Categories of Purchases

Goods are generally defined as tangible items such as supplies, materials or equipment. Commonly purchased goods at the university include office supplies and research or lab materials. Certain goods should be purchased through pre-negotiated supplier relationships available through the university’s catalog ordering systems (i.e., SmartMart Catalog Suppliers)  to ensure the best pricing and terms. In addition, some goods require special consideration or treatment to ensure regulatory and compliance needs are met.

The Purchase Goods page provides the recommended purchasing method and related guidance for:

• Capital equipment 
• Office and home office equipment and furnishings
• Office supplies
• Computers, laptops, printers, and mobile devices
• Lab, life science, research, or medical supplies
• Stanford-branded merchandise

Services are generally defined as a transaction where work or action is performed and there may not be a physical good involved. At the broadest level, this includes labor, maintenance, consulting, business services, and venue or facility rentals. Some services require special consideration or treatment to ensure regulatory and compliance needs are met.

The Purchase Services page provides the recommended purchasing method and related guidance for:

• Professional services, performed by an independent contractor or consultant, include the following:
  • Proofreading/Editing/Copywriting/Publishing/Indexing services
  • Graphic Design/Branding/Illustration services
  • Transcription/Translation services
  • Video/Photography services
  • Equipment repair
  • Indexing services
  • Legal related services (e.g., notary, fingerprinting, document scanning). Please note: Hiring an attorney requires a contract and must be approved by Stanford’s Office of the General Counsel.
     
• Temporary staffing services
• Speaker (non-Honoraria)
• Cloud computing
• Internet services
• File sharing and storage services
• Software
• Website or application development
• Shipping, freight, importing, and customs services
• Advertising on a social media network
• Office or lab moving services
• Event venues and catering
• Lab-coat rental or cleaning
• Commissioned work
• Construction services
   

The university pays directly or reimburses individuals for expenses that are necessary and appropriate to conduct university business. Expenditures must be consistent with the university’s purchasing policies and guidelines as well as the guiding principles and IRS regulations with regard to Business and Travel Expense policies.

Travel Bookings and Expenses

For guidance when booking flights, hotels, and rental cars for university-sponsored travel, visit Business and Travel Expenses. Visit the Stanford Travel Program page to explore services and booking options offered by the university. 

Types of Business Expenses

Common types of business expenses include business and travel meals, lodging, and transportation. Additional common expenses, such as conference, training fees, and employee morale, are covered in the Topic Overview: Other Reimbursable Business Expenses.

The Stanford Purchasing Card (PCard) is the preferred payment method for local business meals. Alternatively, personal funds may be used and a request for reimbursement submitted. The same policies must be followed regardless of payment method. To support administrative efficiency, the Stanford Travel Card (TCard) is the preferred payment method for travel costs unless the traveler will choose the per diem reimbursement method. Alternatively, personal funds may be used and a request for reimbursement can be submitted after the trip concludes.

A department may wish to purchase carbon offsets or carbon credits as a strategy to reduce the environmental impact of a project or program that produces carbon emissions. Departments are advised to first focus on directly reducing emissions through financially responsible means before purchasing carbon offsets or carbon credits–for example, through responsible purchasing and only traveling for essential purposes. Carbon offsets or carbon credits procured will not be included in Stanford’s annual emissions accounting. Individual purchases of carbon offsets or carbon credits (e.g., when booking a flight or rental car) are not permissible.

If offsets are desired for a strategic purpose, departments are encouraged to utilize removal offsets as opposed to avoidance offsets due to their increased durability and performance. An offset purchased must be immediately retired. These purchases must be made through the purchase order or requisition process and use Expenditure type: 56070 CARBON OFFSETS. The purchase will be routed to the Office of Sustainability for approval and reporting requirements. Carbon offsets are unallowable and cannot be charged to sponsored awards.

At the discretion of each department or school, gifts or awards may be made to regular, benefits-eligible university employees [50% full-time equivalent (FTE) or more] for non-performance related recognition, such as to acknowledge years of service or celebrate retirement. 

Some high level guidance for employee gifts includes:

• Depending on the purpose/occasion for the gift, the taxable threshold will vary. Tax and shipping costs are excluded from the thresholds.
• All gift cards (cash equivalent or non-cash equivalent) are taxable for the entire value when provided as gifts, regardless of amount or type.
• Purchases of Stanford-branded merchandise or other tangible items, including food, are strongly encouraged by the university over the use of gift cards.

Learn more about types of gifts, tax considerations, and appropriate tracking and processing of gift purchases on Topic Overview: Employee Gifts.

Gifts, including electronic gift cards, can be provided in support of an identified university business purpose such as for human subject payments, conference meals, event or research study prizes, or employee gifts. Stanford-branded merchandise or other tangible items, including food, are strongly encouraged instead of gift cards.

Gift cards are prohibited to be issued to businesses/organizations in lieu of payment for goods or services. All university goods or services must be purchased only with university-initiated payment methods.

Tax considerations

While gift cards can be provided as gifts, the full value of all gift cards, regardless of purpose or amount, is taxable. Providing tangible items, such as Stanford-branded merchandise, minimizes the tax burden for the recipient. 

Gift cards provided to employees in order to cover the cost of a business meal are generally not taxable to the employee. Refer to Meal Expenditure Types for more information.

Gift Card Best Practices 

To safeguard university assets, the following best practices are recommended when purchasing and stewarding gift cards:

• Funding source: Confirm whether the funding source (sponsored or non sponsored) allows for the purchase of gift cards and comply  with any requirements.
• Storing and Tracking: Store gift cards securely and distribute to its intended recipient shortly after purchase. Track all gift card recipients (include the name of recipient and amount received) locally and attach to applicable transactions.  
• Documentation: Follow documentation guidance on paying human subjects and employee gifts to appropriately purchase and tax report in these instances.

Methods of Purchasing Gift Cards

The Stanford PCard is the preferred purchasing method for the purchase of gift cards when the total transaction is $4,999 or less.

For gift card purchases of $5,000 or higher, the Stanford PCard cannot be used, and instead, the department will need to create an iProcurement Non-catalog Requisition. Once the purchase order (PO) is created, departments will need to upload the invoice to the PO for processing and payment.

Refer to the table below for specific gift card use cases and appropriate purchasing methods. Please note that Stanford’s Amazon Business account does not support the purchase of gift cards.

Optional Gift Card Suppliers

There are many programs available for departments to purchase gift cards. Procurement Services has worked with the following suppliers to purchase gift cards. As mentioned above, the Stanford PCard is the preferred purchasing method for the purchase of gift cards when the total transaction is $4,999 or less.

• Blackhawk Network Inc: To set up an account, departments can contact Stanford's Account Manager, Cathy Goetz.
• Tremendous Inc: To set up an account, departments can contact Stanford’s Account Manager, Tyler Traylor.

Leasing equipment 

An equipment lease is an agreement to rent, borrow, or use equipment, such as a medical device, vehicle, or copier. For accounting purposes, Stanford considers the agreement a lease when Stanford will pay for the use of the equipment for longer than one year, with total payments of $5,000 or greater. Refer to Equipment Leases for more information.

Purchasing capital equipment

Equipment is considered capital equipment if the purchase meets all of the following criteria:

• The equipment cost or value is $5,000 or more.
• The useful life of the equipment is more than one year.
• The equipment is a tangible item that is stand-alone and moveable (not a “fixed asset” that is permanently attached to a building).

Equipment can be purchased, fabricated, leased, or donated. Purchasing is the most common method of acquiring property at Stanford University. Requisitions for property are placed online, using the iProcurement application within Oracle Financials. Refer to Purchase Capital Equipment for more information. 

Leasing real estate

Real Estate Leases are contracts in which a party agrees  to pay for the use of real estate for a specific period of time. Real Estate leases are considered long-term financial obligations of the university. Refer to Lease or Rent Real Estate for more information.

Purchasing real estate

Lands and buildings (as defined as real estate) are purchased for a variety of reasons, including to generate income for the university’s operations, to fulfill the university’s mission and long-range vision and to increase the availability of housing for faculty and staff. Refer to the Real Estate department of Land, Buildings & Real Estate (LBRE) for more information.