Payment Systems

» Posted by on Jul 9, 2014 in Payment Methods | 0 comments

My agency uses both the Centrally Billed Accounts (CBA) and Individually Billed Accounts (IBA) for travel expenses.  Agency travelers are required to use their GSA SmartPay2 program cards (government travel charge cards) issued by US Bank to pay for lodging and rental car expenses.  Previously, travelers also used their IBA to pay for airfare expenses, but all transportation expenses are currently being paid by a CBA, along with the e-travel transaction fees.  After a traveler submits an expense report, our agency financial system issues split disbursements through Electronic Funds Transfer (EFT).  Charges made to the IBA are paid directly to the bank and out of pocket expenses owed to the employee (miscellaneous expenses, taxi, parking, etc) are made directly to the employee’s bank account.  As a result of this process, payment to vendors and reimbursement to travelers of travel expenses are usually made within 2 weeks, well before the 30 day requirement.  In addition, because of the wide acceptance of both the IBA and CBA as forms of payment, the need for travel advances is greatly minimized.

In the future, I expect lodging and rental car expenses to be paid from a CBA instead of IBA, the same way that transportation expenses are now covered by a CBA.  In our e-travel system, FedTraveler, travelers can make transportation, lodging, and rental car reservations.  Since airlines accept CBA as a form of payment, the hotels and rental car companies may soon follow suit.  This puts the liability on the government rather than the individual traveler.  In addition, this would minimize opportunities for travelers to use their personal credit cards to pay for government travel expenses.  After an audit, it was discovered that some employees inappropriately used their personal credit cards to get reward points instead of using their IBA.  The travelers did not utilize the split disbursement function in FedTraveler correctly and were reimbursed for expenses made to their personal credit cards.  Another problem with the IBA is that sometimes travelers make late or insufficient payments, resulting in penalty fees.  Covering more expenses under a CBA would reduce these problems.  However, IBAs are still needed for miscellaneous kinds of expenses, but training and consistent application of the rules need to enforced to prevent misuse of the IBAs.  The new feature of the GSA SmartPay2 program cards with built in credit evaluations will also help with IBA management.

Lorie Henderson

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