Sensitive Expenditure - OP Business Division Procedure

Otago Polytechnic  spends public and private money, and all such spending must meet standards of probity and financial prudence that will enable it to withstand Parliamentary and public scrutiny.  The primary purpose of all expenditure should be for the benefit of Otago Polytechnic.

This policy will support understanding of and set out the responsibilities for appropriately using public funds for sensitive expenditure.

Scope

This policy encompasses all the activities and operations of Otago Polytechnic Ltd, including any controlled entities, and applies to the Otago Polytechnic Ltd Board members, employees (including permanent, fixed-term and casual), secondees, contractors, and consultants.

Definitions

“Sensitive expenditure” refers to expenditure that provides, has the potential to provide, or is perceived to provide a private benefit to an employee, secondee, contractor, or consultant (or a party related to these), that is additional to the business benefits Otago Polytechnic derives from the expenditure.  It also includes expenditure that could be considered unusual for the Polytechnic’s purpose and/or functions.

Sensitive expenditure is discretionary expenditure and choices can be made about the type, level, or nature of expenditure and the expenditure can be perceived to have an element of personal benefit.  Sensitive expenditure may include, but is not limited to:

• Travel – air, car rentals, taxis, private mileage, accommodation, meals
• Using mobile devices and communication technology
• Entertainment and hospitality
• Gifts (both giving and receiving)
• Individual training or professional development.

It is the circumstances in which the expenditure occurs, together with the materiality of the expenditure, which will determine whether it is potentially sensitive.

Sensitive Expenditure at Otago Polytechnic 

Sensitive expenditure will be consistent with accountability and responsibility standards that the public expects of public servants using taxpayer money, as set out in the guidelines from the Office of the Auditor-General titled “Controlling Sensitive Expenditure: Guidelines for Public Organisations”.

Otago Polytechnic staff will work ethically, responsibly, and with integrity. The principal purpose of all expenditure incurred by Polytechnic staff should be for the benefit of Otago Polytechnic.  Having undertaken official duties, no one should:

• Be out of pocket
• Have any personal gain or benefit

The principles applying to sensitive expenditure decisions require that the decisions:

• have a justifiable and dominant business purpose
• preserve impartiality
• are made with integrity
• are moderate and conservative, having regard to the circumstances
• are made transparently; and
• made with proper authority.

Applying Judgement in Decision Making

All expenditure must withstand internal and external scrutiny.  To ensure this, apply these standard tests before you incur or approve expenditure:

• Could the Polytechnic confidently justify this expenditure to the Minister, a taxpayer, a stakeholder, or other interested party?
• Is the primary purpose for the expenditure to benefit Otago Polytechnic?
• Does the expenditure support the Polytechnic’s functions? If so, what are the specific organisational benefits?
• Would publicity on the expenditure reflect a well-managed and prudent Polytechnic?
• Is the expenditure moderate, appropriate to the occasion, and good value for money?

Managing Expenditure

Follow these steps to ensure measurement of expenditure:

• Explanations should be documented for any discretionary expenditure, particularly sensitive expenditure such as travel, entertainment, internal events, or expenses that may appear unusual.
• All expenditure must be within the budgetary authority and be authorised and approved according to relevant policies, procedures, and guidelines.
• Use the standard judgement tests above to evaluate if an expense is reasonable and that it complies with the Polytechnic’s standards of appropriate spending.
• If you have any doubt at all, check with your Formal Leader or do not approve the expense.

Approvals

Sensitive expenditure should be approved:

• where it meets the standards described in this policy
• before the expenditure is incurred wherever practical
• in accordance with delegated authority, associated policies, and budgetary provision
• by a person “one-up” from the person/s perceived to benefit from the expenditure, where possible, or by the Director: Finance Services, or a Senior Accountant in a backup capacity.

Claims

Claims relating to sensitive expenditure should:

• clearly state the business purpose
• be accompanied by supporting documentation, correctly coded; and
• be submitted promptly after the expenditure is incurred.

Breaches of Policy

Non-compliance with this policy may result in disciplinary action up to and including dismissal without notice.  For contractors and consultants, non-compliance may result in the immediate termination of the contract for service.

 The first instance of breach of this policy will be referred to the staff member’s Formal Leader, any additional instances will be referred to the Director: Financial Services.

Policies:

Te Pūkenga Kaupapa-here / Interim Delegations Policy

OP Business Division Procedure - Delegations from Te Pūkenga to the Executive Director and Authorities and Delegations from the  Executive Director

OP Business Division Procedure - Procurement and Purchasing Policy Te Pūkenga Aligned

Mobile Communications Policy

OP Business Division Procedure - Purchasing and Credit Cards Policy

Op Business Division Procedure - Internal Staff Functions, Gifts and Recognition Policy

Asset Management Operational – Acquisition and Disposal Policy

OP Business Division Procedure -Travel on Otago Polytechnic Business Policy

Staff Development Policy

 POLICY VERSION: V6 Previously Coded: CP0008