Every organisation should have a financial procedures manual in place to ensure good corporate governance and internal control. This should be reviewed and updated regularly.
This article addresses what is required within a Financial Procedures manual.
Financial Management is one of the key ways an organisation has for measuring its performance and is therefore a vital component of every organisation.
Underpinning all Financial Management systems is a series of financial policies and procedures which guide the operation and lay out of how your organisation uses and manages its money. The financial procedures manual brings all these policies and procedures into one document. It helps to establish internal controls within your organisation which will ensure accuracy, timeliness and completeness of all your financial data. It is imperative that your organisation has a financial procedures manual in place.
There is no one model layout of a financial procedure’s manual. Below are the content headings of a typical financial procedures manual which can act as a starting point for your own manual to be adapted for your organisation’s requirement, structure, and activities.
What should be included in the Financial Procedures Manual?
1. Financial Responsibilities
2. Budgetary control and monitoring
3. Controls on Income
4. Controls on Expenditure
5. Controls on financial assets /record keeping
6. Controls on Human Resources
7. Controls on physical assets
8. Policies and procedures for GDPR
Internal control effectiveness needs to be monitored and subject to regular review by the board.
The management team in your organisation are responsible for managing risks through maintaining an effective system of internal control and the board as a whole is responsible for reporting on it.
For effective governance within your organisation your internal controls, financial policies and procedures needs to be documented in your financial procedures manual, communicated to all staff, reviewed regularly, and be embedded in your organisation.
For further information on a Financial Procedures Manual or in relation to OSK audit and accounting services please contact Deirdre McDermott.
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