Change Request Policy

Policy Text

Change Requests are the proper method for requesting the following changes to a Purchase Order:

• Increase/Decrease the value of a PO as it relates to the original request (i.e. Scope of Work) and the contract term date has not expired
• Modifying the Open Commitment of a PO
• Distribution of funds between chartfields associated with a PO and establishment of new chartfields associated with a PO (financial Change Request)
• Reconcile PO value to payment (only when such reconciliation is consistent with the original scope of work and/or request)
• Change in current contract dates only when addressing an incremental change based on completing the original requested Scope of Work and if the contract term dates have not expired

To further clarify the above rationale for allowable Change Requests, such requests must be consistent with the original request/scope. Additionally, if a sponsored project grant has expired a Change Request will not be available.

A new Purchase Order is required versus a Change Request when:

• Additional scope is being requested to the current/previous engagement
• Additional products or services are being requested
• An extension is being requested for a specified term of service (i.e. adding a new 1-year support service contract to an expiring 1-year service contract)
• The term of service is exceeding 5 years
• There are more than 3 Change requests on a Purchase Order
• There is a requested change with information relating to Vendor name, address or shipping

It is important to note that any Change Request for sponsored project funded requests that bring the value of the Purchase Order to a new competitive threshold (see Competitive Sourcing policy), this would require the school/department to meet Uniform Guidance requirements before the Change Request can be reviewed.

There is an allowable tolerance for the total payment amount to be greater than the total purchase order amount. This variance allows for items such as shipping charges and small incidental fees that may not have been anticipated when the purchase order was originally created. Above these thresholds, however, a change request is required to increase the value of the original Purchase Order. The CU Marketplace maintains a table of these tolerances. When entering a payment, the system will indicate if the payment is within tolerance and processing can continue. If the payment is not within tolerance, the CU Marketplace will not allow payment processing to continue. This tolerance does not apply to, but is not limited to:

• Leasing
• Catering (on-site)
• Maintenance and repair services

The variance thresholds are as follows:

$ Range                 % Cap     $ Cap    Commodity

All dollar values         10%      $2,500  Applicable to most good purchases

Please note that the lower of the two cap amounts between a % Cap and a $ Cap is what governs as the cap threshold, over which a change request is required.

Examples (non-Facilities):

Example #1

Original Purchase Order dollar value = $10,000

Submitted invoice = $12,000

Dollar Variance = $2,000

Percentage Variance = 20%

Next Step: A Change Request would be required to process this payment as the lower CAP amount in this case would be 10% or $1,000 since the lower CAP will indicate threshold.

Example #2

Original Purchase Order dollar value = $10,000

Submitted invoice = $10,500

Dollar Variance = $500

Percentage Variance = 5%

Next Step: this is OK to process through Accounts Payable without a Change Request as it is within 10% of the specific dollar range and this is the lower CAP amount.

Example #3

Original Purchase Order dollar value = $100,000

Submitted invoice = $110,000

Dollar Variance = $10,000

Percentage Variance = 10%

Next Step: A Change Request would be required to process this payment as the dollar variance is above $2,500.

Example #4

Original Purchase Order dollar value = $4,000

Submitted invoice = $4,600

Dollar Variance = $600

Percentage Variance = 15%

Next Step: A Change Request would be required to process this payment as the lower CAP amount in this case would be 10% or $400 since the lower CAP will indicate threshold.

Responsibilities

Initiator – initiate change request by inputting information into the CU Marketplace and to provide explanation and the required supporting documentation that articulates the rationale for this transaction.

Approver – approving the validity of the change request in the CU Marketplace, both from operational and financial criteria; and verifies that supporting documents provide sufficient detail

Central Procurement – reviews the original purchase order and validates that the requested change is compliant with the terms of the original Purchase Order, and that supporting document(s) are sufficient; approve the change request; convert the change request to an updated purchase order.

Definitions

PO Value:

The current total amount of the PO, regardless of payments.

Encumbrance:

To apply funds whereas those funds have been specifically allocated to a particular order for goods/services. Once funds are encumbered, the department should make an entry on their budget to reduce so as not to overdraw. Encumbrances are comprised of all approved and pending for approval requisitions, purchase orders, and supplier invoices.

Total AP Payments:

AP Payments made to date plus all open invoices that are currently in the CU Marketplace.

Financial Change Request:

A financial Change Request includes any Change Request that does not alter the scope of the PO, such as updating a chartfield or distribution. A financial Change Request bypasses approval by the Purchasing Office and is reflected in the department’s financial reports in the CU Marketplace.

Contacts

Finance Service Center at (212) 854-2122 or [email protected].