From: James C. Kweh Sr.

Subject: Internal Audit

Control (Class Project)

Date: September 4, 2018

Submitted to: Richard G.

Greenfield
The Finance departments of many entities do not have written policies
and procedures. This is due to multiple problems including the
unwillingness or inability of the entities to develop and document
policies and procedures.
This project intends to provide participants of the internal control system
class opportunity at preparing a standard operating policies and
procedures manual.
Requirement:
Develop and document Standard and Procedures Manual for the Finance
Department of your sector (entity, Industry, etc). Portions of the manual
will be, submitted by each participant as follow:
Part 1
a) Write up the functions of the Finance Department
b) Identify and list all positions currently in the Finance Department
c) Draw the organogram of the Finance Department
d) Write up Job description for each position identified in ‘c’ above

Part 2
a) Write up the accounting policies
b) Write up code of ethics for the Finance Department
c) Document the chart of accounts
Part 3
a) Write up the revenues, cash receipts, accounts receivable,
collections and banking policies and procedures.
Part 4
a) Write up the purchasing, cash payments (including petty cash)
accounts payable and disbursement policies and procedures.

Answer part 1
a) The functions of the Finance Department

The essential roles and duties of virtually any accounting department

should include the following:

 making payments and keeping the bills paid

 processing incoming payments
 make sure everyone gets paid (including the government)
 preparing financial reports, e.g. P&L, Balance sheets and
budgets
 to avoid errors, fraud and theft
 b) Identify and list all positions currently in the Finance Department

These are the key positions that you’ll find across most business
accounting units.

 Chief Financial Officer (CFO)

 Chief Accounting
 Accounting Manager
 Treasury Manager
 Accountants
 Bookkeepers

c) Draw the organogram of the Finance Department

 Chief
Financial
Officer

Chief Accounting
Accounting Manager

Treasury
Accountants Bookkeepers
Manager

d) Write up Job description for each position identified in ‘c’ above.

 Chief Financial Officer (CFO) CFOs are typically the head
financial executive of large businesses. They oversee the
financial strategy, health of the business, and manage the rest
of the financial department. CFO’s are very forward thinking
and will help businesses navigate through growth stages and
downturns. With their knowledge of company finances, they
help senior management understand the financial impact of
real-time decisions to ensure the fiscal success of the
business.
  Chief Accounting – The chief accountant holds the same
responsibilities as the accounting manager, but the role
simply differs in terms of the job title.

 Accounting Manager – An accounting manager is responsible

for a company’s accounting activities that include
maintaining and reporting on both the cost and financial sets
of accounts but does not handle or negotiate. The accounting
manager establishes and enforces the accounting principles
based on statutory requirements and auditing policy.

 Treasury Manager – The treasury manager’s role in the

accounting department revolves around the formulation and
development of treasure policies. This includes identifying
the best investment opportunities, developing great banking
relations, optimizing credit facilities, and minimizing finance
costs.

 Accountant – Accountants play a key role in finance

departments such as the measurement and interpretation of
financial information. The results of their work ensure
compliance, and provide the groundwork for greater financial
strategies.

 Bookkeepers – Bookkeepers provide the day-to-day efforts

needed to record and assess basic accounting data. They
typically do not take a strategic role.

These are just some of the main roles and functions of the accounting
department in businesses, there are many more responsibilities the
accounting department is responsible for and a number of subcategories.
Those will depend upon the specific nature of your business. For
instance, inventory control and tracking, government forms and tax
filings and fund raising might be other essential areas of focus that your
accounting department would be responsible for.

Defining those responsibilities is essential for your business.  While the

specific roles may vary from business to business, one thing is certain: 
if your accounting department does not perform these key functions
effectively and efficiently, you could be headed for some serious (and
not so pleasant) surprises.

The great news is that if these functions are covered well, you’ll find
that your accounting department creates a solid base and the most
important measurement tool for your company’s entire operation.

Part 2

a) Write up the accounting policies

To be able to set accounting policies it will be prudent to first define the

term Accounting Policies. However by definition Accounting Policies
are set of rules that dictate a company’s financial accounting.

a) When an institution prepares a financial statement or calculates an

advanced method of accounting, it needs guidelines to adhere to. For
examples of accounting policies, to choose depreciation method, a
company needs to follow specific accounting policy.

Accounting policy may vary company to company; but whatever a

company does in regards to accounting policy, it should be in
accordance with the generally accepted accounting principles (GAAP)
or International Financial Reporting Standards (IFRS).

These policies are structures or frameworks for companies to follow. As

the top management sets the benchmarks for maintaining the quality of
the products or services in a company, accounting policy is also set as
benchmarks to represent a sound and accurate picture of accounting
practices within a company.

a) Write up code of ethics for the Finance Department

Code of ethics for the Finance Department shall include

1. Act with honesty and integrity and avoid actual or apparent

conflicts of interest between personal and professional
relationships
 
2. 2. Provide accurate, complete, relevant, timely and
 
understandable financial information internally.
 
3. Comply with all applicable reporting, disclosure and other
rules and regulations.
 
4. Act in good faith, responsibly, with due care and diligence, and
 
without misrepresenting material facts.
 
a) Document the chart of accounts