Dept. of Education > Administrative Services > Finance, Facilities and Business Strategy Branch > Expenditure > Entertainment expenditure policy

This policy outlines the departmental requirements and approval process for entertainment related expenses, including the purchase of alcohol.

• Coverage
• Policy
  • Definition
  • Approval Process
  • Purchasing Methods
  • Purchase of Alcohol for Non-Entertainment Related Purposes
  • Entertainment Expenses and Fringe Benefits Tax (FBT) Implications
• References
• Internal Controls / Responsibilities
• Monitoring of Compliance
• Related Topics

This policy applies to any staff member involved in using Department funds for the purchase of goods or services, including alcohol, for entertainment purposes; and the purchase of alcohol for non-entertainment related purposes. 

Note: Alcohol or other goods purchased with an individual’s own funds or via an employee funded social club or similar type arrangements are not included in this policy. Information regarding the Department’s Occupational Health and Safety policies on the consumption of alcohol on work premises is currently being developed.

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Entertainment expenses are defined in the Income Tax Assessment Act 1936 as:

• “the provision of entertainment by way of food, drink or recreation; or

• accommodation and travel in connection with, for the purpose of facilitating entertainment as defined above.”

Where alcohol is provided at an event it usually suggests the provision of entertainment.

A further definition of “entertainment expenses” can be found in the Tasmanian Government Corporate Card, Definition of Hospitality Expenses document.

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Approval for entertainment related expenses, including alcohol, must be obtained prior to the expenses being incurred or before a reimbursement is made. The following approval process should be followed at all times:

• entertainment expenses up to $250 are to be authorised by the relevant Branch Director;

• entertainment expenses between $250 and $1000 are to be authorised by the relevant Deputy Secretary;

• entertainment expenses above $1000 are to be authorised by the Secretary.

Approval to incur entertainment related expenditure may be obtained via email.

Any purchase with Departmental funds of entertainment related items, including alcohol, which occurs outside this approval process is strictly prohibited.

Examples of entertainment related expenses, using Departmental funds, which must follow this approval process are:

• food and drink provided at business lunches or staff meetings held off work premises (e.g. at a restaurant, café etc);

• food and drink/alcohol provided for staff and/or guests as a social gesture/gift on or off work premises (i.e. providing a carton of beer or a bottle of wine to staff or clients for a social drink);

• food and drink provided at a promotional event;

• TASTA awards and Education Services Awards; and

• any other ‘social’ event/function expenses.

The following are generally not classified as entertainment, and do not need to follow the above approval process. They need only to be approved by a person in a position with the appropriate delegated authority:

• Light meals/snacks provided on work premises for a staff meeting or similar;

• food and drink incidental to attendance at a seminar with a duration of at least (4) hours; and

• using the Departmental Travel Allowance to purchase food and drink for themselves, other travelling employees, or clients, while an employee is on business travel.

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Entertainment expenses, including alcohol, should be paid via purchase orders, or through direct billing arrangements.

Departmental corporate cards are not to be used to purchase alcohol or for any other entertainment expenditure. For further information on the use of departmental corporate cards see the Department Corporate Card Guidelines.

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Where alcohol is purchased for non-entertainment related purposes, the relevant Branch Director should authorise or seek appropriate approval in accordance with the approval process detailed above. Corporate cards are not to be used for the purchase of alcohol for non-entertainment expenses.

Examples of alcohol which is purchased for non-entertainment related purposes include:

• alcohol that is incidentally provided at a seminar;

• alcohol which accompanies a meal provided on work related travel; and

• alcohol for Adult Education food and wine courses.

NB – For Senior Executive Service (SES) and staff authorised to use a corporate card for work related travel, they may use their corporate card to pay for meals. The card may also be used to pay for alcohol which accompanies the meal, as long as it is incidental to the meal and not excessive. The corporate card however, is not to be used to pay for food and drink for others as this would be deemed to be entertainment expenses.

Alcohol purchased for Adult Education food and wine courses, may be purchased using a corporate card, as long as approval is obtained from a person in a position with the appropriate delegated authority.

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All entertainment related expenses are subject to FBT; as such the Department is required to pay an FBT liability on these expenses. Further information on FBT can be found by clicking here (site still being developed).

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• Fringe Benefits Tax Act 1986 (Cwth)

• Fringe Benefits Tax Assessment Act 1986 (Cwth)

• Income Tax Assessment Act 1936

• Treasurer’s Instruction 520

• Corporate Card Guidelines

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This policy will be subject to internal audit, external audit and performance audits.

• Corporate Card Guidelines

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