Preparing An Accounting Procedures Manual By John

Transcript:Preparing An Accounting Procedures Manual By John:
Preparing An Accounting Procedures Manual By John D. Daum, CPA, Partner James W. Gilson, CPA, Partner of Condon O’Meara McGinty & Donnelly LLP Table of contents/Overview 1) Introduction 2) General 3) Billing, cash receipts and accounts receivable 4) Payroll 5) Purchasing, cash disbursements and accounts payable 6) Receiving and inventory management 7) Asset management 8) Property and equipment 9) Club activities 10) Other items for consideration 11) Recent developments 12) In summary Introduction Major reasons for having an accounting procedures manual Changes in the composition of the board, senior management and finance and accounting employees requires that appropriate accounting and internal control procedures be documented for future reference Auditors are required to report to those charged with governance “other findings or issues, if any, arising from the audit that are, in the auditor’s professional judgment, significant and relevant to those charged with governance regarding their responsibility to oversee the financial reporting” (AU 260.12) Not having an internal control process accurately documented would in most cases fall under this requirement. Introduction The accounting procedures manual is a great road map to training new personnel or, in case of emergency, to help keep the accounting department running Documentation of management’s assessment of risks of material misstatement of the financial statements Committee of Sponsoring Organizations (“COSO”) 2013 Framework Control environment Risk assessment Control activities Information and communication Monitoring activities Poll Question # 1 What is the main reason why you should have an accounting procedures manual for your entity? It documents the internal control structure of your entity Accounting standards require that you evaluate and document your internal controls formally It’s a good road map to assist employees in doing their respective accounting functions All of the above Poll Question # 1 D) All of the above General Organizational flow chart Including detailed breakout of accounting department Detailed job descriptions for accounting department positions Accounting and computer system overview Password/Control/Safeguard Protocols Access Data backup procedures - Disaster recovery plan Vulnerability Assessment Record retention policy/storage of old records/permanent documents Reporting General Daily, Monthly, Quarterly, Annual Reports Types of reports to be completed Deadlines Various board/committees requirements and interaction Annual audit, review or compilation process Annual review of various insurance policies Document the responsible person and the timing of renewals Poll Question # 2 When documenting your various internal controls in the accounting procedures manual? You should document them based on what you think they