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Key Terms
Bid:
A formal offer made by suppliers after Procurement and Payment Services has issued an Invitation for Bid (IFB) or a Request for Bid (RFB). If the University accepts a bid, it can then become a contract. The Alabama Competitive Bid Law requires that purchases of $7500 or more be based on competitive, formal, sealed bids. Bids are opened and publicly read aloud and become a matter of public record after the award of a contract (PO).
Change Order: A written modification or addition to a purchase order which amends the originally issued PO in some way (source of funding, add or deleting items, canceling the order). The need for processing the Change Orders must be fully documented, reviewed and approved by PPS and issued to the applicable vendor in writing BEFORE the vendor can take action on it.
Contract: 1) A legally enforceable promise; 2) a relationship, a legal obligation resulting from the parties' agreement to mutual consideration; 3) an agreement with specific terms between two or more persons or entities in which there is a promise to do something in return for a valuable benefit known as consideration. Since the law of contracts is at the heart of most business dealings, it is one of the three or four most significant areas of legal concern and can involve variations on circumstances and complexities.
Delegated Signature Authority: In order to carry out the day-to-day business of Auburn University, the President delegates signature authority to certain departments and individuals occupying unique positions at the University. Those departments/individuals are said to have "delegated signature authority". Signing documents without such delegated signature authority can result in personal liability and/or risk to the University.
Emergency:
Failure to anticipate or plan for a need is not considered an emergency. For Procurement and Payment Services purposes, an emergency is a circumstance in which damage to University facilities, personnel or serious damage to University programs will result if prompt action is not taken. Emergency Purchase Orders are considered on their individual merits. They will be processed as emergencies only when Procurement and Payment Services determines that it is necessary, based on your written explanation. If approved,
Procurement and Payment Services personnel will either place the PO by phone or issue you a PO number to
use in placing the order.
Encumbered Purchase Order:
A Purchase Order for which departmental funds have been specifically set aside by account number.
Invitations to Bid (IFB's):
A request by Procurement and Payment Services to potential suppliers (vendors) for a bid on goods or services to be purchased.
Invoice:
An original, itemized bill which includes a description and unit price of the items purchased, an invoice number, invoice date, vendor name and address for remittance.
Lease-Purchase:
A lease that actually represents the purchase and/or financing of equipment. Contact Procurement and Payment Services (4-7771) or Financial Reporting (4-7771) for assistance in determining if a transaction constitutes a lease-purchase.
Multiple Vendor Voucher - BO 55-02:
A voucher used to pay more than one recipient for like payments (e.g., refunds, stipends, etc.).
On-Campus Supplier:
Any University department that provides goods or services to other AU departments. Most such suppliers process charges through the Direct Charge system. PO's are usually not required. If the supplier doesn't direct charge, they will issue an invoice to the department who then prepares an ITV. Submit contract and grant related ITV's to Contracts and Grants Accounting and all others to Financial Reporting for processing.
Proprietary item
is a related term for an item produced exclusively by one firm. (For example, Coca Cola.)
Purchasing Card:
The Visa credit card available to departments for small dollar purchases (generally under $2500) through the University Purchasing Card Program. See the
Purchasing Card
section for details.
Purchase Change Order Request Form:
A form which requests modification to a contract or purchase order. The
Purchase Change Order Request Form is available online.
Purchase Order (PO):
The form that Procurement and Payment Services generates and sends to a vendor which formally states all terms and conditions of a proposed transaction as submitted by the department on a Purchase Requisition. Each Purchase Order reflects the unique PO number assigned to that purchase.
Purchase Requisition (PR):
The online form that a department sends to Procurement and Payment Services (electronically via Banner) which describes the requested materials or services and is the basis for the PO issued by Procurement and Payment Services.
Quotation (or Quote):
A quotation or quote is provided by a seller to a prospective buyer. It is a specific statement of price, terms of sale, and description of the goods or services which the seller offers. The Request for Quotation (RFQ) is used by Procurement and Payment Services to obtain less-formal oral or written offers from vendors. These are used for purchases of less than $7,500 which do not involve official advertising or sealed bids.
Request for Proposal (RFP): A competitive vehicle used by buyers to purchase goods and services where requirements are not often clear or easily specified, allowing suppliers to question and interpret what is being requested. The proposal is the supplier's interpretation of the buyer's solution to its needs. Lowest price is not necessarily the determining criteria.
Sealed Bid: A vendor offer submitted in response to an Invitation to Bid (IFB) or Request for Bid (RFB) issued by Procurement & Payment Services for the purchase of goods or services. By law, such bids are submitted in sealed envelopes which must be opened and read aloud in a public setting at the time, day and location specified in the IFB/RFB document.
Single (or Sole) Source Purchase:
An item that can only be purchased from one supplier because of its unique character. Few purchases fit this definition. Proprietary item is a related term for an item produced exclusively by one firm. (For example, Coca Cola.) Sole Source Justification forms are available online.
Travel Expense Voucher BO 55-05:
A standard University form prepared by the department to process a request for reimbursement of travel expenses, honorariums or professional services fees.
Vendor:
One who sells something; a "seller" or supplier.
Vendor Voucher - BO 55-01:
A standard University form which the department prepares and processes to request payment to a vendor.
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