CORPORATE POLICY AND PROCEDURE

CORPORATE POLICY AND PROCEDURE POLICY CATEGORY Accounts Payable Policy and Procedure Finance AUTHORITY RELATED POLICIES APPROVED BY Finance Purchasing Policy Purchase Order Policy & Procedure Human Resources Policy Manual Treasurer EFFECTIVE DATE 1 September 2012 REVISION DATE On review of Purchasing Policy 1. POLICY STATEMENT In order to aid the Municipal staff and Council in understanding Accounts Payable policies and in the prompt and effective processing of invoices and other payment requests, the following policies and procedures should be followed. 2. CONTACT INFORMATION Questions and Comments If you have questions dealing with Accounts Payable issues, please contact one of the individuals listed below, either by phone or e-mail. Accounts Payable Clerk, Ext.1109 Sharron Knox sknox@meaford.ca Deputy Treasurer, Ext.1111 Michael Humble mhumble@meaford.ca Forms and related documents may be found in the Shared S Drive under Forms. 3. PROCEDURE FOR SUBMITTING INVOICES AND EXPENDITURE REIMBURSEMENT REQUESTS The Accounts Payable Department wants to provide the best service possible to our customers. Your compliance with the procedures below will ensure that all invoices and reimbursement requests are processed in a timely and efficient manner and that requests for payment are all paid within 30 days of invoice date. Material Requisition/Purchase Orders Purchasing is to take place in accordance with the Municipality of Meaford Purchasing Policy. Unless exempted by the Municipality of Meaford Purchasing Policy any purchase or commitment over $2,500 will require a Purchase Order. This procedure should be in accordance with the Municipal Purchase Order Policy & Procedure. 1 MUNICIPALITY OF MEAFORD CORPORATE POLICY AND PROCEDURE MANUAL

Delivery of Invoices to Accounts Payable Invoices should be sent directly to the accounts payable department by the vendor. The Customer Service Clerk stamps the invoices with the date of receipt and an approval stamp. The Accounts Payable Clerk sorts the invoices into department folders/mailboxes on a daily basis. These are to be picked up by departments at least once a week, by Tuesday at the latest. Approvals Required At the department level, each invoice is verified by the person who placed the initial order. They are to acknowledge that the work was done, the price charged was correct, and the goods were received or the service was performed as invoiced. The Director of the Department then approves the invoice and is ultimately responsible to ensure that invoices are appropriate, accurate and charged to the correct budget line. Directors can only approve invoices / requests for payment that are coded to their own budget lines. Invoices originating from a Director s purchasing activity will be approved by the Treasurer or Deputy Treasurer. If expenses are shared between departments, written approval, including email authorizations, must be obtained from both budget managers. The Director is responsible for approving the invoices in a timely manner, and returning to the Accounts Payable Clerk within one week. Should an invoice be received in error, please let Accounts Payable know immediately so that it can be forwarded to the appropriate department. Frequency of Cheque Runs The Accounts Payable Clerk processes cheques one time each week on Fridays. Approved invoices with complete supporting documentation must be received by close of business on the prior Tuesday. Processing Time/Cheque Distribution for Invoices Properly authorized and coded invoices will be paid 30 days from the invoice date. All cheques will be mailed unless otherwise stated. Processing Time/Cheque Distribution for Reimbursements Properly authorized and coded requests for reimbursement will be issued within 14 days of receipt in the Accounts Payable Department. All cheques will be held for employee pickup unless otherwise stated. Original Invoice Required Payment should not be made from anything but an original invoice in order to prevent duplicate payments. Packing slips, quotes, sales orders and statements will not be accepted for payment. It is the responsibility of each department to provide an original invoice wherever possible. If for any reason a copy must be submitted, the top of the invoice should be marked "Copy". Please avoid placing approval signatures and account coding on the remittance portion of any invoice, as this part of the invoice must be returned to the vendor. 2 MUNICIPALITY OF MEAFORD CORPORATE POLICY AND PROCEDURE MANUAL

Account Coding Invoices and reimbursement requests must be coded with the correct company, business unit and object code. Any request over $1,000 must also include a PO number (see Purchase Orders Policy and Procedure for directions). Invoices and reimbursement requests submitted with invalid account coding will be returned. Remittances Requiring Enclosures with Cheques Any forms to be included with the cheque when mailed should be sent with the invoice along with a note to include the documents with the cheque when mailing. The Accounts Payable Clerk will be responsible for enclosing the document with the cheque. Accounts Payable Clerk Voucher Processing Once invoices are returned from the departments each week, the Accounts Payable Clerk reviews: the G/L account recorded on the invoice to make sure it s valid and appropriate, that verifying and approving signatures are in place, The appropriateness and reasonableness of the expenditure, and questions anything that looks unusual before recording the invoices in the accounts payable module of the financial system. The financial system (Keystone) will not allow the posting of an invoice if it will put the account over the allotted budget. If this happens, the department head contacts the Deputy Treasurer for corrective action. After entering the invoice, an Invoice Edit List is printed and the individual invoice details are confirmed back to the invoice. The invoice is then posted, and a Posting Summary Trace is printed. At this point the invoice has been recorded in Keystone as an account payable. The cheque run to pay outstanding invoices (according to vendor payment terms) is usually done weekly, by Friday afternoon. The Accounts Payable Clerk confirms that the next cheque number to be issued by the computer agrees to the cheque number on the next cheque. If a cheque has to be voided, it is filed in a void cheque file.. All cheques are accounted for. The cheques and invoices are matched up and the cheque stub is attached to the invoice and forwarded for signature. Authorized cheque signers are any one of Mayor or Deputy Mayor, combined with any one of Treasurer or Deputy Treasurer. The invoices are provided with the cheques to the signers for their ongoing diligent review prior to signature. No signature stamps are used. All cheques are signed by hand. The Accounts Payable Clerk reviews all statements to ensure that the invoices have either been paid or are waiting for payment. Suppliers are requested to supply copies of missing invoices so that all invoices are recorded in the financial system. Once all entries have been accounted for on the supplier statements, they are filed alphabetically. 4. ELECTRONIC FUNDS TRANSFER PAYMENTS Due to the short time frame from receipt to payment date for utilities, these accounts are set up for automatic payment. The Accounts Payable Clerk posts these automatic payments from spreadsheets that are verified when the Finance Clerk performs the bank account reconciliation at month end. 3 MUNICIPALITY OF MEAFORD CORPORATE POLICY AND PROCEDURE MANUAL

At the time of posting the Accounts Payable Clerk compares usage of current month to prior month and to the same month in the prior year. If anything appears out of the ordinary the Accounts Payable Clerk contacts the department. Due to the large volume, utility invoices are no longer sent out to the departments. Department heads can request to review their utility accounts or request printouts. 5. PETTY CASH Petty cash funds are intended to be used for small, incidental purchases. Petty Cash is not to be used to pay for personal expenses or normal operating expenses within your department. For all other requests a cheque request must be submitted. 6. CREDIT CARD Credit cards may be issued to employees if the operational need can be substantiated based on need and convenience. Credit cards are not intended to replace purchase orders and cheque payments to vendors for goods and services purchased. Invoices billed to the Municipality of Meaford are not to be paid by credit card. Staff wishing to use the general corporate credit card (issued in the name of the Treasurer) will need to complete the Visa Purchase Request form and have the use approved by the Treasurer or Deputy Treasurer prior to using the card. This process is necessary to facilitate invoice matching to the credit card statement. At the end of each billing cycle, the Cardholder will receive a monthly statement of account from the bank listing the Cardholder s transactions for that period. Each purchase on the credit card statement is considered a separate request for payment and needs to be supported by properly authorized and coded receipts when submitted to Accounts Payable. The cardholder will attach the original sales documents (packing slip, invoice, cash register tape and credit card slips, etc) for all items listed on the monthly statement. This data attachment is CRITICAL to enable audit substantiation. The careful matching of complete support documents, including receipts, to the statement is vital to the integrity of our financial controls. It is the Cardholder s responsibility to submit the signed and reconciled statement, along with the original receipts to Accounts Payable by the 24th of each month to ensure processing before month-end. The approving authority will check the Cardholder s monthly statement and confirm with the Cardholder the following items: Receipts and shipping documents exist for each purchase. The goods were received or the services performed. Detailed explanations for purchases are included. The approving supervisor s signature on a Cardholder s monthly statement indicates that the Cardholder s purchases are authorized, and that those purchases were made in accordance with applicable procedures. Misuse of credit cards will be cause for immediate revocation and may also be reason for disciplinary action up to termination. 4 MUNICIPALITY OF MEAFORD CORPORATE POLICY AND PROCEDURE MANUAL

7. TRAVEL REIMBURSEMENT / EXPENSE REPORTS The Municipality of Meaford will reimburse its employees for authorized expenses incurred while fulfilling their responsibilities as employees of the Municipality in accordance with the Human Resources Policy Manual. Expense reimbursements should be requested using the Expense Claim form. Attach appropriate original expenditure receipts to the Expense Claim form. Expenditures will not be reimbursed without appropriate receipts. Expense Reports are to be submitted no later than five days after each trip ends or monthly if expenditures are incurred on an ongoing basis. Individuals with budgetary responsibility cannot approve their own expense reimbursements. Your supervisor must sign and approve the Expense Report before reimbursement will be made. Hospitality Expenses Hospitality charges include entertaining visitors for business purposes. The following detail must be documented in order to be a viable business expense. Amount Date Place and description of entertainment Purpose and nature of discussion Names, titles and business relationships of all persons attending Receipts are required for reimbursement and details must be written on each receipt or described in the appropriate area of the Expense Report if reimbursement is needed Miscellaneous Reimbursable Expenses Miscellaneous reimbursable expenses include tolls, postage, faxes, baggage handling fees, valet expenses, tips for porters, bellhops, taxi drivers, etc. Non-Reimbursable Expenses Incidental expenses such as personal recreation, movies, snacks, alcoholic beverages or any other personal expense will not be reimbursed. This includes personal travel while on Municipal business, and travel expenses for family members. 8. REVIEW This policy will be reviewed in conjunction with the Municipality of Meaford Purchasing Policy. 5 MUNICIPALITY OF MEAFORD CORPORATE POLICY AND PROCEDURE MANUAL