ES, IG-98-011, NASA's International Merchant Purchase Authorization Card Program

NASA'S INTERNATIONAL MERCHANT
PURCHASE AUTHORIZATION CARD PROGRAM
IG-98-011

Executive Summary

Background
The International Merchant Purchase Authorization Card (IMPAC) is a commercial credit card for use by Government organizations to purchase approved supplies and services costing $2,500 or less (micropurchases). This Government commercial credit card program began in 1987 when the Office of Management and Budget asked the General Services Administration (GSA) to provide commercial credit cards to Government agencies for use in making small purchases. The Rocky Mountain BankCard System (RMBCS) was awarded the Government's credit card contract in 1989.

GSA and the RMBCS established model procedures for using the credit card to include management controls for monitoring the program. These procedures have been incorporated into the NASA supplement (NFS) to the Federal Acquisition Regulation, which is NASA's primary regulatory document for the program (see Appendix A for additional background information).

Objectives
The overall objective of the audit was to determine whether NASA was adequately managing the credit card program. Specifically, we determined whether internal controls were adequate to ensure:

purchases were proper,
the payment authorization process was adequate, and
property accountability was effective.

Additional information on scope and methodology is shown in Appendix B.

Overall, the NASA IMPAC program was generally effective, and controls over the use of credit cards were in place. The program has provided a quick and cost-effective way of making small purchases. However, in view of the increasing number of cardholders and dollar amounts of purchases (see Appendix C), NASA needs to make improvements in the overall management of the program.

Results of Audit
During the audit, we separately notified management of problems in property accountability, split purchases, and credit cards used by someone other than the cardholder. Management took prompt corrective action in all three areas (see Appendix D). Additional improvements in purchase and payment controls will further strengthen the program. Additional savings are also possible through improved oversight of the credit card program.

We have also included examples of controls used by other agencies and some NASA locations (see Appendix E). Our purpose was to identify, for management, additional controls that individual NASA locations may want to consider for their use.

Background	The International Merchant Purchase Authorization Card (IMPAC) is a commercial credit card for use by Government organizations to purchase approved supplies and services costing $2,500 or less (micropurchases). This Government commercial credit card program began in 1987 when the Office of Management and Budget asked the General Services Administration (GSA) to provide commercial credit cards to Government agencies for use in making small purchases. The Rocky Mountain BankCard System (RMBCS) was awarded the Government's credit card contract in 1989. GSA and the RMBCS established model procedures for using the credit card to include management controls for monitoring the program. These procedures have been incorporated into the NASA supplement (NFS) to the Federal Acquisition Regulation, which is NASA's primary regulatory document for the program (see Appendix A for additional background information).
Objectives	The overall objective of the audit was to determine whether NASA was adequately managing the credit card program. Specifically, we determined whether internal controls were adequate to ensure: purchases were proper, the payment authorization process was adequate, and property accountability was effective. Additional information on scope and methodology is shown in Appendix B. Overall, the NASA IMPAC program was generally effective, and controls over the use of credit cards were in place. The program has provided a quick and cost-effective way of making small purchases. However, in view of the increasing number of cardholders and dollar amounts of purchases (see Appendix C), NASA needs to make improvements in the overall management of the program.
Results of Audit	During the audit, we separately notified management of problems in property accountability, split purchases, and credit cards used by someone other than the cardholder. Management took prompt corrective action in all three areas (see Appendix D). Additional improvements in purchase and payment controls will further strengthen the program. Additional savings are also possible through improved oversight of the credit card program. We have also included examples of controls used by other agencies and some NASA locations (see Appendix E). Our purpose was to identify, for management, additional controls that individual NASA locations may want to consider for their use.