Financial Procedures

Financial Procedures

It is good practice for an organisation to produce a detailed set of financial procedures. Financial procedures are a set of instructions that any stakeholder, including new members of the committee or staff, can use to find out exactly: what tasks need to be done; who will do these tasks; and who will ensure the tasks are done properly.

It is important that the agreed financial procedures are written down so that there is clarity about what is required and that the management committee ensures that staff and committee members are aware from the outset of what is expected of them.

Answer the next few questions to find out whether you need to establish or develop procedures.

a) Does the group have a set of written financial procedures?

b) Are the procedures adequate (consider accountability, audit trail, segregation of duties and recording, reporting and decision making tasks)

c) Do they ensure:

• Only legitimate expenses are incurred.
• Each expense is scrutinised for accuracy and matched to the relevant source of income.
• Expenditure is properly approved and authorised for payment.
• Payment is only made to the appropriate people.
• A consistent and transparent audit trail is produced and available for each payment.
• A full bank reconciliation is completed on an at least a monthly basis for each bank account.

d) Does the day to day operation of the finance function follow these procedures?

e) Are all committee members and relevant staff aware of what these procedures are?

f) Are procedures reviewed on at least an annual basis?

g) When was the most recent review?

Go to sections Financial Terms and Where else to go for information to find out who provides support and detailed information to help your committee develop its knowledge and practice.