New Regulations Governing Expenditures & Reimbursements
New Policy 3-010, Expenditure of University Funds & Personal Reimbursements, and Rule 3-010A Expenditure and Reimbursement Requirements, have been approved by the Board of Trustees. Campus departments should communicate new policy requirement to their personnel, and begin to comply with the requirements immediately.
The Policy and Rule will help create a basic framework for processing of expenditure transactions, support best practices expenditure behavior and ensure the University follows appropriate expenditure regulations.
The new Policy defines a University business expense and the standards for expenditures of University funds, including personal reimbursements, as well as outlining overall responsibilities. The Policy and Rule will be binding upon all University colleges, departments, and units, including University Hospitals & Clinics. This Policy and Rule will combine to effectively support best practices expenditure behavior.
The Policy establishes clear requirements to help ensure that expenditures further the mission of the University and are necessary, reasonable, prudent, appropriate and transparent. The Policy makes clear that accountability for the funds entrusted to the University, regardless of funding source, extends to all those involved in the expenditure of those funds, including monies from federal contracts and grants. It also makes clear that personal reimbursements are subject to all the requirements of expenditures made directly via University funds. This new Policy suggests that reimbursements should be avoided, since they are far less efficient than direct procurement methods, do not allow the University to maximize the cost benefit of negotiated contracts, and may include the payment of Sales Tax, from which the University is generally exempt.
The Rule establishes minimum documentation requirements for reimbursements:
- Description of item or services purchased
- Date of invoice or date of purchase
- Adequate description of business purpose
- Appropriate invoice or receipts
- Appropriate accounting distribution
- Necessary approvals, including supervisor approval
The Rule provides guidance for appropriate handling and approval of reimbursements below or above certain dollar amounts:
- Reimbursements below the minimum, currently $25, should be paid by a departmental Petty Cash fund, if available
- Reimbursements greater than the maximum, currently $1,000, require supervisory and director or department chair approval, and an explanation why preferred procurement methods were not used
The Rule clarifies that combining the use of personal funds with the use of the University Sales Tax Exemption Certificate is a violation of state requirements and if documentation suggests misuse of this certificate, the reimbursement will require a letter of justification, including approval of the cognizant Vice President.
The Rule provides that reimbursement requests will not be eligible for expedited processing (Next Day or Same Day) without department Director or Chair approval.
The Policy and Rule do not apply to University travel.
Please take the time to read and understand the new Policy and Rule. Training for the new Policy and Rule will be incorporated into Accounts Payable and other training classes.
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