In terms of the expense rules for suppliers, it might have the opposite effect to the goal of controlling cost because suppliers will quote higher now due to the fact that they will not be paid for some of the expenses. How to handle that?

The fact some of the expenses will no longer be paid for by the University does not necessarily justify the suppliers to raise their cost to us. We should do our diligence to ensure suppliers we award our contracts to are not taking this opportunity to raise their cost without justification.

For allowable expenses, we need to plan ahead at the time of procurement planning and contract establishment. Doing so will help us to make these costs visible, budgeted for and under control.

In terms of the expense reimbursement rule for suppliers, we know there will be some expenses that are inevitable in the project we are working on, what can we do in these situations?

Suppliers need to be informed of these rules related to expense reimbursement, such as meal, hospitality and incidental expenses can no longer be claimed, and original itemized receipt is required for any claims.

For other allowable expenses that will likely occur during the course of project, establish a contract with clauses that explicitly provide the reimbursement.

If a contract needs to be extended because the supplier can’t complete work on time with acceptable reason(s), the total spending remains the same, how to handle that?

Contract revision needs to be approved according to department’s approval authority schedule and to be documented by the department.

If a purchase order needs to be revised to reflect the contract change, email Purchasing Services with all related information including the reason and what the new term is. Purchasing Services will revise the PO accordingly.

Who has the responsibility to manage and document supplier performance and contract? Is there any form that we can use?

Depending on the roles of each department in the establishment and execution of a contract, the responsibility to manage and document supplier performance and contract lies with each department who is responsible for that particular procurement activity.

For what type of purchases do we have to have a contract?

Contract means an agreement entered into by two or more parties with the intention of creating a legal obligation.

A contract doesn’t have to be in the form of a document signed by both parties.  It can be in the form of any one of the following:

Who has the authority to enter into agreement /contract with suppliers?

Anyone who has the approved authority to commit University funds can enter into agreement or contract with suppliers within his or her signing authority.


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