STANDARD OPERATING PROCEDURES (SOPs) FINANCE DIVISION HIGHER EDUCATION COMMISSION, ISLAMABAD

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1 1/13 STANDARD OPERATING PROCEDURES (SOPs) FINANCE DIVISION HIGHER EDUCATION COMMISSION, ISLAMABAD INTRODUCTION This dcument utlines the Financial Cntrl Framewrk within the Higher Educatin Cmmissin and explains its business prcesses being fllwed by the HEC Finance Divisin. It will als ensure that internal cntrls are in place and financial pwers are exercised apprpriately, effectively and efficiently. PAYROLL The Human Resurces Department (Administratin Divisin) is respnsible fr establishing and maintaining detailed payrll and pensins prcedures. All payments are made in accrdance with these detailed prcedures and t cmply with ther statutry requirements. Salary Bills are prepared:- 1. HEC Recurring Budget 2. Develpment Budget (fr Prject Staff) SALARY PREPARATION PROCEDURE I) All ffice rders pertaining t appintments are incrprated in Payrll upt 15 th f instant mnth. II) Appintment ffice rders which d nt indicate the prper budget head, perid f cntract are referred back t Administratin Divisin fr clarificatin. III) Office rders are stamped as SAP system. Psted in HEC Payrll dated: after psting in the IV) Payrll duly cmpleted is sent t Audit fr vetting upt 20 th f instant mnth. V) Amendments/crrectins if any made by audit are incrprated in system upt 25 th f the mnth. VI) Transfer letters & cheques f salary are prepared & get signed upt 27 th f the mnth.

2 2/13 VII) Letter are sent t bank n 28th f the mnth fr transfer f salary int emplyees accunt n the last/clsing day f the mnth PAYMENTS Finance Divisin prcesses the cases frwarded fr release f payments, issuance f advances and there adjustments. Finance Divisin is maintaining the expenditures frm fllwing fur types f Budget:- RECURRING GRANTS 1. HEC Secretariat Budget 2. Prmtin f Research 3. Inter-University Academic Activities 4. Recurring Grant t universities, centres 5. HEC, Universities Prgrams Which are further divided int sub heads DEVELOPMENT GRANTS 1. Develpment Grant fr Prjects managed by HEC 2. Develpment Grants fr Prjects managed by Universities. GENERAL The Prject Directr/Officer respnsible fr initiating cases fr advances/releases/ adjustments shuld ensure that: The expenditure is in accrdance with the relevant financial rules/regulatins/ plicies; Budget/PSDP prvisin is available t meet the expenditures. All prescribed cdal frmalities have been fllwed such as; Cllectin f qutatins (wherever applicable) Tender (wherever applicable) has been invited thrugh pen advertisement in press/web sites; Verified cmparative statements; Minutes duly evaluated, signed by the Tender Cmmittee and apprved

3 3/13 by the Cmpetent Authrity. All verified receipts/bills/invices/sale Tax Invices/cash mems (in supprt f payments) are placed in the file. The expenditure is crrectly classified under prper head f accunt. The expenditures have been duly sanctined by the cmpetent authrity specifying: Amunt (in figure and wrds) t be released; Individuals/Parties in favur f which the releases are t be made; and Specific head/sub head f the accunt against which the releases are t be made. All Sanctins are in accrdance with the Delegatin f (sanctining) Pwers as ntified by the Administratin Divisin frm time t time. In case f Head f Accunts titled Cntingencies in case f develpment prjects, the Prject Directrs shuld ensure that sanctining pwer f Rs.50,000/- is nt verrun. If the expenditure is mre than Rs. 50,000/-, sanctin and apprval f Executive Directr is required. In case f meetings f Management/Other Cmmittees, the Prject Directrs are empwered t sanctin the expenditure fr refreshments nly. Apprval f Executive Directr is required in case f meals, accmmdatin, traveling, fficial visit and travel by private cars. All vuchers are supprted by Debit Advices specifying: Amunt (in figure and wrds) t be released; Individual/Parties in favur f which the releases are t be made; Specific head/sub head f the accunt against which the releases are t be made; and Purpse fr which is the amunt is being released. (Specimen f Debit Advice is attached at Annex A ) Entries f articles purchased are made in Stck Registers maintained fr assets/cnsumable stres. The entries f cndemned articles/items are made in the Dead Stck Register. Cpy f PC-Is/Research Prjects (wherever applicable) are placed in the file.

4 4/13 Cpies f Administrative Apprvals f develpment prjects are prvided in the files. Cpies f Award Letters/Purchase Orders/Wrk Orders have been attached and referenced. The explanatry ntes are cmprehensive and self-speaking. The ntes shuld cntain full histry f past releases and rates and parameters used fr calculatins. Dcuments are flagged prperly. Varius HEC prgrams/develpment prjects cntain prvisin fr wrkshps/seminars/curses t be rganized by the departments/institutes/centers f a university and fr which Advances are t be placed at the dispsal f Heads f Departments/Officers f university. In all such cases it is the respnsibility f cncerned PD/Directr/initiating fficer t btain audited statements f expenditures alngwith audited vuchers frm universities fr adjustment. In case f air fare, three verified qutatins are required frm HEC apprved Travel Agents and ne f these qutatins shuld invariably be btained frm PIA directly. The paragraphs (and pages) f nting prtin are prperly referenced. The file cnsists f tw prtins Nte Prtin Crrespndence Prtin Bth prtins shuld be prperly maintained in separate file cvers, prperly tagged, marked page and paragraph numbers and submitted in a file bard. TA/DA CLAIMS FOR REIMBURSEMENT TA/DA claims shuld be made n prescribed TA/DA claim Frm Claim fr the re-imbursement f actual expenditure incurred whlly and necessarily n the business f the cmmissin, must be in accrdance with the apprved rates. TA/DA claims shuld be accmpanied by apprved tur prgram. Supprting vuchers dully verified by the fficer cncerned must be prvided fr the cst f accmmdatin, fares, and ther majr items f expenditure. All clumns f the TA/DA claims shuld be are cmpleted in all aspects.

5 5/13 If persnal car is used then apprval f the Executive Directr may be btained and als car number may be recrded n the TA/DA claim. TA/DA ADVANCE Advance fr travel is made accrding t apprved daily rates. Request fr advance shuld be made by giving details f dates and cuntries t be visited, and breakdwn f the advance required duly vetted by Audit. Claimants must submit full dcuments within seven days f return and the prcess f the claims against advance must be cmpleted within ne mnth f the return date. Advance shuld nt be utstanding fr mre than tw mnths, it must be adjusted after the cmpletin f activity fr which the advance was drawn. DEVELOPMENT PROJECTS Fr Schlarship Prjects, Tuitin fee invice must be: On the fficial letter head pad alng with date f issue, amunt fr the perid/semester, student names, and prgram under the signatures and fficial stamp f the Bursar/Finance Directr. Verified by the cncerned Prject Directr. All releases are bjective based. Apprved Scpe/Targets (financial as well as physical) prescribed in the PC-I, shuld nt be verrun. Peridic Prgress Reprts are duly signed by Supervisr and Head f Department. Statement f Expenditure are signed by Resident Auditr, Supervisr r Head f Department. Minutes f Varius Management Cmmittees duly signed and apprved by the cmpetent authrity are placed in the file. Each case is frwarded fr payment n its permanent (main) file. Partfiles/Multiple Files are avided unless abslutely necessary. All dcuments in supprt f claims f individuals/parties sent fr pre-audit are certified by cncerned Prject Directr, failing which case will nt be entertained in Finance sectin fr Payment. The paragraphs (and pages) f nting prtin are prperly referenced.

6 6/13 Head f Accunt frm which payment is t be made and cmpetent authrity t sanctin the remittance is invariably reflected in the nting by case initiating fficer. In case f every new Schlarship Award, availability fllwing infrmatin/dcuments is ensured thrugh a suitably designed check list: NTS Results with percentage Cpy f NSMC decisins Applicatin frm duly attested by leave sanctining authrity Name f the University / Institute (Jb Place) Jb Status f Awardee & Designatin Subject Status Acceptance Letter Deeds f Agreement duly signed by Prject Directr/dealing fficer f HEC. Study Leave Admissin Letter Registratin Number with registratin date Cnsent f HEC apprved supervisr Recgnized University / Institute Date f start f curse wrk Cpy f relevant pages f PC-I. Installment Details. Date f jining letter. Cnfirmed award and Acceptance letters.

7 7/13 Fllwing checklists may please be bserved while submitting files t Finance Divisin fr prcessing f payments:- S N. 1 Descriptin Yes N The Budget Head (HEC recurring/ Develpment Prject) frm where the expenditure is t be met 2 Balance available in Budget/Prject (PSDP Allcatin) 3 Apprval/Sanctin f the Cmpetent Authrity In case f Schlarship payments, list f beneficiaries are prvided giving details f the perid fr which the schlarship is t be released & cpy f the minutes f NSMC Decisin. In case f purchase, bills have been entered in the relevant stck register and verified by the cncerned fficer. Prper printed bills/invices bearing number have been btained in case f purchases exceeding Rs. 200,000/- and abve tender requirements have been met In case f sle distributr f the firm, an authrized certificate has been btained accrdingly The firm frm whm prcurement is being made is registered with Incme Tax and Sales Tax Department. GENERAL PROVIDENT FUND (GP FUND) SUBSCRIBER S ACCOUNT An accunt is prepared in the name f each subscriber and the amunt f his subscriptin with interest theren is credited. CONTRIBUTION Cntributin f General Prvident Fund in respect f subscriber is made accrding t the prescribed rates as ntified by the Gvernment f Pakistan frm time t time. INTEREST Accunt f subscriber is charged/credited with Interest rate as may be determined fr each year accrding t the methd f calculatin prescribed frm time t time by the Gvernment f Pakistan. Interest is credited with effect frm last day f in each year in the fllwing manner:-

8 8/13 I. On the amunt at the credit f a subscriber n the last day f the preceding year, less any sums drawn during the current year interest fr twelve mnths. II. On all sums credited t the subscriber s accunt after the last day f the preceding year interest frm the date f depsit up t the end f the current year Interest shall nt be credited t the accunt f Muslim subscriber if he infrms in writing that he des nt wish t receive it, but if he subsequently asks fr interest, it shall be credited with effect frm the first day f the year in which he asks fr it. GP FUND ADVANCE An advance may be granted t a subscriber frm the amunt standing t his credit in the Fund with the apprval f the apprpriate authrity t the fllwing reasns:- (a) N advance shall be granted unless the sanctining authrity is satisfied that the applicant s pecuniary circumstances justify it, and that it will be expended n the fllwing bject r bject and nt therwise:- i) fr the repair & renvatin f Huse 80% f the amunt at the credit f the subscriber in the fund. ii) any ther purpse 50% f the amunt at the credit f the subscriber in the fund. NON REFUNDABLE ADVANCE a) 100% f the amunt at the credit f the subscriber in the fund may als be advanced as Nn-refundable t a Gvernment servant, wh has attained the age f 50Years b) 80% f the amunt at the credit f the subscriber in the fund may als be advanced as Nn-refundable advance t a Gvernment servant, wh has attained the age f 45 Years. RECOVERY Recvery f the advance is made in maximum 48 equal installments frm the mnthly salary f the subscribers

9 9/13 HOUSE BUILDING ADVANCE A cmpetent authrity may sanctin the grant f advance t a Gvernment servant fr cnstructin f huse, purchasing a huse, cmpletely recnstructin a huse r extending a huse already wned by him. The advance is granted nly nce in service fr the cnstructin f a new huse and fr the genuine residential requirements f the Gvernment servants himself. In case f cnstructin f a huse at Islamabad, hwever a secnd advance may be granted prvided that the previus advance drawn by him has been repaid in full tgether with the interest. Huse Building Advance may be granted t the extent and subject t the usual cnditins prescribed fr the admissibility f huse building advance. This shall be subject t the fllwing further prvisin:- a) Befre receiving the amunt f advance, r payment f the amunt t the cnstructin agency direct, the Gvernment servant cncerned shuld be required t execute an Agreement in the prescribed Frm, and after the purchase f the huse is cmpleted t execute and register the Mrtgage deed in the prescribed Frm as security fr repayment f the amunt advanced with interest. b) Satisfactry evidence will have t be prduced within 3 mnths f the drawl f the advance t shw that the amunt has been spent n the purchase f huse. This can be dne by shwing the valid legal receipt issued by the cmpetent agency cncerned in tken f the purchase deed. The advance shuld nt exceed 36 mnths pay f Gvernment servant. The advances shuld be paid in installments, the amunt f the each installment being such as likely t be spent during the next three mnths. The brrwer shuld prduce satisfactry evidence befre the sanctining authrity t the effect that the installment previusly drawn has actually been utilized twards the cnstructin f huse and then nly a secnd installment will be paid. All the bills fr the drawl f advances, when presented shuld be dully supprted by the fllwing certificate frm the cntrlling fficer in respect f fficer BPS-16 and abve and frm drawing fficer in respect f thers:-

10 10/13 Certified that the amunt Rs. being installment twards the huse building advance granted t Mr. is likely t be required fr expenditure in the next three mnths, and that I am satisfied that the amunt previusly advances (if any) had actually been utilized fr the purpse fr which it was drawn. ADVANCE FOR PURCHASE OF CONVEYANCE The Gvernment servants may be granted advances fr purchase f cnveyance. ADVANCE FOR THE PURCHASE OF MOTOR CAR A Gvernment servant drawing pay f Rs. 8,136/- p.m. (as ntified by Gvt. f Pakistan frm time t time) r abve may be granted advance fr the purchase f mtr car. The ttal amunt f advance shuld nt exceed Rs. 150,000/- r eighteen mnths pay f the Gvernment servants r the anticipated price f the car whichever is less. The recvery f the advance will start frm the firs issue f pay after the drawl f the advance and will be cmpleted in 60 (sixty) equal installments. It may be recvered in smaller number f installments if the Gvernment servant cncerned s desires. The recvery f interest wuld cmmence frm the mnth fllwing the mnth in which the recvery f the principal amunt is cmpleted. At the time f drawl f advance the Gvernment servant shuld execute an agreement in Frm G.F.R.16. The cntrlling fficer shuld scrutinize the agreement and recrd a certificate n the bill that the agreement is in rder. ADVANCE FOR THE PURCHASE OF MOTOR CYCLE An advance fr the purchase f mtrcycle may be granted t a Gvernment servant drawing pay Rs. 2,926/- (as ntified by Gvt. f Pakistan frm time t time) and abve. The advance shuld nt exceed eighteen mnths pay f the Gvernment servant f Rs. 50,000/- r the anticipated price f the mtrcycle whichever is less. Other cnditins will be same as in the case f mtr car.

11 11/13 ADVANCE FOR PURCHASE OF BICYCLE Advance fr purchase f bicycle may be granted t Gvernment servants subject t the fllwing cnditins:- a) The amunt f advance shuld nt exceed Rs /- b) Recvery t be made in 30 installments INTEREST FEE LOANS N interest shuld be charged n the huse building and cnveyance advance drawn by a Gvernment servants whse depsits in the Prvident Fund carry n interest subject t the fllwing cnditins:- a) The Gvernment servant has nt received n his Prvident Fund accumulatin prir t the drawl f the advance frm Gvernment. b) If at any time in future the Gvernment servant wh has availed himself f this cncessin chses t take interest n his G.P. Fund depsits, he will be required t pay in full t the Gvernment the amunt f interest accrued n the advances drawn by him frm Gvernment.

12 12/13 Annex A HIGHER EDUCATION COMMISSION Finance Divisin Ref : (File N.) Dated: Frm : T: Subject: Name f PM/PD Official Designatin Higher Educatin Cmmissin Islamabad Directr General Finance Higher Educatin Cmmissin Islamabad Release f schlarship funds under (Name f the prjects/scheme) Please arrange t release an amunt f Rs. 200,950/- (Rupees tw hundred thusand nine hundred fifty nly) in favur f (by giving full particular f the payee) n accunt f (purpse f the payment with full descriptin) frm the:- Prject : (Name f the Prject) Head f expenditure (accrding t Administrative apprval/cash plan prvided) Signed/- (Name & Designatin f PM/PD) Cpy t :- Cncerned departments Nte: in case f funds are t remitted t abrad fllwing infrmatin are pre-requisites t materials the transfers: Title f Accunt: Accunt N. Name f Bank

13 13/13 Bank Address ABA/IBAN N. Swift Cde. Any ther additinal infrmatin prvided fr safe transfer f funds