Guidelines for Allowable Employee Meals

General Accounting abides by the following guidelines to determine whether meals and/or entertainment for UNM employees may or may not be allowable per policy.  Please keep in mind that these are just general guidelines, and each individual case is considered separately based on the particular facts of the situation.

The University Business Policies and Procedures Manual, policy #4000 “Allowable and Unallowable Expenditures”, addresses meals/entertainment as follows:

Section 4.8 states:  "The purchase of office refreshments (including coffee makers, food and beverages) is prohibited, except when the refreshments are to be consumed primarily by guests of the University or at business meetings."

General Accounting considers "business meeting" to be self-explanatory.  If the event in question cannot be considered to be a business meeting, food and/or drink paid for by the University is not allowed.  An agenda and minutes for the event may be requested to determine if the event meets this requirement.  The general guideline that central accounting offices have used in interpreting this policy has been that if the meeting is incidental to the food, the food is unallowable; if the food is incidental to the meeting, the food may be allowable.  This means that for a one-hour meeting, refreshments would generally be unallowable; for a four-hour meeting, refreshments would generally be allowable; for an eight-hour meeting, lunch and refreshments would generally be allowable.  Meeting length is not the only criterion.  If the meeting were held at a restaurant, the meal would generally be unallowable; if the meeting were held in a conference room, a catered lunch would generally be allowable.  Other criteria considered would be the number of attendees, who the attendees were, what was served, and the cost.

Section 4.13 states:  "Entertainment of University employees (for example, meal expenses), other than pursuant to the University's travel policy, is prohibited. Exemptions are allowed when the function is a hospitality event that includes both University employees and invited guests of the University."; and:  “In accordance with Internal Revenue Service (IRS) regulations, all requests for reimbursement of hospitality expenditures or requests for payment of invoices must be accompanied by a list of the individuals attending the function. For functions attended by more than twenty (20) people or open to the public, a description of the function and definition of the guests invited is sufficient.”

General Accounting’s guidelines for whether an event can be considered a "hospitality event" pursuant to this policy include: if the event includes people from the community, whom the University wants to thank for past service to UNM, or from whom the University hopes to receive some service in the future, it would generally be allowable.  For example a retirement party for a staff accountant, with only department members included, would generally be unallowable; a retirement party for a college dean, which included alumni that might gift an endowment, would generally be allowable.  The requirement for “a list of individuals attending the function” (when 20 or less) is considered to mean more than merely names.  As with the requirement for more than 20, a “definition” of each guest should be provided.  This information should include the individuals’ title and affiliation, and if they are a UNM employee.

Section 4.15 states in part:  “The purchase of alcoholic beverages is prohibited except when incurred in the performance of University business such as a hospitality event for guests of the University…Payment or reimbursement for the purchase of alcoholic beverages shall not be made from Instruction & General appropriated funds or Contract and Grant funds…”

Due to the restriction on the payment or reimbursement for alcoholic beverages, General Accounting requires itemized receipts for all meals being claimed as “business meetings” at a restaurant, in order to be able to determine if alcohol was served.  This itemized receipt also helps us determine if the number of meals being claimed corresponds to the list of attendees.  The “customer copy” of a credit card receipt is not sufficient documentation.

General Accounting highly recommends that advance approval be obtained for a particular event in order to avoid any unanticipated decisions.  In all cases, a detailed, valid UNM business purpose, explaining how the expenses in question benefit UNM, must be provided.