Discretionary expenditure, gifts and travel policy

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1 Discretionary expenditure, gifts and travel policy ISSUE DETAILS Effective Date: 24 June 2014 Minor Update 8 Policy Owner: Written By: Chief Financial Officer Financial Controller Approved By: Chief Executive: June 2014 Policy Revision Authority: Updates in this Issue 8f: Policy Review Frequency: The Chief Financial Officer has the authority to approve minor (but not material) revisions and amendments without the requirement for a repeat approval. Changes to travel policy guidance; guidance on Koha. Five Yearly Policy Review Date: June 2019 TRANSPOWER APPROVED CORPORATE POLICY This Policy was implemented: June 2014 Transpower New Zealand Limited 1

2 CONTENTS 1. PREFACE COMPLIANCE REQUIREMENT REFERENCES Legislation Regulations Policies Procedures KEY WORDS DISCRETIONARY EXPENDITURE SPECIFIC RESPONSIBILITIES Employee responsibility Approver responsibility METHOD OF EXPENDITURE DISCRETIONARY EXPENDITURE DOCUMENTATION ENTERTAINMENT RELATED EXPENDITURE GIFTS OR HOSPITALITY RECEIVED BY STAFF Disclosure in the gift register Approval to accept hospitality Gifts which must be declined Guidance for special events Exclusion for hospitality provided at seminars and workshops Guidance on compliance GIFTS GIVEN BY TRANSPOWER TO EXTERNAL PARTIES KOHA GIVEN BY TRANSPOWER TO EXTERNAL PARTIES NON-MONETARY RECOGNITION OF STAFF STAFF WELFARE PAYMENTS PAPERS AND PERIODICALS CLUBS AND PROFESSIONAL MEMBERSHIPS SPONSORSHIP FUNDING OF SOCIAL CLUB ACTIVITIES CORPORATE BOXES FINES CARE OF DEPENDANTS STATIONERY PURCHASES TRAVEL BOOKINGS APPROVAL OF INTERNATIONAL AIR TRAVEL SELECTION OF AIRLINE CLASS OF TRAVEL TAKING LEAVE WHILE ON INTERNATIONAL TRAVEL MEMBERSHIP TO AIRLINE CLUBS AIRPOINTS...12 Transpower New Zealand Limited 2

3 29. TRAVEL INSURANCE TRAVEL EXPENSES GRADUATES HOTELS HOTEL SERVICES STAYING WITH FRIENDS/FAMILY LONG TERM OVERSEAS ACCOMMODATION CAR HIRE TAXIS EMPLOYEE USE OF PRIVATE VEHICLES FUEL CARDS PARKING EXPENSES LUNCH AND OTHER MEALS WHILE AWAY FROM NORMAL PLACE OF BUSINESS CREDIT CARDS CASH ADVANCES REIMBURSEMENT ADDITIONAL MISCELLANEOUS EXPENSES USE OF TRANSPOWER ISSUED MOBILE PHONES FOR PERSONAL CALLS USE OF PERSONAL MOBILE PHONES FOR BUSINESS CALLS THE BOARD AND CHIEF EXECUTIVE REPORTING OF INAPPROPRIATE EXPENDITURE Employee responsibilities Senior management responsibilities MONITORING COMPLIANCE TO THIS POLICY...17 APPENDICES APPENDIX 1 GUIDELINES FOR DECLARING GIFTS (EXAMPLES ONLY)...18 APPENDIX 2 GUIDANCE ON KOHA...20 Transpower New Zealand Limited 3

4 1. PREFACE This policy sets out Transpower s requirements relating to: the incurring and approving of discretionary expenditure; the conditions under which gifts can be given and accepted; domestic and international travel. 2. COMPLIANCE REQUIREMENT REFERENCES 2.1 Legislation This policy has the following specific legislative compliance requirements: Goods & Services Tax Act 1985 Income Tax Act Regulations This policy has no specific regulatory compliance requirements. 2.3 Policies Refer to the following relevant and related Corporate Policies: Code of Ethics and Conduct Compliance Policy Delegated Authority Policy Motor Vehicle Policy Directors Fees and Expenses policy Drug and Alcohol Policy Learning and Capability Policy 2.4 Procedures This policy has the following specific documented procedures relating to it: Insurance policies Long Service Recognition Guidelines Procedures for the Management of Drugs and Alcohol in the Workplace Fraedom procedures VISA Card procedures 3. KEY WORDS Accommodation Airline club membership Bookings Car hire Cash advances Credit cards Discretionary expenditure Domestic travel Expenses Hospitality Hotels Insurance Koha Mobile phones Reimbursement Service Recognition Sporting events Taxis Transpower New Zealand Limited 4

5 Fuel cards Gifts Gift register Travel Travel and business expenses VISA Card 4. DISCRETIONARY EXPENDITURE Discretionary expenditure is a generic description that covers many types of expenditure. Characteristics of discretionary expenditure are as follows: (a) Discretionary expenditure is very often incurred in respect of travel and its associated costs, e.g. airfares, hotels, meals, taxis. (b) Discretionary expenditure often involves judgement to ascertain whether or not it is appropriate to charge a particular expense to the company, e.g. should a meal be accompanied by wine, what is an appropriate amount to claim in respect of a meal away from the office? Discretionary expenditure is generally not subject to a specific financial delegation. Staff can, subject to this Discretionary Expenditure, Gifts and Travel Policy incur expenses on their Visa Card without having a delegated financial authority. 5. SPECIFIC RESPONSIBILITIES 5.1 Employee responsibility Discretionary expenditure may only be incurred in accordance with this policy. Where this policy does not cover the particular expenditure being contemplated the following questions should be considered: (a) (b) Does the expenditure support the goals of Transpower? Could Transpower confidently justify this expenditure to a taxpayer, shareholder or other interested party? (c) Would publicity about this expenditure adversely affect the organisation? In cases where expenditure has already been incurred (e.g. on a company VISA card) failure to follow this policy or to apply the criteria above may lead to Transpower requiring reimbursement of the expenditure concerned. No employee may approve their own discretionary expenditure or the expenditure of a relative or a person they share accommodation with. Where more than one staff member is present the most senior person in attendance must pay the bill. This ensures that the Approver is an employee that was not present when the expenditure was incurred. In the event the most senior person attends but leaves prior to the settlement of the bill then the manager of that senior person must still approve the expenditure. An exception to 5.1 would be where for a celebratory event a senior person puts in a brief appearance, but is absent for the majority of the time and cost of the of the event. In this situation they can still approve the expenditure at the event. For example if there is a celebratory dinner, and a manager attends briefly having one drink and no meal then they could still approve the expenditure incurred at the event. If the manager had dinner, or spent a reasonable period of time at the event then they could not approve the expenditure at the event. Care should be taken to ensure that the exception is not used to get around the general rule, and that the expenditure is appropriate. Transpower New Zealand Limited 5

6 Excessive alcohol expenses (including any alcohol from a mini-bar) are inappropriate and are not to be incurred or approved. Mini-bar expenses are addressed specifically in section 32 below. Tipping should typically only occur in those countries where the practice is the norm. 5.2 Approver responsibility A person that approves discretionary expenditure (an Approver ) is responsible for ensuring that this policy is applied. Transpower relies on Approvers to enforce this policy. If discretionary expenditure is approved that does not comply with this policy, Transpower may consider that both the Employee that incurred the expenditure and the Approver are at fault in respect of policy compliance. In considering the approval of discretionary expenditure there are three elementary tests that should be applied: (a) (b) Does the expenditure support the goals of Transpower? Could Transpower confidently justify this expenditure to a taxpayer, shareholder or other interested party? (c) Would publicity about this expenditure adversely affect the organisation? If the Approver is not satisfied that the transaction passes the three tests shown above, guidance should be sought from one of the following: (i) Approver s manager (ii) (iii) Financial controller People & Performance Manager. 6. METHOD OF EXPENDITURE This policy is to be applied when approving all discretionary expenditure regardless of method, e.g. discretionary expenditure may be incurred using a company credit card, company mobile telephone, air travel, etc. 7. DISCRETIONARY EXPENDITURE DOCUMENTATION For out of pocket expenses and credit card purchases an employee must obtain GST invoices and other supporting documentation and attach (via scanning or photo attachment) it to the relevant Cash Expenses Claim or Credit Card statement. EFTPOS receipts are not sufficient documentation. It is possible that receipts are occasionally mislaid. Systematic failure to submit receipts is regarded as a policy breach since it may leave Transpower unable to fully reclaim GST and/or deduct expenses for Income Tax purposes. This, in turn, increases the company s costs. Further information regarding supporting documentation is contained in the company Fraedom procedures, under the heading Documentation. Fraedom is accessible at 8. ENTERTAINMENT RELATED EXPENDITURE Entertainment related expenditure is defined as expenditure for business reasons usually spent for the purpose of: Building relationships; Representation of Transpower; Reciprocity of hospitality; Recognition of significant business achievement; Transpower New Zealand Limited 6

7 Building revenue. 9. GIFTS OR HOSPITALITY RECEIVED BY STAFF Employees should never place themselves or Transpower under an obligation at any time by the acceptance/offer of gifts or hospitality (hospitality includes invitations to sporting, social or cultural events, lunches, dinners, etc.). As a general rule a gift must not be accepted (whatever the nature or value) where it could be seen by others as an inducement or a reward that might place Transpower under an obligation. 9.1 Disclosure in the gift register All gifts or hospitality must be disclosed in the Transpower Gift Register unless the gifts or hospitality can be considered to be inconsequential (e.g. low value items such as pens, coffee mug, an occasional cup of coffee, etc.); if you are in any doubt, disclose it. Gifts and invitations of hospitality which are declined are not required to be entered in the Gift register unless the gift or invitation is of such a magnitude that it could be considered to be an inducement. In this case, the matter must be brought immediately to the attention of your General Manager or the Chief Executive. The Financial Controller maintains the Gift Register. Disclosure is to be by way of to finance@transpower.co.nz, with the subject Gift Register. The must be copied to the staff member s manager and also the appropriate General Manager if the gift or invitation exceeds or has the potential to exceed $100 in value. The should include details of the recipient, donor, value, description and purpose of the gift. The Gift Register is reviewed by the Chief Financial Officer on a monthly basis. 9.2 Approval to accept hospitality Staff must seek approval from their relevant Manager prior to accepting any hospitality that would require disclosure in the Gift Register. Where an invitation of hospitality is estimated to be worth or has the potential to be worth in excess of $100, General Manager approval to accept is also required. In estimating value, ancillary costs such as drinks, flights, etc. should be included. Some degree of judgement in estimating the value may be required. If prior GM approval was not obtained then it should occur as soon as possible after the event, along with the reason why prior approval was not obtained. Annual leave may be required to be taken and/or travel cost reimbursement may be required where the relevant Manager considers these to be significant. 9.3 Gifts which must be declined Gifts of excessive value that might be seen as an inducement should be refused. The provision of goods and/or services at discounted rates that are, or may be perceived to be, derived from suppliers of such goods and services to Transpower may not be received by staff, their partners or family for private use, except if they are made available by Transpower for the benefit of all staff. Staff must not accept cash or other monetary benefits of any value at any time and gifts cannot be exchanged for cash. 9.4 Guidance for special events Specific instructions to suppliers or staff, on the provision or receipt of gifts and hospitality may be issued from time to time around Christmas or significant sporting or cultural events. Transpower New Zealand Limited 7

8 9.5 Exclusion for hospitality provided at seminars and workshops Hospitality which is ancillary to externally provided seminars, workshops or professional updates, (i.e. at which employees of other organisations are also present) is not required to be declared in the Gift Register. Staff should, however, seek approval of their manager before attending such events. 9.6 Guidance on compliance Some guidance on complying with Gift Register disclosure is contained in the examples set out in Appendix 1. However, if in doubt, disclose it. 10. GIFTS GIVEN BY TRANSPOWER TO EXTERNAL PARTIES Hospitality and/or corporate gifts (see section 11 for koha ) given by Transpower should not exceed $250 per recipient. Relevant General Manager approval is required before gifts over $50 per recipient are given, or in the case of a General Manager, the Chief Executive s approval must be obtained. Under no circumstances can gifts given be exchanged with Transpower for cash. The value of gifts to be given to hosts overseas should be appropriate to the circumstances. Business-related gifts should, where appropriate, be selected from Transpower branded merchandise. Contact People and Corporate Relations to find out what s available. 11. KOHA GIVEN BY TRANSPOWER TO EXTERNAL PARTIES Transpower recognises the practice of providing koha as a gesture of thanks and good will, in particular when dealing with tangata whenua on project consultation (this is one aspect that demonstrates our Commitment to Tangata Whenua). All koha is required to be approved by a General Manager, or if it is over $500, then it must be approved by the CEO. Refer to Appendix 2 for practical guidance applying to koha. 12. NON-MONETARY RECOGNITION OF STAFF Each budget manager may budget for an amount up to $250 per employee per year as a staff entertainment allowance. The figure is a guide not an entitlement and budget managers should justify how they have constructed their budget figure. This budget covers: non-monetary rewards for performance of teams; working lunches; morning teas; team building costs; staff functions, etc. All such expenditure must identify the date, venue, costs, recipient(s) or attendee(s) and the benefits derived and/or reasons for the event. Please note that expenditure is required to be demonstrably reasonable and appropriate to the event, and reimbursement from the manager concerned is required where company funds are committed inappropriately. Spending all or a substantial part of the allowance at any one time is likely to be at odds with the guidance in section 5. Transpower New Zealand Limited 8

9 Excluded from the staff entertainment allowance are those items separately funded such as the staff Christmas party, training course meals and senior management / GMT forums. Please note there is a separate Rewards and Recognition Policy detailing allowable remuneration and benefits for awarding staff special recognition. Managers should be clear which policy is being applied. Monetary rewards can only be given under the Rewards and Recognition Policy. 13. STAFF WELFARE PAYMENTS Transpower reimburses the cost of: (a) (b) (c) (d) Flowers or token gifts for personal events related to staff members and their immediate family such as births and deaths (but not for birthdays and anniversaries) up to the value of $75. Expenses that improve working conditions such as the cost of flu injections providing these have been approved by the appropriate budget manager, e.g. P&P for flu shots, IST for larger screens, etc. Farewell gifts for staff who have been employed in excess of 24 months up to the value of $100, except where General Manager (or Chief Executive) signoff is obtained. Service recognition celebrations that are held in accordance with the Long Service Recognition Guidelines, for those who reach 10 years service and every subsequent 10 years, such as morning tea or, in the case of those who reach 40 years service, a lunch. (e) A Service Recognition award of $500 for each person at their 40-years anniversary. All such expenditure must be approved by the Budget Manager, identifying the date, costs, recipients and the reason for the expenditure. 14. PAPERS AND PERIODICALS Any purchase of magazines and periodicals must: Be approved by a Senior Manager; Be appropriate and necessary to the performance of Transpower s duties. Cost centres must budget for any magazines or periodicals within yearly budget cycles. Variations from one year to the next must be approved by the relevant Senior Manager. With the exception of the People and Corporate Relations division Transpower does not pay for daily newspapers. 15. CLUBS AND PROFESSIONAL MEMBERSHIPS Club and professional memberships paid for by Transpower are for the benefit of Transpower and are not intended to be a personal benefit to staff members, and accordingly are not liable for Fringe Benefit Tax. Club and professional memberships paid by Transpower must be: (a) (b) Clearly relevant to the performance of the staff member s duties and responsibilities. Be for that person alone and is not to cover members of the staff member s family. Transpower New Zealand Limited 9

10 (c) Be for no longer than one year with possible exemption where significant discounts are available and it is reasonable to expect a multi-year subscription to be to the advantage of Transpower. (d) Cancelled or transferred to a replacement Transpower staff member in the first instance, should employment with Transpower cease. A decision not to cancel or transfer membership is at the discretion of the relevant General Manager. Any refund of fees as a result of cancellation of membership belongs to Transpower and must be refunded to Transpower immediately. Membership of Airline Clubs is set out below. Club or sporting memberships such as a golf club membership must be approved by the CEO, or in the case of the CEO the Chairman of the Board. Professional memberships must be relevant to the role being carried out by the employee and can be approved by a manager with the appropriate delegated authority. Transpower will generally only pay for one professional membership per staff member. If more than one professional membership is necessary to carry out a particular role, CEO or CFO approval is required for any additional membership(s). 16. SPONSORSHIP All sponsorships and donations can only be approved by the GM People and Corporate Relations (or their delegate). Other managers cannot budget for or incur any donations or sponsorship expenses. 17. FUNDING OF SOCIAL CLUB ACTIVITIES Any funding of a Transpower social club or social club activity must be accounted for through the People and Corporate Relations budget only. 18. CORPORATE BOXES 19. FINES The hire, lease or other payment by Transpower for the use of corporate boxes should be justified by a full business case, approved by the Chief Executive. General Manager approval is required for a one-off event and CEO approval for any longer-term arrangement or commitment such as a periodic lease. Individuals who incur fines for parking or traffic fines whilst on Transpower business are personally liable for those charges. 20. CARE OF DEPENDANTS Subject to notification of the relevant General Manager, payments for the care of dependants are to be made only in exceptional circumstances, such as when a staff member is unexpectedly required to perform additional duties at very short notice or a dependant unexpectedly requires additional care that the staff member cannot provide because of the essential nature of their duties at the time. 21. STATIONERY PURCHASES Stationery should be purchased through the Transpower office supplier. 22. TRAVEL BOOKINGS In general, airline travel, hotels and rental cars must be booked by your Group Administrator through Transpower s Travel Agent. Transpower New Zealand Limited 10

11 23. APPROVAL OF INTERNATIONAL AIR TRAVEL Applications for all international travel must be submitted to the following approvers using the International Travel Request / Approval Pre-Requisition Module in Fraedom Type of international travel Approver Travel to the East Coast of Australia, including Adelaide All long haul travel (beyond the East Coast of Australia) General Manager General Manager and CEO If the application for long haul international travel is approved, the employee is issued with an approval number which must be quoted at the time of booking. Transpower s Travel Agent will not accept any requests to book long haul international travel unless the request is accompanied by an approval number. In the event of a change to the approved travel arrangements (including intentions for personal travel and/or annual leave), the change must be resubmitted for approval. 24. SELECTION OF AIRLINE Transpower is a participating agency under the All of Government ( AoG ) travel contract. Under this contract the panel of suppliers are: Domestic travel Air New Zealand, Jetstar, Sounds Air and Sunair International Travel Air New Zealand, Qantas, Lufthansa, Emirates, Singapore Airlines, Etihad, Latam, United Airlines and Virgin Australia Employees must select the best value airfare from a panel supplier when booking travel, unless the panel supplier cannot meet the travel requirements (e.g. due to routing, scheduling, capacity or fare class availability) then an alternative supplier can be used. For international travel, Transpower s Travel Agent will provide the best value airfare available, subject to finding an efficient route. For domestic travel the fare provided will be the cheapest airfare with arrival up to half an hour before the intended arrival time for morning flights and up to half an hour after the intended arrival time for afternoon flights. Flexifares should generally not be selected. 25. CLASS OF TRAVEL Within New Zealand and to the East Coast of Australia (including Adelaide) the approved class of travel is Economy. For other international travel, the approved class of travel is Premium Economy or an equivalent class. If General Managers, or in the case of a General Manager the CEO, believes that special circumstances exist then they may approve Business Class travel rather than Premium Economy. If employees downgrade the status of their fare, the difference between the fares must be reimbursed back to Transpower. Employees are not permitted to down grade their fare to subsidise personal travel during their business trip. 26. TAKING LEAVE WHILE ON INTERNATIONAL TRAVEL If the employee intends to take leave in conjunction with travel on Transpower business overseas, the employee must disclose this in the International Travel Transpower New Zealand Limited 11

12 Request / Approval Form, which can be found and in the case of travel to the East Coast of Australia, must disclose this to their General Manager. The employee must indicate the period(s) when not engaged on company business or business travel, at the time the application for international travel is forwarded for approval. Any incremental costs for additional travel that the employee undertakes in conjunction with travel paid for by Transpower is at the employee s own expense. 27. MEMBERSHIP TO AIRLINE CLUBS Effective from 1 July 2016, Transpower will no longer pay for airline club memberships or renewals. Air New Zealand do provide complimentary airline club memberships to individuals, based on a certain number of flights which contributes to their airpoint status. Those Transpower staff that qualify for this can accept that complimentary membership. Employees may purchase their own airline club memberships using Transpower s corporate rate. For more information please contact the Facilities team. 28. AIRPOINTS Employees are able to earn air points, air point dollars or status points when travelling on an AoG panel supplier airline. Air points, air point dollars or status points may also be earned from participating suppliers for hotel accommodation and rental cars. These may be retained by employees. Employees should select flights based on the lowest available airfare not on the basis of any private airpoint benefit. 29. TRAVEL INSURANCE The Transpower New Zealand Ltd Insurance Policy is published at: Specific advice on insurance is available from Treasury. 30. TRAVEL EXPENSES Transpower reimburses actual and reasonable costs of business related travel expenditure incurred by employees. If employees take leave in conjunction with travel on Transpower business overseas, all expenditure undertaken by employees during the period(s) of leave is their responsibility. All personal expenses, including any incremental costs incurred as a result of taking leave in conjunction with the business travel, is also the responsibility of the employee. Transpower pays for the travel costs of family members accompanying employees only if prior written approval is given by the CEO (in the case of the CEO, approval would be by the Chairman). Employees are not permitted to provide flights for family members by downgrading their business class flight, unless they obtain prior written approval from the CEO. If the cost of travel for partners is funded by Transpower then the General Ledger Accountant should be notified for Fringe Benefit Tax purposes. 31. GRADUATES Staff who are part of the graduate programme must have all their travel and intended allowances approved by P&P prior to departing. Transpower New Zealand Limited 12

13 32. HOTELS A list of Transpower s preferred New Zealand hotels and the room rates at those hotels is available at Travel Policy and Processes. Where appropriate, employees should stay at one of these listed hotels. It is recognised that on rare occasions staying at one of the preferred hotels listed above may result in higher total charges to Transpower (e.g. where taxi charges to get a person to their destination are included) and in these instances departure from the preferred hotel policy is allowed. Transpower does not have a preferred arrangement with any hotels outside New Zealand, so Transpower s Travel Agent recommends a suitable hotel at the time of booking. As a State Owned Enterprise, Transpower can access government rates at some hotels in Australia. Hotel bills should be settled by the employee upon departure using a company credit card. 33. HOTEL SERVICES Employees staying at a hotel for business purposes can claim actual and reasonable expenses for the following: Hotel meals; Laundry and dry cleaning for stays in excess of 3 nights; Other expenses at the discretion of their Manager. Employees staying at a hotel cannot claim for: Movies; Minibar charges except for moderate expenditure on non-alcoholic beverages. 34. STAYING WITH FRIENDS/FAMILY Employees may stay in a private residence with family or friends while travelling on business. An allowance of $30 (including GST) per night, up to maximum of 10 nights, may be claimed with the prior approval of their manager, provided that the total cost of the arrangement (i.e. allowance plus any other additional costs for travel, etc.) does not exceed the costs which would have been payable for a comparable hotel stay. 35. LONG TERM OVERSEAS ACCOMMODATION Where employees are required to stay overseas for a significant period of time a daily allowance can be paid in lieu of making expense claims. Staff would be required to be overseas in excess of a month to be eligible. The applicable daily rate would be determined by the Financial Controller in the first instance, with approval required by the applicable General Manager and the CFO. 36. CAR HIRE Transpower has an arrangement with Avis and Hertz to provide rental cars. Employees are required to book the best value rental rate at the time of booking. Group D or E (or similar class) and up to 2000 cc capacity vehicles should generally be used. When there are 5 or more people (or significant equipment), a larger vehicle may be hired. A 4WD vehicle, may be used where circumstances require one. Transpower New Zealand Limited 13

14 37. TAXIS As all rental car companies charge a premium on fuel, employees should fill the rental car up with fuel prior to returning it to the depot. Transpower's insurance policy provides cover for employees hiring vehicles within New Zealand only. For more information on insurance requirements refer to the Motor Vehicle Policy. When hiring rental cars overseas, employees should purchase the hire company s insurance using their company credit card. Employees should use one of Transpower s preferred taxi suppliers in Auckland, Wellington and Christchurch or a ride service such as Uber. A list of the preferred taxi suppliers is available at Travel Policy and Processes. The preferred method of payment is company credit card and this method must be used by holders of such cards whenever possible and practicable. Where an employee has not got a company credit card or the card is not accepted by the taxi driver, reimbursement may be sought by submitting an expense claim, authorised by the employee s immediate manager, with receipts attached. Taxi expenses may be claimed where a company function has been arranged and where alcohol has been served, or where it is desirable to ensure that an employee can get home safely due to out of hours working by providing transport. 38. EMPLOYEE USE OF PRIVATE VEHICLES Employees are entitled to claim mileage reimbursement when they use a private vehicle for business purposes. For out of town travel, if employees elect to travel by private vehicle, the amount that can be claimed is limited to the value of the airfare, unless flights are fully booked, in which case the current authorised mileage rate may be used. In a situation where several employees travel together saving several airfares, the allowable claim increases per head subject to a maximum claim of the full authorised rate. Transpower pool vehicle use is preferred rather than private vehicles and employees should also consider whether hiring a car is more cost effective than using their own car. Use of a private vehicle for longer than 150 km (there and back) for business purposes requires prior approval of your Manager. If an employee travels directly to off-site Transpower business (including an airport) from home the amount of mileage that the employee may claim is the additional mileage incurred. If the journey to the off-site destination is shorter than the journey to the employee s normal place of business, there is no mileage entitlement. If the journey to the off-site destination is longer than the journey to the employee s normal place of business, the amount to be claimed is the total mileage less the normal home to work mileage for each direction travelled. Mileage claims must be based on IRD rates. The current authorised rate is 74 cents per kilometre up to 5000 kilometres and then 19 cents per kilometre for every kilometre over 5001 kilometres. This should be claimed for the tax year in which it is current, i.e. 1 April to 31 March each year. Employees must note in their expenses claim kilometres travelled so that the 5000 kilometre cap of reimbursement at 74 cents is not breached. An employee s personal insurance will apply in the first instance for use of a private vehicle. Transpower s vehicle insurance policy applies subsequent to or in absence of other insurance (e.g. if an employee s personal insurance excludes cover for Transpower New Zealand Limited 14

15 business purposes). For more information on insurance requirements refer to the Motor Vehicle Policy. 39. FUEL CARDS Fuel cards are provided to users of company vehicles. These are only to be used for purchases of fuel and oil. 40. PARKING EXPENSES Parking expenses are not reimbursed except when: away on business with company car; parking required overnight or during the day for a rental or private car, on company business. 41. LUNCH AND OTHER MEALS WHILE AWAY FROM NORMAL PLACE OF BUSINESS When working away from one s normal place of business a light takeaway style meal may be claimed for lunch, this would generally be less than $15. Actual and reasonable costs are reimbursed where an employee is required to be away from home overnight as a result of business. 42. CREDIT CARDS For information about the use of company credit cards while travelling on company business see Fraedom 43. CASH ADVANCES Cash advances are only arranged in circumstances when it is not possible for the employee to use a Transpower credit card. The Transpower credit card is intended to remove the need for staff to carry cash advances. Please see the VISA Card information regarding cash advances at: Visa Card Procedures REIMBURSEMENT Where expenses are not able to be incurred on a company credit card it is necessary to make a claim as soon as possible. Claims are to be approved by the employee s manager and processed through Fraedom. Employees are required to gain prior approval in the first instance. Business expenses that are charged or claimed must be: required for the successful conduct of Transpower business; specifically identifiable; able to be backed up by receipts; accompanied by the appropriately completed documentation. 44. ADDITIONAL MISCELLANEOUS EXPENSES Transpower meets the cost of all visas required by an employee when working on Transpower business. The cost of issuing or renewing a passport is the responsibility of the employee. Transpower New Zealand Limited 15

16 Any charges levied by carriers for excess baggage is the responsibility of the employee, unless such charges are the result of carrying business related equipment. If the employee takes leave while travelling all expenditure undertaken by the employee during this time is their responsibility. Any marginal costs incurred, as a result of this leave are also the responsibility of the employee. Transpower does not pay for parking or traffic fines as these are the driver s responsibility. 45. USE OF TRANSPOWER ISSUED MOBILE PHONES FOR PERSONAL CALLS Transpower allows actual and reasonable personal calls on Transpower mobile phones, subject to the following rules. Personal calls in excess of $20 in any month should be discussed with your manager, and re-imbursement may be required for costs above this $20 threshold. Regardless of the $20 threshold, the following phone usage requires reimbursement to Transpower. Phoning or calling for contests or other 0900 type accounts; Donations or other non-work related charges (e.g. personal car parking). For smart phone and tablet/i-pad users the purchase of any Apps, should only occur through your own Apple or other personal user account i.e. apps should not be purchased on your Transpower visa card. With the approval of your manager, costs of those apps which have a clear business purpose may be reimbursed. Where an employee is staying in a hotel/motel, mobile phones are to be used rather than in-house telephones as mobile phones are more cost effective. In such circumstances, a call to family for social/domestic purposes is considered to be a fair and reasonable expense. 46. USE OF PERSONAL MOBILE PHONES FOR BUSINESS CALLS The cost of business calls made on personal mobile phones is reimbursed. Claims are to be approved by the employee s manager and processed through Fraedom. 47. THE BOARD AND CHIEF EXECUTIVE The Chief Executive s discretionary expenditure is approved by the Board Chairman, or in his absence the Deputy Chairman. Similarly discretionary expenditure incurred by members of the Board is approved by the Chairman or his or her delegate in line with the Directors Fees and Expenses Policy. The Chairman s expenditure is approved by the Chairman of the Board Audit and Finance Committee. 48. REPORTING OF INAPPROPRIATE EXPENDITURE 48.1 Employee responsibilities All Transpower employees must be alert to possible situations of inappropriate expenditure. Any suspicions must be reported to a Senior Manager or as detailed in the Compliance Policy Senior management responsibilities The Senior Manager is responsible for: Transpower New Zealand Limited 16

17 Following up any reported suspicions of inappropriate expenditure; Conducting regular reviews of expenditure in monthly FMIS reports. Any substantiated or repeated instances of inappropriate expenditure must be reported to the Chief Executive, who will decide on an appropriate course of disciplinary action which could include dismissal. 49. MONITORING COMPLIANCE TO THIS POLICY The Chief Financial Officer is responsible for monitoring compliance with this policy. Any breaches of this policy are handled in accordance with the Compliance Policy. Transpower New Zealand Limited 17

18 APPENDIX 1 GUIDELINES FOR DECLARING GIFTS (EXAMPLES ONLY) Gift Cup of coffee paid for by an external party 1. Casual (cafe) lunch paid for by an external party (cost less than $100). Dinner with external party at one of better restaurants in town, you have three courses and drinks (cost more than $100). Dinner with external party at one of better restaurants in town, you have an entrée only and drink tap water. External party provides you with a pen and coffee cup with their name upon it. You attend a seminar on a professional topic (locally) for free, where refreshments are provided, none of the other attendees (from other organisations) had to pay. You are invited to a conference by an external party where Declare Gift Register Approval Comment No No Section 9 only requires Registration and prior GM approval where costs over $100. Yes Manager only Section 9 only requires prior GM approval where costs over $100. Yes Yes Manager and General Manager or CEO (for General Managers) Manager and General Manager or CEO (for General Managers) Section 9 requires Registration and prior GM approval where costs over $100. Section 9 only requires Registration and prior GM approval where costs over $100. However, the potential for costs to be in excess of $100 clearly arises and indicates that prior GM approval should be sought. No No Trinkets are excluded. No Manager only Section 9 excludes professional updates. Yes Manager and potentially general manager if it is Section 9 requires Registration and prior GM approval where costs over $ External party encompasses current or prospective contractors, suppliers, etc. Transpower New Zealand Limited 18

19 Gift other parties have to pay, but you do not. You are invited to watch Wellington play Canterbury at Rugby (a local game). You are invited to watch Wellington play Canterbury at Rugby (locally) you decline. You are invited to a tennis final overseas. You are invited to watch the All Blacks play You are offered $50 cash. You are invited out to play golf for the afternoon. You attend a conference or event and win a return trip to Australia. You receive a basket of goods at Christmas. Declare Gift Register Yes Approval worth more than $100. Manager and potentially general manager if it is worth more than $100. Comment All sporting or cultural events must be declared irrespective of value. No No Gift was declined. Yes and Decline Yes Yes and Decline Yes Yes Yes Invitation should be notified to the relevant General Manager or CEO. Manager and General Manager Offer should be notified to the relevant General Manager or CEO. Manager and potentially general manager if it is worth more than $100. Manager and potentially general manager if it is worth more than $100. Manager and potentially general manager if it is worth more than $100. Subsection 9.1 requires gifts or invitations of such a magnitude to be considered an inducement and should immediately be notified to your GM or the CEO. Section 9 requires Registration and prior GM approval where costs over or have potential to be over $100. Section 9 states that staff may not accept cash or other monetary of any value at any time. All sporting or cultural events must be declared irrespective of value. Annual leave may need to be taken/approved. Note that it was a prize and the circumstances of the prize (drawn at random, not all attendees win, etc.). Constitutes a gift. Note: contractors / suppliers are told not to provide Christmas goods to Transpower staff. Transpower New Zealand Limited 19

20 APPENDIX 2 GUIDANCE ON KOHA A1 A2 Introduction This Appendix provides guidance on when koha might be provided, as well as how much koha should be provided. What is koha, and how and when should I give koha? Koha is a voluntary, unconditional gift which is made to any non-profit body or organisation. It is a way in which one can express deep gratitude and respect to your hosts in the form of a gift such as pūtea (money) or kai (food): It is usually appropriate to give koha when you are visiting a marae for an event or occasion, such as when it is hosting a sod-turning and/or site blessing, or an employee is invited to speak on the marae. If the koha is a cash payment it should be placed in an envelope with an accompanying compliments note. Where possible, this note should be in te reo, along the lines of: Tena koutou Anei ngā koha aroha mā te iwi mana whenua Nāku iti noa, nā (CEO/Project Manager) Greetings Here is a gift of love for you the people of the land Respectfully (CEO/Project Manager) Koha is not only in pūtea value. It may be appropriate to provide koha in kind, such as kai contributions (eg kaimoana) or a native tree. This is entriely voluntary and at the discretion of staff. In-kind koha should accompany the usual cash payment. There can be some protocols around the giving of koha at a marae. In general, if the koha is for the marae it should be placed on the ground. If it is for the people, it should be placed in their hands. If an employee visits a marae for a meeting and is charged a fee for attending (for example to cover food and expenses), then this is not koha. 2 A3 How much koha should I give? The appropriate value of koha will vary depending on the occasion. Questions to consider include: How many people are in your party? Are there other parties there, such as other companies? Who has called the gathering Transpower or the marae? How many people are attending the event and are involved in organising or helping out at the event? This is a particularly important consideration whanau working at the marae do not get paid and often people must take time off work. Are there other expenses that Transpower has picked up such as kai? A contribution of pūtea should also be considered to contribute to the other costs of the event. A general guide would be to allocate about $30 per person. For large marae gatherings or very special occasions, koha of more than $1000 could be 2 If this occurs, a GST invoice must be requested and the payment coded to the appropriate cost centre. Transpower New Zealand Limited 20

21 appropriate. This should be discussed with others in the organisation to determine the appropriate level. A4 Personal contributions Opportunity should be given at the Hui for other manuhiri (visitors) / Transpower staff to voluntarily contribute personally to the koha provided. This gives a chance for a visitor to make an individual contribution or acknowledge the experience from a personal perspective. Individuals should contribute what they can and what they feel is appropriate for the occasion. A5 Transpower s koha processes Relevant General Manager approval is required for all koha (in the case of a General Manager, the Chief Executive s approval must be obtained). Any koha greater than $500 requires CEO approval. Cash should be withdrawn from a Transpower Visa card (or a cheque may be an alternative). As the koha must be linked to Transpower s business activity, adequate records 3 must be supplied to support the payment and this linkage. The law on GST states that money given by the Crown or a government department is not an unconditional gift, and as such must have GST accounted for. All koha given to external parties by Transpower must be registered on the Gift Register maintained by the Financial Controller by way of to finance@transpower.co.nz with the subject Gift Register. 3 Including the particulars of the meeting (time, date, place), the reason for attending the meeting, the type of payment made, and the source of the payment. Transpower New Zealand Limited 21

22 APPENDIX 3 SUGGESTED GUIDANCE ON WHEN TO FLY Air travel is considered reasonable for the following example reasons: Approved, budgeted workshops where face to face interaction is required (e.g. ideation / white boarding / design sessions). Supplier negotiations (e.g. annual service provider price review meetings). Divisional planning days (or similar) which occur less than twice a year. Required attendance at training that is not available online or via video conference / Skype. Significant staff matters and performance review conversations (2 per annum). Air travel is suggested not to be advised for these example reasons: Team meetings (all levels) which occur more than twice a year. Informal (e.g. weekly or monthly) reviews with staff members Periodic catch ups with staff. Travel from home location to spend time with staff on a day to day basis. Every quarterly performance review with a staff member. Staff should use their discretion if their reason for travel is not listed above or check with their manager. Transpower New Zealand Limited 22