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Policy: Payment or Reimbursement of Business Meals 


Date: 05/01/10 Policy ID: FIN-004 Status: Final

Policy Type: University
   
Contact Office: Procurement and Supplier Diversity Services
   
Oversight Executive: Vice President for Management and Budget
   
Applies To: Academic Division, the Medical Center and the College at Wise.
   
Table of Contents: 

Policy Statement
   1.  “Business Meal” Expenses – General Information
   2.  Payment Methods – Direct Payment vs. Reimbursement
   3.  Payment from State Funds:  Dollar Limits
   4.  Payment from State Funds:  Additional Restrictions
   5.  Payment from Local Funds
   6.  Purchases of Alcohol
Procedures

   
Reason for Policy: 

The University is committed to sound fiscal stewardship of federal, state, and local funds.  This policy defines “business meals,” the circumstances in which the University will pay or reimburse individuals for business meal expenses, including restaurant and catered meals as well as unprepared foods, and the source(s) of funds that may be used in each circumstance.

This policy does NOT cover “Travel Meals,” which are addressed in  Policy FIN-030, Payment or Reimbursement of Travel Expenses, for the Academic Division and Travel for the Medical Center.

Note:  Medical Center employees are to contact Medical Center Accounts payable at 434-924-9272 for information regarding Medical Center procedures for business meals, travel and related reimbursements.
   
Policy Summary: 
   
Definition of Terms in Statement: 

Business Meal:  A meal that must have departmental approval, include more than one person, and have a substantive and bona fide business purpose deemed essential to the University's mission.

Note:  Business meals are distinct from both daytrip and overnight "Travel Meals."  Business meals may be taken while traveling, but the meal must be claimed as "travel" or "business," not both.

Catered Meal: A meal supplied by either an internal or external vendor and requires both planning and forethought on the part of the purchaser, including a pre-established menu.

Local Funds: Local funds are primarily composed of gifts, endowments, and endowment income.  Some exceptions to State and Sponsored Program limits can be processed using these funds.

State Funds: Include tuition and fee revenues, F&A recoveries, funding from state tax dollars, sales and services activities, grants, and auxiliaries.  State limits apply to payments and reimbursements from these sources.

Travel Meals: Meals for which an individual may be reimbursed for no other reason than that the meal was taken while traveling on approved University business.  Travel meal reimbursement may be claimed only for the traveler, not for others who may be present.
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Policy Statement: 

University faculty, staff, students, others acting on behalf of the University, and Medical Center employees may be reimbursed for those meals deemed to fall under the definition of “business meals” according to the guidelines set forth below.
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  1. "Business Meal" Expenses – General Information
    The University will pay for or reimburse individuals for actual expenses incurred, up to specified limits, for those meals that are deemed to be “business meals.” All such payments and reimbursements must be reviewed and approved by Procurement Services for the Academic Division and Medical Center Accounts Payable for the Medical Center Division prior to disbursement.

In order to be approved, all requests for payment or reimbursement for business meals must be submitted in accordance with published Procurement Services or Medical Center procedures as applicable. These procedures will also describe requirements for approval and documentation, which will include receipts and written justification for categorizing the expense as a “business meal.”

Certification of ALL business meals, regardless of the source of funds used, requires the signature of the Supervisor on the appropriate approval document.  Additional approvals may be required, depending on the nature of the meal and source of funds. 

Reimbursement for correctly certified business meals is NOT treated as taxable income.
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  1. Payment Methods – Direct Payment vs. Reimbursement
    Regardless of payment method, all payments must be made using the established procedures published for the payment method by Procurement Services or Medical Center Accounts Payable.

    In all but four specific circumstances (see below), individuals should pay for the meals and then request reimbursement using the established procedure published by Procurement Services or Medical Center Accounts Payable.

    Direct payment can be made to the vendor for business meals in the following circumstances:
    1. Petty cash advances for business meals when reimbursement is not practical.  All state and local spending limits apply.

    2. Catered meals that qualify (see Procurement Services Website).

    3. Unprepared food (e.g., grocery store food items) purchased using University Purchasing Card (Academic Division only).  All state and local spending limits and restrictions apply.

    4. Restaurant meals on a standing purchase order created by buyers in Procurement Services or Medical Center Materiel Support Services.  Limited Purchase Orders (LPOs), used by the Academic Division only, may not be used for this purpose.  This method should be used only when no other method is available.
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  2. Payment from State Funds: Dollar Limits
    On state funds, business meals may be paid only up to specific dollar limits per person per meal.  These limits depend on the locality where the meal is taken.

    Current state limits are posted on Procurement Services’ web site on the Rate Guide.

    Note: Reimbursement from state funds can be claimed for business meal costs exceeding the above limits by up to 50%, with written justification and approval of the Supervisor on the appropriate approval document.  Meals using state or grant funds cannot exceed 50% over the limits.

    Catered meals from internal vendors -- For internal catering vendors only, spending limits may be set higher than the state funds limits, but these limits cannot be exceeded.  Other restrictions on the use of state and local funds still apply. See the Internal Catering page on Procurement Services’ web site for current spending limits for internal catering and a list of internal caterers.

    Catered meals from external vendors -- All state spending limits and restrictions apply.
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  3. Payment from State Funds: Additional Restrictions
    There are additional restrictions on the types of meal expenses that can be paid from state funds:
    • Alcohol -- Any expenses for alcohol during a business meal will NOT be paid from state funds.
    • Spouses -- Spouses of business meal participants may attend a business meal, but their portion of the expense will NOT be paid from state funds.
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  4. Payment from Local Funds
    Business meal expenses may be paid from local funds, up to local funds spending limits, which are generally higher than state limits. Current local funds spending limits for business meals are published at Local Funds Limits—All Locations. With written approval of the Dean or Vice President, local funds may also be used to pay for:
    • Alcohol
    • Meal expenses for spouses of meal participants

    (See Medical Center Policy 0238 for information regarding local fund expenditures within the Medical Center.)
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  5. Purchases of Alcohol
    All alcohol must be purchased with local funds only.  Information on circumstances under which alcohol may be purchased is published in the policy on Use of Alcoholic Beverages and Prohibition of Other Drugs.

    • Alcohol purchased separately from meals for university-related events requires the written approval of a Dean or Vice President.

    • Alcohol consumed with meals, where the cost of alcohol does not exceed the cost of the meal, requires no additional approvals.  However, if the cost of the alcohol exceeds the cost of the meal, written approval of a Dean or Vice President is required.
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Procedures: 

Business Meals – Procurement Services
"Preparing Payment Vouchers"– Procedure 6-101.

Medical Center Accounts Payable
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Related Information: 

Academic Division:
Goods and Services Procurement Guide
Rate Guide
Travel Basics – Procurement Services
Locations Requiring Use of UVA Catering
Use of Alcoholic Beverages and Prohibition of Other Drugs 

Medical Center:
Food and Drink Restrictions
Travel Reimbursements
Local Funds

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Policy Background: 
   
Major Category: Finance and Business Operations
   
Category Cross Reference: 
   
   
Process: 
   
Next Scheduled Review: 05/01/13
   
Approved By, Date: Policy Review Committee, 04/01/04
   
Revision History: Updated 4/26/10.
   
Supersedes (previous policy):  Meal Expenses VI.G.2