University of California Business and Financial Bulletin 79 contains several definitions that are important to consider before processing any transactions for business meetings, social events, or student programs.
- Entertainment is defined as "expenditures for meals or light refreshments and related services (e.g., labor charges, room rental, equipment rental, decorations, flowers, and similar expenditures) incurred in connection with events that are primarily social or recreational activities in support of the University’s mission. Such activities must support an underlying University business purpose such as promoting goodwill, donor cultivation, etc."
Expenses cannot be claimed when they personally benefit the host or other university employees. A legitimate business need must always exist in order to claim entertainment expenses and must be documented appropriately.
- Business Meeting expenditures are defined as "expenditures for meals or light refreshments and related services (e.g., labor charges, room rental, equipment rental, and similar expenditures) incurred in connection with meetings of employees to conduct official University business. At least one University employee or other individual representing the University must be present at any business meeting that includes non-University persons."
- Programmatic activities are meetings and events that are in keeping with the University’s mission. As a tax-exempt organization, the University may incur 'entertainment costs' that are in keeping with business purposes, such as expenditures for meals or light refreshments incurred in connection with student enrichment, training programs, food provided as a necessary part of a community-support activity (e.g., snacks at a blood donation event), and similar activities."
- Guest-Host Relationship
To be considered "entertainment," an event typically should have a guest-host relationship. An official guest or guests attend an event at the invitation of a UC Santa Barbara host, for a business purpose. Although administrative meetings might not typically include a guest-host relationship, they too may incur allowable expenses under the Entertainment policy.