July, 2007 In this edition: 1. Comptroller's Corner - Candidate's Expenses **************************** Scenario 1 - Candidate Expenses A prospective candidate asks the interviewing committee if he/she may bring their spouse and children with them on their interview visit. The Committee Chairman responds that it would be fine and that they will reimburse for ALL the expenses of the candidates visit. The business reason for the reimbursement is that the University wishes to attract the candidate and the decision would involve the spouse. Issue: While it may be considered a valid business expense by the departmental representatives, only the portion of the expenses directly related to the candidate are reimbursable under the "accountable plan" as tax-free. All of the expenses incurred on behalf of the spouse and children are considered taxable to the beneficiary, in this case, the candidate. This problem demonstrates the difference between a qualified (nontaxable) and a nonqualified (taxable) transaction. In this case, the processing of the reimbursement will generate a 1099 to the recipient. The candidate will receive a check for the entire amount of the expense reimbursement request, but will also receive a 1099 in January to include the nonqualified reimbursement as taxable income. The process for payment requires the department to split the expenses on the check request and list which are for the candidate and which are for the spouse and children. Unless the department explains this to the candidate, the candidate may be confused when they receive the 1099 in January and wonder why the University has reported taxable income to the IRS. **************************** In addition, information/training sessions have been scheduled to answer questions and ensure that everyone is comfortable getting reports out of ISW and/or having them emailed as pdf files. Sign up for a "Receiving your FRS Reports" session at http://www.fso.arizona.edu/isw/default.asp?app=training. If you want to get a head start, contact mailto:support@fso.arizona.edu and request that your FRS reports stop being printed. Please be sure to include your department numbers. **************************** -Kuali has it's first implementation - Strathmore University, Kenya, Africa went live July 2nd - 7 months after the first release of Kuali Financial System - -There is still room and time left to register for a Kuali Project Update and Demo -Bradley University, Boston University and University of Southern California have joined the Kuali Foundation. USC will also be joining the Phase 2B development effort. -Kuali Research Administration (KRA) development kicked off last week at Cornell. -The big picture: the following graphic shows development and release dates for the three Kuali projects - Financial (KFS), Research Admin (KRA) and RICE (KR): http://kuali.org/assets/Kuali_Projects_Development_Timeline_lg.jpg For more info: http://kuali.org/ **************************** Effective September 1, 2007, the University will no longer be able to reimburse employees traveling on university business for meals without an overnight stay. This will bring the UA into compliance with Internal Revenue Service (IRS) regulations. Under the new policy, for example, if you travel to Phoenix for a meeting and come back the same day, meal per diem will no longer be paid. The IRS audited the State of Arizona and concluded that the State and its agencies are in violation regarding same day meal reimbursement without an overnight stay. The State settled with the IRS and signed a closing agreement that included certain stipulations on uniform allowances, independent contractors, and meal reimbursements without an overnight stay. If an employee is reimbursed for a meal without an overnight stay, that meal reimbursement becomes taxable. The State of Arizona is implementing a revised policy to adhere to the IRS finding. The UA's FRS Policy 14.13, Per Diem Reimbursement, will be updated September 1, 2007 to reflect this change. NOTE: Meals can be reimbursed as business meeting expenses as long as it is supported with a business purpose and original receipts are provided, refer to FRS 9.10, http://www.fso.arizona.edu/fso/deptman/9/910reimb.html#business for business meeting reimbursement requirements. **************************** The Biz.Comm (Business Community) website (http://bizcomm.arizona.edu) was created as a resource for new employees in the UA's financial, business, and administrative areas. We would like to improve and expand the site and ask for any suggestions, tips, best practices, or links that you think will help employees find their way through our often complex systems. Please send your ideas to: mailto:fsocommunications@fso.arizona.edu. **************************** Your Question: When processing a reimbursement for a foreign visitor (B-1 visa), do I need to obtain his signature or can the paperwork be processed without his signature? Reply: The reimbursement to a foreign visitor can be processed without the payee's signature. FSO maintains a database of frequently asked questions. Visit our FAQ page at http://www.fso.arizona.edu/app/faq/faq.asp to review previously asked questions, search by category or keyword, or ask a question of your own. **************************** **************************** Susan Brown, Accountant, Financial Management Contact: Kymber
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