Number range CHAPTER

**Office of the Secretary**

**Standard Operating Procedures**

**Gifts and Bequests Fund**

**Official Entertainment and Representation**

**September 2005**

# OPERATING INSTRUCTIONS

**Office of the Secretary**

I.  Purpose 3

II. Legal Authority 3

III. Acceptance and Processing of Official Entertainment 3

> Official Entertainment Includes
>
> Official Entertainment Does Not Include

The 50/50 Rule

The Procedures

### IV. Authorization for Accepting Gifts and Bequests 6

### V. Acceptance and Processing of Gifts and Bequests 6

###  The Procedures

### VI. Gifts of Travel 9

###  The Procedures

###  Gifts of Travel In-kind

###  Semi-Annual Report to the Office of Gov Ethics

### VII. Tracking Costs & Reconciling Account 10

### VIII Maintaining Quarterly Reports for the Department 10

### IX. Annual Meeting of G&B Managers 10

Appendix A: Departmental Orders

DAO 203-9 *Gifts and Bequests*

####  DAO 203-10 *Official Entertainment/ Representation Authorization*

## Appendix B: Instructions on Preparation of Forms

##  Sample - Trav[e]{.underline}l Gift Package

##  Sample - Official Entertainment Request Package

##  Sample -- G&B Package Requiring O/S Approval 

## **I. [PurposE]{.underline}**

This manual provides guidance and internal procedures applicable to
program offices within the Office of the Secretary (OS) (Departmental
Management), for the receipt and use of gifts and bequests and for
expenditure of funds for official entertainment and representation.
[Each bureau's budget/finance office should develop and maintain
published, bureau-specific, internal operating procedures for accepting,
holding, administering, and using gifts and bequests. Policies and
procedures must be consistent with regulations set forth in DAO 203-9
*Gifts and Bequests.*]{.underline}

**II. [LEGAL AUTHORITY]{.underline}**

The Gifts and Bequests (G&B) Fund Account was established by Public Law
88-611, October 2, 1964, for the receipt and use of gifts and bequests
to aid or facilitate the work of the Department. Section 1522-1524 of
Title 15 United States Code (U.S.C.) authorizes the Secretary to accept
and use gifts and bequests.

**[AUTHORIZATION]{.underline}** for Official Entertainment and
Representation is set forth in Department Administrative Order (DAO)
203-10 effective October 8, 2004, which is contained in Appendix A to
this manual. Authorization for Gifts and Bequests is set forth in DAO
203-9 effective September 7, 2004, also contained in Appendix A

Various bureaus within the Department have been granted specific legal
authority in their appropriation language to spend appropriated funds
for official entertainment. Gifts and bequests funds described in this
document may also be used for official entertainment and representation.
Please refer to DAO 203-10 for guidelines for official entertainment or
representation expenditures.

**III. [ACCEPTANCE AND PROCESSING OF OFFICIAL ENTERTAINMENT
REQUESTS]{.underline}**

Official entertainment is entertainment which furthers a Departmental
purpose directly associated with the Department's statutorily mandated
mission. Representation is official entertainment abroad for the purpose
of furthering the interests of the United States.

**[OFFICIAL ENTERTAINMENT INCLUDES]{.underline}** luncheons, dinners,
and receptions for entertaining guests who are involved in activities of
interest to the Department; and the purchase of flowers, wreaths and
similar tokens for dignitaries according to their customs.

**[OFFICIAL ENTERTAINMENT DOES NOT INCLUDE]{.underline}** social
functions that do not have a legitimate connection with official
Department functions and activities as statutorily mandated; or
activities that primarily benefit Government employees, e.g.,
refreshments at office, staff, or work- related meetings. Expenditures
should not be made for acquiring, maintaining, operating, or hiring
passenger motor vehicles; paying membership fees; supporting charitable
activities; giving mementos for Government employees; and for the
purchase of alcoholic beverages, unless the serving of such beverages is
deemed to be a necessary part of an official entertainment program.

**[THE 50/50 RULE]{.underline}**, as it is referred, is the requirement
that the majority of the attendees at an official entertainment function
must be non-Federal employees. When entertainment functions are being
held where at least 50% of the attendees will be Federal employees, the
Secretarial Officers or heads of primary operating units may approve the
function after determining that the function is not primarily for the
benefit of the Federal employees. **This authority may not be further
delegated.** (DAO 203-10, Sec. 5.02).

**[THE PROCEDURE FOR DEPARTMENTAL MANAGEMENT OFFICES:]{.underline}**
Official entertainment requests are initiated by the requesting office
completing and submitting a Form CD-464, *Request for Authorization by
Primary Operating Unit for Official Entertainment or Representation*.
(Appendix B). All CD-464\'s for Departmental Management, regardless of
dollar amount, should be submitted at least two weeks prior to the event
for the Chief Financial Officer and the Assistant Secretary for
Administration's (CFO/ASA) approval. The form should be signed by the
director of the requesting office and submitted to the Office of
Financial Management (OFM). The request should include itemized cost
estimates and a guest list. Once the request has been approved,
purchases are generally made via credit card. Employees should
[not]{.underline} use personal funds to pay for entertainment expenses.
**The requesting office should provide copies of all bills, receipts and
supporting documentation to OFM/OEB as soon as possible.**

**[THE OFFICE HOSTING THE OFFICIAL ENTERTAINMENT FUNCTION
WILL]{.underline}**:

A.  Prepare a CD-464 to include:

1\. A detailed description of event -- who, what, when, and

where.

2\. A cost estimate with backup.

3\. A guest list defining government and non-government

attendees.

B.  Submit the CD-464 to the Office of Executive Budgeting (OEB)

> 1\. If submitted less than two weeks prior to event, include
>
> a memo from the Secretarial Officer/Head of operating
>
> unit, addressed to the CFO/ASA, detailing the events that led to
>
> the late submission of the request.

**[OFM/OFFICE OF EXECUTIVE BUDGETING (OEB) WILL]{.underline}**:

C.  Log in the CD-464, assign the request a tracking number, and prepare
    a

> file.

D.  Review the request for timeliness of submission, compliance with the

> 50/50 rule, and ask for a guest list and cost estimates, if not
> attached.

E.  Determine if sufficient funds are available, if the purpose meets
    the criteria for official entertainment, and prepare a
    recommendation memorandum for the CFO/ASA, summarizing the request.

F.  Initial the recommendation memo, retain a copy of the package in the
    OEB pending file, and forward the package for the Deputy CFO's
    review and signature of the memo. The Deputy CFO will forward the
    package to the CFO/ASA, who reviews and approves the CD-464 and
    sends it back to OFM.

G.  Copy the signed CD-464 and place in pending file until copies of
    bills/receipts arrive; contacts the requesting office to pick up the
    approved package. Requesting office should submit receipts/billings
    and supporting documentation as soon as possible.

H.  Review all bills, receipts and supporting documentation received
    from the requesting office and perform a monthly reconciliation of
    all outstanding transactions.

**IV. [AUTHORIZATION FOR ACCEPTING GIFTS AND BEQUESTS]{.underline}**

Authorization for accepting gifts and bequests on behalf of the
Department is outlined in Departmental Management Order (DAO), 203-9,
effective September 7, 2004, which is contained in Appendix A to this
manual.

DAO 202-739 governs gifts from Foreign Governments; gifts for training
are governed by DAO 202-410, and property and services accepted through
the Mutual Educational and Exchange Act and all other bureau authorities
are governed by Pub. L. 87-256, 22 U.S.C. 2451.

**V. [ACCEPTANCE AND PROCESSING OF GIFTS AND BEQUESTS]{.underline}**

**[THE SECRETARY OF COMMERCE APPROVES]{.underline}** the acceptance of
all gifts valued in excess of \$35,000. The gift must be approved by the
Secretary prior to acceptance.

**[THE CFO/ASA MUST APPROVE]{.underline}** , prior to acceptance, gifts
of real property, gifts offered on the condition that the Department
undertake activities not part of regular programs, gifts that must be
deposited, invested or managed according to particular requirements,
gifts which involve unusual conditions or requirements, gifts which
require more than incidental expenditures in connection with
administration and use, and gifts which involve an in-kind donation for
travel and are valued at \$500 or more over the amount allowable under
the Department's Travel Handbook.

**[A GIFT OR BEQUEST MAY BE ACCEPTED]{.underline}** by an **authorized
official** only if the donation would aid or facilitate the work of the
Department, constitute a "bona fide" gift or bequest rather than a
payment in exchange for goods and not cause questions as to the
integrity of the agency programs or operations. Acceptance of gifts
should not create a conflict of interest or the appearance of
impropriety. Authorized officials should seek the advice of the General
Counsel where necessary. In-kind gifts are not limited solely to travel.
Employees not authorized to accept gifts should obtain prior approval,
when possible, from an authorized official.

**[ALL CHECKS SUBMITTED BY A DONOR]{.underline}** should be made payable
to "United States Department of Commerce" or the "United States
Government." All checks should be brought to the primary operating
unit's budget/finance office for deposit together with a copy of Form
CD-210 *"Record of Gifts or Bequests"* (see Appendix B), and as
applicable, travel vouchers, travel orders, and receipts. If a check has
been made payable to an employee, it should be endorsed over to the
Department or the United States Government.

**[ALL PROPERTY SUBMITTED BY A DONOR]{.underline}** other than monies or
in-kind donations should be sent to the Bureau's' property office, along
with a CD-210 signed by the CFO/ASA, for recording in the property
records.

**[THE PROCEDURE FOR DEPARTMENTAL MANAGEMENT OFFICES]{.underline}** is
initiated when the receiving office is notified of an offer of a gift or
bequest. The receiving office should acknowledge gifts and bequests in
writing, to the donor. An authorized official should indicate approval
by signing a CD-210 prior to acceptance. A copy, with supporting
documentation, should be submitted to OEB/OFM.

**[OFM/OEB WILL]{.underline}**:

A.  Sign and date the bottom of the CD-210 and verify receipt of a
    check, if appropriate; assign a G&B number, set up a file folder and
    include documentation. If the gift is "in-kind," the process is
    complete. If the gift is in the form of a check for reimbursement,
    proceed to (B).

B. Log in the check, including the amount, name of the donor, name of
traveler and date. Prepare a cover letter to NIST accounting office
requesting the check be deposited into the Secretary's G&B Account -
6002000/1100/2111. Send cover letter, check and travel documentation to
NIST accounting office. This should be done within **[one
day]{.underline}** of receipt in OEB.

> C. Set up a G&B pending file until actual travel costs are incurred.
> (All travel will be charged as usual to the employee's office) Perform
> monthly reconciliation using the accounting detail report, to verify
> actual costs. The travel voucher number is necessary to locate these
> costs.

D. Transfer actual costs to the G&B account using an Advice of
Correction (AOC). Send the AOC and copies of supporting documentation,
to NIST accounting office to process by end of the month.

**[THE PROCEDURE FOR ACCEPTING GIFTS VALUED IN EXCESS OF
\$35,000]{.underline}** is initiated by the receiving office completing
Form CD-210 and submitting to CFO/ASA. The CD-210 should include all
supporting documentation and memorandums for signature.

**[THE OFFICE RECEIVING THE GIFT WILL]{.underline}**

E.  Ensure the CD-210 is signed by the director of the receiving office.

F.  Verify all calculations are mathematically accurate.

G.  Attach a copy of the agreement or the offer letter from the donor.

H.  Prepare memorandum for the Secretary;

1\. Route package through the Department's Office of General Counsel,
Ethics Division for clearance.

2\. Submit complete package to OFM for review.

**[THE OFM/OEB WILL]{.underline}**

I.  Log in the Form CD-210, assign the request a tracking number and
    prepare a folder with tracking number.

J.  Review request for completeness and prepare a recommendation
    memorandum for the CFO/ASA, which summarizes the request.

K.  Initial the recommendation memorandum and make a copy of complete
    package for the file.

L.  Forward package to the Deputy CFO for signature on the memorandum.
    The Deputy CFO forwards the package to the CFO/ASA who reviews and
    clears package. The CFO/ASA forwards package to the Executive
    Secretariat for Secretary's signature. Once the Secretary signs the
    CD-210, the Executive Secretariat returns package to originating
    office. Originating office sends a signed copy to OFM.

**VI. [GIFTS OF TRAVEL]{.underline}**

**[GIFTS OF TRAVEL]{.underline}** received from a non-federal source
will be accepted and reported in accordance with the policies in DAO
203-9, the Federal Travel Regulations, 41 CFR Part 304-1, or other
relevant law. A CD-210 must be prepared documenting the donation. An
authorized official must approve, in advance of travel, all gifts or
bequests for official travel. If the acceptance of a donation arises
when on official travel, Department employees may be designated by
authorized officials to accept gifts and bequests on an ad hoc basis.
This approval may also be given retroactively. The amount of the
donation should not exceed the value of expenses authorized by the
Department's Travel Handbook. Lavish travel accommodations in most
circumstances will not be accepted. Gifts may be received as in-kind,
prepaid or reimbursable.

**[TYPES OF DONATIONS]{.underline}** received from a non-federal source
for travel costs should be received one of three ways. Donors who agree
to pay for travel costs incurred by an invited DOC official may do so
by:

1\) [Furnishing travel tickets and paying meal and lodging expenses
directly to an airline and hotel.]{.underline}

> These transactions are known as services "in-kind". The traveler and
> NIST accounting do not handle any expenditures or checks.

2\) [Reimbursing the Department for actual expenses.]{.underline}

> The donor reimburses all expenses paid by the Department after the
> trip is completed.

3\) [A combination of Services in-kind and Reimbursement of actual
expenses.]{.underline}

> For example, the donor furnishes an airline ticket and later pays for
> per diem and related expenses with a check.

**[ONCE A CHECK IS RECEIVED]{.underline}** for a gift, the employee
should submit it to the OFM/OEB. The related CD-210, travel vouchers,
travel orders, and receipts must accompany the check.

**[THE SEMI-ANNUAL REPORT]{.underline}** of payments from non-federal
sources for travel, subsistence and related expenses which totals more
than \$250 per event is due to the Office of Government Ethics each year
in April and October. The Departmental G&B contact in OFM coordinates
this effort for the OS by issuing a request to each program office to
submit a completed Form SF-326, *Semi-Annual Report of Payments accepted
From A Non-Federal Source*, listing each payment from a non-federal
source in excess of \$250 along with the related travel orders, travel
vouchers and receipts.

**VII. [TRACKING COSTS & RECONCILING ACCOUNT]{.underline}**

Tracking costs and reconciling the Office of the Secretary's G&B account
is the responsibility of OFM. NIST accounting office generates and
distributes the Fund Status and Detail Reports to OFM each month. These
reports are used to balance the G&B account on a monthly basis.

**VIII. [MAINTAINING QUARTERLY REPORTS FOR THE DEPARTMENT]{.underline}**

The G&B Manager for each Bureau shall provide the available balance
(designated and non-designated) in the Bureau's account, along with a
copy of the SF-133, *Report on Budget Execution and Budgetary
Resources*, for each quarter, to the Office of the Secretary G&B Manager
in the OFM. For those Bureaus not serviced by NIST accounting office,
provide a copy of the Bureau's SF-133 to NIST for preparation of the
Department's consolidated SF-133. The OFM will prepare a quarterly
Departmental consolidated G&B Report that tracks the available, as well
as the unavailable, fund balances to be provided to the CFO/ASA upon
request. This Report will also include any transfers to the Office of
the Secretary from other Bureaus.

**IX. [ANNUAL MEETING OF G&B MANAGERS]{.underline}**

In keeping with the Office of Inspector General\'s recommendation, cited
in the FY 1995 audit of the G&B Trust Fund Principal Statements, there
will be an annual meeting of all G&B Managers, upon bureau or CFO/ASA
office request, coordinated by OFM. All pertinent G&B matters will be
discussed including changes to or implementation of procedures. Bureaus
shall notify OFM promptly of any changes to their designated G&B manager
function.

**This manual can be accessed on the OFM web-site by logging onto
[www.osec.doc.gov/ofm](http://www.osec.doc.gov/ofm) and clicking on the
OFM Publications link and selecting budget Management Handbook**