Statement of Policy
The mission of Purdue University is to serve the citizens of Indiana, the
United States, and the world through discovery that expands the realm of knowledge,
learning through dissemination and preservation of knowledge, and engagement
through exchange of knowledge.
As a public institution, the University is entrusted with funds by various
constituencies. With limited resources available to carry out its mission,
the University must demonstrate prudent judgment when expending funds. Therefore,
a valid business purpose must exist for expenditures of University funds.
During the course of business, it may be necessary to incur hospitality expenses.
Hospitality expenses are defined as the provision of food, beverages, activities,
or events for the purpose of promoting and furthering the mission of the University.
The University's hospitality expenditure guidelines are based upon an understanding
that food and beverage expenditures are allowable only when clearly required
to advance the mission of the University and appropriate to the occasion.
Hospitality expenses should be reasonable in amount and necessary to fulfill
the mission of the University.
While responsible judgment should be used when expending any University funds,
particular care should be exercised for hospitality expenses. Individuals
responsible for making decisions concerning hospitality expenditures should
always question whether the proposed expense represents an appropriate use
of University funds. Thoughtful consideration of each decision will ensure
that University resources are expended appropriately.
Reason for Policy
The guidelines in this policy establish a framework for allowable hospitality
expenditures. Within the parameter of the guidelines, departments or organizational
units may specify more restrictive policies.
Who Should Know This Policy
- President
- Provost
- Vice Provosts
- Chancellors
- Vice-Chancellors
- Vice Presidents
|
- Deans
- Directors/Department Heads/Chairs
- Principal Investigators
- Faculty
- Administrative and Professional Staff
- Business Office Staff
|
Related Documents
Contacts
University Comptroller (765) 494-7536
Table of Contents
Statement of Policy
Reason for Policy
Who Should Know This Policy
Related Documents
Contacts
Table of Contents
Definitions
Guidelines
Special Situations
Exclusions
Responsibilities
History
Definitions
| Hospitality Expenses |
The provision of food, beverages,
activities, or events for the purpose of promoting and furthering the
mission of the University. |
| General Fund Accounts |
General fund accounts are used
to record income and expense for general operating funds. The funding
source is typically state appropriations. |
| Gift Accounts |
Gift accounts are used to record
income and expense for gifts received from donors. |
| Auxiliary Services Accounts |
Auxiliary services accounts are
used to record income derived from fees charged to external parties for
goods and services (e.g. Intercollegiate Athletics, Housing and Food Services). |
| Sponsored Program Accounts |
Sponsored program accounts are
used to record income and expense for activities sponsored by external
organizations. Sponsors may be federal agencies, state agencies, industry,
etc. |
Guidelines
Allowable Hospitality Expenses
Allowable hospitality expenses have been divided into three general categories.
The categories include (1) meals or refreshments served during business meetings,
(2) meals for prospective employees, visitors, guests, or donors, and (3)
University receptions.
Allowable hospitality expenses may be charged to general fund accounts, gift
accounts, or auxiliary services accounts. Sponsored program accounts may be
used if the expense is specifically approved in the budget and is in accordance
with sponsor and University policy. When charging hospitality expenses to
the above funding sources, expenses for alcoholic beverages are prohibited.
Following is a description of each of the categories along with examples
of allowable hospitality expenses. Faculty and staff should be aware that
any hospitality expenditures that do not fall within the University policy
or are exorbitant or unreasonable will become a personal liability for the
faculty or staff member.
Meals or refreshments served during business meetings:
The University may pay or reimburse expenses for meals or refreshments served
during business meetings when the purpose of the meeting is to conduct University
business. Following are examples of business meetings where meal and refreshment
expenses are allowable.
-
Meals or refreshments served at University sponsored
seminars, retreats, workshops, orientations, or other University functions.
-
Meals or refreshments served during University sponsored
meetings of advisory groups, outside reviewers, or other committees when
the group is composed of both University employees and non-employees.
-
Working breakfast, lunch, or dinner meetings, when groups
of employees are giving up personal time to conduct University business.
A formal business discussion must be the purpose of the gathering.
Meals for prospective employees, visitors, guests, or donors:
The University may pay or reimburse meal expenses when entertaining prospective
employees or entertaining visitors, guests, or donors. Following are examples
of meals for prospective employees, visitors, guests, or donors.
-
Meals related to the individual recruitment of faculty
or staff. When entertaining prospective employees, only meal expenses for
the prospective employee and the principal individuals involved in the decision-making
process will be considered allowable meal expenses. When the spouse/partner
of the prospective employee is present at the meal, the University will
also reimburse the meal expenses of the spouse/partner or guest of the principal
individuals responsible for the recruiting.
-
Meals for individuals invited as academic visitors to
contribute to the intellectual life of the University community. Normally,
such visitors will deliver a seminar, colloquium talk, or other lecture
or performance for the benefit of University faculty and/or students.
-
Meals related to marketing University facilities and
services to secure potential conference business. When entertaining guests
from external organizations that are considering conference arrangements
with the University, only meal expenses for the guest and the principal
individuals involved in the conference selection process will be reimbursed.
-
Meals related to cultivation of donor prospects, whether
prospective or previous donors. Meal expenses for donors and University
staff involved in the fund-raising effort are considered an allowable University
expense. If it is appropriate for the spouse/partner of the University staff
member to be present at the meal, the University also will reimburse those
expenses.
University receptions:
The University may pay or reimburse expenses related to University sponsored
receptions. Following are examples of allowable receptions:
-
Receptions for any employee who retires or terminates
from the University, providing that the employee has 15 or more years of
service with the University or is an official University retiree.
-
Receptions for faculty, staff, and students/families
when the predominant numbers of those in attendance are students.
-
Receptions to present or to acknowledge awards to faculty,
staff, students, and alumni for outstanding accomplishments.
-
Receptions to honor visitors, guests, or dignitaries.
-
Receptions for the opening of new exhibits at University
galleries.
Unallowable hospitality expenses
Certain hospitality expenses are unallowable on University funds. Following
are examples of unallowable expenses. Please note: This list is not intended
to be exhaustive and does not list all unallowable expenditures on University
funds.
Alcoholic beverages:
The purchase or reimbursement of alcoholic beverages is not allowable on
University funds. Any bill that includes alcoholic beverages must be charged
completely to Purdue Research Foundation (PRF) funds. Departments desiring
to charge only the alcoholic beverages portion of the bill to PRF funds should
obtain separate billings from the food provider.
Holiday and other social functions:
Expenses related to holiday receptions, luncheons, etc., are not allowable
on University funds. Additionally, expenses for functions related to secretary's
week, staff birthday parties, and other social events are not allowable on
University funds.
Flowers:
Purchasing flowers is not allowable on University funds unless the flowers
serve as a decoration for an allowable event listed in this document.
Musicians:
Procuring the services of musicians other than PMO or University Band affiliates
is unallowable on University funds.
Meals for employees:
Meals and refreshments for employees (except as allowed in this policy) are
not allowable on University funds.
Items of a personal nature:
Expenses for items of a personal nature utilized by a University employee
when entertaining University guests are unallowable on University funds. Examples
include golf clubs, memberships in social organizations, etc.
Gifts and charitable contributions:
Gifts and benefits to employees are unallowable.
Donations to charities and/or civic fundraising campaigns (internal or external)
are unallowable.
Special Situations
Home entertaining:
The guidelines listed above provide the framework for allowable and unallowable
hospitality expenditures. The guidelines have assumed that the majority of
hospitality expenses will be incurred at a restaurant or catered event. However,
it is likely that some official University events will occur in the home of
a University employee. When a University employee chooses to host an allowable
event in their home, reimbursement may be granted under the following guidelines:
-
Food, beverages, and disposable or rented service ware
directly related to the event may be reimbursed.
-
All food and beverages served at the event must be purchased
from a vendor that provides itemized receipts. The receipt should provide
a listing of the items by name.
-
Allowable funding sources for home entertainment follow
the guidelines specified for the various allowable events.
Miscellaneous entertainment purchases for receptions:
University receptions to honor employees, visitors, guests, or dignitaries
may require additional expenses over and above food and beverages. Allowable
miscellaneous expenses include the following:
-
Flowers may be purchased if serving as decorations at
the reception. Flowers may be charged to general fund accounts, gift accounts,
or auxiliary services accounts. Sponsored program funds may be used if the
expense is specifically approved in the budget and is in accordance with
sponsor and University policy.
-
Musician expenses are allowable for receptions, as long
as Purdue Musical Organizations (PMO) or University Band groups are used
(Varsity Glee Club, Purduettes, etc.). Musician expenses may be charged
to general fund accounts, gift accounts, or auxiliary services accounts.
Sponsored program funds may be used if the expense is specifically approved
in the budget and is in accordance with sponsor and University policy.
Exclusions
The following events, while similar to hospitality events, are governed by
other University policies.
-
Fundraising events may include banquets for prospective
donors or alumni, ground-breaking ceremonies for facilities, and building
dedication events. There may be instances when expenses associated with
ground-breaking and building dedication ceremonies are allowable charges
to the facility's campaign gift proceeds. Please see University Policy IX.1.1
for a definition of allowable costs and approval processes.
-
Conference events may include meals, refreshments, and
other hospitality expenses. Executive Memorandum Number B-47 assigns academic,
administrative, and fiscal responsibility for all conferences and short
course activities sponsored by a school, department, or other agency of
the University and outlines those University-wide policies and procedures
that govern the conduct of these activities.
Responsibilities
The roles listed below are responsible for the following tasks:
President:
-
Approving the University hospitality policy.
Executive vice president and treasurer (or designee):
-
Approving or denying exceptions to the University hospitality
policy.
-
Monitoring the hospitality guidelines established by
the administrative officers reporting to the Provost.
-
Monitoring the hospitality guidelines established by
the administrative officers reporting to the regional chancellors
Administrative officers reporting to the provost, the executive vice president
and treasurer, or the regional chancellors:
-
Developing internal guidelines for allowable hospitality
expenses within their areas of responsibilities.
-
Communicating the internal guidelines to the Directors/Department
Heads/Chairs within their area.
-
Approving or denying exceptions to the internal guidelines
established for their areas. May only approve exceptions as long as the
exceptions comply with University policy. Any exceptions not complying with
the University policy must be forwarded to the Comptroller.
Directors/Department heads/Chairs:
-
Communicating internal hospitality expense guidelines
to faculty, staff, and business manager.
-
Reviewing and approving hospitality expenses within the
parameters of the internal guidelines. Hospitality expenses that do not
fall within the parameters of the internal guidelines must be forwarded
to the next administrative level with a written justification for the expense.
-
Understanding the internal hospitality guidelines established
for their area.
-
Complying with all guidelines.
-
Collecting all necessary receipts and completing reimbursement
requests.
-
Ensuring that expenditures have been documented to include
the purpose of the event, location, date, nature of the attendees (alumni,
donors, etc.), and number of attendees.
-
Reviewing exceptions to the University hospitality policy.
-
Recommending approval or denial of the exceptions.
-
Reviewing hospitality expenses to ensure compliance with
departmental guidelines and University policy.
-
Recommending approval or denial of hospitality expenses
to Directors/Department Heads/Chairs.
-
If inappropriate expenditures are found, recommend the
authorizing administrative unit to recover the expenditures from the individual(s)
involved.
History
This policy is the first to formalize guidelines for hospitality expenditures.
|
