Procedure FN2023 Group Meal and Meeting Expenses

Process Owner: Controller, a division of the Office of Budget and Finance

Policy Steward facilitating procedure: Associate Vice President for Budget and Finance

Subject Matter Expert: University Financial Officers

GENERAL

Employees with responsibility for administering institutional funds and employees requesting reimbursement from institutional funds should ensure that funds are spent only for legitimate business purposes and not for the personal benefit of the employee or other individuals.

Food purchases and reimbursements for group meals and meetings should be charged to the appropriate non-personnel expense general ledger account (52xxxxxx) for meals within the System for Integrated Management, Budget, and Accounting (SIMBA) or SAP Concur. This procedure defines the requirements for reimbursement or payment of group meal and meeting expenses.

The host must receive written (i.e., email or memo) permission from the budget executive, prior to hosting a group meal or meeting. This permission is to ensure that institutional funds are available and appropriate expenditures for business area funds. This documented permission will become supporting documentation for the transaction.

PROCEDURE

All group meals and meeting expenses must comply with the requirements as defined in policies:

ACCOUNTABLE PLAN

Business Purpose

Under the Internal Revenue Service (IRS) regulations, reimbursements for ordinary and necessary business-related expenses that are not lavish or extravagant are excluded from taxable compensation when made under an "accountable plan" policy. Otherwise, the reimbursement that employees receive for approved expenditures will be considered part of their taxable compensation. Ordinary is defined as "common in [a] field of trade, business or profession" and necessary as "helpful and appropriate for [a] business." To qualify as business expenses, expenditures must be directly related to or associated with the University's mission.

Reimbursement for meal and incidental expenses when no overnight travel is involved requires that the reimbursement amount be reported as part of the employeeâ€™s taxable income unless it is a valid group meal with a clear business purpose and a list of attendees is supplied. See the IRS Local Travel Guide for complete details. The SAP Concur system provides Payroll with a list of 1-Day Taxable Meal Amount by employee on a monthly basis.

Documentation

To qualify as an accountable plan, requests for reimbursement must be submitted within 60 calendar days after the date the expenses were paid or incurred and have a valid Penn State University business purpose. Reimbursements will not be processed if submitted more than 120 calendar days after the expenses were paid or incurred. See the Group Meal or Meeting Support Form Instructions for information pertaining to when use of the form is required or optional. Petty cash funds MAY NOT be used to reimburse expenditures for group meals and meetings. Business Areas are responsible for providing sufficient documentation to address the following:

Names of the individuals attending
Description of what is being reimbursed or paid
Date of event
Location of event
Business purpose of event

FOOD AND REFRESHMENTS FOR EVENTS AND MEETINGS

Business Meetings

When meetings of an administrative nature are held that are directly related to the business of the University, the cost of meals or light refreshments may be paid from University funds. The meetings should take place over an extended time and if an agenda is prepared for the meeting it should include a working meal to indicate the meal is part of a business function.

The expenditure of funds for food and refreshments should be cost-effective and reasonable. Meal costs must be in alignment to the appropriate meal (breakfast, lunch, or dinner) per diem meal rates for the location (see CONUS Per Diem Rates or OCONUS Per Diem Rates). Costs per person exceeding the per diem amount for the appropriate meal will be subject to review and may be considered non-reimbursable personal costs for the host if found to be unreasonable or excessive.

In accordance with Policy FN10 Other Business Expenses and Activities, the provision of food for gatherings of University employees on a daily or similar ongoing basis is not considered to be an appropriate use of University funds.

Food and refreshments may be purchased with University funds for one or more of the following purposes or activities:

Recognition or promotion of exemplary achievement or scholarship, such as induction into prestigious honorific professional societies and distinguished prizes, awards, or accomplishments
Facilitation of the communication of intellectual ideas among students, faculty, staff, administrators, and community members
Meetings with community leaders regarding the role of the University in the community
Recognition and appreciation of volunteers who work on the University's behalf
Official meetings of the University with national laboratories, other colleges and universities, and community partners regarding the improvement and enhancement of existing or future agreements and other partnerships
Meetings of the Board of Trustees, accrediting agencies and organization, officials from other universities, public officials, and community members in supporting, inspecting, and reviewing the University's facilities and programs
Workshops and seminars
Retreats of departments or other units
Working lunches when that is the only available time for all parties to attend the meeting

In accordance with Policy AD26 Sale and Serving of Food and Beverages at University Locations, the University has entered into an exclusive agreement with Pepsi for specific beverage products, however dispensed. The Pepsi Agreement covers all University locations, except The Pennsylvania College of Technology. Pepsi beverages shall be the only beverages sold, dispensed, or served at official Pennsylvania State University facilities. See the Pouring Rights web-page for complete details.

Hospitality Events that Include Outside Parties

Reasonable expenses for light refreshments and meal expenses may be allowable for hospitality events that include both University employees and invited guests of the University. To be allowable, hospitality events must promote or advance the University's mission.

All requests for reimbursement of hospitality expenditures must be accompanied by a list of the individuals attending the function and their affiliation. The following are examples of allowable hospitality events:

Receptions to honor visitors, guests, or dignitaries
Receptions for the opening of new exhibits at University facilities
Recruitment of highly qualified faculty and staff
Receptions in connection with an academic conference

Reimbursement for group meals and meeting, excluding alcohol (see below), should be charged to general ledger account:

52390101 - Event Costs - Event Expense - Primarily Guest/Donor/Candidate/Board - Unallowable F&A
52390201 - Event Costs â€“ Event Expense - Primarily - Students - Unallowable F&A
52390301 - Event Costs â€“ Event Expense â€“ Employee Only â€“ Unallowable F&A
52390401 - Event Costs â€“ Event Expense - Faculty/Academic Only - Limit Use - Unallowable F&A
52390601 â€“ Event Costs â€“ Event Expense â€“ University Community â€“ Unallowable F&A

Alcoholic Beverages

All rules for serving alcoholic beverages, as defined in Policy AD18 Possession, Use, and Distribution of Alcoholic Beverages must be followed.

Serving alcoholic beverages must be appropriate based on the business purposes of the event and use of unrestricted gift funds for this purpose should be vetted against other potential uses of those funds in meeting unit priorities.

NO contract and/or grant funds may be used to purchase alcohol as a hospitality expense. Only gift funds (restricted or unrestricted) are permitted fund types for the purchase of alcoholic beverages.

Reimbursement for alcohol at group meals and meetings should be charged to general ledger account:

52390121 - Event Costs - Alcohol - Primarily Guest/Donor/Candidate/Board - Unallowable F&A
52390221 - Event Costs - Alcohol - Primarily - Students - Limit Use - Unallowable F&A
52390321 - Event Costs - Alcohol - Employee Only - Limit Use - Unallowable F&A
52390421 - Event Costs - Alcohol - Faculty/Academic Only - Limit Use - Unallowable F&A
52390621 - Event Costs - Alcohol - University Community - Unallowable F&A

Coffee Break and Refreshment Supplies

Coffee and other beverages that are purchased with University funds for guests should not be used for employees unless consumed in conjunction with University guests. Pepsi beverages shall be the only beverages sold, dispensed, or served at official Pennsylvania State University facilities. See the Pouring Rights web-page for complete details.

Use general ledger account 52211000 Supplies - Food Supplies - Allowable F&A or 52211001 Supplies - Food Supplies - Unallowable F&A, as appropriate, when obtaining food supplies such as cups, napkins, coffee, etc.

FOOD AND REFRESHMENTS FOR STUDENT EVENTS AND MEETINGS

The University sanctions and sponsors certain student-centered events and meetings that are designed to supplement classroom learning and allow students to gain leadership skills, develop connections to the campus community, engage in service work, and recognize student accomplishments. Engaging students in these ways helps to fulfill the core mission of the University, enhance student life, and promote academic success. Food and refreshments may be an integral part of these events. It is not possible to specify all the student events or meetings that would warrant expenditures for food and refreshments, but several examples are provided below:

Events or meetings that are officially sponsored or sanctioned by the Office of the Vice President for Student Affairs or any of the departments within that division
Events for the purpose of recognizing or promoting academic and leadership achievement, athletic achievement, scholarship, or service to the University or the state
Events or meetings that promote the communication of intellectual ideas among students, faculty, staff, administrators, and representatives of the public
Events or meetings that promote and create campus community and engagement
Events or meetings that recruit students to programs or groups

Funds that the Associated Student Activities or the Campus Allocation Committee allocates to chartered student organizations may be used for food and refreshments to the extent that such expenditures were included in the organizations' budgets approved by ASA as part of the allocation process. This provision also applies to the Residence Hall Association, Residence Life, and student hall associations.

Reimbursement for group meals and meeting involving students should be charged to general ledger account:

52390201 Event Costs - Event Expenses - Primarily for Students - Unallowable F&A

PAYMENT METHODS

The following payments methods are to be utilized for group meal and meeting expenses:

Purchase Order - a Purchase Order (PO) must be used for large events expected to cost $10,000 or more. A PO provides protections and recourse for the University. All pre-approved contracts and/or agreements must be uploaded to the Shopping Cart as supporting documentation. The use of the Group Meal and Meeting Support Form is not required. A list of attendees, the business purpose, and the budget executive preauthorization email/memo must be uploaded to the Shopping Cart in PSUbuy (see Documentation section).
Purchasing Card - the Penn State issued purchasing card may be used, up to cardholder limits. All pre-approved contracts and/or agreements must be uploaded to SAP Concur as supporting documentation when settling the expense report. See the Group Meal and Meeting Support Form instructions for when the form is required or optional. If the Group Meal and Meeting Support form is not utilized, a list of attendees, the business purpose, and the budget executive preauthorization email/memo must be uploaded as supporting documentation in SAP Concur (see Documentation section).
Non-PO Invoice - a Non-PO Invoice may be utilized for small events (under $10,000). All pre-approved contracts and/or agreements must be uploaded to SIMBA as supporting documentation for the transaction. The use of the Group Meal and Meeting Support Form is not required. A list of attendees, the business purpose, and the budget executive preauthorization email/memo must be uploaded as supporting documentation in SIMBA (see the Documentation section).
Direct Bill Journal Entry - If BJC Catering, Penn State Hospitality Services, or Campus Food Services will be providing the food and or beverages for a group meal and meeting, the Direct Bill Journal Entry processes in SIMBA would be utilized. The Group Meal and Meeting Support Form is not required. A list of attendees, the business purpose, and the budget executive preauthorization email/memo must be uploaded as supporting documentation in SIMBA (see the Documentation section).
Out-of-Pocket - SAP Concur may be utilized to reimburse for group meal and meeting expenses that are incurred with personal funds. See the Group Meal and Meeting Support Form instructions for when the form is required or optional. If the Group Meal and Meeting Support form is not utilized, a list of attendees, the business purpose, and the budget executive preauthorization email/memo must be uploaded as supporting documentation in SAP Concur (see Documentation section).

All contracts and/or agreements, submitted by an external entity, must be reviewed, and approved in advance of payment by the Central Procurement Contract Review Team.

VIOLATIONS

Violation of a financial policy and/or procedure should be reported to your supervisor, unit manager, your Human Resources representative, and/or office responsible for the policy and/or procedure. Where those resources are inadequate, you may choose to make an anonymous report through the Penn State University hotline by calling 1-800-560-1637.

AUDIT COORDINATION - FINANCIAL AND PROCEDURAL

The Financial Officer is responsible for ensuring that procedures pertaining to the accountability and safeguarding of all cash receipts, cash funds, and other assets are established and followed in accordance with approved University policies and procedures. Regular audits relating to advances, cash, travel, equipment accountability, and other expenditures provide a means to protect University assets. The Financial Officer is responsible for collaborating with Internal Auditing when audits are being performed in the administrative area. Audits pertaining to sponsored activities or other audits performed by external auditors may also be performed. The Financial Officer is also responsible for collaborating with the external auditor and/or a central University office related to these procedures.

UNIVERSITY RECORDS RETENTION AND DISPOSITION

University Records must be retained and managed in accordance with Policy AD35 University Archives and Records Management, and the University's Records Retention Schedules that have been approved by the Records Management Advisory Committee (RMAC), the Office of General Counsel, and Senior Vice President and Chief of Staff. These Records Retention Schedules are derived from - or based upon - federal, state, and local statutes or regulations (i.e., Federal Acquisition Regulations, the OMB Uniform Guidance, Internal Revenue Service, and other regulations governing the auditability and retention of financial records), University Policy, industry standards, and business needs. All University Records must be maintained in such a manner to provide ease of access, establish a suitable audit trail for all transactions, and to be reviewed prior to disposition.

University Records and Transitory/Disposable Records are defined below. See Policy AD35, Definition of Terms for additional information.

University Records - Information that documents a transaction or regularly conducted activity of the University and that is created, received, or retained pursuant to law, University policy, or in connection with a transaction, business, or activity of the University. The term includes documents, papers, letters, books, drawings, maps, plans, photographs, tapes, film or sound recordings, microforms, digital or analog files, information stored or maintained electronically, and data- or image-processed documents.
Transitory/Disposable Records - University Records that have temporary value and, as a result, may be destroyed after they are no longer needed. In no event shall be retained longer than the official copy of the University Records as delineated on the Records Retention Schedule. Examples include photocopies of official University Records, a printed copy of a University Record that is held by the Responsible Party or within a System of Record, a spreadsheet containing data that is exported from or officially resides in another systems, personal emails not related to University business or activity, and/or mass emails or communications.

Upon completion of the retention period, University Records must be disposed of via secure destruction or transfer to University Archives, unless an exception to the disposition process set forth below applies. In many cases, retention periods and disposition methods may be generally determined by comparing the type of record (i.e., reports, correspondence, etc.) to similar records series with known retention periods listed on the Records Retention Schedule. If the disposition method for University Records states "Review by Archives" on the Records Retention Schedule, the Unit responsible for those records should consult the University Archivist for a final determination of disposition. For University Records that must be securely destroyed, units may arrange for shredding services by contacting the Inactive Records Center (IRC).

Exceptions to the disposition process are as follows:

University Records subject to a Legal Hold (see AD35, Legal Hold). A legal hold will remain in effect until it is released in writing by the Office of General Counsel.
University Records under audit or review by external auditors - The Financial Officer will be notified regarding any cost objects that are under audit hold; the Financial Officer will be responsible for contacting the Unit associated with the cost objects. An audit hold will remain in effect until the hold is released by the Office of Budget and Finance.
University Records under audit or review by Internal Auditing - Internal Auditing will notify the department or individual regarding any audit holds pertaining to an Internal Auditing investigation. The audit hold will remain in effect until the hold is released by Internal Auditing.

To safeguard the privacy of individuals, records that contain Personally Identifiable Information (PII), as defined in University Policy AD53 Privacy Policy, or student records, as defined in University Policy AD11 Confidentiality of Student Records, must be destroyed beyond recovery. For additional information regarding privacy and the protection of an individual's personal information, see Policy AD53 Privacy Policy.

Additional questions may be directed to the Office of Records Management

Original - January 15, 2025