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Internal Control Practices: Honorarium Payments

Read best practices for paying honorarium payments.

UC Employee Honorarium Payments

Honorarium payments for UC employees must be processed through UCPath for tax reporting purposes following the multi-location appointment guidelines.

For instructions on how to process UC Employee Honorarium Payments, visit the PayPath Transactions section and see the UCPath job aid for How to Manage Multi-Location Appointments.

Non-UC Employee Honorarium Payments 

People invited by UCSD to give lectures, seminars, or concerts may be paid an honorarium instead of reimbursement for travel expenses or other fees. Be sure that these guests are paid through Disbursements and the accounts payable system.

Separation of duties

Assign duties associated with handling honorariums among different people. A key step your unit can take to ensure a proper payment process is to have different people involved in the process.

  • Best practice is to have different people:
    • Prepare honorarium payments.
    • Approve honorariums.
    • Review and reconcile financial records.
  • Potential consequences if duties are not separated:
    • Excessive costs incurred
    • Unauthorized or unnecessary payments made
    • Improper charges applied to account/funds
    • Loss of future funding

Accountability, authorization, and approval

Remember that honorariums are only paid to non-University employees. University employees providing special services are paid through the payroll system. Contact Disbursements for information about eligibility requirements for recipients, best methods of payment, and tax liabilities.

  • Best practices:
    • Determine recipient's eligibility status.
    • Provide accurate information about the recipient.
    • Consult with Disbursements about visa requirements and documentation.
    • Obtain pre-approvals.
    • Review signature authorizations periodically and update as needed.
  • Potential consequences if accountability does not exist:
    • Unauthorized, unnecessary, or fraudulent payments
    • Unauthorized special events conducted
    • Improper charges to incorrect accounts/funds
    • Incorrect method of payment used

Security of assets

Be sure to keep payments in a safe place and protect your guest's private or personal information. Secure information in a safe location and restrict access only to designated employees who need the information to perform their job functions.

  • Best practices:
    • Follow up with Disbursements regarding check status.
    • Assure that payment has been sent.
    • Secure personal information in a locked or password protected location.
    • Limit people who have access to personal information.
  • Potential consequences if your assets have not been secured:
    • Lost or stolen checks
    • Identity theft

Review and reconciliation

Your reconciliation activities confirm that honorarium activities have been approved and billed correctly. Perform monthly ledger reconciliations to catch improper charges and validate transactions.

  • Best practices:
    • Review the operating ledger to ensure honorarium payments are properly classified and recorded.
    • Review contract and grant terms and other fund restrictions to ensure expenses are allowable.
    • Perform monthly reconciliations of operating ledgers to assure accuracy and timeliness of expenses.
    • Assure daily honorarium limits are applied correctly.
    • Assure payments comply to UCSD policy.
  • Potential consequences if review and reconciliation is not performed:
    • Improper charges made to your department budgets
    • Disallowances resulting from costs charged to incorrect accounts/funds
    • Payments made for items or services not provided
    • Inaccurate financial reports
For information about honorariums, contact Disbursements, (858) 534-0045. For information on internal control practices, contact Arlynn Renslow, (858) 822-2968.