University Financial Policies

Allowable Expenditures and Necessary Documentation
All requests for disbursements, whether funded from State or Federal sources or "Local" (non-State) sources, must include documentation to support the purpose of the expenditure. This documentation must attest to the fact that the expenditure is a business related expenditure and is reasonable. Individuals submitting and approving the expenditure for processing are responsible for ensuring that the expenditure is reasonable, meets all external (e.g., Commonwealth of Virginia, Virginia Public Procurement Act, State Travel Regulations, Federal government) or internal (e.g., University, school, department) guidelines, and is coded to the proper University and accounting code. Departments that improperly use another department's index are responsible for resolving the error.

A "Business Related Expenditure" is generally accepted to mean an expenditure that is directly related to the operation of a functional area (i.e., school, department, administrative area, etc.) in the fulfillment of its stated mission or objective as part of the University (i.e., instruction, research, public service, support services, etc.). The term reasonable is defined to mean an amount that a prudent businessperson would expend to obtain that particular good or service on behalf of a public agency of the Commonwealth of Virginia. This also infers that the good or service has been acquired under a competitive procurement process, when applicable.

The University is a nonprofit State-assisted institution and its expenditures receive a more substantive review because it operates in the public sector. As such, the University must ensure that all expenditures are necessary in the fulfillment of its stated mission and are incurred at a reasonable cost.

It is the responsibility of persons authorized to submit an expenditure for processing to ensure the most efficient and effective use of the University financial resources assigned to their area of responsibility. It is the responsibility of the Administrative Division to ensure that all expenditures, regardless of funding source, contain appropriate justification as to the reasonableness of the expenditure and the business related purpose of the expenditure. Any question concerning this policy or a question regarding the reasonability and/or business purpose of an expenditure should be directed to your fiscal administrator.

Business Expenditures
Business expenditures are expenses directly related to the operation of a functional area in the fulfillment of its stated mission or objective. The functional area must establish the appropriate business justification. Examples of allowable and non-allowable business expenses follow.

Allowable
1. Purchase of equipment and supplies for office use.
2. Memberships in professional organizations when the membership will result in a direct benefit to the institution.
3. Memberships in social organizations require the prior approval of the President or his designee and will be authorized only after the business purpose is clearly established and documented (Local funds only).
4. Retirement parties/socials. The cost associated with the function should be in proportion to the retiree's length of service and position within the institution (Local funds only).
5. Receptions, entertainment, alcoholic beverages, coffee, office parties with a clearly defined business purpose (Local funds only).
6. Dedications and University sponsored events. Athletic events and cultural events are included only when a clear business purpose can be established, such as fund raising or entertainment of guests of the University.
7. Office plants when they aid in the professional appearance of the office or building; to be located in common/public areas.
8. Subscription to news journals, periodicals and magazines where such subscription is necessary to fulfill ones professional responsibility. (note: they should be mailed to a VCU office)
9. Funeral attendance travel expenses for one employee selected by the Agency Head or his designee.
10. Flowers for either funerals (Local funds only) or University sponsored events, such as dedications. Otherwise, the purchase of flowers requires VP approval, the occasion indicated, the recipient identified, the business purpose clearly stated, and Local funds utilized.
11. Bottled water (Local funds only) unless the water available in the building is hazardous to employee health.

Non-allowable
1. Interest on personal credit cards.
2. Flowers, balloons and gifts (Christmas, "Thank You", birthday, baby shower, Secretary's Day, Bosses' Day, etc.) to University employees or outside individuals other than those given to retiring employees or certain employees leaving the University's employment (exception requires VP's approval, a business purpose clearly stated and use of local funds only).
3. Purchase of goods or services for non-University or personal use or for use of an organization other than the University.
4. Cleaning of personal clothing worn on the job.
5. Memberships in organizations when membership will not result in any direct benefit to the institution. Examples would include memberships in health clubs, gymnasiums, social clubs.
6. Donations or contributions to outside organizations. (An exception is allowed for contributions up to $50 in lieu of flowers for a funeral; requires VP approval and the use of local funds.)
7. Picture framing for personal pictures that may hang in a University office, but are not considered VCU property.
8. Furniture that will not be retained by the University.
9. Portraits of individuals whether retained by the University or not, unless prior approval is obtained from the Dean or Vice President administratively responsible for the area.
10. Registration for outside seminars, continuing education programs, and courses at other educational institutions if similar training opportunities are offered at VCU (see Personnel Policy IX, Education and Training Opportunity).
11. The payment of any type of employee subsidy (i.e., rent, parking, insurance, etc.), unless prior approval has been obtained from the Vice President administratively responsible.
12. Motor vehicle moving violations and parking tickets.
13. External legal services, unless prior approval has been obtained from and documented by the Office of the General Counsel.
14. Any expenditure that may constitute a violation of the University's Conflict of Interest Policy (see Section 2.00) or other administrative regulations.

Information concerning necessary and reasonable expenditures for business related lodging, meals and travel is included in Section 7.30 (Travel Expenses), with examples of allowable and non-allowable expenditures.