1. INTRODUCTION
This financial and administrative policies &
procedures manual is designed to provide a best
practice protocol for Operations Enfants du
Cambodge’s utilization of donor funding and
financial management.
Donors view sound financial
management policies as paramount, and Operations
Enfants du Cambodge must work to ensure the use of
donor funds in the most effective manner possible.To
do this, strict but fair internal finance procedures
are essential.
Operations Enfants du Cambodge must be diligent in
conforming to all specifications or requirements of
a donor in order to sustain our credibility as a
competent administrator of fund and thus be worthy
of continuing financial support. Project Manager
(PM) should obtain detailed guidelines as to how we
should spend donor money and all staff must
familiarize themselves, at project start, with the
donor requirements for their project /program.
Operation Enfants du Cambodge must also ensure
that it has in place proper accounting procedures
and internal controls so that we can assure our
managers and our donors that money is spent in the
manner for which it was provided.
This manual explains the approved policies and
procedures to be4 administered within Operations
Enfants du Cambodge to ensure that we may achieve
our goal of showing to donors that we are competent
and efficient stewards of their funds.
1.1 General Project Financial Responsibilities
The Project Manager is responsible for the
overall running of the project. This includes but is
not limited to:
Managing project activities and meeting
project goals
Managing project finances so they are spent
as contracted
adhering to the finance policy in
procurement and payment activities
Maintaining detailed records of project
inventory
Maintaining personnel
Complying with donor regulations
Completing required narrative reporting in a
timely manner
Safeguarding of project asset
Safeguarding of project information
Obtaining no cost extension from
donors where necessary
The Finance and Administration
personnel are responsible for:
Adhering to the finance policy
in procurement and payment activities
Maintaining cash and bank
accounts
Maintaining asset/ inventory
registers and labeling assets/ inventory
Completing required financial
reporting in a timely manner
Preparing payroll information
Managing office support staff
Assisting Project Manager’s with
project finances by participating in preparation
of budgets, quarterly projection, monthly
financial reports and project finance re-
projections
FINANCE ORGANIZATION CHART
3. DELEGATION OF AUTHORITY
Operations Enfants du Cambodge has determined levels
of authority for a number of functions within the
office. It is essential that all is aware of this
delegation, as this determines who is able to
perform certain assignments or make certain
authorizations within the office. It is possible for
staff to further delegate their authorities to staff
within their programs, but any further delegation
must be in writing and must be sent to the Executive
Director. the Executive Director must accept
delegation for it to be affective. There should
always be a person in the office who is able to
approve expenditures.
The delegation of authority
is implied in the remaining sections of this manual
and where approval of expenditures is referred to
this means that it is approval within the delegation
framework. All staff should be aware of whether or
not they have a delegation and the extent of that
delegation. A copy of the delegation framework is in
the Annexes 1.
Should there be any dispute amongst authorized
personnel on a particular decision; the mediator
shall be the Executive Director. If the dispute has
still not been resolved, then the Operations Enfants
du Cambodge Board of Director may be approached for
mediation. Consequences of bypassing the delegation
of authority is a serious matter and disciplinary
measure may be taken.
4 PROCUREMENT PROCEDURES
The purpose of this section is to ensure that we
have a consistent and transparent approach to
purchasing goods and services. This section applies
to the procurement of physical goods as well as to
the purchasing of services such as vehicle rental,
office space rental, venue/ hotel arrangements and
consultants, etc.
4.1 Requesting Goods or Services
*NOTE:
All staff that are involved in requesting goods and
services or procurement must sign the procurement
Conflict of Interest Statement on an annual basis
(Annex).
Staff needing any goods or services must complete
the Purchase Request Form (Annex 3). This form
should contain a detailed description of the item(s)
or services required; it should be correctly coded,
and must be approved in accordance with the
Delegation of Authority. The person approving this
form is also indicating that this purchase is
necessary for the project and that there is
sufficient budget to cover the expense.
4.2 Quotations Operations Enfants du Cambodge policy on
receiving quotations before considering a purchase
for goods OR services (such as consultants) are as
follows:
NO QUOTAION
NEEDED
US$ 0- US$
199.99
Single items or
a number of items totaling less than $200,
no quotation is required.
3 WRITTEN
QUOTAION NEEDED
US$ 200- US$
4,999.99
For single
items in excess of $200 to be purchased from
1 supplier, or a number of items totaling
greater than $200 three WRITTEN quotes from
different suppliers are to be obtained.
*NOTE:
Purchases
CANNOT be broken up into smaller parts to
circumvent quotation requirements.
INVITATION OF
BIDS
>US$ 5,000
For single
items or a number of items totaling greater
than $5,000 competitive bids must be invited
through placing an advertisement in local
newspaper.
*NOTE:
Purchases
CANNOT be broken up into smaller parts to
circumvent quotation requirements
Within the stipulated thresholds highlighted
above, teams must obtain 3 authentic quotation.
Please note at minimum such quotes must include
supplier name, address, telephone number,
detailed description of services or goods
offered, price breakdown, supplier signature,
supplier thumb print and supplier name card.
Such quotes should be produced by the supplier,
rather than Operations Enfants du Cambodge
staff, whether hand-written or by computer. A
standard quotation, where possible, shall be on
supplier’s letterhead paper, signed and stamped.
2. Upon receiving quotes from suppliers
staff member will complete the Summary of
Quotations From (Annex 4), outlining details of
items/ services, analyzing the quotations
received, and making a recommendation.
Where it is not possible to obtain 3 quotes
the reason for this must be valid and be stated
on the “Summary of Quotation” From and then
signed in accordance with the Delegation of
Authority. It would be in instances where there
are not three suppliers of a particular item in
country. If there is only one supplier
available, a Sole Source Justification (Annex)
must be completed expressly stating how it was
determined that there were not other suppliers
and this must be approved in accordance with the
Delegation of Authority.
The completed “Summary of Quotations” From
in addition to the original quotes should be
approved in accordance with the Delegation of
Authority for final approval and agreement with
the team’s recommendation. Please note this is
an important step in the process, as the
aforementioned positions check the authenticity
of the quotations and assess the transparency of
each quote.
The Approver confirms/agrees with the
procurement of the goods/services and the
subsequent expenditure.
4.3 Competitive Bidding
Where goods or services in excess of US$8,500 are
requested, a local/national (or internationally per
donor regulations) avert must be placed for tenders
for these goods. Operations Enfants du Cambodge
procedures are:
A selection committee of at least 3 people
should be formed. The Committee should consist of a
representative of the project, Project Manager and
one other person such as Finance Officer and they
should determine:
Information required on bid application
including: (i) Items Specifications
(ii) Price
(iii) Supplier details: vendor, address, contact
name, telephone, nationality
(iv) Source and origin of goods
(v) License details if required
(vi) Bank details. Vendors placing competitive
bids must have a bank account in the company
name to which payments will be made by cheque or
transfer
Where and how to submit bids (Must be
submitted in sealed envelope with vendor contact
details note on the outside)
Closing Date for bid submission and date and
time for opening bids
Criteria for selection
Where to advertise
Write out invitation to bids and place the
advertisement.
Stamp the received date on submitted bid
envelopes as they are received. Keep them secure and
sealed. Bids that are not seals or are submitted
after the closing date must be rejected. Stamped
envelopes must be retained as part of the bid
paperwork to show transparency and fairness.
All paperwork is forwarded to Procurement for
purchasing and original bidding documents attached
to the disbursement voucher or filed in a Project
Bid file which should be referenced on the voucher.
Where less than 3 appropriate bids are received
see donor regulations on how to proceed
5 PAYMENT PROCEDURES 5.1 Short-term Advances
An advance may be issued before receipts have been
obtained for purchases. If cash is required this
must be requested on a Advance Voucher (Annex 8)
which clearly identifies the purchase that is to be
made. The advance is to be acquitted in a timely
manner. Salary advances are permitted on a case by
case basis.
Detailed Advance procedures
An Advance Voucher must be fully completed
including proper coding and must be approved by a
person delegated to approve the eventual purchase.
The Advance Voucher must then be validated by an
authorized Finance staff (according to the
Delegation of authority Framework). The authorized
validator of the voucher must check with Cashier if
the requester already has any outstanding advances,
and check that all details on the voucher are
complete and in with Finance Policies, and the
appropriate persons have approved the advance.
The Advance Voucher is given to the Cashier
responsible for cash, who will also check to ensure
that all of the appropriate fields have been
completed, and then give cash to the person
requesting. Cashier is not permitted to issue
advance without the authorization and validation
signatures.
The advance should be recorded the cashbook
including date given, payee, purpose, amount, and
signature of advance recipient.
The items are purchased and proper documentation
obtained.
An Expenditure Voucher (Annex) is prepared with
all required documentation.
The Expenditure Voucher must be approved and
validated again by the authorized persons to ensure
correct and authentic documentation has been
obtained. If supporting documentation is not
sufficient the voucher will be rejecting until
proper documentation is supporting the Expenditure
Voucher.
Approved Expenditure Voucher is then passed to
Cashier.
The Advance Voucher must always become part of
required Expenditure Voucher documentation. In
addition to showing an audit trail of funds, this
will be documentation for any refund received or
additional funds disbursed.
Staff are only permitted to have TWO cash
advances outstanding at any one time. A third
advance cannot be given until the prior advances are
cleared, unless there are exceptional circumstances. Advances must be cleared:
Within 4-5 days of receiving the
advance for purchasing of goods OR
Within 1 day after returning form a
trip/training/ or workshop
Consequences of Not Clearing:
If the advance is 5 days late: The Accountant
will verbally request for advance to be cleared and
make a note on the Advance Voucher of this request.
If the advance is 7days late: The Accountant
will send a written request with a copy of the
advance voucher to the person who took the advance
and send a copy to the Finance manager. At this time
the Finance Manager will either facilitate acquittal
of the advance or authorize- in writing on the
Advance Voucher-deduction of the amount advanced
from the salary of the person who has received this
advance.
Due to negative balance sheet implications, as
many advances as possible should be cleared before
the end of the year. All advances that have been
outstanding for long than 7 days that show on the
end of the month Balance Sheet must be explained and
signed off as approved the Finance Manager on this
from.
1.2 Long –term cash advances
Cash may need to be advanced on longer term basis,
for example when transferring to an external partner
or for projects carried out in location where there
is not OEC office.
Advances may only be sent to partners where a
contract exists between Operations Enfants du
Cambodge and the partner. The contract must clearly
state how much the partner shall receive and in what
instalments. These advances may be for up to 1or 3
months maximum at a time.
Where advances are
issued for Operations Enfants du Cambodge staff that
need to work mainly provincially in a non-
Operations Enfants du Cambodge office, different
procedures apply and will be officially determined
case- by case. Where partner or donor offices are
located nearby, efforts will be taken to secure cash
advances in those locations. The appropriate Team
Leader or Project Manager for the project must first
submit a monthly budget for anticipated expenses.
The maximum cash advance shall be for $3,000 at any
one time. The maximum period for this cash advance
will be for 1 month, and all advances must be
cleared before accounts are closed at end of month.
The Team Leader shall keep a clear and complete
cashbook that shall also be submitted at the end of
month. If any expenses were not anticipated, Team
Leader must contact Project Manager and obtain
verbal approval before spending. Surprise cash
counts may be conducted at any time. All major
procurement and supplies shall be purchased at the
Operations Enfants du Cambodge office and
transported to the located project.
1.3 Paying for goods and services by cheque
Payment of transactions, where possible, should be
made either by bank transfer or by cheque. Payment
by bank transfer or cheque to a company (not
personal) account is required for all purchases
greater than $500. In special cases where company’s
do not have company bank accounts, a letter from the
company owner is required stating this, with a copy
of their ID card/passport, name, address, telephone
number. This is to be attached as supporting
document to the Expenditure Voucher. All cheque
issued must be photocopied and attached to the
voucher.
5.4 Procedures for cash and cheque payments
An invoice is received from the supplier and
goods/services are delivered/received
Goods are checked to ensure that goods
received are the same as what was requested and
at the correct price. Once we are satisfied that
this is the case then the invoice should be
stamped with the “Goods Received By” stamp and
signed by the person receiving the goods.
An Expense Voucher (Annex 9) is
prepared with correct coding for goods
purchased, and all appropriate documentation is
attached with the voucher including:
Supplier Invoice with Goods Received Stamp
and signature.
Payment receipt if supplied
Approved Purchase Request Form
Quotations or reference to where they are
located, if required
Summary or Quotations
Competitive Biddings documents or reference
to where they are located, if required
Sole Source Justification if required
Travel Request Form (Annex) for travel
expenses
Invitation letters for workshops
Mission Activity Report for any travel
(Annex)
Emails of correspondence for further
verification
The Expenditure voucher is approved for
payment by an authorized person. The person
approving the Expenditure voucher is indicating
that all required documents are attached and
correct.
It is then given to the Cashier responsible
for disbursing cash, cheques or bank transfers
who will then prepare payment
If the payment is by cheque the invoice is
stamped as “paid” and the cheque number and date
paid is written on the invoice. The signed
cheque is copied and attached to the Expenditure
voucher.
If the payment is made by bank transfer the
invoice is stamped as paid and the bank transfer
document is attached to the invoice
The supplier is contacted to come and
receive payment:
The supplier will sign and date the
Expenditure voucher to indicate that payment has
been received whether paid by cash or cheque
The cash disbursement voucher is numbered
and filed consecutively in box file
Expenditure vouchers are entered into
QuickBooks with CLEAR descriptions of the
expense in English
Supporting Documentation Overview
Complete, accurate and adequate documentation is
essential to effective internal control and provides
evidence of the transaction, the amount, nature and
terms thereof.
The Test The test of adequate documentation of an
accounting entry is whether someone not involved in
the transaction could the documentation many years
after the date of the transaction and that it
clearly describes the transaction and is in
accordance with policy and procedures. If a verbal
explanation is required then is not enough
documentation.
6. TRAVEL AND PER DIEMS Staff are often required to travel as part of
their employment. If a person is required to travel
for work, a Travel Request Form (Annex 10) must be
completed and submitted to the Executive Director
for approval.
All international travel is to be booked by the
Administrator.
Domestic travel (within Cambodia) can be
arranged by the traveler themselves.
6.1 Travel Advances
Where a person is travelling for Operations Enfants
du Cambodge work they will be entitled to take a
travel advance. These advance normally consist of
the pre-set Per Diem according to Operations Enfants
du Cambodge Per Diem Policy (Annex), hotel allowance
in accordance with Operations Enfants du Cambodge
Per Diem Policy, and airport taxes (if any) likely
to be incurred, and visa expenses where necessary.
Emergency funds are given only in special
circumstances.
Within 1 working day of returning to the office
the advance should be cleared through the raising of
voucher and having it approved by a person delegated
to do so. To clear an advance it is necessary to
have supporting documents or evidence that the per
diem policy is complied with.
All accommodation costs will be paid for based on
the actual authentic receipt provided and subject to
the maximum cost permitted per night. Any excess
hotel costs above the maximum allowance shall not be
paid by Operations Enfants du Cambodge.
Operations Enfants du Cambodge’s per diem policy
is located in the Financial Policy. Where foreign
currency is used, staff must also submit currency
exchange receipt, so expenses may be calculated
accurately. Where no currency exchange receipt is
submitted, Cashier shall use prevailing rates
provided by bank Prior to approving an acquittal of
an advance it is necessary for the person approving
the voucher to ensure that all of the supporting
documents are attached to the voucher.
6.2 Mission Activity Reports Where staff are travelling for work, either
nationally or internationally, a Mission Activity
Report (Annex 11) must be completed. The report
outlines what your original objective was and what
the actual results were off the mission. This report
must be signed by the appropriate person in
accordance with the Delegation of Authority
Framework. The approved final report is attached as
supporting document to the travel related voucher.
7. Receiving money It is necessary to ensure that we have
procedures in place to ensure that there are
controls when cash is received .All cash received
must be receipted and income voucher (Annex 13) must
be created. The receipts should be pre-numbered and
in triplicate and the original will be signed by the
Cashier and given to the person paying money.
The following procedures apply when funds are
received:
The Cashier shall keep a pre-numbered
receipt book which is in triplicate;
On receiving money a receipt is to be
prepared ensuring that all donor and purpose of
donation details are provided for. The receipt
should be signed by both the person receiving
the money and the Cashier and then approved by a
person with delegated authority.
The original will be issued to the person
paying the money.
The second copy is attached to the Income
Voucher (Annex 13). The income Voucher is
completed with name of payer, (Email) address,
date, method of payment, amount, fund category
etc which is then checked and singed by Finance
Manager or Finance Coordinator;
The third copy of the receipt is retained in
the receipt book.
At the end of each month, Finance Manager
should page through the receipt vouchers and
make sure that all receipt sure numerically
accounted.
The Income Voucher must also have attached, any
credit advice from the bank, if payment was made by
bank transfer, or a copy of the cheque, if payment
made by cheque, and any related communications, e.g.
emails from donors saying that funds have been
transferred etc.
8. PAYROLL
Salaries must be processed latest by the last
working day of the month. All national employees are
entitled to a 13 month bonus in line with the.
Operations Enfants du Cambodge Regulations, The
bonus is based on the fiscal year; January-December.
The 13 month bonus is payable to staff in
2instalments; 50% on 31 March for Khmer New Year and
50% on September for Pchum Benh. Employees that have
not worked a full year prior to the bonus payment
will receive pro rata bonuses, calculated by number
of days worked in the year.
All employee
contractual salaries stated gross (before salary tax
deduction CONTENTS calculates tax on salary monthly
and deducts from staff salaries. Operations Enfants
du Cambodge pays tax on salary to the Tax Department
monthly before 15 of every month).
The payroll procedures are follows:
Finance Manger prepares the payroll
spreadsheet showing staff name, positions , base
salary the tax on salary, any overtime and
salary adjustments . The pay slips (Annex 14)
must detail clearly the base salary and any
additions or deductions, and finally allocation
to donors with budget lines.
All pay slips must send to finance manager
checking at least 3 days before payroll is due
to be processed.
After finance manager has checked all
payroll records, Cashier will process payroll.
Program Director or Program Coordinator must
approve all pay slips. Pay slips for Program
Director or Program Coordinator are approved by
Executive Director.
Salaries are paid by bank transfers, cheque
and in special circumstance by cash. All are
processed after approvals.
Accountant the raised and Expenditure
Voucher for the total payroll, to which all
signed pay slips are attached. This must be
approved by Finance Coordinator.
Employees must sign their pay slips one by
in privacy for confidentiality purposes. A
listing of salaries on which all employees sign
for their pay is NOT acceptable.
All payroll data is confidential. Any staff
privy to payroll data must be able abide by
confidentiality policy. Breach of this policy will
be taken very seriously.
9. ASSET MANAGEMENT
9.1 Definition
Operations Enfants du Cambodge defines fixed assets
as: Items over US$100 in value and with a useful
life of more than twelve (12) months should be
recorded in an asset schedule. Items with a value
less than US$100 but with a useful life of greater
than 12 month should be recorded in an inventory
schedule.
9.2 Asset/ Inventory Items Items considered to be either an asset or
inventory can be identified as follow:
Construction Equipment
Computer Hardware
Computer Software
Communication Equipment
Office Equipment/Furniture
Other Equipment (e.g. Vocational Training
Equipment)
Vehicles
9.3 Procedures to Maintain Registers
In purchasing a fixed asset we follow our normal
procurement procedures outline in this manual. The
following procedures outline the method to maintain
our asset and inventory registers:
Each month a report on asset purchases will be
generated from QuickBooks by the accountant who will
identify entries charged to the specific asset
accounts.
This list will be sorted into assets and
inventories, based on monetary value.
Each items purchased and charged to one of these
account and value at greater than US$100 is to be
added to the asset register by the accountant. Each
items purchase and charged to one of these accounts
and value less than US$100 will be added to the
inventory list by the accountant.
The completed list will be emailed to finance
Coordinator who will make sure the required changes
were properly added and save the new register to the
server.
The standard Operations Enfants du Cambodge
asset and inventory registers that must be used and
fully completed are located in the Annexes.
Each asset/inventory items is to be numbered and
labeled per the example in the Annexes. They are to
be labelled within one week after the items is
received.
The reason for maintaining an inventory
register is that some items may fall below the
financial value set out above but may still be
considered liable to loss or theft because of size
or nature. These items maybe portable and attractive
and include radios, mobile phones, cameras, etc.
Where a portable and attractive inventory or asset
items is assigned to an individual (e.g mobile
phone, laptop) the individual must sign an
Accountable Asset from clearly stating the terms and
condition of use and Operations Enfants du Cambodge
of the items (Annex).
9.4 Asset transfers
From time to time assets may be transferred from one
location to another or from one project to another.
When an asset is transferred an Asset Transfer Form
should be completed (Annex) and submitted to the
authorized person for approval. Where necessary,
approval of the donor must also be obtained. If the
transfer is from Operations Enfants du Cambodge one
project to another the items must beaded to the
asset/inventory register of the project that
receives it. This form need to be signed by receiver
and transferor, as well as appropriate person for
approval (see Delegation of Authority Framework).
9.5 Disposal of assets When an asset no longer has any use it should be
disposed of appropriately. All asset disposals must
be pre-approved by Program Director, as per the
delegation and comply with donor regulations. Where
the asset has been purchased by a current donor, the
donor must give authority in writing to dispose of
the asset, and agree with the manner of disposal,
such as donate to beneficiary, donate to a partner
organization, donate to a government office, sell
the asset or simply destroy it because it no longer
works.
The disposal must be supported by documentation
and note in the fixed asset register. There should
be no warranty offered on assets sold or donated,
and the assets are sold on an “as is, where is”
basis and the receiver is responsible for removing
the asset at their own risk.
Where IT assets are disposed of it is necessary to
ensure that all files have been backed up and
removed from the hard drives. Hard disks should be
reformatted rather than relying on deleting files.
If an asset is to be sold the principle of open and
effective competition is to be applied.
10. JOURNAL VOUCHERS
The Journal vouchers are for Finance staff usage
only. The voucher can be found in the Annexes. The
journal vouchers are used for all non-income and
non-expense transactions. Examples of usage are as
follow:
Withdrawal of cash from the bank account
(Supported by cheque copy).
Deposit of cash to bank account (deposit
slip receipt attached).
Adjustment to erroneous allocation of
expense or income (with reference of original
income or expense voucher)
Advance clearance where no expense occurred,
e.g. Employee takes a $20 advance, and returns
the full $20 with no transaction occurring.
(Attach Advance Voucher as supporting document)
All Journal Vouchers must have as much
supporting document as is possible. The Journal
Voucher ensures the all recorded transactions in
QuickBooks are supported by a voucher for reference.
11. CASH MANAGEMENT POLICY
Operates predominantly in a cash economy and must
therefore maintain strict control over all cash
which should be managing cash are called" Cash
custodians" and their position are titled" Cashiers
".
11.1 Petty Cash Balance OEC has in place an Impress Petty Cash System.
This means that there is a minimum and maximum
amount of petty cash on hand. The Cashier is
responsible for ensuring that there are sufficient
funds on hand to meet the needs of the office on a
day to day basis, as well as any emergencies. An
impress system is one which constantly maintains
approximately the same maximum level of cash. When
the balance of funds reaches the minimum balance
permitted or we have knowledge that a large amount
of payments are to be made then we will replenish
the balance to the maximum balance by making a
withdrawal of funds, supported by the appropriate
documents.
In all instances cash withdrawals will be made to
bring the cash balance bank to the amount expected
to be required to implement activities. The
following table shows the minimum and maximum petty
cash for the OEC Head Office deemed sufficient.
Office
Minimum Balance
Maximum Balance
Head Office , Battambang
US
$500
US
$1000
11.2 Cash books
Every petty cash box must be supported by a physical
cashbook. The cashbook is a prime book of entry, in
which transaction related to cash only are recorded
in detail. This cashbook is maintained by the cash
custodian. The cashbook columns:
DATE
REF
DESCRIPTION
DR
CR
BALANCE
Date of
the
transaction
Voucher
reference of expense/
advance/
Income
Explanation of the transaction
Amount
of
incoming
cash
Amount
of
outgoing
cash
Running
balance of the petty cash after each
transaction
Every column must be completed in full
with no delays. This means the cashbook entry is
completed at the precise moment the cash changes
hands. All staff that receive or give cash to the
cashier must write their name and sign on the
cashbook if they agree with the amount, date and
explanation. This requires that each staff waits
while the cashier completes each column.
It is not acceptable to leave the name and signature
column blank, or to write something generic such as
"Supplier". Where more than one currency is used,
there shall be 1 cashbook for both currencies. The
columns for amounts will therefore appear as:
DR
US
$
DR
KHR
CR
US$
CR
KHR
BALANCE
US$
BALANCH
KHR
3
3,000
xxx
xxx
Where one transaction is conducted in 2
currencies, the whole transaction should only appear
on 1 line. The above shows an example of the amount
of $3.75. All cashbook must be bound and taken care
of. When not in use, they must be locked in the
cashier's desk drawer.
If the petty cashbox
changes hand a recorded cash count must be conducted
both the giver and the recipient of the petty cash
box, so that both parties are in agreement of the
balance of the cash at the time of handover. Such
instances occur, when the regular cash custodian
will be on annual leave, or when they depart the
organization, or even if they are out of the office
on an errand.
All cash transactions must be accompanied by
an approved supporting document. These documents
will include:
An Advance Voucher
An Expense Voucher
An Income Voucher
A Journal Voucher
No transaction is permitted without the
accompanying, appropriately approved voucher. The
cash Custodian will be held responsible is such an
event occurs.
11.3 Cash Counts A “cash count” is when the physical petty cash
is counted using the cash count form, to verify the
balance on hand. The cash count balance is compared
against the balance stated in the cashbook, which is
why it is imperative that the cashbook is completed
immediately upon every movement of cash. There are
serious consequences if; the cashbook is not
maintained as such; or of the cash count does not
match the cashbook.
Under no circumstances, must a transaction 3 record
if there is no movement in cash, e.g. for cash kept
“aside” for an expected payment. If the cash has not
left the cash custodian, the transaction must not be
recorded. This would results in a discrepancy
between the cash balance and the cashbook balance.
The cash custodian is expected to conduct a recorded
cash count at minimum 3 times per working week. Upon
these counts, only 1 signature will appear in the
cash count form. A second counter is required to
conduct a recorded cash count at minimum once per
week. The second counter may be; a Finance Manager,
Assistant Accountant , Administrator. In these
instances, 2 signatures must appear in the count
form.
Form time to time a “Surprise” cash count must be
conducted. These are cash counts where the cash
custodian is not expecting a cash count. Once a
declaration has been made to the cash Custodian of
the intention to conduct a surprise cash count, the
process shall be as follows:
The cash count must take place immediately
(not e.g. after lunch).
The surprise cash counter must remain
present and observe the cash custodian
retrieving the cashbox (from the safe or their
desk drawer).
The cashbook and cash count book must be
given to the surprise cash counter.
The surprise cash counter must write
“Surprise Cash Count” on the cash count sheet
and the date.
The Cash Custodian must observe the cash
count being conducted.
The surprise cash counter should match the
cash balance against the cashbook.
It is therefore imperative that the surprise cash
counter decides on an appropriate time for both then
to count the cash and for the cashier to be
available. If any discrepancies are found, these
must be reported to the Finance, Project manager,
Technical Advisor and Executive Director.
Any senior management member, Project Manager, or
Technical Advisor is authorized to conduct a
surprise cash counter at any time.
11.4 Petty Cash Office Hours
Cash custodians are often have other
responsibilities in their daily work, aside from
managing the cash. For this reason, all program
offices have “Cash Office Hours”. Only during these
hours, the cashier is available to give/receive
cash. In exceptional emergency circumstances, e.g.
emergency hospital costs for a beneficiary, which
may be out of cash office hours, the cashier will
provide assistance and issue cash as needed.
11.5 Security of Petty Cash
Out of cash hours, all petty office will be kept in
a lock safe. All safes have 2 required entry keys,
which include a numeric combination and a steel key.
Arrangements may be made in the office, whereby 1
authorized employee has the key to the safe, and
another staff has combination code, resulting in
requiring 2 person to open the safe at all times.
This may not always be feasible and therefore it is
not a compulsory requirement.
During cash office hours, the cash will be
secured in locked desk drawer. Under no circumstance
must cash be left unattended. If cashier leaves
their desk, the cash must be locked in drawer and
keys shall remain with the cashier. It is
unacceptable for staff to take home the cash box
contents, for any reason.
11.6 Discrepancies in Cash Counts Cash custodians are expected to work with
precision and accuracy at all times, as they hold a
major and vulnerable asset of organization. As such,
unreported discrepancies and major unexplained
discrepancies will be taken very seriously.
Should the Cash custodian find a discrepancy
between the physical cash balance and the cashbook
balance, they must report this immediately to their
Manager and Finance Manager, before attempting to
resolve the difference. They must never attempt to
rectify any difference by contributing their own
cash or taking out cash.
Senior Finance staff may decide to rectify small
differences by allowing adjustments, with the
support of the Journal Voucher, however such
adjustments must be infrequent and of significantly
low value (e.g. US$1 equivalent).
Cash reconciliations are conducted by a finance
staff member separate from the cash custodian. The
cash reconciliations will compare the updated
QuickBooks petty cash balance, against the cashbook
and the cash count record. All reconciliations must
be document and signed.
12. THE ACCOUNTING SYSTEM
a/
Accounting Procedures 12.1 The prime entry record to the QuickBooks
system is the cashbook. As the prime entry record it
is imperative that recording be correct and
description listed be clear and easily interpreted
by someone outside the project. The cashbooks should
detail and reflect all transactions made. 12.2 It is necessary that the vouchers are
correctly codes as these are entered on to the
cashbook (see below). 12.3 After the cashbook, the vouchers are
entered into the QuickBooks system in voucher order.
This must be done daily to ensure month and
reporting is not delayed. 12.4 Vouchers to be entered into QuickBooks
(“Make General Journal Entries”) include expenditure
vouchers; advance vouchers, income vouchers and
journal vouchers.
b/ Voucher Coding
All vouchers must be numbered/ coded. The code in
voucher identified what type of voucher it is, the
month and year, and an assigned number to that
voucher. Every expenditure voucher/transaction in
the cashbook is identified separately by the voucher
number, e.g.
2digit code: Number of the transaction
PV= Expense Voucher which is consecutively
RV= Receive fund (Donor) Voucher numbered, starting
at 001
c/ Chart of Accounts
Operations Enfants du Cambodge uses a global Chart
of Accounts for all transaction. All accounts have a
numerical code that must be written on each
expense/income voucher. When expense vouchers are
entered into QuickBooks, each transaction is
allocate to an account code. Monthly and annual
Statement of Receipts and Disbursements are
completed using the Chart of Accounts. For internal
reporting purposes.
13. MONTHLY FINANCIAL REPORTING PROCEDURES
Monthly reporting must include:
Statement of Receipts and Disbursements
Statement of Financial Position (Balance
Sheet)
Statement of Changes in Equity
The financial statements must show 2 balances
that equal:
Surplus/deficit of fund receipts
Net assets/Working capital
If the 2 balances are not matching this
indicates lack of double-entry use or error, and
must be corrected.
All reports must be distributed by the 10th of the
month to finance Manager, Project manager, Executive
Director and relevant Project Management staff.
The QuickBooks files must be backed-up in the online
Drop Box at minimum monthly.
14. RATE OF TRAVEL ALLOWANCE AND PER DIEM a/ Travel Allowance