Fin Pol and Procedures

(Organization Name)
ACCOUNTING DEPARTMENT
PROCEDURES MANUAL
(Date Approved)
Policies & Procedures Template
TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
RESPONSIBILITIES......................................................................................................................1
GENERAL POLICIES....................................................................................................................1
Compliance with External Policies...........................................................................................2
Security and Access..................................................................................................................2
OVERVIEW OF ACCOUNTING SYSTEM..................................................................................2
Data Backup..............................................................................................................................3
Funds Received.........................................................................................................................3
Funds Disbursed.......................................................................................................................3
Payroll System..........................................................................................................................3
DETAILED ACCOUNTING PROCEDURES................................................................................4
Funds Received.........................................................................................................................4
Receipt Book............................................................................................................................5
Petty Cash.................................................................................................................................5
Fund Disbursements.................................................................................................................6
Approvals and Authorization...............................................................................................6
Custodial Funds (if applicable)............................................................................................7
Missing Invoices..................................................................................................................8
Vendor Documentation.........................................................................................................8
Check Writing Procedures....................................................................................................8
Check Approval Process.......................................................................................................9
Electronic Payments and Transfers......................................................................................9
Payroll ................................................................................................................................10
Payroll Preparation and Payment............................................................................................11
Purchasing...............................................................................................................................12
Leases ................................................................................................................................12
Consultant/Contract Services.............................................................................................12
Furniture and Equipment....................................................................................................13
Loans (if applicable)..............................................................................................................13
Third Party Loans...............................................................................................................13
Intra Fund Loans................................................................................................................13
Employee Loans.................................................................................................................13
Bank Accounts........................................................................................................................14
Accounts Receivable..............................................................................................................14
OTHER FINANCIAL SAFEGUARDS.........................................................................................15
Personnel Records System......................................................................................................15
Corporate Credit Cards...........................................................................................................16
Employee Benefits..................................................................................................................16
Employee Leave: Vacation and Sick Leave.......................................................................17
Retirement..........................................................................................................................17
Other Benefits....................................................................................................................18
1. Cafeteria 125 and Flexible Benefit Plan17...................................................................18
Travel
18
Mileage Reimbursement....................................................................................................18
Travel Out of Service Area.................................................................................................19
Board of Directors Travel and Reimbursement..................................................................19
Allocation of Costs.................................................................................................................19
Indirect Costs 20
Property and Inventory Control..............................................................................................20
Fixed and Capital Assets....................................................................................................21
Equipment Depreciation.....................................................................................................21
Audits
................................................................................................................................22
Taxes and Reporting Requirements........................................................................................22
Grants and Contracts...............................................................................................................23
Budgets ................................................................................................................................23
Internal Reporting ..................................................................................................................24
Record Retention......................................................................................................................24-25
Special Funds.26
Risk Management and Insurance

26
Investment Policy...........................................................................................................................26
APPENDIX A Staff Responsibilities.....................................................................................27&28
INTRODUCTION
This manual puts in place basic accounting, billing, and cash control policies and procedures
designed to protect and secure (Organization Name), ensure the maintenance of accurate
records of financial activities and ensure compliance with governmental and private funding
source reporting requirements. Where this manual conflicts with specific federal or State
regulation or with (Organization Name)s Board policy (such as the Personnel plan), the
regulations or board policy shall prevail.
RESPONSIBILITIES
The Board of Directors formulates financial policies, delegates administration of the

financial policies to the (Management Position), and reviews operations and activities.
The (Management Position) has responsibility for all operations and activities, including
financial management.
Exceptions to these policies may be made on an individual basis, as necessary, with the
approval of the (Management Position).
The (Financial Position) is responsible to the (Management Position or board) for all
financial operations.
The (Staff Position) is responsible to the (Management Position or board) for

operations.
GENERAL POLICIES: (Example showing proper business practices)
Current job descriptions are maintained for all staff members indicating their duties and
responsibilities.
There are separation of financial duties and responsibilities so that no staff member has
sole control over cash receipts, payroll, bank reconciliations, accounts payable or other
accounting functions.
Accounting duties are rotated among (staff positions or staff) whenever possible.
Financial Procedures are reviewed annually by the (Staff position).
/var/www/apps/conversion/tmp/scratch_2/286965736.docPolicies
& Procedures Template
1
Separate General Ledger accounts are maintained as required by funding source

regulations.
Accounting forms and timesheets are typewritten or completed in ink. Whiteout or

correction tape is not be used.
Passwords must comply with organizational standards. They are to be treated

confidentially and are not shared with other staff. Policies may be established requiring
the expiration of passwords where appropriate.
Compliance with External Policies

(Organization Name) accounting policies and procedures are consistent with: (choose the
ones that apply or add additional as needed. Delete all others)
Generally Accepted Accounting Principles (GAAP).
OMB Circular A-122, Cost Principles for Non Profit Organizations
OMB Circular A-110 Uniform Administrative Requirements for Grants and Agreements
with Institutions of Higher Education, Hospitals, and Other Non-Profit Organizations
OMB Circular A-133 Audits of States, Local Governments, and Non-Profit

Organizations.
GASB 34
Security and Access:

To ensure that only authorized staff can access the financial, personnel, payroll, computer,
on-line and paper records of the organization:
Security and access is determined by the (Staff position(s)).
Access to computer or on-line systems for accounting, personnel, payroll, and online and
phone banking is controlled by (detail how this access is limited). Within each system,
access permission is set to allow the appropriate level of access depending on staff
positions and job duties.
2
Upon separation of a staff member, the password is immediately locked to prohibit any
unauthorized activities or entries and keys to (Organization Name)s office(s) are
returned.
3
OVERVIEW OF (Organization Name) ACCOUNTING SYSTEM:

The financial records of (Organization Name) are maintained on (Type of accounting system.
If manual so designate) using the (Accrual, modified accrual or Cash) basis of accounting.
Access to the accounting system is controlled to maintain the reliability and integrity of the data.
Security is set by the (Financial Position) to allow different levels of access. The
(Executive/Board Position(s)) has(ve) full access to the entire system including setup and
administration. (Note positions that have access to the accounting systems and whether or not
it is limited to only certain modules or functions, if applicable).
Data Backup:
Backup is done daily to assure that the data is secure and will not be lost in the event
of a computer failure. (Media used) are rotated according to the day of the week and
once per month. Year end back up (Media used) are kept for 2 years. (Media used)
are stored in a locked fire-resistant cabinet.
Funds Received:
The funds received policies and procedures ensure that all in-coming funds are
properly recorded and safeguarded through separation of duties and proper
documentation. The (Executive/board position(s)) designate which staff is
authorized to collect in-coming (Organization Name) funds.
Funds Disbursed:
Specialized procedures govern check writing and petty cash procedures. Only the
(Staff/board position) may authorize the issuance of checks. Access to the check
printing system is limited to accounting staff and is controlled by (note control used)
by the (Staff position). Petty cash access is limited to staff assigned by the (Staff
position).
Payroll System:
4
Access to the payroll system is controlled to assure accurate and confidential data.
Access is limited to accounting staff responsible for payroll processes. Payroll is
processed by (Staff position and, if applicable, External service initiated by staff
position). One example of information to include here Payroll data is maintained on
line and transmitted to the payroll service for processing. The payroll service is
responsible for tax payments and reports. The (staff position) verifies the payments
at the end of each month by analyzing the payroll service reports and the bank
reconciliation statement.
DETAILED ACCOUNTING PROCEDURES
Funds Received
Cash (will or will not) be accepted from participants for payment of deposits, credit checks,
loan payments, etc. Cash may be accepted from staff or others in payment of amounts due to
(ORGANIZATION NAME) in amounts less than (designate amount, if applicable) for
copies, faxes, or other expenses.
In each office, mail is to be opened promptly and distributed by the (Staff position 1).
All checks, money orders and cash are promptly logged into a Cash Receipts Log
maintained (note whether a computer spreadsheet, manual ledger, etc.) and then given to
the (Staff position(s) 2) for processing these receipts. The (Staff position 1) will
5
restrictively endorse the back of any checks received; and enter into the Cash Receipts Log
prior to distributing checks to designated staff.
The (Staff position 1) will log in-coming cash into a pre-numbered duplicate Cash Receipts
book.
A pre-numbered receipt will be issued or mailed to issuer of cash by the (Staff position 1),
preferably at time of receipt.
Documentation for receipts (letter, stubs, etc.) is provided with the checks/cash when
forwarded to designated staff for processing and deposit.
Funds awaiting bank deposit are kept in a locked file/safe with access limited to staff
designated by the (Executive position).
(Staff position 2) verifies the checks and cash to documentation received, makes copy of
checks and prepares deposit for delivery to bank.
Note how deposit gets to the bank, i.e. designated staff delivers or bank courier picks up. Is
a log kept of the daily or weekly deposits that went to the bank and who took them.
Bank confirmations are delivered to the (Staff position) to attach to back up documentation.
The deposit is entered into the accounting system by (Staff position), and then filed in
chronological order into a Cash Receipts file/folder for the month.
At the end of the month, (Staff position 1) totals each column of the Cash Receipts log
verifying that all bank account totals add up to total funds received for the month and then
prints out the log, retaining one copy, for the auditors, and forwarding a second copy to
(Executive position) or other designee to verify against the deposits listed on the bank
statement(s).
6
1.
2.
3.
Receipt Books
Receipt books are assigned by the (Executive/accounting position) to (Staff position)
The (Staff Position)
7
is responsible for safeguarding the receipt book.
Receipt Books must be kept in a secure place at all times.
Receipt Books consist of three-part, pre-numbered forms. They should be used in

numerical order and filled out completely. The original is to be given to the person
(participant) from whom funds have been received. The second copy (yellow) is to be
sent with the transmittal form and the cash to the e(Financial position)for processing and
deposit. The third copy (pink) is to remain in the receipt book.
Receipts may be voided, but the pink copy of any voided receipt must remain in the book.
The receipt book should be reviewed against either the monthly bank statement or Cash
Receipts log to assure all cash received was recorded and deposited.
When all the receipts are used, the book must be returned to the (Executive position) or
other designee who will issue a new book.
Petty Cash
The purpose of a Petty Cash Fund is to facilitate small business purchases or reimbursements
needed in the day-to-day operations of the organization, without going through the check writing
process.
The limit for the petty cash fund is set by the (Executive position).
Petty cash is kept in a locked box and secured in a locked filing cabinet, safe or locked
desk. Only assigned custodians will have keys to the box.
Disbursements of up to (establish an amount) may be made from the petty cash fund for
miscellaneous expenses. Disbursements in excess of this may be made with prior
approval of the (Executive position).
8
If funds are requested to make a purchase, purchaser must complete a Petty Cash receipt
for the amount of funds received prior to custodian providing the requested funds.
The purchaser must submit receipts for all purchases to the custodian of the fund,
including change if funds were requested prior to purchase. In the case of a lost receipt,
the (Executive position) or other designee may approve a disbursement based on a
memo describing the item and cost.
The custodian will ensure that the petty cash slip is properly completed and a proper
receipt is attached.
The custodian will ensure that the petty cash box contains receipts and cash totaling the
amount of the fund at all times.
Any irregularities in the petty cash fund are reported immediately to the (Executive
position).
Loans will notbe made from petty cash funds.

Requests to replenish the fund are completed by the custodian and approved by the
(Executive position). Petty cash replenishment checks are made out to the custodian
who is responsible for cashing the check for the fund.
The (Executive position) or Designee will periodically make unannounced checks of

petty cash
Fund Disbursements
9

The fund disbursement policies and procedures are designed to ensure that disbursements are
properly made based on adequate documentation and proper authorization.
Approvals and Authorization
The (Executive position or other designee) will authorize the following expenditures:
General Funds, Indirect Funds, Leases for Space or Equipment, Purchases of Equipment,
Contracts for Services, all Credit Card Expense.
Program managers will authorize expenditures within their departments.
Authorization for expenditures may be delegated. Delegation of expenditure authority

will be in writing and approved by the (Executive position or other designee) and
(Accounting positionr
(ORGANIZATIONS NAME) Funds
Payment for supplies or services will be made based on invoices, not statements.
Requests for Payment (RFP) are submitted with the original invoice attached.
The RFP is coded by the staff requesting the payment as to the fund and expense
code to be charged. The RFP is signed by an authorized staff member indicating
approval of the expenditure.
RFP/Invoices are processed by the (Financial position). Each invoice is stamped

ENTERED or POSTED when entered as a payable in the accounting system
and the check and all corresponding documentation is stamped PAID when the
payable is processed for payment.
Custodial funds
10
(Organization name) administers funds on behalf of government agencies as prescribed

by contract between the agency and (Organization name). Custodial funds are subject
to the same security safeguards as (Organization name) funds.
Original invoices for New Homes Program, including 502 funds, and Housing
Rehabilitation are maintained in the family files. Contractor payments and/or
invoices for New Homes are approved by authorized staff and entered into the
New Homes data system. A payment schedule is printed and submitted to
accounting for payment to the vendor and invoicing to the funding agency.
Housing Rehabilitation payment releases and invoices are approved by the family,
Construction Supervisor, and administrative staff, before copies are submitted to
accounting for payment.
11
Missing Invoices
In the event that an invoice for services or supplies is lost, a memo explaining the
expense and detailing the cost is submitted with the Request for Payment for approval by
the (Executive or other designee position).
Vendor Documentation
All vendors must submit an IRS Form W-9 Request for Tax Payer Identification and
Certification or equivalent to the Accounting Department, prior to payment. A
determination is made by the (Financial position) on the need to file an annual IRS Form
1099-Misc. on payments made to vendors. Form W-9s should be mailed to all current
vendors each year prior to Form 1099 preparation to assure information is current.
Check Writing Procedures
Checks are processed (How often? Weekly, bi-weekly, etc).
Checks are written (describe method, i.e. manually, through accounting software,
through other software that must then be entered in accounting software, etc.).
The (Executive or Financial position) will designate staff with access to the check
printing system. Except where specifically authorized by the (Management
position) the (Financial positio) does not write checks.
Checks are automatically numbered, electronically signed, and printed on blank check
paper using MICR cartridge toner. Facsimile signature of the Executive Director is
used.
Checks are not to be post dated, signed blank, or made out to cash.
A copy of each check is attached to the RFP/Invoice plus any other documentation,
such as purchase orders or shipping documents, and filed in check number order in
the respective Paid vendor files.
Voided or spoiled checks will have the signature block torn off and will then be filed
in numerical order with the cancelled checks received from the bank.
12
Checks are recorded in the Disbursement log and given to the (Executive position
and/or signatories) for review and approval
.
Check Approval Process
This procedure is designed to ensure that all checks have adequate documentation and
authorization and that there are no missing checks or checks written to phantom vendors.
The RFP is reviewed for proper account coding, appropriateness of expenditure, and
authorized signatures.
The RFP is compared with the invoice and the check amount. The copy of the check is
initialed by the (Executive position or designee) to indicate the review has been
completed and the documentation is in order.
The batch of checks is reviewed in check number sequence to assure no checks are
unaccounted.
The Disbursement log will be reviewed by the (Executive position or designee) to

assure that the first check in each batch of checks begins with the next sequential check
after last batch processed. The Disbursement log is initialed by the reviewer to indicate
that all checks in the current batch have been verified to assure there is no gap in the
check sequence.
If there are no questions to be resolved, the Disbursement log and signed checks are
returned to the (Financial position or other designee) as authorization to mail or release
the check to the vendor.
Checks are mailed to vendors by the (Staff positio) unless specific arrangements had
been made in advance for pickup of checks at the office. If a check is picked up, the
person picking up the check must provide identification which agrees with the payee on
the check or must have verifiable written authorization from the payee to pick up the
check.
13
Electronic Payment and Transfers:
These procedures ensure that unauthorized transfers will not be made. Procedures may
vary based on the system of the banking institution.
Required documentation for all transfers is the same as for Requests for Payment.
Electronic banking allows wire transfers, electronic transfers, stop payments on checks,
and account balance inquiries be initiated and completed via computer or telephone.
Wire transfers, electronic transfers, and stop payments cannot be set up and approved by
the same person..
Password security is set to allow wire transfers, electronic transfers, and stop payments to
be set up by staff designated by the (Executive position or designee).
Transfers can only be approved and sent by the (Financial position or designee) and can
only be transferred between (Organization name) accounts.
When a wire transfer, electronic transfer, or stop payment has been set up by the
accounting staff, the documentation supporting the transaction is given to the (Executive
or Financial position) for verification and approval before the transaction is initiated.
Electronic transfers to and from the Investment Account are approved by the (Executive
position) and completed by the (Financial or staff position). The Investment Account
has been established so that only transfers into valid (ORGANIZATIONS NAME)
accounts may occur.
An Authorization for Interfund Transaction is completed and signed by the (Executive

position) prior to any transfer from or to the Investment Accounts. The Authorization
details the accounts and the explanation of the transfer which is set up to transfer only to
designated (Organization name) accounts.
14

Payroll
These procedures are designed to assure that payroll is based on proper authorization and
required documentation, is paid at the approved rate, is only paid to actual employees, and to
assure that proper and timely reporting is made to federal, state, and local taxing authorities.
(Organization name) uses (describe method used for processing payroll and required
payroll tax deposits, i.e. manually, in-house software, outsourced to payroll company, etc).
(Organization name) payroll is processed on (how often is it processed) basis. Pay

periods are (detail payroll periods, i.e. 1-15 and 16 End of Month, every other
Friday, etc). Pay dates are (detail dates payroll payments are made available to
employees) but checks may be issued earlier if requested and approved by (Executive
position).
Payroll is based on time sheets completed by employees and approved by supervisors.

Each time sheet reflects the cost centers to which the employees time is charged.
Time sheets will reflect the use of sick, vacation, or other leave time, if applicable.
Overtime for Non Exempt employees requires the prior approval of the employees
supervisor.
Time sheets must be completed in ink with no whiteout or correction tape. Changes are
initialed by the employee. The time sheet will be signed by both the employee and the
assigned supervisor.
New hires and salary and/or benefit changes must be approved by the (Executive
position). A Personnel Action Formauthorizing the salary, wages and employee position
is completed by the (Staff position) and signed by the (Executive position and/or
supervisor) and forwarded to the (Financial position) for processing.
Payroll records are maintained by the (Financial positio) in a confidential manner.

Information regarding payroll will not be discussed with other staff. Files must be in
locked cabinets with access limited to designated personnel.
15
Documents that verify tax withholding and authorize other deductions such as health
insurance premiums or voluntary contributions are filed in the payroll files by the
(Financial position). A separate file contains the I-9 forms for each current employee
and is maintained by the (Staff positio).
Payroll Preparation and Payment
Payroll is prepared from employee time sheets which have been completed and signed by
the employee and reviewed, approved, and signed by the supervisor.
The (Financial position) will check each time sheet for computational errors.
Hours worked by cost center are converted to percentages and entered into the payroll
syste.
For salaried staff, computation of partial pay periods will be based on the percentage of
the pay period worked.
Payroll is submitted electronically to the payroll service by ther(Accounting positio).

The (Financial position) or other designee receives the payroll vouchers, checks, or
reports directly from the payroll service to assure that all of the checks are for actual
employees or other required payments (i.e. garnishments). This information is reviewed
for appropriateness prior to forwarding to the (Financial position).
Once approved by the (Executive position), the (Financial position) verifies the payroll
is accurate and complete by verification against submission data.
Paychecks are directly deposited to the employees bank accounts. Employees receive
duplicate vouchers which detail all deduction.
The payroll service prepares checks to vendors for employee deductions such as
contributions to 403(b) accounts, cafeteria [125(b)] plans, garnishments, and donations.
Electronic fund transfers are made by the payroll service for employee contributions to
theO(ORGANIZATIONS NAME) retirement pla.
An electronic transfer of funds to cover payroll is made to the payroll service

byO(Organization Name)s bank at the request of the payroll service.
(Organization Name) account clerk verifies the fund transfer against the submitted
payroll information.
16
Payroll tax deposits are made by the payroll service. Reports are reviewed by the
(Financial/Staff position) to verify the accuracy of the deposits.
Monthly payrollsexpenditures by cost center are entered into the General Ledger by
(Staff position)yusing a Payroll Journal Entry
Purchasing
Leases
Only the (Executive position) can sign lease agreements.
Copies of all leases will be maintained by the Accounting Department. An RFP

authorizing payment of the lease for the fiscal year is maintained by the Accounting
Department. The RFP will be reviewed by the (Financial position) and (Executive
position) annually.
Consultant/Contract Services
The (Executive position) will review and approve proposed contracts.
Consideration is made regarding in-house capabilities to accomplish services before

contracting for them.
Written contracts clearly defining work to be performed is maintained for each

consultant and contract services by (Staff position) and Accounting department.
The qualifications and reasonable charges for fees are considered in hiring consultants
and proof of insurance and Form W-9, at minimum, will be required.
Requests for Proposals will be issued for amounts exceeding (specify dollar amount or
other criteria meriting an RFP).
Furniture and Equipment

All furniture and equipment purchases must be pre-approved by the (Executive position)
Loans
Third Party Loans
Loans from outside sources (other agencies, banks, etc.) are authorized through board
action and initiated by the (Executive position) or other designee.
17
Loans to third parties must be approved by the (Executive position) and evidenced with
a Promissory note prepared by (Financial position) and signed by requesting third party
before funds are released.
Upon repayment of funds, the promissory note is returned to the (Financial position).
Intra Fund Loans
Intra fund loans must be authorized by the (Executive position). Only (Organization
name) Funds may be used for this purpose. Custodial funds will not be used for intra
fund loans.
An Internal Lending Rate is established by the (Organization name) Board to

determine the cost of using (Organization name) funds.
Employee Loans
Loans may be made to employees to meet emergency situations.
All requests must be submitted to the (Executive Director) or other designee in writing,
for approval.
Generally, employee loans are limited by established guidelines and may not exceed the
net pay for one pay period; are interest free; and must be repaid within six months.
Employees must execute a repayment agreement which states that repayment to

(Organization name) will be automatically deducted from the employee's pay check(s),
and agree if termination of employment occurs prior to full loan repayment, the
remaining balance will be deducted from the final paycheck.
Employee loans will be made only from the General Fund.
18
Bank Accounts
The Board of Directors may delegate by resolution the authority for the board Chair, Vice-Chair,
Secretary, Assistant Secretary and Treasurer to establish bank accounts and set signatory
authority.
Bank accounts are established to meet the needs of the organization for separation of funds and
the specific requirements of funding sources. Separate accounts for specific federal or state
programs which exceed the FDIC limits must be collateralized by the bank to ensure the safety
of the deposit. All other accounts, where possible, are established to maximize the use and
earnings of cash.
A complete listing of all accounts and the account numbers shall be maintained by the
(Financial position).
Bank Reconciliations for each account are completed monthly by the (Financial
position). The bank statements are received by the (Executive position) unopened to
assure that they remain intact.
Reconciled bank statements are reviewed by the (Executive position) or designee

monthly.
Outstanding checks more than (designate number of days) old are investigated and stop
payments issued as required. Replacement checks are reissued after appropriate
documentation has been collected.
Accounts Receivable
For each grant, contract, loan or other agreement, the (Executive position) will designate the
staff responsible for preparation of invoices, payment requests, or reports necessary to secure
payment to (ORGANIZATIONS NAME). The following procedures ensures that all requests
for funds are properly recorded and tracked.
Generally, the (Designated Department) processes invoices to partner agencies, with

copies provided to the (Financial position).
Generally, (Designated Department) processes requests for funds from (Identified

funder), with copies provided to the (Financial position).
19
The (Financial position) prepares requests for funds from other agencies.
Billings to funding agencies are entered as revenue/receivable when sent out to the
agencies.
Aged receivables are reviewed by (Executive position).
Write-offs of uncollectible receivables must be approved by the (Executive position) and

documented through the general journal entry for each write-off.
Accounts receivable are reviewed by the (Executive position) and (Financial position)
annually to ensure that receivables have a reasonable expectation of being collected and
any necessary steps are to taken to ensure collection. If there is no reasonable
expectation of collection, a decision is made on what action to take.
20

OTHER FINANCIAL SAFEGUARDS
Personnel Records System:

Access to the personnel records system is controlled to assure the confidentiality, privacy,
and appropriate access to records and reliability of data. Access is limited to the
Executive Position, Financial position and key administrative staff.
Paper personnel files are maintained in locked file cabinets. The files contain all
personnel related information in sections, including employee selection documents
(resume, application, transcripts, test results, offer letter, etc.), employee performance
documents (evaluations, letters of recognition, and disciplinary actions), employee
development (completion of training certificates, education records, specialized licenses),
and miscellaneous data (employee handbook receipt, requests to inspect personnel file,
leave of absence requests, attendance records, letter of resignation, termination records
and other employment related documents). Additionally, one file containing all Form I9s for current employees eligible to work in the United States is maintained. Access is
controlled by the (Executive position) and (HR or Financial position).
O(ORGANIZATIONS NAME) Credit Card
(Organization name) authorizes credit cards for key staff for the purpose of facilitating
business purchases including business travel that is not easily handled through normal
disbursement processing. Due to the potential for theft, misuse, and auditing problems, use of
(Organization name) credit cards is monitored carefully. The (Executive or Financial
position) reviews all credit card purchases, and the (Executive position) must approve all
payments. Misuse of credit cards or failure to follow these procedures will lead to
restrictions or loss of credit card privileges.
21
Each card holder is given instruction when they receive the card designed to ensure
that the cards are used for (Organization name) business only and to protect against
misuse and theft and must sign a declaration of his/her understanding.
The (Financial position) must be notified immediately if a card is lost or stolen. If the
(Financial position) is unavailable, the (Executive position) or other designee will be
contacted.
Appropriate credit limits are established by the (Executive position) for each card and
a list of all card holder and card holder numbers is maintained by accounting.
Phone Credit Cards are issued to employees who travel frequently. Phone bills are
reviewed by the (Financial position) to assure that there is no misuse of the cards.
Credit and phone cards for employees who resign or are terminated are canceled
immediately by the (Financial position).
22
23
Employee Benefits
These procedures are designed to ensure that employees receive the appropriate benefits as
specified in the Personnel Plan.
24
Employee Leave: Vacation and Sick Leave
Employee balances are maintained by the payroll service based on data submitted and
checked by the Bookkeeper. Employee vacation leave balances appear on employee
paycheck vouchers.
(Organization name) funds the vacation accrual on a monthly basis to ensure that all
programs pay their fair share of the vacation liability and to ensure that (Organization
name) liability for accrued leave is fully funded. Based on a rate determined by the
costs of salary, fringe benefits, and the accrued time, charges are made monthly to
funding sources based on the time spent on specific programs and aggregated in a
vacation pool fund. When vacation leave is used by an employee, the salary and fringe
cost for that time are charged to the vacation pool fund
Sick leave is not funded. There is no liability for payment to an employee for accrued
sick leave when an employee leaves (Organization name) employment
Sick Leave pay is charged to each funding source as it is used, based on time worked
during a pay period. If an employee is sick the whole pay period, the leave is charged to
the cost centers that would be normally charged by the employee.
Retirement
(Organization name) has a Profit Sharing 401 (k) plan for employees, which is self-directed.
The Board of Directors determines on an annual basis the contribution to be made on behalf of
staff. A third party administrator is retained to insure that the plan is up to date, to process
distributions, and to prepare tax filings.
Employer contributions are transmitted to the investment company as soon as administrative

feasible to comply with ERISA (Employee Retirement Insurance Securities Act)
requirements.
Salary deferrals to either the 401(k) or to employee established 403(b) plans are transmitted
with each payroll. Written employee authorization is required before salary deferrals are
25
deducted and sent to the appropriate fund. Employees must re-elect these directives on an
annual basis during the Open Enrollment period.
Other Benefits:
1.
Cafeteria 125 and Flexible Benefit Plan
These two benefits allow pre-tax payment of health insurance premiums. The Flexible
Benefit Plan also allows for payment of unreimbursed medical or child care payments. A
benefit administrator maintains the records, processes reimbursement checks, and sends
reports to participating employees and (Organization name). Written employee
authorization is required before deductions are made from employees salary and forwarded
to the plan administrator. Employees who participate in the plan send reimbursement
requests directly to the plan administrator. Reimbursement checks are sent to
(ORGANIZATIONS NAME) for signature before being given to the employee. The
(Executive position) or board signatories are authorized to sign the checks.
Travel
Travel policies and procedures assure that all travel costs are pre-authorized, documented and are
consistent with applicable regulations.
Mileage Reimbursement
The reimbursement rate for privately owned vehicles is the rate paid by Federal
agencies for the use of private vehicles, unless otherwise established by the Board of
Directors, not to exceed the current GSA rates.
26
Mileage reimbursement forms must be completed in ink and signed by the employee,
approved by the supervisor, and submitted to the (Financial position or
department). Reimbursement for mileage expense is made along with other vendor
payments. The (Executive or Financial position) must approve payment of mileage
claims which have been submitted late.
Mileage Reimbursement records are maintained by the (Financial staff).
Employees are required to have proof of auto insurance on file with the (Financial or
personnel staff).
Employees will not be reimbursed for mileage unless proof of insurance is on file for
the period in which mileage is incurred.
27
Travel out of service area
Travel out of the (Organization name) service area must be pre-approved by the
(Executive position) or other designee. Travel out of state requires pre-approval by
the (Executive position).
Federal per diem guidelines apply unless otherwise established by the board, not to
exceed the current Federal GSA rates. Exceptions may be approved by the
(Executive position).
The (Executive position) or other designee may approve travel advances for
employees. When authorized, the (Financial position) will process a Travel Advance
Request for employees based on estimated per diem and other anticipated travel costs.
Following a trip, employees will submit to the (Financial position) a properly authorized Travel
Expense Report. The report must detail all expenses, and required receipts must be attached.
The report will reconcile the advance funds received and will show funds to be returned to
(Organization name) or additional expenses to be paid to the employee.
Board of Directors Travel and Reimbursements
(Organization name) Board members may be paid allowances and reimbursements

for business expenses incurred in the performance of their duties.
Claims for reimbursement must be approved by the (Executive position).
Allocation of Costs
The purpose of the cost allocation policy is to ensure that all programs are charged their fair
share of the costs whose benefits are not readily identifiable with a specific program or funding
source but are necessary to the general operation of the organization.
28
Indirect Costs
Indirect costs are those costs that are not attributable to a specific cost center and which
generally benefit the organization as a whole, such as salaries, benefits and other costs
relating to the (Executive position), accounting staff, and other administrative staff. Costs
relating to the Board of Directors are also considered indirect costs.
OMB Circular A122 established the federal requirements for determination of allowable
and unallowable direct and indirect costs and the preparation of cost allocation proposals.
Annually, (Organization name) submits an (Indirect Cost Rate Plan) or (Cost Allocation
Plan) proposal to their cognizant agency for approval as required by OMB Circular A122.
Please refer to the current Approved (Indirect Cost Rate) or (Cost Allocation) plan.
Property, Inventory and Control

(Organization name) property inventory procedures provide for management control of
(Organization name) owned property and documentation of property for potential insurance
losses and tax reporting. All property in excess of (dollar amount) in value but less than the
established capitalization threshold at the time of original purchase is included in inventory.
29
(Organization name) will maintain property records to reflect furniture and equipment
purchased, including tagging of these items, and include location, changes, deletions, etc.
Every year a physical inventory and of all furniture and equipment plus estimates of
supplies on hand is completed prior to year end.
Any discrepancies are brought to the attention of the (Executive or Financial position) for
appropriate action.
Transfer of furniture or equipment within or between locations is approved by the

(Executive position or other designee).
Equipment to be retired is documented with an explanation for release. The listing of

equipment to be retired is authorized by the (Executive position). Any salvage value
received is so noted on the records.
30
Fixed and Capital Assets

(Organization name) has established a capitalization threshold of (Amount) for property
expected to benefit the operations of the organization for multiple years to be considered a fixed
asset.
All property with an acquisition cost in excess of (Capitalization threshold) (the federal
definition of a fixed asset) is purchased with (Organization name) funds so that no
property has federal character.
The cost of all property acquired through federal or state funds will be clearly designated on
the Statement of Financial Position as Paid in Capital, including depreciation of such assets.
Capital Assets include buildings and improvements.
Property purchased meeting the fixed asset definition is tagged with a pre-numbered asset
tag noting (Organization Name) and added to the list of assets maintained by the
accounting department. This list is categorized by type of fixed asset, i.e. buildings,
furniture and equipment, plant assets, etc. and includes the asset number, date of installation,
cost including taxes, shipping and installation fees, and life expectancy for depreciation
purposes. A copy of the invoice(s) should be maintained with these asset records until asset
is sold or deleted.
Equipment Depreciation
The purpose of depreciation is to recognize the decreased value of the property over time
(useful life) and to quantify this usage as an expense to each cost center deriving benefit
from its use.
A fixed asset, as previously defined, is depreciated according to the (Organization name)

Depreciation Policy.
31
The Depreciation Policy sets the useful life of property types (Buildings, Capital Assets,
Furniture & Equipment, Vehicles, etc.) which may differ from depreciation methods used
for income tax purposes.
Depreciation Schedules are prepared for the full fiscal year utilizing the guidelines of the
Depreciation Policy.
A separate schedule is made for each property/asset type. The schedule is maintained by
the (Financial position). As depreciable property is purchased, it is added to the
depreciation schedule in the month following purchase/installation.
A recurring journal entry is set up for posting each month, charging the depreciation
expense to the appropriate program(s).
Audits
(Organization name) is required to have a (type) on an (how often) basis.
Periodically, as determined by the Board, a Request for Proposal is sent to audit firms qualified
to provide the type of audit that meets (Organization name) and/or funder need. The Audit
Committee is responsible for soliciting bids, interviewing firms and making the recommendation
to the Board of Directors when selecting the firm to be awarded the audit contract. Acceptance
of the audit contract will be evidenced by a signed audit engagement letter that contains the type
of service to be provided, the timeframe for providing the service, the cost for the service
including incidental expenses, the term of the engagement and a clause stating if unanticipated
issues arise during the course of the audit that will result in additional fees, the audit firm will
notify the Audit Committee for approval prior to incurring additional costs.
The audit is reviewed in detail by the Audit Committee, but presented to the board by the auditor
and accepted by the Board of Directors based upon recommendation by the Audit Committee.
Taxes and Reporting Requirements
The auditor prepares Form 990 IRS Return of Organization Exempt from Income Tax,
the (State Form) (State Form Name) Exempt Organization Annual Information Return,
and (list any other tax forms related to year-end audited numbers in this section).
32
The (Staff Position) completes and submits Welfare Exemption and Business Property
forms on (Organization name) owned and leased offices.
Welfare Exemption forms for (Organization name) multi-family properties are

completed by (Organization name) property management staff.
33
34
Grants and Contracts

Contract and grant documents are reviewed and approved by appropriate program staff, as well as
the (Financial position), prior to being signed by the (Executive position).
The (Executive or Financial position) will carefully review each award to ensure that
(Organization name) will be in compliance with all financial provisions.
The Program Manager will carefully review each award to ensure that all programmatic
provisions will be met.
Original copies of signed grants and contracts are filed in the contract file with copies to the
(Financial position), program staff, and (Executive position).
The (Financial position) will assign appropriate general ledger account numbers and
customer numbers for each new grant or contract.
The (Financial position) will designate the appropriate staff responsible for preparation of
reports, payment requests and/or invoices.
The (Financial position) will maintain individual contract files containing copies of the
grant/contract, any amendments, relevant correspondence regarding the grant/contract, and
reports of expenditures or billings.
A log of all grants/contracts is maintained by (Designated staff) detailing grant/contract

numbers, effective dates, and reporting requirements.
Budgets
Budgets provide a standard by which to measure performance, encourage planning, and allocate
resources in accordance with funding source requirements.
Budgets should use reasonable
assumptions of income and expenses. All budget assumptions should be documented to facilitate a
thorough analysis and evaluation, not only of the budget, but of the actual revenue and expenditures
as they relate to the budget.
35
The organization budget is prepared by the (Staff positions involved).
Budgets are submitted to the (Executive position) for review and approval prior to
submission to the Board of Directors.
The (Executive position) will submit an annual organization budget to the Board of
Directors for their approval.
The General Fund budget is established and approved by the Board of Directors.
Note when budget reports are reviewed and by whom
Internal Reporting
Reports assist the Board of Directors, (Management or Executive position), and funders with
managing and controlling of program activities and financial resources.
Monthly financial reports, including a revenue and expense report, and balance sheet where
appropriate, will be provided to the (Executive and Board of Directors).
The (Financial position) will prepare monthly and quarterly reports as required by funding
sources.
The (Executive position) or designee will review the reports to the funding sources.
The (Executive position) or designee will sign all reports to funding sources.
The (Financial position) will prepare and maintain, on a current basis, a listing of reports
and due dates for funding sources.
It is the responsibility of the (Financial position) to ensure that all financial reports are
submitted on a timely basis.
36
37
38
Record Retention
(Organization name) sets guidelines on the retention of records which will meet the requirements
of all federal and state agencies, as well as those of other funding sources.
(Organization name) will comply with OMB Circular A-110, Attachment C, Retention and
Custodial Requirements for Records.
Financial records, supporting documents, statistical records, and all other records pertinent to an
agreement shall be retained for a period of three years with the following qualifications:
a.
If any litigation, claim or audit is started before the expiration of the three-
year period, the records shall be retained until all litigations, claims or audit findings
involving the records have been resolved.
b.
Records for nonexpendable property acquired with Federal funds shall be
retained for three years after its final disposition.

c.
When records are transferred to or maintained by the Federal sponsoring
agency, the three-year retention requirement is not applicable to the recipient.
The retention period starts from the date of the submission of the final expenditure report or,
for grants and other agreements that are renewed annually, from the date of the submission
of the annual financial status report.
Recipient organizations should be authorized by the Federal sponsoring agency, if they so

desire, to substitute microfilm copies in lieu of the original records.
Record Retention for Accounting Records
Type of Record
Detail Ledger
Trace Reports
Time Sheets/Travel Vouchers
Accounts Payable
W-2 , Quarterly Reports, etc.
Payroll Records
Bank Statements, Cancelled Checks
Check registers
Deposit Data Entries, Journal Entries
Years
10
8
8
8
8
8
8
8
8
39
Partnership Records
Contracts
Tax Returns
Indefinitely
10
Indefinitely
40
Special Funds
(Organization Name) maintains several special funds which are governed by special policies and
are used for specific activities.
General Fund:
The (Organization name) Board retains sole discretion for budgeting and expenditure of
General Funds. They are usually used to fund activities not allowable under federal, state or
local grants.
The (Executive position) approves all expenditures.
41
Risk Management and Insurance

In the implementation of the Risk Management Policy, (Organization name) will insure those risks
which (Organization name) deems appropriate using an insurance professional who is
knowledgeable about the market, who understands or is willing to learn about (Organization
name) operations, is an assertive advocate for (Organization name)s interests, and is organized
and responsive to (Organization name)s needs.
Investment Policy
The purpose of the investment policy is to minimize risk and maximize investment return, while at
the same time assuring that (Organization name) can meet the cash need for ongoing operations.
42
43
Security & Access
AC
Data Backup
AC
Receipt Books
AC
AC
Fund Disbursements
AC
AC
Electronic Payments & Transfers
AC
AC
Payroll
AC
AC
Purchasing
Leases
Consultant/Contract Services
Furniture & Equipment
Loans
Third Party Loans
Intra Fund Loans
Employee Loans
Computer Loans
AC
AC
Personnel Records
AC
(ORGANIZATIONS NAME) Credit

Cards
Employee Benefits
AC
Allocation of Costs
Property & Inventory Control
AC
A
R
A
Admin. Analyst (Computer)
Administrative Support Staff
Clerical Support Staff
Loan Processors
R
R
R
R
Travel Reimbursement
Taxes & Reporting
C
C
Petty Cash
Audits
Acct. Clerk III
R
R
Bookkeeper
AC
Funds Received
Bank Accounts
Program Manager REHAB
Program Manager MFH
Deputy Director
Controller
Executive Director
Directors(ORGANIZATIONS NAME) Board of
Financial Systems
A=Approval &/or Authority
C=Controls Security
R=Responsibilities in this area
44
R
R
Grants & Contracts

Budgets
AR
Internal Reporting
Record Retention
R
R
MFH owned by (ORGANIZATIONS

NAME)
MFH owned by (ORGANIZATIONS
NAME) controlled asset corp.
(ORGANIZATIONS NAME)
Subsidiaries
Risk Management & Insurance
AR
AR
AR
AR
Investment Policy
AR
45
Admin. Analyst (Computer)
Administrative Support Staff
Clerical Support Staff
Loan Processors
Acct. Clerk III
Bookkeeper
Program Manager MFH
Deputy Director
Controller
Executive Director
Directors(ORGANIZATIONS NAME) Board of
Financial Systems
A=Approval &/or Authority
C=Controls Security
R=Responsibilities in this area

Fin Pol and Procedures

Uploaded by

Document Information

Original Description:

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Fin Pol and Procedures

Uploaded by

Copyright:

Available Formats

(Organization Name)

Policies & Procedures Template

Policies & Procedures Template

Risk Management and Insurance

Policies & Procedures Template

The Board of Directors formulates financial policies, delegates administration of the

The (Staff Position) is responsible to the (Management Position or board) for

GENERAL POLICIES: (Example showing proper business practices)

Financial Procedures are reviewed annually by the (Staff position).

Separate General Ledger accounts are maintained as required by funding source

Accounting forms and timesheets are typewritten or completed in ink. Whiteout or

Passwords must comply with organizational standards. They are to be treated

Compliance with External Policies

Generally Accepted Accounting Principles (GAAP).

OMB Circular A-122, Cost Principles for Non Profit Organizations

OMB Circular A-133 Audits of States, Local Governments, and Non-Profit

Security and Access:

Security and access is determined by the (Staff position(s)).

OVERVIEW OF (Organization Name) ACCOUNTING SYSTEM:

DETAILED ACCOUNTING PROCEDURES

Receipt books are assigned by the (Executive/accounting position) to (Staff position)

The (Staff Position)

is responsible for safeguarding the receipt book.

Receipt Books must be kept in a secure place at all times.

Receipt Books consist of three-part, pre-numbered forms. They should be used in

Loans will notbe made from petty cash funds.

The (Executive position) or Designee will periodically make unannounced checks of

Program managers will authorize expenditures within their departments.

Authorization for expenditures may be delegated. Delegation of expenditure authority

(ORGANIZATIONS NAME) Funds

RFP/Invoices are processed by the (Financial position). Each invoice is stamped

(Organization name) administers funds on behalf of government agencies as prescribed

Checks are processed (How often? Weekly, bi-weekly, etc).

The Disbursement log will be reviewed by the (Executive position or designee) to

Electronic Payment and Transfers:

An Authorization for Interfund Transaction is completed and signed by the (Executive

(Organization name) payroll is processed on (how often is it processed) basis. Pay

Payroll is based on time sheets completed by employees and approved by supervisors.

Payroll records are maintained by the (Financial positio) in a confidential manner.

Payroll Preparation and Payment

Payroll is submitted electronically to the payroll service by ther(Accounting positio).

An electronic transfer of funds to cover payroll is made to the payroll service

Only the (Executive position) can sign lease agreements.

Copies of all leases will be maintained by the Accounting Department. An RFP

The (Executive position) will review and approve proposed contracts.

Consideration is made regarding in-house capabilities to accomplish services before

Written contracts clearly defining work to be performed is maintained for each

Furniture and Equipment

Intra Fund Loans

An Internal Lending Rate is established by the (Organization name) Board to

Employees must execute a repayment agreement which states that repayment to

Employee loans will be made only from the General Fund.

Reconciled bank statements are reviewed by the (Executive position) or designee

Generally, the (Designated Department) processes invoices to partner agencies, with

Generally, (Designated Department) processes requests for funds from (Identified

Aged receivables are reviewed by (Executive position).

Write-offs of uncollectible receivables must be approved by the (Executive position) and

Personnel Records System:

Employee Leave: Vacation and Sick Leave

Employer contributions are transmitted to the investment company as soon as administrative

Cafeteria 125 and Flexible Benefit Plan

Mileage Reimbursement records are maintained by the (Financial staff).

Travel out of service area