Hospitality Expense Policy (200-25)

PURPOSE:

There are occasions when judicious extension of hospitality in connection with official University business is in the best interest of the University. This section outlines policies and procedures governing the manner and extent to which the University may extend hospitality for business purposes and specifies the University funds that may be used for such purposes.

DEFINITIONS:

A. UNIVERSITY: California State University, Northridge and all its auxiliary organizations.

B. HOSPITALITY: The provision of meals (catered or restaurant) or light refreshments, promotional materials, gifts, awards, and travel expenses of official guests of the university. Hospitality includes expenses for activities that promote the university to the public, usually with the expectation of benefits accruing directly or indirectly to the university.

C. OFFICIAL HOST: The provision of meals (catered or restaurant) or light refreshments, promotional materials, gifts, awards, and travel expenses of official guests of the university. Hospitality includes expenses for activities that promote the university to the public, usually with the expectation of benefits accruing directly or indirectly to the university.

D. APPROVING AUTHORITY: A person to whom authority has been delegated in writing to review and approve hospitality expenses.

E. OFFICIAL GUEST: A person who is invited by the official host to attend a meeting, conference, etc.

F. LIGHT REFRESHMENTS: Beverages, hors d'oeuvres, pastries, cookies, etc

G. AWARD: A gift of tangible personal property in recognition of service or achievement directly benefiting the university.

AUTHORITY:

The policy set forth in this document is issued under the authority of the President of the University. Authority and accountability is herewith delegated to all vice presidents and directors or chief operating officers of campus auxiliary organizations for implementation of this policy within their respective areas of responsibility.

POLICY:

A. BASIC CONDITIONS FOR HOSPITALITY EXPENSES:

1. Hospitality expenses must be directly related to, or associated with, the active conduct of official University business. When a University or auxiliary organization employee acts as an official host, the occasion must, in the best judgment of the approving authority, serve a clear University business purpose, with no significant personal benefit derived by the official host or other University employees.

2. The expenditure of funds for hospitality should be cost effective and in accordance with the best use of public funds. When determining whether a hospitality expense is appropriate, the approving authority must evaluate the importance of the event in terms of the costs that will be incurred, the benefits to be derived from such an expense, the availability of funds, and any alternatives that would be equally effective in accomplishing the desired objectives.

3. Hospitality expenses, including awards and gifts, must conform to IRS regulations.

B. ALLOWABLE HOSPITALITY EXPENSES & OCCASIONS:

(See Appendix A for Examples of Allowable Expenses When Hospitality Funds Are Not Required And Other Funds May Be Used).

1. Host to Official Guests: When the University hosts official guests, including visitors from other of universities or members of the community, the cost of meals or light refreshments may be reimbursed.

2. University Donors: When the University hosts an event for the purpose of generating the goodwill of prospective University donors, the cost of meals or light refreshments may be reimbursed. Likewise, when a substantial donation has been received, the cost associated with an appropriate acknowledgment may be reimbursed.

3. Retirement Receptions: Payment of or reimbursement for hospitality expenses related to employee retirement receptions is permitted.

4. Meetings of an Administrative Nature: When University employees attend an official business related meeting on or off campus, the cost of meals or light refreshments may be reimbursed (not from general funds) only if the employee is required to attend the meeting during a normal mealtime. Reimbursement from any funds will not be allowed when two or more employees from the same work location go to lunch together to continue their business as an incidental part of the meal, or when the meeting could have een scheduled during regular work hours. In addition, business meals with faculty, staff or other colleagues that occur on a regular basis, and may be reciprocal, are not reimbursable under this policy. University employees should not serve as hosts for other University employees who are also in travel status and eligible for travel allowance.

C. APPROVAL AUTHORITY:

Individuals with delegated approval authority shall not approve the hospitality expense of a person to whom they report; that is, the approving authority should be the supervisor (or higher level) of the official host. In addition, individuals with delegated approval authority shall not approve their own hospitality expenses.

1. Vice presidents must approve appropriate hospitality expenses above $1000 in advance of the event or occasion.

2. Vice presidents may delegate to one person, in writing, the authority to act for him/her in approving expenditures.

3. Approval for any official University hospitality expense above $500 must be obtained at the appropriate level. Vice presidents may delegate to deans, or division heads of non-academic units authority to approve hospitality expenditures between $500 - $1,000 consistent with this policy. This authority may not be redelegated. The Dean or division head is responsible for ensuring that hospitality expenditures conform to the requirements of this policy and that claims submitted for payment or reimbursement include the appropriate supporting documentation.

D. SPECIFIC TYPES OF EXPENSES DISALLOWED:

1. Hospitality expenses related to personal events such as birthdays, weddings, anniversaries, and farewell gatherings (other than retirement) may not be reimbursed.

2. Payment of or reimbursement for memberships in organizations, such as clubs, that provide hospitality privileges are not permitted.

E. EXCEPTIONS:

The appropriate vice president or auxiliary director/chief operating officer must approve, in advance of the event, all proposed exceptions to the Reimbursable Hospitality Expenses and Occasions, Section B. Examples of occasions when an exception could be approved: hosting spouses or domestic partners of guests or official hosts, provided such hospitality serves a bona fide University business purpose; tickets to entertainment or ;sporting events; gifts to official guests, faculty, staff or students.

F. FUNDING SOURCE FOR HOSPITALITY EXPENSES:

Only funds designated for hospitality may be used for these expenses. These expenditures must conform to the guidelines established in the hospitality expense policy.

1. A Foundation hospitality account will be established for each non-auxiliary department that plans hospitality expenditures. Hospitality expenditures must be made only from the Foundation hospitality account for non-auxiliary departments.

2. A department that obtains donations for hospitality can deposit or transfer those donated funds into its Foundation hospitality account. The appropriate dean or division head must approve the deposit or transfer.

3. Only one Foundation hospitality account per department is permitted for non-auxiliary areas. Only one hospitality account is permitted for each auxiliary organization or auxiliary enterprise within their respective fund.

4. Auxiliary corporations and auxiliary enterprises that plan hospitality expenditures will establish a single hospitality account within their respective auxiliary corporation or enterprise fund. Auxiliaries must obtain approval for their hospitality fund allocation from the University President as part of their annual budget process. Auxiliary corporations and auxiliary enterprises are then authorized to spend up to the ;budgeted amount for hospitality expenses. However, these hospitality expenditures will not be processed through designated University Foundation accounts but through a single account within their individual fund.

5. The University Corporation will provide funds to support hospitality expenses by the annual distribution of a hospitality allocation to the University President by June 15. Thus, an annual transfer to support hospitality expenditures will occur from the University Corporation to the Foundation. All hospitality expenditures will be processed through designated University Foundation accounts.

6. The University President will distribute a hospitality allocation to each vice president by July 1. Vice presidents will manage and distribute hospitality allocations to their respective departments as they deem appropriate.

7. No hospitality funds may be solicited or accepted from any vendor who provides services to the University or its affiliates (i.e., centers, institutes, and auxiliary organizations).

FURTHER INFORMATION:

Hospitality Expenses versus Program Expenses

Office of the University Controller, (818) 677-2305,

http://www.irs.ustreas.gov/help/index.html, or

http://www.irs.ustreas.gov/forms_pubs/pubs/p463ch02.htm

Approved by the President