University of Massachusetts Boston



Issuing Office: Controller’s Office Policy Number: FY10-CON-003-01

Policy Name: Employee Business Expense Reimbursement Policy

Original Date Issued: December 16, 2009

Revision #: 01

Last Update: July 1, 2011

Purpose of Policy:

UMass Boston is committed to managing its budget and using its funds as efficiently as possible. One way to be sure that needs of faculty and staff are included in budget management is to encumber funds in advance when the Department Head approves the obligation/Spending Plan. In order to make the most cost efficient purchase, the University provides contracts for supplies and services that have been competitively negotiated. UMass Boston continues to make it convenient for faculty and staff to access these contracts through online purchase orders and the Procard.

UMB’s goal is to provide departments with the tools to support employees in order to reduce the need for employees to use their personal funds for work required supplies and services.

This policy is intended to ensure proper stewardship of University funds by providing guidelines for their appropriate use, and by outlining procedures that will help members of the UMass Boston obtain work-related supplies and services in an efficient and convenient manner.

Applicable to: All departments @ UMB. This policy is applicable to all employees.

Policy:

The University should provide employees with necessary work related supplies and services. This includes informing employees how to acquire supplies and services that are not on hand in the department. This will usually necessitate the use of purchase orders, the Marketplace, or the Procard. When an employee is on official University travel, and makes an approved work required purchase, the employee should be reimbursed through their Travel Expense Report.

This policy supports the elimination of employees being required to use their personal funds for work required supplies and services. In emergency or extraordinary circumstances, the Supervisor must determine that there was no other option for the employee and document with their signature and date on an Expense Report or CON-07 Employee Business Expense Reimbursement Form requesting reimbursement for the employee.

The policy for bargained professional development funds will be issued under separate cover as funds and procedures are identified.

Definitions:

Business Expenses - Business expenses are those costs that are incurred for activities that benefit the University and advance its mission. Business expenses may take the form of direct payments to individuals or agencies that provide the University with supplies or services (Please refer to the UMB Purchasing Manual for state and University restrictions and limits that may apply), or reimbursements to University employees for costs they incur on behalf of the University.

Business & Entertainment Expense – Expenses that are reasonable, necessary and have a clear business purpose and which are used for:

• the purpose of recruiting potential employees, prospective donors or sponsors and hosting official guests when necessary for the conduct of campus business;

• meetings of regular campus committees, which may involve only participants from a single location, and which are documented as part of a working session necessitated by travel requirements, schedule conflicts or other unavoidable circumstances solely for the benefit of the institution;

• institutional events, including recognition/morale activities, public relations/development/fund-raising events, conferences/retreats/seminars, and activities in conjunction with various ceremonial and official events;

• tickets for sports, theater, charitable and other events for the entertainment of institutional donors, alumni, guests and visitors.

Departmental Account Signatory - The individual or individuals who have authority for financial approval for their respective departments and accounts. A Departmental Account Signatory may or may not also be the Department Head. This signature must be documented in the Signature Authorization log located in the Controller’s Office. Additional signatory approvals may be required by internal departmental procedures such as the Principal Investigator and ORSP for a grant or project.

Department Head – The person who has operational and supervisory as well as fiscal responsibility for a department or higher organizational level.

Direct Payment Request - Payment made straight to the actual payee, without first encumbering the expense.

Employee Business Expense Reimbursement – The Employee Business Expense Reimbursement is a Controller’s Office form primarily intended to facilitate the reimbursement of employees’ out-of-pocket expenses due to an emergency or extraordinary circumstance for the purchase of minor supplies and services in the regular course of conducting business, teaching or research at the University.

Expense Manager – An Expense Manager is a role in PeopleSoft Finance that is assigned to one or more UMass Boston employees who has the authority to approve Expense Reports in the PeopleSoft Expense Module for areas under their fiscal responsibility. An Expense Manager can be a Department Head and/or an Departmental Account Signatory or an expense approver in the Controller’s Office. Department Heads and Account Signatories must complete the PeopleSoft Expense Module training before they can be assigned the Expense Manager role in PeopleSoft.

Expense Report – A PeopleSoft Expense Module online form into which an employee enters travel and other expenses. Once expenses have been submitted in PeopleSoft, an Expense Report number will be assigned by the PeopleSoft System for accounting and reporting purposes. A “Printable View” version of the Expense Report can be generated and provides an area for the employee and approver(s) to sign and date attesting that the expenses itemized on the report are true, correct and necessary and that they comply with University rules and regulations.

Fiduciary Responsibility - Responsibility to manage funds in a manner consistent with the missions of UMass Boston and the conditions specified by external sources when applicable.

Reasonable - Not extreme or excessive. An expense may be considered reasonable if the nature of the supplies and services reflects prudent action.

Stewardship - The careful and responsible management and protection of the University's resources, which includes ensuring that resources are used appropriately or used according to applicable policies of the University.

Supervisor - The person who is responsible for overseeing the work of the employee requesting the reimbursement.

Transaction - An event that commits the University to expend funds.

University Funds - All funds, regardless of the source or the manner in which they are acquired, are considered to be University Funds. All University employees should exercise their fiduciary responsibility in a manner consistent with the confidence and trust granted to them by the Board of Trustees in disbursement of these funds.

Policy Overview:

University funds may be used only for University business purposes. This policy provides the guidelines on the various expenses for which University funds may be used. It is intended to provide general guidelines to help all employees of UMass Boston specifically to:

• understand their responsibilities related to the protection, use, and management of University funds;

• properly record and report expenses incurred in support of the University’s mission; and,

• ensure consistent compliance with applicable federal, state, and UMass regulations.

Note: Refer to the policies of your college, center or institute, department or organizational unit as they may be more restrictive than the UMass Boston policy. In no case will any school, department or unit policy on business expenses be less restrictive than the University policy.

Personal Funds

Employees, as a general rule, should not use their own funds to purchase supplies and services on behalf of the University.  The direct payment request process cannot be used to circumvent the payment of supplies and services that should have been ordered using a purchase order or ProCard. 

Sales taxes are not reimbursable when an employee has expended personal funds for the purchase. 

Emergency / Extraordinary Circumstance

If a purchase is necessary due to an emergency or extraordinary circumstance, the employee’s supervisor must authorize the purchase in advance. The employee must submit his or her reimbursement request (other than travel) on a UMass Boston CON-07 Employee Business Expense Reimbursement Form and submit the form with original receipts and a written explanation why these expenses needed to be paid from personal funds to the employee’s supervisor. The written explanation must have the signature and date of the employee’s supervisor indicating approval of the reason for the exception

University Policies on Purchasing and Expense Reimbursement

To avoid incurring costs for which an employee may not be reimbursed, or committing the University to costs that cannot be paid using University funds, refer to the Procurement Office “Guidelines for Work Related Employee Supplies and Services”.

Sponsored Projects

Business expenses charged to sponsored projects are subject to the University’s guidelines provided in this policy, unless the funding agency imposes greater restrictions. The terms of a particular grant or contract should be referred to for guidance on what expenses are allowed.

For questions related to a specific grant or contract, contact the Office of Research and Sponsored Programs.

Non-Travel Expenses Incurred While on Business Travel

Non-travel expenses that are incurred while on business travel will be deemed permissible when pre-approved so long as they are necessary and reasonable. Such expenses include, but are not limited to, the following:

• books, business supplies, research and presentation materials, and other business expenses that were not anticipated prior to the travel;

• overnight delivery postage for business documents.

Stewardship Responsibility

All employees who incur or authorize business expenses on behalf of the University have a responsibility to ensure that University funds are used appropriately. All employees of the University are expected to exercise due diligence when generating, reviewing, and approving transactions that commit expenditures on behalf of the University.

Transaction Authority

Certain individuals are delegated the responsibility or authority to initiate or enter into transactions that commit the University to spend funds. All individuals incurring, approving, recording or processing payment of business expenses must know the signatory approval structure established in his/her school, department, or unit. This structure ensures that business expenses are properly reviewed.

Travel & Relocation Expense Reimbursement

An employee may be approved by the Provost or Vice Chancellor to be reimbursed for moving and relocation expenses. Moving expenses must be reported to the IRS. The employee should complete the UMass Boston CON-10 Employee Moving Expense Tax Form and attach it to the CON-07 Employee Business Expense Reimbursement Form when requesting payment.

Procuring Goods & Services (General)

The Procurement Office of the University has been given the responsibility by the University of Massachusetts Trustees to purchase goods and services on behalf of the University, which includes the selection of vendor, negotiation of price, and assurance of quality and delivery. The UMass Boston Procurement Office functions as an agent of the University and is responsible for advising colleges, centers & institutes, departments, and organizational units on availability and value of goods and services in the marketplace.

The Procurement Office is required by federal and state regulations to maintain a formal procurement system. Its purchasing files are subject to audit by federal agencies and must include proper documentation (i.e., purchase orders, contract negotiations, bid awards, sole source justifications, etc.).

Any goods and/or services purchased with University funds or University-managed funds (i.e., Sponsored Research Accounts) are bound by conditions and requirements detailed in the Purchasing Policies and Procedures Manual.

Purchase Order (P.O.)

A University purchase order is a contract between the University who is offering to buy something and a vendor who accepts the offer by acknowledgment or by filling the order and providing the goods or services requested and should be used to purchase goods and services in most situations.

University Procurement Card

Books, supplies, one-time repair services and other small dollar purchases totaling $1,000 or less should be procured with a University ProCard. Benefits to the cardholder include:

• Ability to shop in many formats -  internet, by phone, in person.

• Eliminates the need for small dollar purchase orders.

• Provides convenience, security and flexibility.

• Allows you to obtain goods faster.

• CitiCards Online Statement Access at Citi Commercial Cards (electronic statements & card management)

Employee Reimbursement for Supplies & Services

The employee business expense reimbursement process is a way to request payment for supplies or services due to an emergency or extraordinary circumstance or the normal practice would be to pay in advance, when:

• the issuance of an official University purchase order is not practical;

• the a vendor will not accept a University Mastercard Purchasing Card (ProCard).

Business & Entertainment

Expenses may be incurred by a duly authorized UMass Boston employee in the process of conducting University business related to the recruitment/solicitation and entertainment of potential employees, donors and sponsors and for hosting official guests when necessary for the conduct of University business. Business and entertainment expenses must be documented on a CON-04 Business & Entertainment Expense Authorization Form and attached to the CON-07 Employee Business Expense Reimbursement Form.

Original Receipt Requirement

Original receipts are required for expense items of $25 or more. If an original receipt is lost or otherwise not attainable by the employee, the employee must complete a CON-08 Missing Original Receipt Affidavit attesting that the receipt was lost or not obtained and that the employee has been unable to obtain a duplicate from the provider of goods or services for which payment was made and that it has not, nor will it be submitted for any other reimbursement to the University of Massachusetts or any other organization. The affidavit must be submitted with the CON-07 Employee Business Expense Reimbursement Form.

Procedures (Online and Manual)

1.0 Expense Reimbursement Through Payroll (Online Expense Submission and Approval – see Attachment 1 for Approval Flow Chart)

All employee expense reimbursements, including Employee Business Expense Reimbursements as defined in this policy, are entered in the University’s online Expense Reimbursement Through Payroll System (Expense Module).

Employees may submit their business expenses online in the PeopleSoft Expense Module in the same manner as they would submit a travel expense. Refer to UMB Policy FY09-CON-002-02 – Employee Travel Policy & Procedures for detailed instructions on how to create an expense report.

See instructions below for the required information that must be entered for Non-travel related expense reimbursements.

1. Create Online Expense Report (PeopleSoft)

Comment Section for Policy Exception Justification – The reason that required the employee to pay for the expense from personal funds must be explained in the “Comment” box in the General Information section of the expense report.

Comment Section for Listing Authorized PI – An authorized Principal Investigator (PI) name (or names) must be listed in the Comment section of the expense report indicating the PI who has, or will, sign and date the expense report on the line for Principal Investigator or Other Approval. This requirement only applies when a Project ID is entered on the expense report.

Expense Type – In the *Expense Type column in the “Details” section of the expense report, select Other Job Related Expenses from the drop-down menu.

Payment Type – Select “Out of Pocket” in the *Payment Type column from the drop-down menu.

Billing Type - Select “Non-Travel Expense” in the *Billing Type column from the drop-down menu.

Description – Type in a brief description of the expense in the Description column. Enter the Vendor or Payee name at a minimum.

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2. Submit, Print, Sign and Date Expense Report

The employee who is requesting the reimbursement should print, then sign and date the “Printable View” Expense Report attesting that he or she had to expend personal funds due to an emergency or extraordinary circumstance and submit the report to his or her supervisor for approval.

Refer to the UMB Policy FY09-CON-002-01 – Employee Travel Policy & Procedures for detailed instructions on submitting, printing, signing and dating an expense report.

3. Supervisor Approval

The supervisor of the employee who is requesting the reimbursement should sign and date the “Printable View” Expense Report if he or she approves the exception for the payment of the expense from personal funds due to an emergency or extraordinary circumstance. The signed and dated report and associated receipts must be submitted to the Departmental Account Signatory (if different from the employee’s supervisor) for approval.

Refer to the UMB Policy FY09-CON-002-01 – Employee Travel Policy & Procedures for detailed instructions on submitting, printing, signing and dating an expense report.

If the supervisor does not approve the reimbursement, he or she should explain the reason for the rejection to the employee.

1.4 Departmental Account Signatory Approval

The Departmental Account Signatory must approve the expense report online if the expense report was created online. Refer to the UMB Policy FY09-CON-002-02 – Employee Travel Policy & Procedures for detailed instructions on approving and rejecting an expense report online.

1.5 Office of Research & Sponsored Programs (ORSP)

If the expense reimbursement pertains to a grant or sponsored program, the expense report will be electronically forwarded to ORSP for approval after the Controller’s Office has entered and approved the expense report (online). ORSP will rely on the Departmental Account Signatory’s approval that an authorized PI as indicated in the Comment section of the expense report has signed and dated the expense report.

ORSP will verify:

• the correct Chartfield was entered,

• the grant or sponsored program includes sufficient budget for the expense,

• that the PI as indicated in the Comment section of the expense report is an authorized PI for the grant or project.

If ORSP approves the travel form, the ORSP representative will approve the expense report online in the PeopleSoft Finance Expense Module.

1.6 Controller’s Office Final Approval

Pre-Audit – The Controller’s office reviews all expense reimbursement forms for signatures, dates and original receipts. If the documentation looks complete, the Controller’s Office approves the expense reimbursement request online. Once the Controller’s Office approves the expense reimbursement, the payment will be processed through the biweekly payroll system.

Post-Audit - A random sample of paid expense reimbursements are routinely checked for travel policy compliance. If an error is found, the employee will be reimbursed if the error is in the employee’s favor. If the employee is deemed to owe the University, he or she will be contacted by the Controller’s Office and asked to repay the amount reimbursed in error.

1.7 Expenses Not Approved

If the Account Signatory determines that the expense reimbursement is not correct or allowed, the Account Signatory must return the Expense Report and any accompanying receipts to the employee with an explanation why the expense report is being returned.

If the Controller’s Office or ORSP rejects the expense report, the approver will also need to go online and select the PeopleSoft Finance Expense Module “Send Back” option and provide an explanation for returning it in the Comments section of the online expense report. The original, signed and dated expense report will be returned to the employee for corrective action.

2.0 Manual Employee Business Expense Reimbursement Submission & Approval

If the employee does not have access to the Expense Module and cannot utilize the services of an approved Expense Preparer, a completed CON-07 Employee Business Expense Reimbursement Form must be submitted to the Controller’s Office for processing. The CON-07 Employee Business Expense Reimbursement Form can be downloaded from the Controller’s Office web site.

2.1 Prepare CON-07 Employee Business Expense Reimbursement Form

Justification for Policy Exception – The reason that required the employee to pay for the expense from personal funds must be explained in the “Justification for Policy Exception” box in the General Information section of the CON-07 Employee Business Expense Reimbursement Form.

Expense Type – In the *Expense Type column in the “Details” section of the expense report, select Other Job Related Expenses from the drop-down menu.

Payment Type – Select “Out of Pocket” in the *Payment Type column from the drop-down menu.

Billing Type - Select “Non-Travel Expense” in the *Billing Type column from the drop-down menu.

Description – Type in a brief description of the expense in the Description column. Enter the Vendor or Payee name at a minimum.

Remaining Steps - Refer to the UMB Policy FY09-CON-002 – Employee Travel Policy & Procedure for detailed instructions related to the remaining steps for processing an Expense Report.

2.2 Print, Sign and date Employee Business Expense Reimbursement form

The employee should sign and date the form and give to his or her supervisor for approval along with all original receipts.

2.3 Supervisory Approval

The supervisor of the employee who is requesting the reimbursement should sign and date the CON-07 Employee Business Expense Reimbursement Form if he or she approves the exception for the payment of the expense from personal funds due to an emergency or extraordinary circumstance.

If the employee’s supervisor is also the Departmental Account Signatory for the department where the expense is to be charged, the supervisor should send the signed and dated CON-07 Employee Business Expense Reimbursement Form and original receipts to the Controller’s Office for entry in PeopleSoft Finance.

If the employee’s supervisor is not the Departmental Account Signatory, the supervisor must sign and date the reimbursement form and submit it to the Departmental Account Signatory for approval.

If the supervisor does not approve the reimbursement, he or she should explain the reason for the rejection to the employee.

Refer to the UMB Policy FY09-CON-002-02 – Employee Travel Policy & Procedures for detailed instructions on approving and rejecting an Expense Report.

2.4 Departmental Account Signatory Approval

A Departmental Account Signatory approver must verify the following:

• that the expense is compliant with the UMass Boston Employee Business Expense Reimbursement policy,

• the employee and supervisor (if different from the Departmental Account Signatory) have signed and dated (not a copy or stamp) the CON-07 Employee Business Expense Reimbursement Form,

• original receipts that support the business expenses are attached,

• that a Principal Investigator (PI) has signed and dated the report and is the PI noted in the Justification section of the report. This requirement applies only to reimbursements for grants and sponsored projects.

If the submitted expenses are appropriate, the Departmental Account Signatory must sign and date the expense form and forward the original and signed and dated form to the Controller’s Office for entry in PeopleSoft Finance where an online expense report pertaining to the expense reimbursement request will be created.

Approval of the expense report from this point on is electronic and follows the same process as the online approval identified in Section 1.0.

2.5 Controller’s Office Expense Report Submission

The Controller’s Office processes expense reimbursement forms online acting on behalf of the employee and Departmental Account Signatory who have submitted expense reimbursement forms manually. After the expenses have been entered in the PeopleSoft Expense Module by the Controller’s Office, the Controller’s Office will review the expense report for accuracy and approve the expense report online.

Oversight Department: Controller’s Office

Responsible Party within Department: Associate Controller for Fiscal Operations

Monitoring: It is the responsibility of UMass Boston to maintain operations according to guidelines established by the University's Board of Trustees, and to comply with applicable federal, state, and local rules and regulations.

The Controller’s Office reviews all Employee Business Expense Reimbursements for compliance with this policy.

The goal of the Controller’s Office is to process employee reimbursements within 5 business days. The payment will be added to the employee’s pay in the next available pay cycle.

Authority:

Purchasing Policy - Massachusetts Board Of Trustees Policy T92-031 (Appendix A)

The University Of Massachusetts Board Of Trustees Policy T92-031 (Appendix A) states “No person is authorized to obligate the University without encumbering, in advance, sufficient funds to meet the obligation.”

Internal Revenue Service Publication 521 – Moving Expenses

Business Expense Policy – Massachusetts Board Of Trustees Policy T92-031 (Appendix C)

UMASS Treasurer’s Office – Employee Moving Expense Payroll Tax Guideline 103

FY09-CON 002 Employee Travel Policy & Procedure

Related Documents:

CON-04 Business & Entertainment Expense Authorization Form

CON-07 Employee Business Expense Reimbursement Form

CON-07 Employee Business Expense Reimbursement Filled-In Form

CON-10 Employee Moving Expense Tax Form

Guidelines for Work Related Employee Goods and Services

CON-08 Missing Original Receipt Affidavit Form

Attachment 1

EXPENSE REIMBURSEMENT

APPROVAL WORKFLOW (Approval Process)

Submitting and Approving an Expense Report / Reimbursement Online

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Legend: FS_EX_Entry = Employee who enters Expense Reports (only)

EXPENSE_MANAGER = The Departmental Account Signatory who approves online Expense Reports, Travel Authorizations, Cash Advances

PROJ_SUPP = An employee in ORSP that approves Expense Reports, Travel Authorizations, Cash Advances for expenses related to grants and sponsored projects.

PREPAY_AUDITOR = An employee in the Controller’s Office

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Employee / Expense Preparer

Add/Edit/Update Expense Report (online) FS_EX_Entry role

YES

YES

NO

YES

NO

NO

YES

NO

NO

Approve?

Automatic Routing to ORSP

ORSP

(PROJ_SUPP role

Approve?

Controller’s Office

PREPAY_AUDITOR role

Approve?

Payment

Send Back for revision

Employee Paycheck / Direct Deposit $

Expense Report

Employee signs, dates & submits to Supervisor (& PI if Grant) for approval

Supervisor, PI (if applicable) signs, dates & submits to Departmental Account Signatory for approval

Print Expense Report

Dept. Account Signatory

Submit for Approval (online)

EXPENSE_MANAGER role

Grant or Project ?

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