Business Expense Guidelines
University of Ontario Institute of Technology Approved by the Vice-President (Finance and Administration), March 2007 Associated Policy: UOIT Business Expense Policy (Approved by the Board of Governors, March 2007) I. INTRODUCTION
This document provides general guidelines for reimbursing appropriate business expenses and how they are to be documented. These guidelines identify how and when expenses may be charged to various university accounts in order to ensure the proper use of resources. Research-related expenses paid from a research grant must conform to rules established by the relevant granting agencies. UOIT employees are expected to apply good judgment in incurring expenses and should ensure conservative and reasonable expenses, consistent with the trust we hold to taxpayers and students. UOIT will authorize expenditures and reimburse employees for actual and reasonable incurred university business expenses which meet the requirements of these procedures. Properly documented expense reports must be submitted by employees, with appropriate authorization prior to reimbursement. Both the individual who incurs the expense and the approver of the reimbursement are responsible for ensuring maximum practical economy in the expenditure of funds. For the purpose of determining economical purchases, the price paid by the individual is compared with the price that would have been paid in a similar situation. When the price paid by the individual exceeds that which would have been paid by the university, the lesser amount will be reimbursed. II. APPROVALS
All business-related expenses must be documented on the appropriate Expense Report form which must be approved by the appropriate Faculty Manager, Director, Dean or Vice-President. The form must be approved by the next highest level of management authority (e.g., Director approves Manager, Vice-President approves Dean/Director). Unless otherwise stated, all expenses in excess of $1,000 must be approved by the employee's direct supervisor (i.e., one-up approval) in advance. Approvals must have original signatures, and may not be facsimile, rubber stamp, or having others signing on behalf of the individual authorized to approve the expenditures.
1
III. A.
PROCEDURE REQUIREMENTS AIR TRAVEL
Travelers should request the lowest available fare at time of booking. Please note that the lowest available fare often results in a cost that is lower than the Economy rate. Because significant savings can be realized by making reservations in advance, all employees are recommended to plan their travel at least 14 days prior to departure. 1. Class of Service
The least expensive Economy class fare must be utilized for all domestic and international flights. Business class is permitted only for trips over 6 hours in length. Lack of availability of Economy seats due to late travel arrangements that could reasonably have been avoided through better planning does not justify business class travel. 2. Approvals
Domestic: All travel within North America requires prior one-up approval. International: Requests for business travel outside North America are to be submitted in writing for one-up approval, which will be provided as warranted/justified. 3. Air Travel: Other
a. Insurance: Flight cancellation insurance is an allowable expense. Further insurance other than that provided by UOIT is not reimbursable. Information on insurance provided by UOIT is available from the Finance Department. Automatic Travel Accident insurance of $100,000 is obtained when a common carrier (plane, train, ship or bus) ticket is charged in advance to the UOIT American Express card. The UOIT benefits plan covers emergency medical services both out-ofprovince and outside of Canada and additional coverage should normally not be necessary. b. Reconfirming Flight Reservations: Reconfirming return or continuing reservations on North American flights is not required. However, reconfirming flight times before leaving for the airport is recommended. Return or continuing reservations on international flights must be reconfirmed by the UOIT employee at least 72 hours prior to scheduled departure. Airlines may cancel international bookings that have not been reconfirmed. In such situations, UOIT may not reimburse associated costs. c. Missed Connection/Delayed Flight or Denied Boarding: If the delay is more than four (4) hours due to a late flight arrival or departure because of over-booking of a
2
flight, up to $250 in actual expenses may be charged for necessary food and accommodation provided flight arrangements have been charged to the UOIT American Express card. d. Luggage Delay/Loss: If luggage is lost or delayed more than six (6) hours, up to $250 in actual expenses may be charged prior to the return of the luggage for clothing and sundry items providing the flight arrangements have been charged to the UOIT American Express card. e. Airport Transportation: When traveling to and from airports, the most sensible and cost effective means of transportation should be utilized. When personal automobile is the most sensible and cost effective mode of travel, the employee may claim mileage for its use to and from the airport and the related parking cost. Eligible mileage is the difference between the distance normally travelled to the university and the actual distance travelled. 4. Air Travel
a. Reimbursement: In order to be reimbursed for airline tickets obtained utilizing American Express card, attach the original passenger portion of ticket coupon and boarding pass to an expense report. If the ticket is an electronic ticket, please attach email notification and the boarding pass as verification. Exceptions may be made for long term advanced bookings. b. Personal/Business Travel: When personal travel is combined with business travel, the employee will be reimbursed for only the business portion of the trip at the lowest available fare. In some cases, the costs of a business trip can be significantly reduced by an extension of a day or two. When such extensions are used for personal purposes, one-up pre-approval should be secured. B. ACCOMMODATION
Travelers should request the lowest available rate at time of booking. Employees should enquire whether they are eligible for Government or CAUBO rates when booking. Employees should give due consideration to location and economy prior to making arrangements for accommodations. Claims for accommodations with friends or relatives must state the name, address and relationship (i.e., friend or relative). The rate per night currently in effect is $20. A single room with a private bath in a business class hotel is the UOIT standard. When making lodging reservations, employees should request the most economical rate available. Use of luxury accommodation will not be reimbursed. If a staff member is required to spend more than one continuous month in a single location, appropriate arrangements for suitable rental or board and lodging accommodation at weekly or monthly rates should be made in advance of the start of the travel period.
3
1.
Accommodation Reservations/Cancellations
Late cancellation charges are the responsibility of the employee. Thus cancellations of reservations should be made prior to the designated times specified by the hotel. 2. Hotel/Motel Burglary
UOIT has automatic coverage for loss of personal items up to $500 (excluding cash) if a hotel room is burglarized provided the reservation has been guaranteed with the UOIT American Express card. 3. Accommodation Expense Reporting
In order to obtain reimbursement for accommodation bills, each employee must complete an expense report, and submit it along with the original accommodation receipts to the employee's immediate supervisor for approval and processing. Reimbursement for hotels, motels and other lodging will be limited to reasonable amounts in the particular circumstances and should not exceed the single occupancy rate. C. AUTOMOBILE/VEHICLE RENTAL
Travellers should request the lowest available vehicle rental rate at time of booking. Travellers should use their best judgement to ensure a rental car is the most efficient and cost effective mode of transportation. When renting a car, a mid size should be used. When several employees are visiting the same location and a car rental is the lowest cost method, one car should be rented for each four people making the trip. 1. Rental Insurance
a. Domestic: UOIT receives free collision damage waiver (CDW) in North America when payment for car rental is made with the UOIT American Express card. When renting vehicles, this coverage should be declined. b. International: When a vehicle is rented outside North America, both CDW and Liability insurance should be purchased. All other insurance should be declined. 2. Car Rental: Other
a. Promotional Rates: When picking up the car, check with the counter attendant to insure that the lowest fare is offered. b. One-Way Rentals: Often contract rates do not apply on one-way rental and costly drop charges are imposed. c. Gasoline Refill: Travellers should ensure that they fill up the gas tank before returning the car to avoid costly gasoline surcharges.
4
3.
Car Rental/Expense Reporting
a. Reservations/Payment: Payment should be made with the UOIT American Express card. b. Reimbursement: In order to be reimbursed for car rental charges and/or gasoline charges, attach the rental and/or gasoline invoice to an expense report for processing. D. USE OF EMPLOYEE-OWNED AUTOMOBILE FOR UNIVERSITY BUSINESS
All mileage travelled in an employee's personal automobile when conducting university business will be reimbursed on a cents per kilometre basis. Effective August 14, 2006, the kilometre rate is $0.40 per kilometre. The employee must have a current valid driver's license and carry insurance on the vehicle that meets the minimum requirements of the respective province. a. Short Journeys: Short journeys (less than 500 kilometres round trip), where this option constitutes the most economical means of transportation or where no suitable alternate transportation is available is reimbursable. If a trip of greater distance is made, the maximum claimable expense is the cost of the most economical means of transportation by the most direct route. b. Airport Transportation: When travelling to and from airports, the most sensible and cost effective means of transportation should be utilized. When it is the least expensive mode of travel, the employee may claim mileage for use of a personal automobile to and from the airport and the related parking cost. Eligible mileage is the difference between the distance normally travelled to the university and the actual distance travelled. (Canada Revenue Agency regulations prohibit reimbursement of employee travel to their workplace.) E. MEALS AND ENTERTAINMENT
The reasonable costs of meals or entertainment, when providing for a specific business purpose, are reimbursable. Entertainment might include social, athletic, and cultural events. Current per diem rates are CDN$40 for Canada and US$40 for the US. For travel outside of Canada and the US, Government stated per diem rates will be used. 1. Entertainment of Guests
Entertainment of guests should be limited to the cost of meals and beverages furnished in a hotel dining room or restaurant. Entertainment of a different variety (e.g., golf, tennis, athletic events, theatre productions, etc.) requires prior one-up approval. Unapproved entertainment may not be reimbursed.
5
Any UOIT employee hosting a business lunch, dinner or other entertainment event should limit the employees and other participants attending to only those who can be expected to contribute directly to the accomplishment of the business purpose. 2. Entertainment of Fellow Employees
Normally the cost of entertaining fellow employees is not reimbursable, except in unusual/special circumstances. Such circumstances would include time limitation (extended work day), nature and sensitivity of matters to be discussed, employee promotion or job performance (job well done), and employee retirement. A full explanation of the business purpose must be given of the expense report and proper authorization should be received prior to the special circumstance. Meals taken between two or more employees without a clear business purpose, which ordinarily could be conducted during normal working hours, are not reimbursable. The cost of such meals should be borne by the employees themselves. Expenses incurred in relation to the following events are considered to be personal in nature and therefore not reimbursable: parties or meals for birthdays, weddings, births, showers, parties not sponsored by the unit and made available to all employees of the department. 3. Home Entertainment
Upon appropriate one-up approval, an employee may entertain business guests in their home if it serves a specific business purpose. Entertainment of fellow employees will be considered personal and not reimbursable. 4. Gifts
Units may incur an expense, in the form of a gift, on behalf of an employee or an employee's immediate family, for the following events: a. Recognition of a long-term employee leaving a unit or retiring: A general guideline is $10 for every year of service. Such gifts should not exceed $200. b. Illness of an employee or student, requiring hospitalization: A recommended limit is $50. c. The death of an employee or an employee's immediate family member: Memorial gifts made on behalf of an employee may include flowers or a donation to a charitable organization. In such cases, the university should be acknowledged as the sender (e.g., "from all your friends and colleagues at [university unit]”). In the case of a donation to a charity, the notation should indicate the donation is from the university unit. A recommended limit for this gift is $50. Gifts in recognition of employee work-related achievement or years of service are allowable; they must be approved by the relevant Dean/Vice-President and should not exceed $50.
6
Holiday gifts for faculty, staff, students and volunteers are not allowable expenses. Gifts to honour an individual for personal reasons other than those indicated above (e.g., birthday, wedding, baby shower, housewarming, promotion, etc.) may not be charged to university accounts. Personal contributions among colleagues should be the method of providing such gifts. 5. Political Donations Donations to political parties and candidates are not considered allowable expenses. They cannot be charged directly against university accounts nor can a university employee be reimbursed for such donations. As a registered charity, the university must not support or oppose political parties or candidates; our activities must be entirely nonpartisan in nature. University employees are, of course, free to support parties and candidates in an individual capacity but they should refrain from making use of their university affiliation. F. 1. MISCELLANEOUS BUSINESS-RELATED ITEMS Telephone and Facsimile
Expense incurred on behalf of UOIT business is permissible and reimbursable. Employees travelling on extended business trips may telephone their home at reasonable intervals at the university's expense. Justification for unreasonably high expenses must be provided on the expense report. 2. Gratuities
Gratuities in reasonable amounts are reimbursable if services have been provided in addition to those considered normal. Such services include baggage handling (where excessive baggage is involved) and errand services for business related purposes. 3. Laundry and Valet Service
Laundry and valet services provided at the hotel is allowable for reimbursement if the trip is extended over the anticipated number of days (minimum 5 days). 4. Tolls/Parking
Receipts of $50 or more should accompany the expense report. Highway 407 charges are permitted as an allowable expense. 5. Bus, Taxi, and Limousine Fares
Receipts of $50 or more should accompany the expense report.
7
6.
Travel with Spouse
Spouse travel expenses on domestic or international trips are not reimbursable unless a specific business purpose is served. When accompanied by a spouse the eligible expense is the most economical rate charged by the establishment for a single occupant. 7. Non-Reimbursable Expenses
Certain expenses, while doing business, are not reimbursable. Examples include motor vehicle violations, travel and personal card interest charges, movies, etc. G. 1. EXPENSE REPORTING AND PAYMENT METHOD University American Express Card
The preferred method of payment for full-time employees is the use of the American Express card. It provides the card holder with various travel benefits including Travel Accident Insurance, Car Rental Theft and Damage Insurance, Missed Connection/Delayed Flight or Denied Boarding benefit, Luggage Delay/Loss benefit, and Hotel/Motel Burglary compensation. American Express also allows 45 days from statement due date to settle an account before interest charges are levied, providing ample time to process a reimbursement request. Rewards benefits (i.e., points, air miles) are available to each individual using an American Express card. These benefits must be specifically requested, and the individual must bear the annual cost of the rewards program. The card is available to full-time employees upon one-up approval. Forms are available from the Finance Department. 2. Personal Credit Card
Where travel will be completed and reimbursed by the university prior to the due date for payment of the credit card account, personal credit cards may be used without any additional cost to the cardholder. Any interest charges incurred are the responsibility of the employee. 3. Cash/Accountable Advance
Cash advances are discouraged and will only be approved in exceptional circumstances, e.g., travel to areas that do not accept the American Express card. Accountable advances are issued only under appropriate one-up approval and must be issued in the name of a full-time employee.
8
4.
Expense Report Reconciliation/Delinquency
When reconciling business expenses, reimbursement must accompany any expense report with a balance due to the university. Where employees have received a cash advance and are 6 or more weeks late in submitting expense reports are considered delinquent and are not eligible for future cash advances. 5. Reimbursement
All expense reports must be approved by the employee's direct supervisor (i.e., one-up approval). It is the supervisor's responsibility to insure compliance with the UOIT procedures. By approving the expense report, the supervisor is verifying compliance, not just authorizing payment. Approvers will review all employee expense reports for compliance with these policies and will not reimburse an employee or expenditures in violation of these policies. Expense reports will be processed through direct deposit on a bi-weekly basis to ensure prompt payment of the university American Express Card. A schedule of submission and deposit dates can be found in the "forms" section under Finance & Strategy. Receipts must accompany expense reports for those expenses of $50 or more. All research-related expenses must be accompanied by receipts for monitoring and audit purposes under the granting councils’ rules. 6. Currency
All employees will be reimbursed in Canadian funds in amounts equivalent to the actual expenses incurred and, where necessary, converted to Canadian funds for reimbursement. All expenses must be listed on the Expense Report in the currency that was used for the actual expenditures along with proof of conversion costs. 7. Exceptions
Exceptions to any of the provisions in these guidelines require written documentation and approval. A memorandum or related document justifying the request for exception must be approved by the appropriate Dean/Vice-President (i.e., one-up approval), and be submitted to the Purchasing Department along with the Expense Report.
9