF SERVICES
APPOINTING AND PAYING CONSULTANTS
Consultants’ services shall be sought for:

i) A job for which the required technical expertise does not exist in-house at [name of
organization].
ii) A job that is not ongoing and hence does not require full time staff.
iii) A job that does not require more than 6-months continuous engagement.
The following procedure shall be observed for engaging he services of a consultant at VICKSLY
FOUNDATION The decision to hire the services of a consultants shall be taken by the executive
director in liaison with the heads of the various departments in consultation with the board of
directors.
i) The executive director shall send invitation to specific appropriate consultant(s)
requesting for proposal for the consultancy by a stated date.
ii) The proposals received shall be reviewed by a panel composed of the various heads
of department and the ensuing recommended name shall be submitted to the
executive director who shall discuss with the [name of organization] executive
committee.
iii) The terms of reference for the consultancy shall be mutually agreed upon and the
financial officer shall be involved in the negotiation of financial aspects of the terms.
iv) v) The contract agreement shall be signed by both parties before commencement
of the consultancy assignment.
v) Payment is conditional on satisfactory completion of the whole job unless the
agreement provides for installments at completion of specifically agreed
components/tasks.

APPOINTING AND PAYING TEMPORARY STAFF

Temporary staff include locum, short-term project staff engaged for on-off tasks. The following
procedure shall be observed for engaging the services of temporary staff;
i) The temporary staff is engaged by the executive director in liaison with the
department in need of the staff and the financial officer.
 ii) The letter of engagement is issued by the executive director stating the temporary
status of the employment and the agreed terms.
iii) A temporary staff is expected to comply with all the policies of [name of
organization] while in the service of [name of organization].
iv) Payment shall be made at the end of the month along with the payroll of the regular
staff.

APPOINTING AND PAYING CASUAL WORKERS

Casual workers will be those engaged in project work especially manual work, for one to several
days. The following procedure shall be observed for engaging the services of casual workers:
i) The casual workers are engaged by the heads of departments upon the approval of
the executive director.
ii) A list of casual workers (name and identity numbers) shall be maintained by the
head of department stating the terms of reference for the casual worker.
iii) The letter of authority for engagement of casual workers shall be issued by the
executive director to the head of department, stating the terms of reference for the
casual workers.
iv) Casual workers are expected to comply with all the policies of [name of
organization] while at their service.
v) v) Payment shall be made on a daily or weekly basis.
PROCUREMENT PLAN FOR GOODS
Item Month when
description needed (When Quantity (How From where to
(What to buy?) to buy?) many to buy?) buy? Estimated cost
PROCUREMENT PLAN FOR SERVICES
What type of Is this an
service is Month when Needed for how individual or an Total estimated
needed? needed many days? organization cost
Ethics and Code of Conduct
And Prohibition on Provisions in Solicitation That Unduly Restrict Competition

As required by 2 Code of Federal Regulations parts 2 CFR §200.318 (a) – (c) of General procurement
standards.

(a) The non-Federal entity must use its own documented procurement procedures which reflect
applicable State, local, and tribal laws and regulations, provided that the procurements conform to
applicable Federal law and the standards identified in this part.

(b) Non-Federal entities must maintain oversight to ensure that contractors perform in accordance with
the terms, conditions, and specifications of their contracts or purchase orders.

(c)(1) The non-Federal entity must maintain written standards of conduct covering conflicts of interest
and governing the actions of its employees engaged in the selection, award and administration of
contracts. No employee, officer, or agent may participate in the selection, award, or administration of a
contract supported by a Federal award if he or she has a real or apparent conflict of interest. Such a
conflict of interest would arise when the employee, officer, or agent, any member of his or her
immediate family, his or her partner, or an organization which employs or is about to employ any of the
parties indicated herein, has a financial or other interest in or a tangible personal benefit from a firm
considered for a contract. The officers, employees, and agents of the non-Federal entity may neither
solicit nor accept gratuities, favors, or anything of monetary value from contractors or parties to
subcontracts. However, non-Federal entities may set standards for situations in which the financial
interest is not substantial, or the gift is an unsolicited item of nominal value. The standards of conduct
must provide for disciplinary actions to be applied for violations of such standards by officers,
employees, or agents of the non-Federal entity.

(2) If the non-Federal entity has a parent, affiliate, or subsidiary organization that is not a state, local
government, or Indian tribe, the non-Federal entity must also maintain written standards of conduct
covering organizational conflicts of interest. Organizational conflicts of interest mean that because of
relationships with a parent company, affiliate, or subsidiary organization, the non-Federal entity is
unable or appears to be unable to be impartial in conducting a procurement action involving a related
organization.

The SFA follows the Following Ethics and Code of Conduct

As representatives of the school food service department, all employees are expected to conduct
themselves in a professional and ethical manner, maintain high standards of integrity, and use good
judgment. Employees are expected to be principled in their business interactions and act in good faith
with individuals both inside and outside the school food service department.

The following Code of Conduct shall govern the performance, behavior, and actions of the school food
service department, including board members, employees, directors, volunteers, or agents who are
engaged in any aspect of procurement, including, but not limited to, purchasing goods and services,
awarding contracts and grants, or the administration and supervision of contracts.
Code of Conduct

a) No employee, officer, director, volunteer, or agent of the school food service department shall
participate in the selection, award, or administration of a contract supported by federal, state, or local
funds if a conflict of interest is real or apparent to a reasonable person.

b) Conflicts of interest may arise when any employee, officer, director, volunteer, or agent of the
school food service department has a financial, family, or any other beneficial interest in the vendor firm
selected or considered for an award.

c) No employee, officer, director, volunteer, or agent of the school food service department shall
do business with, award contracts to, or show favoritism toward a member of his/her immediate family,
spouse’s family, or to any company, vendor, or concern who either employs or has any relationship to a
family member; or award a contract which violates the spirit or intent of federal, state, and local
procurement laws and policies established to maximize free and open competition among qualified
vendors.

d) The school food service department’s employees, officers, directors, volunteers, or agents shall
neither solicit nor accept gratuities, gifts, consulting fees, trips, favors, or anything having a monetary
value in excess of ___ dollars from a vendor, potential vendor, or from the family or employees of a
vendor, potential vendor, or bidder; or from any party to a sub agreement or ancillary contract.

Disciplinary Action. Disciplinary action may result from the violation of work rules, from failure to carry
out job instructions and assignments properly, or from violation of any law. Disciplinary action shall be
progressive and for correcting conduct. However, acts of Serious Misconduct (Section C) or other
situations may be determined to be of such a serious nature that immediate dismissal is necessary.

It must be recognized that, since each case is different, it is impossible to prescribe a specific penalty for
a offense. In accordance with Chapter 410 of the Wisconsin Human Resources Handbook (WHRH), a
Letter of Expectations may be issued when the behavior of the SFA and/or vendor is not severe enough
to warrant formal discipline. Disciplinary actions are cumulative from the effective date of the letter of
the first violation until the SFA and/or vendor employee is free from any further discipline for 12 months
at which time a progression step may be repeated versus increased to the next level. The level of
discipline may be reduced if the employee remains discipline free for longer durations.

Prohibition on Provisions in Solicitation That Unduly Restrict Competition. The school food service
department shall not include in a solicitation any feature that unduly restricts competition. Some of the
situations considered to be restrictive of competition include, but are not limited to, the following:

a). Excessive Qualifications. Imposing unreasonable business requirements for bidders or offerors.
b). Unnecessary Experience. Imposing unnecessary experience requirements for bidders and offerors.

c). Improper Prequalification. Using prequalification procedures that conflict with federal, state, or local

regulations.

d). Retainer Contracts. Making a noncompetitive award to any person or firm on a retainer contract with

the recipient if that award is not for the property or services specified for delivery under the retainer

contract.

Term Defined:

A retainer contract is a work for hire contract. It falls between a one-time contract and full-time
employment. Its distinguishing feature is that the employer pays in advance for work to be specified
later. Additional contracts regarding the performance of this work may also apply.

It is common for a person seeking the services of a lawyer (attorney) to pay a retainer ("retainer fee") to
the lawyer, to see a case through to its conclusion. A retainer can be a single advance payment or a
recurring (e.g., monthly) payment.

A retainer fee can be paid on a fixed, pre-negotiated rate or on a variable hourly rate depending on the
nature of retainer and, the practice of the lawyer/advocate being retained. Both models exist in the
industry. The purpose of a retainer fee is to ensure payment for future services or work to be rendered.
Absent an agreement to the contrary, a retainer fee is refundable if the work is not performed.

e). Excessive Bonding. Requiring a bonding that far exceeds the requirements described in federal, state

or local regulations.

f). Brand Name Only. Specifying only a “brand name” product without allowing offers of “an equal”
product or allowing “an equal” product without listing the salient characteristics the “equal” product
must meet to be acceptable.

g). In-State or Local Geographic Restrictions. Specifying in-State or local geographical preferences, or
evaluating bids or proposals in light of in-State or local geographic preferences, even if those
preferences are imposed by state or local laws or regulation except as permitted by federal regulations.
See section of the Procurement Policy and Procedures Manual for application of geographic restrictions.

h). Restraint of Trade. Supporting or acquiescing in noncompetitive pricing practices between firms or
between affiliated companies. Questionable practices would include, but not be limited to, submissions
of identical bid prices for the same products by the same group of firms, or an unnatural pattern of
awards that had the cumulative effect of apportioning work among a fixed group of bidders or offerors.

i). Arbitrary Action. Taking any arbitrary action in the procurement process.

Term Defined: An arbitrary action is an action, determination, or selection founded on individual

discretion, especially when based on one's opinion, judgment, or prejudice, rather than on fixed rules,
procedures, or law.
j). Excessively Specific Qualifications. Developing specification and evaluation criteria which
unnecessarily favor a contractor.

k). Arbitrary Contract Splitting. Splitting larger procurements into multiple smaller procurements to
evade competition requirements at certain ordering thresholds.