Customer Travel
The company is introducing a new product and wants to organize a conference to demonstrate its use. In connection with the conference, the company wants to pay the travel and lodging expenses of both private customers and customers in which a foreign government has an ownership interest (such as an oil and gas company).

• Can the company pay for the travel and lodging expenses of employees of the state-owned customers?
• What if the conference is in Orlando, Florida?
• Can the company pay for a one-day outing to Disney World? What about a 3-day outing? What about other destinations?
• What is the best way to pay for the expenses? A cash advance to the travelers? Direct payment to the vendor/service provider? Can the company provide a cash stipend for subsistence?

Gifts
You are about to close a big deal with your company’s governmental partner, the Ministry of the Interior.

To commemorate the occasion, you give to the Minister a gold-plated gift engraved with the closing date of the transaction and the parties’ names. Your assistant characterizes the gift as a “promotional expense” in the company’s books and records and properly identifies the recipient and the purpose of the payment.

However, your assistant inadvertently records the value of the gift as $50 when in fact it cost $500.

• Was it appropriate to make a gift of this nature to the Minister?
• Was the payment properly characterized?
• What if your assistant intentionally sought to disguise the true value of the gift?
• What corrective action should be taken once the recording error is discovered?
• Does it make any difference whether your assistant acted “inadvertently” rather than deliberately?

If you have any questions regarding these scenarios, please contact us.