Finance Authorization Policy     

Purpose of the Policy

All finance transactions as noted in this policy are to be authorized by the noted authorized person prior to the transaction being undertaken. Moreover, budget should also be prepared before commencing next financial year or month. Furthermore, budget should also be tracked with the actual results and authorized person of each section are responsible for this task. It will definitely reduce the risk of misappropriation of funds.

This policy is to be read in conjunction with other specific finance policies where relevant.

 

Procedures

Prior to any of the following finance transactions being undertaken, the authorising person noted must authorize the transaction.

Where additional policy is noted, this policy must also be adhered to when undertaking the finance transaction.

Finance Transaction	Authorized Person
Bank Accounts	CEO/Finance Manager
Issuing Petty Cash	Senior Managers
Business Credit Card	Senior Managers
Authorizing New Customers	Finance Manager
Authorizing New Suppliers	Finance Manager
Purchasing Stock	Senior Managers
Purchasing Assets/ Equipment	CEO
Debt Collection	Senior Managers
Payment of Invoices	Senior Managers
Preparing of Budget	General Manager

Petty Cash Policy

Purpose of the Policy

Petty cash should be used to pay for small business expenses up to $100 where payments through accounts payable or credit card are not justified or appropriate

Procedures

Issuing Petty Cash

Petty cash vouchers must be completed before any cash is taken from the petty cash float.

Only up to $100 can be disbursed at any one time.

All petty cash vouchers issued must be approved by a Senior Manager.

Once the petty cash is spent, a receipt or invoice should be attached to the voucher and returned to petty cash with any balance of monies unspent

All completed vouchers must have the following details included:

• Issue date of voucher;
• Name of person issued the voucher;
• Amount of monies disbursed;
• Details of expense;
• Invoice or receipt; and
• Signature of approval person,

Reconciling Petty Cash

Petty cash float is to be reconciled at least monthly. This is the responsibility of {insert relevant job title here}

All petty cash expenditure must be entered into the financial system once the petty cash has been reconciled.

The balance of monies and vouchers must equal the petty cash float amount before reimbursement can be made.

Reimbursement of petty cash will be authorized by a Senior Manager.

 

Use of Business Credit Card Policy

Purpose of the Policy

This policy provides guidelines for the issue and use of business credit cards.

Procedures

An employee will only be issued a credit card once the Credit Card Authorization Form has been completed.

The business credit card can only be used for travel, authorized entertainment and purchases of small value expenses or equipment up to the value of $500.

No cash advances are to be taken using the business credit card unless authorized by the Finance Manager.

Where a business credit card is lost or stolen, then the owner of this card is to notify the Finance Manger who is responsible for notifying the issuing agency and ensuring the card is cancelled.

The use of the business credit card is not to be used for personal expenses.

All holders of business credit cards are required to reconcile the monthly credit card statement to the expense form, attach all receipts for payments made on the credit card and have the expense statement authorized by the Finance Manager.

Upon completion and authorization of the monthly expense statement, these documents are to be forwarded to the Finance Manager for payment of the credit card statement.

All business credit cards are to be returned to the business when the person is requested to by the Finance Manager or where they are no longer an employee of the business.

New Supplier Policy

Purpose of the Policy

All new suppliers to the business must be reviewed and accepted in accordance with this policy to ensure that the supplier service is aligned with the business objectives.

Procedures

Choosing a New Supplier

A new supplier must provide our business with quality products, great service, competitive pricing and efficient delivery.

For each new supplier the following information table must be completed prior to agreeing services

Supplier Selection Background Information

Business Name of Supplier: ____________________________________________________

Location of Supplier: __________________________________________________________

Products/Services provided by supplier: ___________________________________________
(Attach a list if necessary)

Name of business owner/ sales representative:_____________________________________

How many years has the supplier been trading?:____________________________________

Supplier Selection Review Checklist

For each new supplier being considered the following checklist must be completed

Is the supplier pricing competitive? Attach list to this checklist: _________________________

What are the payment terms for this supplier? ______________________________________

What is the return policy for this supplier: __________________________________________

Does the supplier provide warranties, guarantees etc.? : _____________________________

Are the suppliers representatives knowledgeable of the products/ services and industry?: ___

Is there an alternative to this supplier, has the alternative supplier been considered?: ______

What are the delivery services of the supplier?: _____________________________________

Has a credit check been undertaken for the supplier (attach to this checklist) : ____________

Has the Personal Property Securities Register (PPSR). been reviewed: _________________

Has the supplier been trade checked (attach this to this checklist): _____________________

{insert additional information required to assist in the decision of appointing a new supplier }

Appointment of Supplier

The appointment of a new supplier will be authorized by the Finance Manager.

All relevant details of the supplier will be entered into the financial system by Administration Assistance once approval is obtained from the Finance Manager.

The Finance Manager will review information entered into the financial system and independently verify the bank account or other payment details of the supplier to ensure payments made are to the correct supplier

Supplier Payment Terms

All purchases from suppliers must be supported by a purchase order – refer to the Purchasing and Stock control policy

Payment terms for all suppliers must be reviewed by {Insert relevant job title here} every {Insert timing of review here, recommended at least once a year}.  Following this review each supplier must be approached to seek improved payment terms by Finance Manager.

All supplier payment terms must be a minimum of 30 days.

Any variation to the above must be authorized by Finance Manager.

All supplier payments are to be reviewed once a quarter to ensure that payment terms are adhered to.  For payments made to any suppliers earlier or later than the agreed terms.  The Finance Manager will prepare a report that details the reasons why payment terms have not been adhered to.

This report will be reviewed and authorized by the CEO.

Purchasing Policy

Purpose of the Policy

This policy provides guidelines for the purchase of goods, services, equipment and assets Grow Management Consultants.

This policy is applicable for all purchases over $100.

Where items to be purchased are less than $100, then the petty cash policy is to be used.

Procedures

Request for Purchase

All purchases for business items must be requested through a purchase order.

All items over the value of $1,000 must be supplied by authorized suppliers.

For items over the value of $5.000 three quotations must be provided.

A request for purchase must address the following criteria:

• Purchasing that promotes environmental sustainability;
• Value for money; and
• Preference to Australian/locally produced.

All purchase orders must be authorized within the following guidelines:

Items Purchased	Persons Authorized
Office supplies	Administration Manager
Equipment	Finance Manager
Assets	CEO
Travel	Administration Manager

All authorized purchase orders are to be copied and one distributed to accounts payable with estimated payment date and one to the Administration Manager who will check receipt of purchase against the purchase order when received.

Equipment Asset Purchases

All equipment and asset purchases must be entered in the financial system by the Finance Manager with the following details included:

• Date of purchase;
• Supplier; and
• Make, model, warranty/guarantee information.

Receipt of Purchases

All purchases received are to be checked against purchase order and noted as correctly supplied.

Once correct receipt has been recorded, this will be recorded on purchase order and forwarded to accounts payable for payment of purchase.

 

Budget Policy

The company must make the month to month budget before the next financial year. The budget should include all the budgeted income and expenses. It should be annually, half yearly and quarterly.

Procedure

Preparing budget

The budget should be prepared by the general manager by using the previous year’s financial data, strategic business plan and objectives. Budget should be discussed with other managers before making it the final. Moreover, every staff person will be informed about the budget so that they would set their objectives accordingly and departmental managers are responsible for keeping the budget and set plans accordingly.

Monitoring Budget

Each manger of different department must monitor the budget after a week (Monthly budget) or a month (Annual budget) so that the company would monitor its expenses. It should be monitored through data collected in accounting software.

If the actual expenses exceeded the budgeted expenses so the manager must assess the condition form where the expenses have increased. Then quality management must be implemented to reduce further costs so that actual expenses would be under budget limit.

If there was the genuine case of increasing expenses so company must approve additional funds. Genuine case might be when the market rent of the conference room increased.

Tracking of Income and Expenses

Company should track all the financial transactions against the consistent income and expenses account in line with the budget. These income and expenses and be tracked through financial management software.

Income

To ensure the accurate and consistent tracking of income so the following income streams must be monitored:

1. Consulting
2. E book
3. Executive search
4. Annual Conference

Expense

To ensure the accurate and consistent tracking of expenses so the following cost streams must be monitored:

1. Salaries and wages
2. Superannuation
3. Accounting fees
4. Cost of sales
5. Utilities
6. Repairs
7. Computer software
8. Motor vehicle expenses
9. Loan expenses
10. Advertising and marketing
11. Travel and accommodation
12. Office supplies
13. Rent
14. cleaning

 

Aged debtors and debt recovery Policy

The company has the strict aged debtors and debt recovery policy so that it would be receive the credit amount from the customers as soon as possible. Senior managers are responsible to send invoices or statements to the credit customers are regular basis.

If the customers or debtors did not pay the amount which was stated in their respective sale contract so senior managers have the right to impose penalty or interest on overdue. Moreover, new invoice template will be sent which will include penalty section.

Furthermore, 5% discount will be given to those customers who will pay the amount in 15 days.

 

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