This job aid provides guidance to help properly document a Business Purpose to ensure compliance with university policy and governing regulations, and to avoid delays in processing financial transactions.
The Business Purpose provides the justification for the expense and should be written so that someone reading it at some future time (for example, an auditor reviewing the expense three years later) would have sufficient information about the activity and why it was a permissible Stanford expense.
The Business Purpose should include six basic elements:
- Brief Summary of the Expense
The first 30 characters of the business purpose will display on reports and should be a brief description of the expenditure. Your department may have specific protocol or format for the summary description.
- Who Was Involved in the Activity?
Give the name(s) of the person(s) and their organization and/or department involved in the activity. For example, if a reimbursement request or Purchasing Card (PCard) transaction is related to a business meal, the who component would be a list of the attendees and their affiliation to Stanford. Supply the information for expense requests involving 10 or more attendees via an attached attendee listing. A list of specific individuals is not required if the participants can be labeled as an identifiable group, including the number of attendees (e.g., Payroll Department; 15 employees). For large seminars and conferences, it is acceptable to estimate the number of attendees and not attach a list of attendees by name.
- What Activity Was Performed?
Explain the activity or circumstance that gave rise to the expenditure.
- When Did the Activity Occur?
Indicate the date or inclusive dates the activity took place. Specific dates are also part of the item descriptions, and dates included in the Business Purpose can be more general (the dates of an entire trip, for instance, instead of the date of each meal).
- Where Did the Activity Take Place?
Give the location of the activity, such as to/from destination, restaurant name and city or other appropriate information.
- Why Was the Activity Done, and How Did It Benefit Stanford?
Describe the benefit to Stanford. For example, does it further ongoing research or teaching efforts?
- If the Business Purposes exceeds the character limit, attach a word document of the Business Purpose, and refer to it in the business purpose field.
- If there are specific restrictions on a funding source, it is recommended that preparers include information about the allowability of the expense in the Business Purpose.
- When a single event incurs multiple transactions, for example, parking costs, table set-up, caterer and service, include the related transaction number(s) and/or the event name/title in the Business Purpose to help link related transactions.
The following examples show acceptable Business Purpose descriptions and answer each of the questions discussed above.
The first few characters (up to 30) present a brief summary that would be meaningful on an expenditure statement and will show in the reporting.
Nelson WHOFR Trip, 4/16-20/19. Who: Professor Mike Nelson and two of his PhD students, Nick James and Elias Storm. What: Attendance at the WhoFR (WHales are Our FRiends) workshop where Professor Nelson presented his paper on An Analysis of the Orca Language. The workshop supported Professor Nelson's research on the U.S. Navy grant Cetacean Communication, award WTALK and has been approved by the sponsor. When: April 16-20, 2019. Where: University of Puget Sound, Washington.
Zack Mayo Graduation Dinner Who: Zack Mayo, PhD (2019), Professor Emil Foley (1946)and PhD students, Paula Pokrifki and Sid Worley. What: Celebration of attainment of PhD degree. Why: Dr. Mayo has worked with Professor Foley as a PhD student for three years while studying for his degree. When: June 18, 2019. Where: Scott's Seafood, Palo Alto.
Quality Award Who: Dr. Peter Mitchell. What: Trophy for the Department of Homeopathy Quality Improvement Award. Why: Award presented annually to the administrative associate who made the most significant improvements in work quality, as measured by number of purchase requisitions and reimbursements that were processed without incident. When: For FY2019, awarded on December 1, 2019. Where: Department of Homeopathy, School of Wellness.
Redford Presentation, 7/4/2019 Who: Robert Redford. What: Participation in a panel discussion on Western Movies in American Cinema. Why: Part of the Drama Department's Summer Seminar Series. When: July 4, 2019. Where: Memorial Auditorium.
Human Subject Guidelines and Examples
- Human subject names should not be in a business purpose.
- Study should be identified using a Protocol ID or other study identifying number.
- Study title or subject description is optional based on the confidentiality requirement for the study.
- Human subject advance request should include the number of participants and the amount each participant will be paid.
The application of these general guidelines will vary based on transaction type.
Hum Subj Payment, ID#12345 (or other study identifying number), Chronic Pancreatitis (study title optional for confidentiality), January 27, 2020 (date participation).
Hum Subj Adv, ID#12345 Who: William Jones PI, What: advance for human subject incentives, 8 participants at $150 each, Why: Protocol ID #12345 (or other study identifying number), Chronic Pancreatitis, When: January 27, 2020 (date of request).
Hum Subj Adv, ID#12345 Who: William Jones PI, What: clear advance ADV87654 for human subject incentives, Why: Protocol ID #12345 (or other study identifying number), Chronic Pancreatitis, When: January 27 through February 28, 2020 (dates of study).
Hum Subj Trav Reimb, ID#12345 Human subject travel reimbursement, Protocol ID #12345 (or other study identifying number), Chronic Pancreatitis (study title optional for confidentiality), Los Angeles to Stanford, January 27 through February 2, 2020.
Reimbursement of business expenses is governed by Administrative Guide Policies:
For a summary of policy, refer to Topic Overview: Business and Travel Expense Policies.