FINANCE POLICIES & PROCEDURES PAYMENT PROCESSING

Transcription

1 FINANCE POLICIES & PROCEDURES PAYMENT PROCESSING EFFECTIVE DATE: March 2007 REVISION/REVIEW April 2011 DATE APPROVED BY BOARD OF DIRECTORS: Signed: Garry Cooke April 2011 SCOPE: All authorized employees. RATIONALE: To provide guidance and principles for the processing of payment of invoices. POLICY STATEMENT: Invoices are processed and paid by cheque or direct payment, properly authorized and supported by documentation according to generally accepted accounting principles and sound financial practices. REFERENCE: Petty Cash Funds Policy Fraud Policy Purchasing & Procurement of Goods and Services Policy Bank Account Policy Financial Signing Authority Policy Page 1 of 4

2 PAYMENT PROCESSING - PROCEDURES PAYMENT RESPONSIBILITY The Manager, Finance Services is responsible for ensuring bank accounts are maintained in compliance with sound financial practices. Employees authorized to pay with debit card and/or credit card adhere to all CLOC policies and procedure. The finance department personnel are responsible to ensure appropriate authorization and documentation in accordance with policy and practice. All personnel in the finance department are required to sign the Standards & Procedures for Finance Department form. Signing officers are responsible for ensuring payments are only made for items that are properly authorized. DEFINITIONS Payee means the person or company to whom a payment is made. Voided cheque means a cheque that has been classified by CLOC as unusable/cancelled. INVOICE PAYMENT Payment Processing: All invoices are stamped and coded with vendor number, HST applied to appropriate rebate account upon receipt. All invoices are paid no later than two (2) weeks from receiving. Interest or late fees are to be avoided. Any exception to this, due to unavoidable circumstances, is brought to the attention of the Manager, Finance Services prior to payment, for approval by initial and date. All invoices are approved according to Purchasing & Procurement of Goods and Services before payment. Financial issues are dealt with in a professional manner. Information is considered confidential. Any release of information is approved of Executive Director or designate. Page 2 of 4

3 PAYMENT PROCESSING - PROCEDURES PAYMENT BY CHEQUE Blank Stock: Blank cheque stock is pre-numbered Blank cheque stock is kept in a secure location Voided cheques are retained and the word VOID handwritten or stamped across them. For cheque voided after signed the signatures are to be removed from the cheque. All copies of the voided cheque are to be fastened together and filed with the numerical filing copy (see Cheque Copies below). Cheque Authorization: All cheques are authorized by a Purchase Request form or by an properly authorized invoice. The completed Purchase Request Form is approved as per the Purchasing & Procurement of Goods and Services form. The complete payment package consists of an invoice, and if applicable, receiving report and/or purchase order. Evidence of approval in accordance with the Purchasing & Procurement of Goods and Services Policy appears on the front of the payment package. Any invoice about which there are questions is placed in a folder and followed up prior to cheque payment process and within one week of receipt. Prohibited Payees: Cheques are not issued in blank, that is, where the name of the payee is not shown Cheques are not issued where the payee is bearer or cash. Cheque Signing Authorities: All cheques require two authorized signatures. No authorized signing officer signs his/her own pay cheque if applicable or practical. Manager, Finance Services or designate reviews cheques prior to going for signature The first cheque signer reviews the supporting documentation and to satisfies that it is reasonable, complete and that the payment has been properly authorized. The second cheque signer ensures that appropriate procedures have been followed and that the cheque appears reasonable. Cheque Copies: The cheque is forwarded to the payee along with any required supporting documentation (i.e. payment stub from invoice / account number). The cheque stub is filed in a sequentially numbered cheque file. Numerical cheques are reviewed and initialed by the Director of Operations quarterly to ensure all are present. Voided cheques, with all copies, are filed in the numerical cheque file. Page 3 of 4

4 PAYMENT PROCESSING - PROCEDURES DIRECT ONLINE PAYMENT / PREAUTHORIZED PAYMENT Payments paid directly through the banking on-line system are managed either by transferring funds per vendor account number or authorizing (pre-authorized payment) the vendor to transfer funds automatically each month. Vendor accounts setup is approved by the Manager, Finance Services. Vendor accounts are setup on the bank pay bill system including a separate Payee and Account number for separate accounts (i.e. utilities). All invoices are properly authorized as per Purchasing & Procurement of Goods and Services Policy. A journal entry is prepared based on invoices paid. All invoices are attached to journal entry. An identifying journal entry descriptor is used for direct payments and is to include a sequential numerical record (i.e. PAY001 ). The journal entry to record payment is completed based on actual activity in bank (each payment process has entry to bank). The journal entry is approved by the Manager of Financal Services or designate by signature Invoices and journal are filed as per copy of cheque, alphabetically in payable files. The Director of Finance & Admin/Manager of Financal Services or designate checks on-line banking account transactions to ensure amount withdrawn agrees with authorized payment. ELECTRONIC FUNDS TRANSFER Individualized funded Service Contracts are paid directly to the payee s bank account. This includes Associate Living Providers per diem payments and individualized funding worker invoice payment where the payee is a Self-Employed Contract Worker engaged by the person receiving support or his/her family. The payee supplies CLOC with the appropriate banking information including name of bank, transit number, and bank account along with a voided, blank cheque. Account numbers are setup through the CLOC bank. For equalized monthly payments (i.e. per diem) a blanket payment journal is established and authorized by the Manager, Finance Services. Authorized invoices are input to the accounting system, setup for transmission to the bank for direct payment, authorized by two signing officers (as per policy) and forwarded to the bank by the Manager, Finance Services or designate for completion. Bank Statement is verified for correct transfer amount(s) within one day of transmission or as per bank policy regarding cancellation A copy of invoices and transmission to the bank is retained in the finance records by date. Signed: Steven Finlay, Executive Director April 2011 Page 4 of 4

5 Standards & Procedures for Finance Department The following are standards for the achievement of quality financial support services for CLOC. Accounts Payable: 1. Invoices received for payment prior to office close on Monday are processed that week. Any invoice and/or request after this time require Director Approval or designate. 2. For any week including a Statutory Holiday on Monday the deadline for invoices is Tuesday at 1 pm. 3. Upon receipt all invoices are stamped and coded with vendor number, HST applied to appropriate rebate account, evidence of receipt of goods/services, price checked to Purchase Order and extensions verified and filed in folder indicated invoices are coded and ready for input. 4. All invoices are paid no later than two (2) weeks from receiving. 5. Any invoice about which there are questions are to be placed in a folder and followed up prior to cheque payment process that week. 6. Interest and/or late fees are to be avoided. Any exception to this, due to unavoidable circumstances, is brought to the attention of the Manager, Finance Services prior to payment, for approval by initial and date. 7. Processes are in place and followed to ensure the following: i. Approval signature/initial as per policy a. Supervisor & Community Service Managers up to$ b. Operation Manager up to $2,000 c. Director up to $5, In order to avoid late fees/interest a cheque for an invoice known to be valid and due will be produced by held by the Manager of Financal Services or designate until invoice is properly authorized. 9. All invoices are stamped paid with cheque number and approved before the filing. 10. Copy of the cheque stub is filed numerically in ascending order. 11. Numerical cheques stubs are reviewed and initialed by the Director of Operations or designate on a quarterly basis. 12. The cheque register(s) is reviewed and initialed by the Treasurer of the Board of Directors on a monthly basis. General Accounting: 1. Bank is reconciled within 5 days of receiving the monthly statement. Journal entries to balance the bank are to be posted to the month relevant to the statement. 2. Month-end for operating accounts is completed by the 10 th of the month (or the first day following the weekend of the 10 th ). 3. Asset & liability accounts are reconciled and verified by the 20 th of the month following 4. All accounts are reviewed with the Director between the 20 th and 25 th of the month. The meeting is to be initiated by the Manager, Finance Services. May 2, 2012 Page 1 of 2

6 OTHER FINANCIAL ISSUES: Cheque Signing, Electronic Transfer Funds or On-line Payments: Two signatures are required for all payments (see Payment Processing Policy) The Executive Director and Director of Operations are to sign cheques whenever possible (see Financial Signing Authority Policy) Financial issues are to be dealt with in a professional manner. Information is considered confidential. Any release of information needs the approval of Executive Director or designate. I have read, understood and agree to meet the standards. Any issue that prevents the above from occurring is brought to the attention of your supervisor or designate immediately. Employee Signature Date Supervisor Date May 2, 2012 Page 2 of 2