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Policies & Procedures

Topics:

  1. Introduction
  2. Policies & Procedures (With Summaries)
    A. Guide To Financial Management (GFM)
    B. Purchasing Policy & Purchasing Policy Administrative Regulations
    C. Purchasing Card Policy
    D. University Travel Card
    E. Income Tax Guide (Employee or Independent Contractor?)
  3. Other Policies & Procedures (Links Only)

Introduction

Financial and administrative management at the University is guided by a broad range of policies and procedures. Most originate from statutory legal requirements, the Ministry of Education and Training, grant/award agencies, the Governing Council and from within the divisions of the University. In order to meet these sometimes complex requirements, University personnel with management or administrative duties need to be familiar with the multitude of policies and guidelines that impact on their areas of responsibility.

This section is provided as a quick reference of helpful links and a summary of some key features of University policies and guidelines frequently cited by the Internal Audit Department. The policy summaries here are provided for convenient reference only. They are not intended to be exhaustive or to suggest that other policy features are less significant. Please refer to the actual policies for complete descriptions by clicking on the links shown below.

Policies & Procedures (With Summaries)

A. Guide To Financial Management (GFM)

Accountable Advances

  • Accountable Advance requests require the approval of a Principal, Dean, Director or Chair
  • Accountable Advance requests should be made no more than 2 weeks prior to the requirement for funds
  • Accountable Advances should only be issued to University employees
  • Accountable Advances should only be used for the purposes for which they were requested

Reimbursement of Expense(s)/Accountable Advance Settlement

  • Expense Reimbursements should only be used when other forms of payment are unavailable
  • Reimbursements require the approval of the person to whom the claimant reports
  • Expense Reimbursements should be used only for University faculty and staff
  • Expenses must be personally incurred by the claimant
  • Claims are due within 3 weeks of the completion of the expense-related activity and should always be claimed within the appropriate fiscal reporting period
  • Payments to individuals for services rendered are not allowed as these are to be processed through the Payroll Department
  • A signed explanation is required if the claimant has not complied with all policy requirements
  • Claims should be supported with original receipts

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Travel Expenses (applies whether paid by expense reimbursement, travel card, invoice, etc.)

  • Expenses require the approval of the person to whom the traveler reports
  • Expenses must meet all terms and conditions of the funding source (e.g. grants)
  • The most economical travel options should be selected
  • Kilometric rates for the use of a rental car or privately owned vehicle are normally ineligible for round trip journeys exceeding 500km
  • The maximum rate for accommodation with friends or relatives while on University business is found here.
  • A per diem meal allowance may only be claimed for expenses funded by external agencies (except agencies or ministries of the government of Ontario) or if provided under a collective agreement.  Where a per diem allowance is claimed, it is not permitted to claim a full day per diem when at a conference if the conference fees include a meal component, or if travel begins in the middle of the day.
  • Airfare should not exceed economy rates by the most direct route and where Business Class airfare is deemed appropriate, one-up approval should be obtained in advance
  • Ineligible expenses include: parking/traffic fines, personal travel insurance and credit card service/late charges
  • Expenses that can be claimed only if specifically incurred and necessary for authorized travel, include: passport or visa costs, traveler’s medical insurance and excess baggage costs

Travel Regulations (applies whether paid by expense reimbursement, travel card, invoice, etc.)

  • Air travel within North America requires prior one-up approval
  • Air travel outside North America requires prior written approval to be obtained by written request from a Principal, Director, Dean or Chair
  • It is recommended that travel arrangements be made through Avenue Travel, the University’s preferred travel vendor
  • Air travelers should request the lowest available fare at the time of booking
  • Business class airfare is only permitted for flights over 4 hours in duration and requires one-up approval in advance of booking the flight
  • Expense reimbursement claims for electronic airfare tickets should be supported with the email notification and the boarding pass as verification
  • Where visitors are reimbursed for airfare and require their original ticket for return air travel, the ticket stub should indicate that it has been reimbursed by the University
  • Entertainment expenses are reimbursable when incurred for a required, specific business purpose but require pre-approval if for other than the cost of meals in a hotel dining room or restaurant for the entertainment of a guest
  • Meal and entertainment expenses must be paid by the most senior University attendee when entertaining other University employees
  • Spousal travel expenses are only reimbursable if a specific business purpose is served
  • When accompanied by a spouse, the reimbursable accommodation expense is the most economical rate charged by the establishment for a single occupancy

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Cash Receipts (includes currency, cheques, credit cards, etc.)

  • Cash receipts should be deposited the sooner of weekly or when receipts amount to $500
  • A receipt should be issued for all cash received, identifying the date, the amount and the payee
  • A log book should be used to record all receipts and the subsequent deposit
  • Cheques should be made payable to “University of Toronto”
  • Cheques should be restrictively endorsed immediately upon receipt, stating “For Deposit Only, Governing Council of the University of Toronto”
  • Receipts should be deposited intact and not used to finance expenditures or for any other use

Petty Cash

  • Petty cash should be stored in a locked, metal cash box
  • Petty cash funds should not be mixed with revenues or deposits
  • Individual petty cash expenditures should not exceed $100
  • Petty cash may not be used for loans, cashing personal cheques or payments for services (except for personal services that are very small, nonrecurring and where the recipient will not receive more than $500 from the University in the calendar year)
  • Reimbursements should be processed in time to record expenses within the fiscal period in which they were incurred
  • At any time, the cash on hand plus the vouchers (receipts/proof of payment) not reimbursed should equal the amount of the fund

Imprest Expenditure Bank Account

  • Access to unused cheques should be restricted
  • Cheques require the signature of the custodian and one other designated signatory
  • Cheques should not be pre-signed
  • Deposits may only be made by the Financial Services Department
  • Each payment should be supported with an original invoice or receipt
  • Cheques may not be used for loans, expense reimbursements (e.g. for travel or hospitality costs), petty cash fund reimbursements or payments for services (except for personal services that are very small, nonrecurring and where the recipient will not receive more than $500 from the University in the calendar year)
  • Reimbursements should be processed in time to record expenses within the fiscal period in which they were incurred
  • The custodian should complete the Imprest Expenditure Bank Account Reconciliation Report monthly
  • At any time, the bank balance plus the vouchers (receipts/proof of payment) not reimbursed should equal the amount of the fund

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B. Procurement Policy & Administrative Regulations - Purchasing

  • All purchases of $5,000 or more require a purchase order or written agreement and should be made only from vendors on the database list of approved suppliers
  • Purchase orders issued for budgetary units (University departments and centres) must be authorized and generated by Procurement Services for all purchases of $25,000 or more. 
  • Purchases between $5,000 and $24,999.99 require at least two verbal/written quotations from qualified suppliers (if verbal quotes are obtained, the details of quotes should be recorded in writing).
  • Purchases between $25,000 and $99,999.99 require at least three written quotations obtained by written invitation from qualified suppliers
  • Purchases of $100,000 or more require an open competitive process (public tender).

C. Purchasing Card Policy

  • The purchasing card may only be used by the person whose name is on the card
  • When not in use, the purchasing card should be stored in a secure location
  • If a card is to be issued to someone other than the principal investigator (PI) for a research grant, the PI must provide written delegation of signing authority and acceptance of responsibility for items charged to the grant
  • The purchasing card may not be used for: purchases of $5,000 or more (incl. taxes/all other charges), personal or non-university use, travel or other transportation, accommodation, food/beverages, cash advances, financial instruments, temporary help, extended equipment rentals/leases, maintenance contracts, hazardous or radioactive materials, laboratory/research animals or internal University purchases
  • Service or interest charges are not allowable expenses
  • Records of purchases (e.g. packing slips, vouchers) must be kept by the cardholder and/or the department card coordinator
  • The cardholder should reconcile expenditures to the cardholder statement monthly
  • The department card coordinator should review cardholder individual billing reports monthly for propriety of use and follow-up on questionable items with the cardholder, department head and Director of Procurement Services

D. University Travel Card

  • The Travel Card may be used for University approved travel expenses only
  • The Travel Card may only be used by the Cardmember
  • The Travel Card may be issued to fulltime appointed academic or administrative staff members
  • Issuance of a Travel Card requires the approval of a Principal, Dean, Academic Director or Chair (or higher)

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E. Income Tax Guide (Employee or Independent Contractor?)

The University of Toronto Income Tax Guide has been prepared for use as a quick reference to determine the correct classification for income tax purposes of payments made to individuals or business entities providing services to the University. It is intended to cover the majority of payment scenarios normally dealt with at the University but cannot include every possible situation that may arise. In those cases, assistance and advice should be sought from Human Resources & Equity.

Chapter 6 of the Guide includes a matrix which summarizes in table form the recommended tax treatment for a variety of situations combining types of service with types of legal forms*.

*Legal Forms:

Individual – is specifically identified with a social insurance number and receives payments which are reported on a T4 (if employment income) or a T4A (if other income).

Sole Proprietorship – is an unincorporated business wholly owned by an individual. A sole proprietorship can operate under an individual's name or a registered name. The business does not have separate legal status from the owner.

Partnership – is a relationship between two or more individuals who join together to carry on a business.

Corporation – is a legal entity separate and distinct from its owners or members. It will usually be identified by the words Limited, Ltd., Incorporated, or Inc.

Other Policies & Procedures (Links Only)

Last updated: March 2, 2012