Luxury Expenditure Policy
You'll Feel Right At Home
Luxury Expenditure Policy
The Board of Directors of Titonka Bancshares, Inc. (the “Company”) adopts this Excessive or Luxury Expenditure Policy (“Policy”) pursuant to the requirements of section 111(d) of the Emergency Economic Stabilization Act of 2008, as amended by the American Recovery and Reinvestment Act of 2009 (“EESA”).
General Policy. The employees and directors of Titonka Bancshares, Inc, Titonka Saving Bank and/or Boyken Insurance Agency, Inc. (collectively, the “Company”) are prohibited from making any excessive or luxury expenditures in violation of this policy. The term “excessive or luxury expenditures” means excessive expenditures on any of the following to the extent such expenditures are not reasonable expenditures for staff development, reasonable performance incentives, or other similar reasonable measures conducted in the normal course of the Company’s business operations:
1. entertainment or events;
2. office or facility renovations;
3. aviation or other transportation services; and
4. other similar items, activities, or events for which the Company may reasonably anticipate incurring expenses, or reimbursing an employee or director for incurring expenses.
Reasonable expenditures may be incurred for business-related activities, events and purposes, including, without limitation, legitimate travel and meeting-related costs for attendance at conferences and meetings in appropriate environments for purposes of professional development, education, training, familiarization with Company products and services, and/or networking and best practice sharing across companies and industries; provided, however, such expenditures must conform with all applicable Company policies and procedures.
Entertainment Expenses. Entertainment is generally defined as an activity for which a board member, employee, or officer uses corporate funds for business development purposes relating to a current customer or prospective customer or to further enhance the Company’s marketing efforts. All expenditures by employees or directors for entertainment must comply with applicable Company policies and must have a business purpose. Requests for reimbursement for such expenditures must be justified and supported by documentation in accordance with applicable Company policies and procedures.
Employee Recognition/Holiday Parties. Employee recognition/holiday parties are part of the Company’s employee appreciation process. These events should generally be local in geographic nature and reasonable in cost.
Conferences. We encourage our board members, employees, and officers to attend conferences that are appropriate educational and networking opportunities. These conferences should ordinarily be directly related to the financial services industry, and should always have a direct correlation to a business interest of the Company. Typically these conferences are sponsored by vendors, business associations, banking associations, regulatory agencies, or other industry-related entities.
Board/Management/Employee Retreats. Retreats shall generally only be used for strategic planning, educational, team building or other business purposes and shall generally be conducted in or in close proximity to the Company’s trade area.
Office and Facility Renovations. Renovations of facilities and office spaces should be consistent with approved projects and the current business plans of the Company. An exception will be permitted to address an emergency situation, such as an act of nature, and the expenditure is necessary to make the facility operational for customer use. An exception is also permitted for a corporate relocation or remodeling impacting a majority of a Company office or a newly-constructed branch, branch renovation, or branch relocation.
General Travel Policy. Transportation for Company staff between branches and to customer business locations, conferences, business development events and other destinations for the conduct of the Company’s business should be conducted in the most cost-appropriate way for the Company. Modes of transportation to be used may consist of Company owned vehicle, employee owned vehicle, commercial air, or rail service. The selection of transportation services should factor in cost, efficiency, and timeliness of travel. Expenditures for the use of an automobile by the Company’s officers and employees must be reasonable and consistent with IRS deductibility regulations.
Air Travel. Air travel on Company business shall generally be by commercial airline and shall generally be via commercial coach air fares and accommodations. First or business class travel is generally not acceptable and requires the prior approval of the Titonka Savings Bank Chief Executive Officer or Executive Vice President for a valid business reason such as the unavailability of a commercial coach fare for any required air travel.
The Company does not own or lease, and does not intend to purchase or lease, any private aircraft for use by Company employees or directors. If an employee deems it to be cost effective or necessary for a legitimate business purpose to charter the use of a small private aircraft for the purposes of any particular travel need, he or she may do so if it is required for a valid business purpose and if any such necessary private aircraft travel is approved by the Titonka Savings Bank Chief Executive Officer or Executive Vice President.
Expenditures Requiring Prior Approval. The following expenditures require the pre-approval of the Titonka Savings Bank Chief Executive Officer or Executive Vice President if the expenditure amount exceeds $5,000:
1. entertainment, conferences, board/management retreats, or other similar events;
2. office and facility renovations;
3. aviation or other transportation services; and
4. other similar items, activities, or events for which the Company may reasonably anticipate incurring expenses or reimbursing an employee for incurring expenses.
Exceptions. Notwithstanding the foregoing, prior written approval is not required for expenditures:
1. to remediate emergency or hazardous conditions;
2. to comply with building codes and ordinances;
3. to satisfy legal, contractual, or regulatory requirements; and/or
4. to pay for items included in a Board-approved annual operating budget.
Documentation. All Company expenditures, including those expenditures covered by this policy, shall be documented, reported, supported by written invoices and receipts, and subject to audit in accordance with standard, uniformly applied Company policies and procedures.
Administration. The Titonka Savings Bank Chief Executive Officer and Executive Vice President is responsible for the day-to-day administration of this Policy and for overall adherence to this Policy and one or both of them must approve any exceptions. Compliance with this Policy is required for all Company board members and employees.
Reporting of Violations. Anyone who becomes aware of a suspected or actual violation of this Policy, whether intentional or inadvertent, shall report such matter in writing to the Titonka Savings Bank Chief Executive Officer or Executive Vice President. The Titonka Savings Bank Chief Executive Officer and/or Executive Vice President shall investigate any reported suspected or actual violation of this Policy and report the findings of any such investigation to the Titonka Bancshares, Inc. Board of Directors along with any corrective or disciplinary actions taken as a result of the investigation. Compliance with this policy is a condition of employment, and any violations thereof may result in disciplinary action.
Certification. Within 90 days of the completion of each fiscal year of the Company, the Titonka Bancshares, Inc. Principal/Chief Executive Officer and Principal Financial Officer shall certify that Titonka Bancshares, Inc., Titonka Savings Bank, Boyken Insurance Agency, Inc., their boards and employees have complied with this Policy during the prior fiscal year or since the date of enactment of this Policy and that any expenses requiring approval were properly approved.
This annual certification shall be provided to the United States Department of the Treasury and the Federal Reserve.
Website Publication. This Policy shall be published on the Company’s website and shall also be provided to the United States Department of the Treasury and the Federal Reserve.