2011 GSA SmartPay® Training Conference

Charge Card Basics

Heelay YaftaliVice President, Citi ®

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A Winning Hand: Solutions, Savings and Sustainability with GSA SmartPayThe 13th Annual GSA SmartPay Training Conference, Las Vegas

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To ensure the best possible learning experience for participants, please adhere to the following house rules:

• Turn cell phones and pagers to vibrate• Hold questions to end of session• Ensure your participant badge is scanned to receive CLP credits− For each course− Must leave room and reenter

• Take advantage of opportunities to provide feedback − Please select the Citi Q&A icon on any Citi PC at the conference− Answers to be emailed after the conference within 60 days

House Rules

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This course is designed to assist you in achieving the following objectives:

• Track how a transaction flows from cardholder purchase to reporting for the Agency/Organization Program Coordinator (AOPC)

• Provide new AOPCs the necessary purchase and travel payment processing information so they are able to assist with many cardholder questions and issues

• Provide an overview of the following fundamentals:− How credit cards work − How an AOPC supports a card program using

Citi tools and Citi resources in order to comply with Agency Policies and Procedures

Goals & Objectives

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Charge Card Basics:• Basics of Credit Card Proces• Role of an AOPC• How to interact with Citi® to manage your

program more efficiently

Agenda

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1. Credit Card Processing Basics

Credit Card Basics

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Charge Card Basics

Who is involved in the transaction flow?

• Cardholder• Issuing Bank • Merchant• Acquiring Bank• Card Association• Processor

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Charge Card Basics – Authorization Request

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CardholderPresents Card for

Purchase

MERCHANT

AuthorizationRequest

ACQUIRERAuthorization

Request

Association Brand

AuthorizationRequest ISSUER

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Charge Card Basics

Charge Card Basics – Authorization Response

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CardholderPresents Card for

Purchase

MERCHANT

AuthorizationRequest

ACQUIRERAuthorization

Request

Brand Network

AuthorizationRequest ISSUER

AuthorizationResponse

AuthorizationResponse

AuthorizationResponse

ReceivesMerchandise

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Charge Card Basics – Transaction Data Flow

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MERCHANT

ACQUIRERISSUER

TransactionData

TransactionData

TransactionData

Brand Network

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Charge Card Basics – Settlement to Merchant

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Federal Agencies

MERCHANT

ACQUIRERISSUER

TransactionData

TransactionData

TransactionData

Credit

Settlement Settlement

PaysInterchange

Fees

ReceivesInterchange

FeesBrand Network

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Charge Card Basics

Charge Card Basics – Final Settlement

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MERCHANT

ACQUIRERISSUER

TransactionData

TransactionData

TransactionData

Credit

Settlement Settlement

Payment

Statement

PaysInterchange

Fees

RecievesInterchange

Fees

Cardholder

Brand Network

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Charge Card Basics

Level 1– Merchant name– Purchase date– Total purchase amount– Merchant category code (MCC)

Level 2– Sales tax amount– Point of sale code

Level 3– Item quantities, unit of measure, item pricing– Product codes, description– Ship to zip– Freight amount, duty amount

Charge Card Basics – Levels of Transaction Detail

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Charge Card BasicsApproving Official Provides Authorizationto Cardholder to Use Account

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Customer Database & Limits

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Citibank issues Visa/MasterCard1

Organization distributes cards2

Employees provide card/ account number to

merchant for payment3

Merchant inputs or swipes card to obtain

approval code4

Merchant /Acquiring Bank5

Visa/MasterCard network carries data to processor

(TSYS)6

TSYS checks customer database & returns

authorization or decline7

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2. A/OPC Role

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Charge Card Basics

Agency/Organization Program Administrator responsibilities includes:• Agency mission • Agency policies and procedures at agency,

department or cardholder levels• Establishment of key roles and responsibilities• Communication and Training• Internal audit requirements• Preventing misuse and controlling delinquency• Payments and reconciliation (Centrally billed vs.

Individually billed)• Reporting tools

AOPC Role – Focal Point

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Charge Card Basics

A set of guidelines to assist agencies in establishing internal procedures and annual reporting requirements:

• Maintain and communicate internal guidelines• Establish controls• Monitor• Report – delinquency, misuse, performance metrics• Training

AOPC Role – Agency Mission

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Charge Card Basics

Circular emphasizes integration and coordination of internal control assessments with control-related activities:• Effective Fiscal Year 2006• Appendix A, B, C • Applies to Executive Agencies− Exception of requirements in Appendix− Appendix A requirements apply to 24 CFO Act Agencies

• Management’s responsibility to develop and maintain internal controls

• Starts with Senior Management – ends up on your desk

• Should have been implemented at your agency already

AOPC Role – OMB Requirements

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Charge Card Basics

General Requirements:

Internal Control Objectives– Effectiveness and efficiency of operations– Reliability of financial reporting– Compliance with applicable laws and regulations

Standards to meet the objectives– Control Environment– Risk Assessment– Control Activities– Information and Communications– Monitoring

AOPC Role – OMB Requirements

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Charge Card Basics

General Requirements:

• Federal agencies fall under numerous legislative and regulatory requirements

Federal Managers’ Financial Integrity Act (FMFIA) –accounting and administrative controls

This circular is a best-practices document for managing your financial activities including GSA SmartPay® Cards

Your agency may not be subject to Circular as a requirement – still drives for efficiencies and control

AOPC Role – OMB Requirements

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Charge Card Basics

Citi controls that can assist AOPC to control, maintain, monitor and report: • Cardholder Demographics• Credit Limits• Cash Limits• MCC restrictions• Activate/Deactivate• Closure of Inactive Cards• Email Alerts• Disputes• Reporting

AOPC Role – Cardholder Management

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Charge Card Basics

Training tools to help you manage and communicate: • Cardholder Training

– User Guides www.citimanager.com• AOPC Training

– On-site Training– Webcast Training– Online Help Functions– CLASS– User Guides www.citimanager.com

AOPC Role – Cardholder Management

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3. Interacting with Citi

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Citi Support Team:• Customer Service• Help Desk• Client Account Specialist (CAS)• Account Manager

Interacting with Citi

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Charge Card Basics

Customer Service handles inquiries from merchants, cardholders, Program Managers, Approving Officials, third parties, and is staffed to handle all emergency situations.

• 24/7 Support• The below options are available after entering an account number

– Option 1 – Automated account information– Option 2 – Payment address and to submit an online payment– Option 3 – Last five transactions– Option 4 – Change Personal Identification Number (PIN)– Option 5 – Customer Service AOPC Change credit lines, cash lines for individuals Change single-purchase limits Close and reopen accounts of individuals Force authorizations in emergency situations

Interacting with Citi – Customer Service(888) 836-5011 Collect (904) 954-7850

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Charge Card Basics

Citi Help Desk is available for technical assistance. • 7 am – 11 pm EST• This option is available prior to entering an account

number• Option 1 – System support and file delivery Help Desk

– Password resets (Available 24/7)– File Delivery– Electronic Access Tools CitiManager CitiDirect® Card Management System (CCMS) Citi® Custom Reporting System (CCRS) Card Statements and Payments (CSP) Library

Interacting with Citi – Help Desk(800) 790-7206 Collect (904) 954-7850

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Charge Card Basics

CAS is the group of specialists who are there to help you with your program needs. • Option 1 – Help Desk – all your electronic access and reporting needs• Option 2 – The first available CAS Representative• Option 3 – Allows you to enter CAS Manager Extension

Be sure to ask your CAS manager’s extension!

Interacting with Citi – Client Account Specialists (CAS)(888) 836-5011 or by dialing (904) 954-7850 collect

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Charge Card Basics

Know Your CAS Manager’s five Digit Extension!

Interact with AOPCs and Account Manager to ensure the program is working well:• Complete Setup Documentation • Build Hierarchy• Establish Accounts• Card Delivery• Account Maintenance• Billing Inquiries • Special Report Requests• Reconciliation• Projects

Interacting with Citi – Client Account Specialists (CAS)(888) 836-5011 collect at (904) 954-7850

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Charge Card Basics

Know Your Account Manager • Strategic Relationship Manager• Account Reviews• Business Development • Ensures Citi Resources• Introduces Products• Special Projects

Interacting with Citi – Account Manager

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Charge Card Basics

Heelay Yaftali Federal Agencies

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Thank you for attending!

Visit the Citibank Welcome Center– Level 3 Foyer – West– National Industries for the Blind will have a

display of products– Conference Slide Show – come see yourself

shine!

Visit the Citibank One-on-One Lab – Lido Room 3101 A/B

Visit the Citibank Mini Sessions – Lido Room 3001 A/B

Citi Q&A Link – Tell us your thoughts

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Reminders

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Schedules Available at the Welcome Center Federal Agencies

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Interactive Training Events – GSA

Charge Card Basics

Citi offers Computer Based Training (CBT) via the Citi Commercial Card Learning and System Support (CLASS) in CitiManager.

Visit home.cards.citidirect.com and from the Web Tools tab select the CLASS link

Please contact your Account or Client Manager if you are interested in setting up a training session. Training can be conducted at a Citi Training Location, on-site at your office or via the Web.

Regional Citi Training Locations– Norfolk, VA– Washington, DC

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Terms & Disclosures

Tuesday, July 28, 2009

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IRS Circular 230 Disclosure: Citigroup Inc. and its affiliates do not provide tax or legal advice. Any discussion of tax matters in these materials (i) is not intended or written to be used, and cannot be used or relied upon, by you for the purpose of avoiding any tax penalties and (ii) may have been written in connection with the "promotion or marketing" of any transaction contemplated hereby ("Transaction"). Accordingly, you should seek advice based on your particular circumstances from an independent tax advisor.

Any terms set forth herein are intended for discussion purposes only and are subject to the final terms as set forth in separate definitive written agreements. This presentation is not a commitment to lend, syndicate a financing, underwrite or purchase securities, or commit capital nor does it obligate us to enter into such a commitment. Nor are we acting in any other capacity as a fiduciary to you. By accepting this presentation, subject to applicable law or regulation, you agree to keep confidential the existence of and proposed terms for any Transaction.

Prior to entering into any Transaction, you should determine, without reliance upon us or our affiliates, the economic risks and merits (and independently determine that you are able to assume these risks) as well as the legal, tax and accounting characterizations and consequences of any such Transaction. In this regard, by accepting this presentation, you acknowledge that (a) we are not in the business of providing (and you are not relying on us for) legal, tax or accounting advice, (b) there may be legal, tax or accounting risks associated with any Transaction, (c) you should receive (and rely on) separate and qualified legal, tax and accounting advice and (d) you should apprise senior management in your organization as to such legal, tax and accounting advice (and any risks associated with any Transaction) and our disclaimer as to these matters. By acceptance of these materials, you and we hereby agree that from the commencement of discussions with respect to any Transaction, and notwithstanding any other provision in this presentation, we hereby confirm that no participant in any Transaction shall be limited from disclosing the US tax treatment or US tax structure of such Transaction.

We are required to obtain, verify and record certain information that identifies each entity that enters into a formal business relationship with us. We will ask for your complete name, street address, and taxpayer ID number. We may also request corporate formation documents, or other forms of identification, to verify information provided.

Any prices or levels contained herein are preliminary and indicative only and do not represent bids or offers. These indications are provided solely for your information and consideration, are subject to change at any time without notice and are not intended as a solicitation with respect to the purchase or sale of any instrument. The information contained in this presentation may include results of analyses from a quantitative model that represent potential future events that may or may not be realized, and is not a complete analysis of every material fact representing any product. Any estimates included herein constitute our judgment as of the date hereof represent potential future events that may or may not be realized, and are not a complete analysis of every material fact representing any product. Any estimates included herein constitute our judgment as of the date hereof and are subject to change without any notice. We and/or our affiliates may make a market in these instruments for our customers and for our own account. Accordingly, we may have a position in any such instrument at any time.

Although this material may contain publicly available information about Citi corporate bond research, fixed income strategy or economic and market analysis, Citi policy (i) prohibits employees from offering, directly or indirectly, a favorable or negative research opinion or offering to change an opinion as consideration or inducement for the receipt of business or for compensation and (ii) prohibits analysts from being compensated for specific recommendations or views contained in research reports. So as to reduce the potential for conflicts of interest, as well as to reduce any appearance of conflicts of interest, Citi has enacted policies and procedures designed to limit communications between its investment banking and research personnel to specifically prescribed circumstances.

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In January 2007, Citi released a Climate Change Position Statement, the first US financial institution to do so. As a sustainability leader in the financial sector, Citi has taken concrete steps to address this important issue of climate change by: (a) targeting $50 billion over 10 years to address global climate change: includes significant increases in investment and financing of alternative energy, clean technology, and other carbon-emission-reduction activities; (b) committing to reduce GHG emissions of all Citi owned and leased properties around the world by 10% by 2011; (c) purchasing more than 52,000 MWh of green (carbon neutral) power for our operations in 2006; (d) creating Sustainable Development Investments (SDI) that makes private equity investments in renewable energy and clean technologies; (e) providing lending and investing services to clients for renewable energy development and projects; (f) producing equity research related to climate issues that helps to inform investors on risks and opportunities associated with the issue; and (g) engaging with a broad range of stakeholders on the issue of climate change to help advance understanding and solutions. Citi works with its clients in greenhouse-gas-intensive industries to evaluate emerging risks from climate change and, where appropriate, to mitigate those risks.

®© 2011 Citibank, N.A. All rights reserved. Citi, Citi and Arc Design and CitiDirect are trademarks and service marks of Citigroup Inc., used and registered throughout the world.

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