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Category Finance
Type Policy
Approved by Council, 13 October 2015
Date Policy Took Effect 14 October 2015
Last approved revision 14 July 2026
Sponsor Chief Financial Officer
Responsible officer Financial Controller

Purpose

Sensitive Expenditure is spending by the University that provides, or could appear to provide, a personal benefit to any member of the University Community; or that may be seen as inconsistent with the University’s functions as a public institution.

The University acknowledges the importance of careful and prudent expenditure, particularly as a publicly funded tertiary institution.

This Policy establishes the principles and approval requirements for Sensitive Expenditure incurred on behalf of the University. All Sensitive Expenditure must be approved prior to being incurred, subject to the thresholds, delegations, and specific exceptions outlined in this Policy.

The Policy and Procedures detail the form/s to be completed and approved, including but not limited to:

  • Meals, travel and accommodation
  • Hospitality and entertainment
  • Staff and student-related events
  • Donations
  • Gifting (including Koha, Pacific Gifting, and research participant gifting)
  • Gifting or private use of University assets and other items
  • Loyalty rewards

Organisational scope

This Policy and Procedure applies to any member of the University Community incurring expenditure on behalf of Ōtākou Whakaihu Waka | University of Otago and Related Parties.

All expenditure arising from internally or externally funded research, or other funded activities, is also within scope of this Policy and Procedure.

Definitions

Approving Person
The person with delegated authority to approve expenditure and who meets the thresholds as defined in section 2(b) of this Policy and Procedure.
Divisional Heads
Refers to the Deputy Vice-Chancellors, Pro-Vice-Chancellors, Chief People Officer, Chief Financial Officer, and Chief Operating Officer.
Donation
A gift usually of a charitable nature. A Donation is a voluntary transfer of property (often money) from the giver (donor) to the receiver (donee), with no exchange of value (consideration) on the part of the recipient (donee).
Event
Any organised gathering, function or occasion, hosted, sponsored or funded by the organisation.
Gifting
The act of presenting an unsolicited, unconditional item to someone without expecting payment, primarily to express appreciation or to celebrate occasions.
Koha
A gift or contribution made in a Māori cultural context that has a kaupapa Māori focus. Koha reflects the mana of both the giver and receiver and embodies the philosophy of reciprocity.
Minor Benefit
A low-value personal benefit an individual receives that would not exist if they were not part of the activity (e.g., if a morning tea was held for 50 people, a minor benefit would be the approver enjoying a cup of tea and scone, if a dinner was held for 6 people, the approver enjoying the dinner is more than a minor benefit).
One-up Approval
Where an Approving Person could receive a benefit from expenditure exceeding the thresholds under this Policy and Procedure or is otherwise not approved under this Policy and Procedure, approval must be obtained from a person senior to the most senior individual(s) who stands to receive more than a minor benefit from the expenditure.
Pacific Gifting
The presentation of an unconditional, spontaneous gift when exchanging with Pacific peoples in Pacific cultural contexts, as a sign of respect and reciprocity, where no payment or obligation is expected.
PCard
A University-issued purchase card (i.e., credit card).
Related Parties
For the purposes of this Policy and Procedure, refers to University wholly owned subsidiaries.
Sensitive Expenditure
Spending by the University that:
  • provides, or could appear to provide, a personal benefit to any member of the University Community; or
  • may be seen as inconsistent with the University’s functions as a public institution.
Unimarket
The University’s e-purchasing system for ordering goods and services.
University Community
All Related Party and University of Otago staff (whether permanent, temporary or part-time), students (whether permanent, temporary or part-time, and including prospective students and students visiting from other institutions), members of the University Council, independent directors and chairs, trustees, honorary staff, contractors, sub-contractors, consultants, and official visitors.

Content

  1. General principles

    1. All expenditure must serve a clear purpose aligned with the University’s functions as a public institution.
    2. All expenditure must be reasonable and appropriate to the circumstances, be able to withstand public scrutiny, and be sufficiently documented should an internal review or external audit be performed.1
    3. All expenditure decisions must be unbiased, transparent, documented, consistent with University policies and strategic frameworks, and protect the integrity and reputation of the University.
    4. All Sensitive Expenditure must be approved before it is incurred, using the approval pathways specified in this Policy and Procedure, including One-up Approval where an Approving Person could receive more than a minor benefit from expenditure.
    5. Where practical, University-owned services (such as the University Union, Residential Colleges, and UniPrint) must be used for venues, catering, meals, hospitality, entertainment, printing, and other relevant goods and services. If a non-University service is required, it must be appropriate, moderately priced, and consistent with other University policies and procedures, such as the Conflicts of Interest Policy and the Procurement Procedure.
    6. Expenditure must be lawful in all respects, including complying with relevant tax legislation.
    7. Unless otherwise stated, all monetary values referred to in this Policy and Procedure are in New Zealand Dollars (NZD) and are GST-inclusive.

      8. 1. The University is audited each year by The Audit Office. This audit includes sensitive expenditure across the University. The Auditor-General has said that all sensitive expenditure by public organisations should be moderate and conservative when viewed from the standpoint of the public and given the circumstances of the spending. It includes considering whether the justifiable business purpose could be achieved at a lower cost.
      Sensitive expenditure: Moderate and conservative – The Audit Office

  2. Approvals

    1. All Sensitive Expenditure requires written approval before it is incurred. The Approving Person must:
      1. Ensure the expenditure complies with the principles of this Policy and Procedure and the Financial Delegations Policy;
      2. Have delegated financial authority over an appropriate budget for the expenditure;
      3. Be senior to anyone who could receive more than a minor benefit from the expenditure (One-up Approval principle);
      4. Complete the relevant Sensitive Expenditure Form and, after the expenses have been incurred, ensure the Form is attached to the Sensitive Expenditure transaction, including receipts that show GST where relevant.
    2. All Sensitive Expenditure requires approval by:
      1. The relevant Cost Centre Head (in most cases the Head of Department, Dean, Principal Investigator, Manager, or Director) for expenditure up to $2,000
      2. The Chief People Officer, Chief Operating Officer, Head of Faculty (in Health Sciences), Deputy Vice-Chancellor, or Pro-Vice-Chancellor for expenditure between $2,000-$10,000
      3. The Vice-Chancellor or Chief Financial Officer for expenditure over $10,000
      4. On a One-up Approval basis if the approver under 2(b)(i), 2(b)(ii) or 2(b)(iii) would receive more than a minor benefit from the expenditure
      5. The Chancellor, for any expenditure incurred by the Vice-Chancellor
      6. The Convener of the Audit and Risk Committee, for any expenditure incurred by the Chancellor
      7. The Pro-Chancellor, for any expenditure incurred by the Convener of the Audit and Risk Committee
      8. The Registrar and Secretary to the Council, for any expenditure incurred for Council events or meetings, including those that involve other relevant staff. Other Council expenditure is approved by the Chancellor
    3. The Auditor-General has said that there is an increasing expectation that public money will not be used to purchase alcohol.2 The University accepts and acknowledges this position. Therefore, only in limited circumstances will the purchasing of alcohol using University resources be approved. There must be clear justification for this expenditure, supported by pre-approval from a Divisional Head or, under the One-up principle, the Vice-Chancellor.
    4. Approval may be granted for individual transactions or, at the approver’s discretion, in principle for a series of related transactions (blanket approval) within the calendar year and approved budget.
    5. Sensitive Expenditure approvals in externally funded research projects may cover the entire project duration, provided the expenditure is consistent with previously allocated expenditure approval.
    6. Variations to the normal approval pathways outlined above are explained in the following sections of this Policy and Procedure.

      7. 2. Entertainment and hospitality expenditure – The Audit Office

  3. Meals, travel and accommodation

    Meal expenditure should be consistent with the principles of this Policy and Procedure, moderately priced and exclude alcoholic beverages.

    1. Meal expenditure during domestic travel on University business does not require pre-approval if it is below the following limits, and within approved budgets.
      1. Breakfast: $25 per person
      2. Lunch: $45 per person
      3. Dinner: $65 per person
    2. Meal expenditure during international travel on University business should be moderately priced and consistent with the principles of this Policy and Procedure taking into account cultural and economic norms for the country in question.  Event approval forms should provide information on options that have been considered to provide evidence that the most cost-effective option has been chosen.
    3. The University will not normally cover partners’ meals or other costs unless their attendance provides clear University benefit (e.g., in cultural or diplomatic contexts).
    4. Travel between home and a local University function is considered personal travel and will not be reimbursed. All other travel-related expenditure must be approved in accordance with:
      1. Travel and Travel Related Costs Policy
      2. Travel Planning Procedure
      3. Event Attendance and Travel Request form

  4. Hospitality and entertainment with external parties

    1. Hospitality and entertainment expenditure will not be approved where it is intended for staff, students, contractors, suppliers and/or potential suppliers, but may be approved for external parties and their University host for the purposes of:
      1. Building relationships;
      2. Representing the University;
      3. Hosting conferences; or
      4. Reciprocating external hospitality.
    2. Catering expenses incurred for the purposes under 4(a) are limited to no more than $100 per person. Anything exceeding this limit must have pre-approval from the relevant Divisional Head or the Vice-Chancellor.
    3. Café expenses may be approved only for the purposes of hosting external guests and will not be approved for meetings between staff and/or students.

  5. Staff and student-related events

    1. An Event Approval Form must be completed for all events.
    2. Expenditure will only be approved for formal farewell or retirement events organised by a University department, where:
      1. the Approving Person determines that the function is commensurate with the staff member’s length of service and role. A funded formal farewell function for a staff member with less than five years’ service should only be approved in exceptional circumstances.
      2. the event complies with the principles of this Policy and Procedure.
    3. Departments that wish to host their own graduation events must comply with the principles of this Policy and Procedure.
    4. Staff recognition, team building, retreats and Christmas events must comply with the principles of this Policy and Procedure and should be limited to two events per year per department.
    5. Low-cost events such as morning teas, afternoon teas, farewell/retirement and staff/student events must comply with the principles of this Policy and Procedure, be limited to $15 per person, and (excluding farewell/retirement events) occur no more than once a month to a maximum of four times per year. The University will not normally cover partners’ costs.
    6. University Council and Council Committee events must comply with the principles of this Policy and Procedure and be approved by the Registrar and Secretary to the Council, or their delegate.

  6. Donations

    1. Under New Zealand law, the University of Otago (as a public tertiary institution) does not have a general power to “donate” money like a private entity. Any payments or transfer of assets must be authorised, aligned to the University’s statutory functions, and properly justified.
    2. Donations of a charitable nature must only be provided to externally recognised charitable organisations with the approval of the Vice-Chancellor and will only be approved if the relevant Donation Approval Form has been completed, submitted and approved before the Donation is provided.
    3. Donations cannot be made to individuals or paid in cash.

  7. Gifting

    1. Gifts will only be approved if the relevant Gift Approval Form has been completed, submitted and approved before the gift is provided.
    2. Gifts with a value greater than $100 per gift, or a cumulative value of $5,000 for multiple gifts, require approval from the Chief Financial Officer.
    3. Koha and Pacific Gifting can include cash gifts and may only be approved in accordance with the:
      1. Kaupapa Here Koha | Koha Policy
      2. Pacific Gifting Policy, Procedure and Guidelines
    4. When a gift is given in the form of a gift voucher, the gift voucher must be ordered using Unimarket. Care must be taken to securely store and record the purchase and use of each gift voucher for audit purposes.

      5. Gifting to external parties (e.g., for appreciation)

    5. Expenditure on gifts for external parties, such as students or members of the public, will not be approved or reimbursed where that gift is:
      1. In the form of cash, unless approved under the Kaupapa Here Koha | Koha Policy or Pacific Gifting Policy, Procedure and Guidelines;
      2. In the form of alcohol;
      3. For services rendered (including honoraria payments or volunteers’ payments for time, which must be processed as payroll payments for taxation compliance);
      4. For goods or services received (which must be invoiced to the University and have payment processed via Accounts Payable);
      5. Made on a regular basis;
      6. Otherwise not a token gift.

      6. Gifting to staff members

    6. Gifts to staff must be coded to dissection code 3491 in Finance One and will attract Fringe Benefit Tax, which will be charged to the department.
    7. Gifts to staff will not be approved or reimbursed for occasions such as births, engagements, weddings, birthdays, or religious celebrations.
    8. One gift may be approved up to $100 providing these are infrequent, pre-approved, and follow the principles outlined in this Policy and Procedure:
      1. For farewells and retirements for staff with more than five years’ service;
      2. For the bereavement of a close family member of a staff member;
      3. On the occasion of a staff member’s serious illness or accident; or
      4. For staff excellence awards; or
      5. Where consistent with the principles in the Bonus Payment Policy and Procedure.

      9. Gifting to research participants

    9. Gifts to research study participants may only be approved if they are given as token recognition for participation and/or recognition of costs incurred to participate, and:
      1. Are, or will be, supported by proof of receipt by recipients (e.g., a signed register);
      2. Are not in lieu of salary or related to time spent on a task;
      3. Are in line with appropriate ethical approvals.

  8. Gifting and private use of University assets and other items

    1. The gifting, transfer, or private use of University-owned assets (items included in the Finance One Asset Register) and minor items (e.g., minor equipment, goods, materials, or other items purchased by the University) constitutes Sensitive Expenditure and must not occur without appropriate approval, except where allowed under another University policy. All assets and minor items purchased by the University, regardless of value or funding source, remain University property unless formally approved for gifting by the CFO and/or disposed of in accordance with the:
      1. Fixed Assets Procedure
      2. Acceptable Use of ICT Resources Policy

  9. Loyalty rewards

    1. Expenditure decisions should not be influenced by loyalty reward schemes. Where loyalty rewards accrue because of University expenditure, staff are encouraged to use those rewards to the benefit of the University (e.g., to offset travel costs).

  10. Supporting documentation, claims, monitoring and non-compliance

    1. Sensitive Expenditure will only be approved based on a completed Sensitive Expenditure Form (or detailed written correspondence if the expenditure does not fall into one of these categories):
      1. Event Approval Form
      2. Gift Approval Form
      3. Donation Approval Form
    2. Additional supporting documentation may be required to further demonstrate why the expenditure was necessary and an appropriate use of University resources.
    3. For approved Sensitive Expenditure incurred using a PCard, a completed Sensitive Expenditure Form is required in addition to the documentation already required by Section 7 of the Purchase Card Procedure.
    4. Sensitive Expenditure incurred without a completed and approved Sensitive Expenditure Form may be charged to the staff member who incurred the expenditure. This is at the discretion of the of the Financial Services Division and the Office of Risk, Assurance and Compliance.
    5. Sensitive Expenditure will only be reimbursed in accordance with the Staff and Non-Staff Reimbursement Procedure, and only where supported by original or clear images of itemised invoices or receipts that include GST and align with the approved values in the completed Sensitive Expenditure Form.
    6. The Financial Services Division and Office of Risk, Assurance and Compliance regularly monitor expenditure for compliance with this Policy and Procedure. Non-compliance may result in:
      1. Disallowance of expenditure
      2. A requirement to reimburse expenditure
      3. Cancellation of PCard privileges
      4. Investigation and/or disciplinary action by Human Resources and/or the Office of Risk, Assurance and Compliance.

  11. Relevant legislation

    1. The University is responsible for the prudent spending of public or taxpayers’ money. These obligations are captured in the Education and Training Act 2020 and the Crown Entities Act 2004, and reflected in this Policy.

Related policies, procedures and forms

Purchasing

Gifting

Travel

Compliance

Contact for further information

If you have any queries regarding the content of this policy and procedure or need further clarification, contact:

Manager, Accounts Payable
Email accounts@otago.ac.nz

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