Intent

The University recognises that the provision of hospitality can result in significant benefits to the institution, particularly in promoting the University as a whole and the activities of the various divisions, colleges and offices.

The Office of the Public Service Commissioner has also issued a set of General Guidelines for Personal Expenses and the Use of Credit Cards by Public Service Employees – including Chief Executives and VCAC Members.  These Guidelines should also be used as guidelines in determining appropriate conduct and expenditure for hospitality/entertainment. (Refer FMPM 420: Policy - Corporate Credit Cards).

The University is required to ensure that appropriate guidelines are specified, that public sector standards of accountability are maintained and that there is a measure of consistency in the way in which this policy is implemented across the University.

Scope

Definitions

Hospitality

Entertainment

Approving Officer

Policy

The justification for incurring of expenditure is underpinned by four principles:

• the expense must be for official purposes;

• the expense must be properly documented;

• the expense must be available for audit scrutiny; and

• the expense must be reasonable for the circumstances.

The primary responsibility for determining the extent to which University resources are applied for the purposes of hospitality/entertainment rests with the:

• Chancellor;

• Vice-Chancellor;

• VCAC Members VCAC Members being members of the Vice-chancellor’s Advisory Committee; and

• Nominees of the above;

and/or as outlined in FMPM 752: Authorised Limits – Hospitality/Entertainment.

VCAC Members Note: This policy should be read in conjunction with University Policy – Alcohol Consumption on University Property.

Requirements

The Chancellor, Vice-Chancellor and VCAC Members, may approve the expenditure of University funds on hospitality/entertainment to be provided at functions and events which will be attended by individuals who are of particular importance to the wider University or Community. This responsibility may be delegated to their nominees.

Participation in corporate entertainment activities as described above should only be arranged where there is a clear benefit to be obtained for the University, such as the facilitation of sponsorship for University activities enhancing the University’s community engagement activities or as part of fund-raising projects.

Approving Officers as listed in FMPM 752: Authorised Limits – Hospitality/Entertainment should be satisfied in disclosing the cost of participation in, and expenditure on, the hospitality/entertainment given, should that be required; be able to identify the benefit to the University and/or the Community and be within their financial delegation.

The Approving Officers should be satisfied in disclosing the participation in and expenditure on the hospitality/entertainment given, should that be required; and be able to identify the benefit to the University, and/or Division; or the relevant organisational unit.

Where the cost of the hospitality/entertainment is expected to exceed the limits as defined in FMPM 752: Authorised Limits – Hospitality/Entertainmentfor a particular function or the function is of the type mentioned in the Grey Area below, or there is uncertainty in relation to whether or not the proposed expenditure is appropriate, advice/approval, where practical, should be sought from one of the officers listed in FMPM 752: Authorised Limits – Hospitality/Entertainment prior to the incurrence of the expense.

The costs of hospitality/entertainment can be charged to research accounts only if the conditions of the grant allow such expenditure. If the conditions of a research grant allow expenditure on hospitality / entertainment, all other guidelines outlined in this policy will apply. For approvals and limits refer to FMPM 752: Authorised Limits – Hospitality/Entertainment.

The addition of tips or gratuities to the account in a hospitality/ entertainment situation is not encouraged and should only be included in exceptional circumstances. However, it is recognised that tipping is the normal custom in some areas of the world and, in those circumstances, an appropriate tip or gratuity may be given.

Participants at functions covered by this policy should normally be restricted to University staff and individuals external to the University who it is believed will contribute to the University’s objectives. On occasion, attendance at such functions by a staff member’s spouse or partner (Associates) may be appropriate. Prior approval for attendance by Associates should be obtained from one of the officers listed in FMPM 752: Authorised Limits – Hospitality/Entertainment.

Specific exclusions for expenditure on hospitality/entertainment are:

• working meals (light lunches/meals on a working day – two course with no alcohol) and morning teas;

• eligible seminar of more than 4 hours (excluding meal breaks);

• exempt training seminar (not business related over a meal);

• meals consumed on work related travel; and

• minor incidental expenditure for items such as tea, coffee, biscuits for servicing meeting rooms.

Refreshments under these circumstances should be regarded as incidental to the activity being performed and charged to the appropriate use code, not Hospitality/Entertainment.

When guest lists are being compiled, the following guidelines should be followed:

• invitees must be individuals who it is believed will contribute to the University’s objectives;

• the number of invitees would not normally exceed the number of university staff who are attending as hosts; and

• spouses and partners of principal invitees and University staff hosts may be included on guest lists if the circumstances of the event warrant this.

For all hospitality/entertainment expenditure, sufficient detail about the event (e.g. number of internal and external attendees, names of employees who attended) should be attached to the financial documentation and be advised through the University’s Expense Management System, which enables the correct determination of FBT liability for the cost centre. Refer to FMPM 421: Procedure - Corporate Credit Cards, FMPM 731: Procedures - Fringe Benefits Tax and FaBS – Spendvision.

The following categories of expenditure should not normally be charged against any University funds:

• functions of a purely social nature;

• farewells to staff leaving the employment of the University; or

• drinks only hospitality/entertainment.

• functions to recognise staff contribution;

It is also recognised that, on occasions, functions are arranged which only involve the participation of University staff and the provision of hospitality/entertainment is incidental to the primary purpose of the function. For the University to pay for the hospitality or entertainment, unless otherwise provided in a Financial Procedure, the primary purpose of these functions must be to further the aims and objectives of the University or the organisational unit and a statement outlining the circumstances should be attached to the financial documentation and be advised through the University’s Expense Management System. This enables the correct determination of FBT liability for the cost centre. Refer to FMPM 421: Procedure - Corporate Credit Cards and FMPM 731: Procedures - Fringe Benefits Tax.

Note: This section is not referring to meals and refreshments provided at courses, seminars or forums arranged for the training and development of staff or for the general engagement of staff in the administration and management of the University.

For limits on contributions by Heads of Organisational Units, refer to FMPM 752: Authorised Limits – Hospitality/Entertainment.

Stocks of Alcohol

Stocked liquor cabinets for small-scale hospitality/entertainment may be maintained on the basis that they are provided primarily for the purpose of offering hospitality/entertainment to external clients, and as a general rule, not to be used for functions exclusively involving University staff.

The Chancellor, Vice-Chancellor or VCAC Members would normally have access to an appropriately stocked liquor cabinet for small scale entertainment. Stocked liquor cabinets in other offices or locations would require approval from members of the VCAC Members. Refer to FMPM 752: Authorised Limits – Hospitality/Entertainment.

Note: This approval does not apply to centrally managed liquor cabinets for functions run by JCU Council and its subordinate committees.

Receiving Hospitality / Entertainment

When accepting hospitality/entertainment, care should be taken to avoid any possible conflict of interest. It is particularly important that such situations should not be perceived or construed as providing an incentive for any commercial transactions.

A hospitality/entertainment benefit may be accepted if it complies with all of the following principles:

• refusal would offend;

• it conforms to normal business practice or other cultural practices of the giver;

• it does not influence a member of staff in such a way as to compromise impartiality or create a conflict of interest; and

• it is received in the course of duty in respect of, work area responsibilities or prior approval has been received as outlined in FMPM 752: Authorised Limits – Hospitality/Entertainment.

Fringe Benefits Tax

Fringe benefits Tax is imposed on certain hospitality/ entertainment expenditure at the current applicable rate. Basically the tax is applied to that portion of the hospitality/entertainment expenditure, which relates to the provision of meals, refreshments, etc to University staff or associates (i.e. partners or spouses).

Refer to FMPM 730: Policy - Taxation and FMPM 731: Procedure - Fringe Benefits Tax.

Related documents, legislation or JCU Statutes

Consumption of Alcohol on University Property

FMPM 711: Procurement Procedure

Income Tax Assessment Act 1997

Fringe Benefits Tax Assessment Act 1986

Pay-roll Tax Act 1971

State Procurement Policy

For enquiries in relation to this FMPM Policy please contact CommercialOffice@jcu.edu.au.

Administration

Approval Details

Revision History