Petty Cash Procedure | CSH108

Petty Cash Procedure

The Petty Cash Procedure helps outline the disbursement and reimbursement of petty cash. To facilitate minor business expenses, a petty cash fund will be available to employees. This procedure applies to all employees of the company. (6 pages, 586 words)

The Cashier will maintain control of the cash box, Petty Cash Journal, and all petty cash transactions. At the end of each month, or whenever the Petty Cash fund drops below a balance of $20.00, the Cashier will complete a Check Request for reimbursement of cash. The Controller and Cashier should meet periodically (e.g., quarterly) to review Petty Cash disbursements and reimbursements against planned (budgeted) figures, as well as discuss discrepancies and the reasons for them.

Petty Cash Responsibilities:

The Cashier maintains control of the cash box, petty cash journal, and all petty cash transactions.

The Controller audits the cash box, petty cash journal, and all petty cash transactions paperwork submitted to resolve any discrepancies found.

Petty Cash Procedure Activities

  • Petty Cash Fund Control
  • Petty Cash Draws
  • Petty Cash Replenishment
  • Petty Cash Review

Petty Cash Procedure Forms

Accounts Payable Cash Disbursement Procedure | PUR106

Accounts Payable Cash Disbursement Procedure

The Accounts Payable Cash Disbursement Procedure explains practices for documenting, recording and issuing payments for purchasing transactions. It is a critical source of funds in the cash to cash cycle (good review of the nine methods to help your accounts payable).

This Accounts Payable Cash Disbursement Procedure ensures only valid and authorized purchase requests are recorded and paid, it secures the accuracy of the general ledger accounts and ensures appropriate timing of payments. The accounts payable procedure applies to all purchases and describes the responsibilities of the CFO, purchasing, accounting and accounts payable functions as they pertain to the disbursements process. (6 pages, 1556 words)

Properly recording liabilities is generally a three-step process, particularly, for merchandise purchases:

The first step in an accounts payable procedure, is properly recording the liability upon receipt of merchandise, using the purchase order estimates as a guideline. For accuracy and timeliness of data, a liability should be recorded as soon as the company receives the purchased items. By necessity, this initial recording is usually an estimate and can be finalized when the actual invoice arrives. This is why a Purchase Order is so important for merchandise purchases. It documents the company’s understanding of how much each item will cost, per the vendor’s terms. This includes estimates for freight and any other charges.

The second step in an accounts payable procedure, takes place when the vendor’s invoice is received. At this point the actual liability is finalized, with any necessary adjustments to the item costs, freight, or other charges.

The third step involves the preparation, issuance of payment for the goods received, and subsequent filing of all paperwork for easy retrieval.

Accounts Payable Cash Disbursement Procedure Activities

  • Documenting Accounts Payable transactions
  • Recording Merchandise Payable
  • Recording Non-Merchandise Payables
  • Payment of purchasing transactions
  • Manual Checks

 

General Purchasing Procedure | PUR102

General Purchasing Procedure

The General Purchasing Procedure outlines the purchasing actions taken for:

  • purchasing of all inventory, supplies and capital equipment;
  • continuous analysis of inventory usage and balances in order to minimize investment level;
  • completion of related procurement documents.

Vendor selection for inventory and non-inventory items will be in accordance with the vendor selection procedure. The reorder quantity of standard inventory items will be determined per available stock on hand in conjunction with the requirements to satisfy the monthly sales plan. Each day the inventory file should be reviewed on a line-by-line basis to determine the items that have reached a reorder point.

The procurement policy involves maintaining investment in your company’s physical inventory at the lowest effective level and supervising according to regulatory and customer contract requirements. The procurement procedure applies to all inventory, supply and capital equipment purchases and is pertinent to all personnel that require a product or service. (16 pages, 1747 words)

General Purchasing Responsibilities:

All Employees that require a product or service must complete purchase requisitions specifying items for purchase and obtain required approvals.

The Purchasing Manager is responsible for using good procurement methods, optimizing price savings, quality or value of products, vendor working relationships, assuring proper inventory control and inspections, maintaining raw material inventories, placing orders with approved suppliers, negotiating pricing with suppliers, and forwarding all paperwork to the Accounting Manager for payment.

The Accounting Manager and Accounts Payable are responsible for payment of procurement invoices only after satisfactory completion or delivery of goods or services has been made.

The Receiving Manager and Warehouse Personnel are responsible for receiving, inspecting materials, and forwarding all paperwork to the Purchasing Manager.

General Purchasing Procedure Activities

  • Purchase Order Determination and Requisition
  • Purchase Order Placement
  • Procurement Recordkeeping and Matching
  • Sundry Purchases

General Purchasing Procedure Forms

 

Inventory Control Procedure | INV101

Inventory Control Procedure

The Inventory Control Procedure outlines guidelines for controlling inventory stock for ultimate salability, usability and traceability, and ensuring efficient selection and delivery of products.

This Inventory Control Procedure should be utilized by purchasing, shipping, receiving, warehouse and accounting personnel. (8 pages, 1990 words)

Be sure to rotate inventory on a first-in, first-out (FIFO) basis, particularly food products and other perishables, when stocking shelves. It’s common to put newly purchased items on the shelf in front of the older items. Instead, remove the older items from the shelf first, and then place the new items on the shelf followed by replacing the old items to the shelf but now in front of the new items. This will help keep the inventory fresh.

Inventory Control Responsibilities:

The Purchasing Manager is responsible for maintaining the investment in inventory at the lowest level, consistent with operating requirements, economy of procurement, financial plan requirements and sound business practices.

The Shipping Manager, the Receiving Manager, and Warehouse Personnel are responsible for the custody and safekeeping of inventory. This includes ensuring that all items in inventory are properly accounted for, that proper procedures are followed for the movement of all inventory, and that all paperwork is forwarded to the Accounting Manager in a timely manner for the proper recording of all inventory transactions.

The Accounting Manager is responsible for processing all paperwork received in a timely manner in order to maintain an accurate inventory status.

The Controller is responsible for revaluing certain inventory items to their Net Realizable Value and for ensuring proper inventory control.

Inventory Control Procedure Activities

  • Inventory Stocking and Storage Control
  • Inventory Usage Control
  • Inventory Protection
  • Inventory Obsolescence
  • Inventory Disposal

Inventory Control Procedure References

  • Food and Drug Administration (FDA) Food Code

Inventory Control Procedure Forms

 

Fixed Asset Capitalization Depreciation Procedure | INV105

Fixed Asset Capitalization Depreciation Procedure

The Fixed Asset Capitalization Depreciation Procedure describes how to delineate capitalization and depreciation methods for various asset groups.

This Fixed Asset Capitalization Depreciation Procedure applies to all acquisitions with more than a one-year useful life expectancy and a minimum threshold amount as specified by the controller. (4 pages, 1232 words)

Fixed Asset Capitalization Depreciation Definitions:

Capitalization – Capitalization is the method chosen to record the purchase of a fixed asset on the company’s accounting books. If an asset is capitalized then it is not expensed in the same year the asset is purchased. Instead the asset is generally recorded on the balance sheet and individually on an asset schedule. Examples of capital expenditures are purchases of land, buildings, machinery, office equipment, leasehold improvements, and vehicles. The asset is expensed each year as depreciation.

Depreciation – is an annual income tax deduction that allows the write-down or write-off of the cost of the asset over its estimated useful life to recover the cost or other basis of certain property over the time the property is used. It is an allowance expense for the wear and tear, age, deterioration, or obsolescence of the property.

As an asset ages and is used by the company, its’ value declines. It, in effect, becomes worth less and less over time. The declining value or usefulness of the asset over time is represented as a discount that is applied to the original purchase price. At the end of the asset’s depreciation period, (and/or useful life), its value on the balance sheet will be zero, or fully-depreciated. At the same time, the individual depreciation expenses will have all been recorded on the income statement.

Cost basis – The total amount paid for the asset, in cash or kind, is considered the “cost-basis.” This should include all charges relating to the purchase, such as the purchase price, freight charges, and installation, if applicable. The cost basis is not the market value or list price of the asset. It is the total amount invested in the purchase or the total amount paid.

Fixed Asset Capitalization Depreciation Procedure Activities

  • Assets Capitalization
  • Assets Depreciation

Fixed Asset Capitalization Depreciation Procedure References

  • IRS Publication 964 “How to Depreciate Property”

 

Account Collections Procedure | REV109

Account Collections Procedure

The Account Collections Procedure provides the methods for processing late or delinquent accounts.

The Account Collections Procedure ensures an optimum accounts receivable turnover ratio through timely and effective handling of late payment activity. This payment collection procedure applies to the credit department involved with collection of past due accounts receivable and sales or shipping departments. (8 pages, 981 words)

No matter how careful customers are screened prior to credit approval, slow pay or delinquent accounts will occur from time to time. Once an account becomes past due by even a few days, the collection process should commence immediately. Studies have shown that the sooner the collection process starts then the more likely that the debt will be collected.

Telephone communication will often speed up the collection process. Credit representatives, when speaking with a delinquent account, should observe a few tips or principles. Make sure to never argue, accuse or be condescending – Verbally fighting or talking down to the customer will only serve to produce negative feelings and may hamper the collection effort. The ultimate purpose is to secure payment, and this is best accomplished without becoming defensive or irritated.

Account Collections Responsibilities:

The Credit Manager reviews all records for a customer to determine a possible explanation for non-payment prior to commencing the collection process. Upon review, they should then proceed with the collection process by completing an REV109 Ex1 ACCOUNT COLLECTION CONTROL Form. This form will assist in planning and tracking the collection effort. Depending on the amount and the customer situation, the representative can choose to follow-up with collection letters, telephone calls or both.

Account Collections Procedure Activities

  • Payment Collection Process
  • Seriously Delinquent or Unresponsive Accounts
  • Working with Collection Agencies
  • Writing off Uncollected Debt

Account Collections Procedure References

  • Fair Debt Collection Practices Act (FDCP)

Account Collections Procedure Forms

 

Travel Entertainment Procedure | G&A103

Travel Entertainment Procedure

The Travel Entertainment Procedure provides guidelines for travel and entertainment expenses as they were actually spent, and ensures all advances arrive promptly and accurately. It also communicates the procedures for reimbursement.

The Travel Entertainment Procedure applies to all departments and individuals who travel or entertain for the company. (12 pages, 1811 words)

Travel Entertainment Responsibilities:

The Travel Coordinator is responsible for making arrangements needed for business travel.

The Accounting Manager will receive and review the expense report documentation and process necessary employee reimbursement.

Travel Entertainment Procedure Activities

  • Travel Arrangements
  • Expense Guidelines
  • Expense Report Preparation and Reimbursement
  • Additional Information Resources

Travel Entertainment Procedure Forms

 

 

Credit Policy Procedure | REV103

Credit Policy Procedure

The Credit Policy Procedure outlines the activities and responsibilities in obtaining a credit approval for a potential customer before sales orders are processed.

The Credit Policy Procedure reduces potential collection problems for your company. The credit policy also provides a process to evaluate and approve new customer accounts or customer credit limit increases through the use of credit scoring. These procedures are to be followed for all credit approvals requested by the Sales or Customer Service Departments for customers interested in open account, lease or rental financing. (16 pages, 3694 words)

This process starts with a credit application. The salesperson should review the application for completeness and accuracy. Missing or erroneous information may result in delays or rejection of the application.

Credit Policy Definition:

Credit scoring is the process of assigning values to various elements of a customer’s credit history and payment performance to quantify its creditworthiness. It is popular because it creates a common, unbiased approach to evaluating credit requests.

Credit Policy Responsibilities:

The Sales Representative is responsible for reviewing Credit Application for completeness and accuracy.

The Credit Manager is responsible for application review and investigation of the applicant’s credit history.

Credit Policy Procedure Activities

  • Credit Application
  • Credit Investigations
  • Credit Approval/Rejection
  • Additional Information Resources

Credit Policy Procedure References

  • Equal Credit Opportunity Act (ECOA)
  • Truth In Lending Act (TILA)
  • Fair Credit Billing Act (FCBA)
  • Fair Credit Reporting Act (FCRA)
  • FRB REG B: Equal Opportunity Act
  • FBR REG M: Consumer Lending Act
  • FBR REG Z: Truth In Lending Act

Credit Policy Procedure Forms

 

Fixed Asset Control Procedure | INV103

Fixed Asset Control Procedure

The Fixed Asset Control Procedure outlines methods for acquiring, disposing and maintaining control of fixed assets to provide reporting assistance and ensure proper internal controls.

This Fixed Asset Control Procedure applies to all capital equipment with a value of $500 or more and with a useful life greater than one year. It includes the responsibilities of department managers and accounting personnel. (10 pages, 1280 words)

Fixed Asset Control Responsibilities:

Department Managers are responsible and accountable for furniture, equipment, machinery, and any other capital assets in their departments and will maintain some type of control over capital assets.

The Accounting Manager will assist and evaluate any department’s capital asset control procedures.

Fixed Asset Control Procedure Activities

  • Asset Acquisition
  • Asset Disposition
  • Asset Records

Fixed Asset Control Procedure Forms

 

 

Inventory Counting Procedure | INV102

Inventory Counting Procedure

The Inventory Counting Procedure offers guidelines to ensure your physical inventory count and inventory ledger is consistent.

This Inventory Counting Procedure applies to all inventory stock from back room, warehouse storage, off-site usage, demonstration or customer loaner purposes. It should be utilized by the inventory control manager and purchasing, sales and marketing, accounting, accounts payable and receivable and warehouse personnel. (12 pages, 2866 words)

It is most important for the Inventory Control Manager to fully understand the POS and accounting system as it relates to inventory, before a physical inventory is taken. This includes an understanding of how the inventory is updated by customer returns, returns to vendors, transfers from inventory to internal use, adjustments for damaged or defective product, and backorders.

The inventory General Ledger balance is affected by every purchase and sale transaction that is processed through the REV102 POINT-OF-SALE (POS) procedure and the Accounting System. To maintain accuracy, one should periodically count the actual inventory on hand and then reconcile that count to the inventory General Ledger balance. Taking a complete physical count of all inventory items is one way to ensure that the balance is accurate.

Inventory Counting Responsibilities:

The Purchasing Manager is responsible for forwarding all paperwork to the accounting manager to ensure that inventory is documented and accounted for properly.

The Sales Manager and the Marketing Manager are responsible for forwarding all paperwork to the accounting manager to ensure that inventory is documented and accounted for properly.

Inventory Counting Procedure Activities

  • Inventory Types
  • Preparation for Inventory Counting
  • Period End Cut-off
  • Complete Physical Count-Cost Method or “SKU” Method
  • Complete Physical Count-Retail Method
  • Cycle Count method

Inventory Counting Procedure Forms

Accounts Receivable Policy Template | REV106

Accounts Receivable Policy Template

The Accounts Receivable Procedure / Policy Template explains the methods for preparing invoices and accounts receivable records.

The policy allows for the timely preparation and distribution of invoices to optimize cash flow and customer payments. This procedure applies to all product sales and services provided by the company. (8 pages, 743 words)

Shipping will immediately forward to Billing completed Sales Orders along with shipping documentation and the customer’s Purchase Order. All Sales Orders will be routed on a daily basis to ensure prompt billing.  Accounts Receivable will then prepare invoices to be mailed by the next business day.

The next sequentially numbered invoice will be prepared from the information from the Sales Order and will include the invoice date, date of shipment, description of items shipped with model numbers, quantity, selling price, and extended amounts and the customer’s shipping and billing addresses.

On a monthly basis, Accounts Receivable will generate an aged trial balance of customers’ accounts with individual invoice information and days outstanding and will forward to Credit for timely collection activities.

Accounts Receivable Procedure / Policy Template Activities

  • Sales Order Routing and Review
  • Invoice Preparation and Posting
  • Distribution
  • Accounts Receivable

Accounts Receivable Procedure / Policy Template Forms

 

Check Signing Authority Procedure | CSH105

Check Signing Authority Procedure

To ensure your accounting system’s integrity, no one person or employee in your organization should enter invoices, select payment invoices, print and sign checks.

The Check Signing Authority Procedure outlines “dollar limits” and check signing authority processes to maintain your company’s maximum check safety. The Check Signing Authority Procedure applies to the president and CFO of your company. (6 pages, 712 words)

While a hired accountant, office manager, or accounting clerk may be responsible for entering bills, paying bills, and printing out checks, all printed checks and related documentation should be presented to a second individual for signing. No one person or employee (other than perhaps the owner) should be allowed to enter invoices, select invoices for payment, then print and sign checks. At a minimum, this process requires at least two individuals to ensure the integrity of the accounting system remains intact.

For back-up purposes, it is advisable to have at least three check signers authorized for each checking account. One should be the owner, President or primary signer and the other should be the CFO or secondary check signer. The third should be a back-up signer. The back-up signer should be a trusted individual but not necessarily an employee. It could be a board member or another principle in the business. A back-up signer will ensure continuing operations in case both the primary and secondary signers become incapacitated for any period of time.

Check Signing Authority Responsibilities:

The President is responsible for adding and removing check signing authority.

The CFO (Chief Financial Officer) is responsible for managing the check signing authority process and alerting all individuals and banks of any changes to authority.

Check Signing Authority Procedure Activities

  • Authorized Check Signers
  • Changing Check Signers
  • Authority Levels

Check Signing Authority Procedure Forms

 

Period-End Review Closing Process Accounting Procedure

Period-End Review Closing Procedure

The Period-End Review Closing Procedure provides a general overview of the process to be completed for reviewing the accounting records at year-end or any particular month-end prior to closing.

The practices mentioned in the Period-End Review Closing Procedure apply to all accounts. A subset of this period review procedure is also applicable to month-end reviews, although, typically, all financial accounts are reviewed and then closed out as of the company’s year-end. (8 pages, 2559 words)

Period-End Review Closing Definitions:

Review – the procedures involved in examining the financial statement balances at any given period to ascertain their accuracy.

Closing – the process of advancing from one month or period to the next or from one year to the next. In most computerized accounting systems the periods are closed by executing a menu command. Monthly closings usually involve nothing more than entering the next month and responding to the program’s suggestion to print various month-end reports. Even after moving to the next month, many accounting systems allow the user to return to previous months to enter or edit transactions.

Period-End Review Closing Responsibilities:

The CFO (Chief Financial Officer) is responsible for creating and reviewing all period-end activities to ensure the period-end financial statements accurately reflect the results of the company’s activities. The CFO should be familiar with the specific software procedures for keeping the prior year open until all final closing adjustments have been made and approved by the CFO.

The Accounting Manager is responsible for gathering all documentation required to complete the period-end closing and completing all ledger adjustments.

Accounting Month End Close Checklist Activities

  • Period Closing Preparations
  • Balance Sheet: Assets Review
  • Balance Sheet: Liabilities and Stockholders’ Equity Review
  • Income Statement: Revenue Review
  • Income Statement Expense Review
  • Financial Ratio Analysis

 

Accounting Period-End Review & Accounting Month End Close

An orderly, timely and comprehensive review of all general ledger accounts should be performed or directed by the CFO on a regular basis to ensure an accurate representation of the company’s financial statements.

Typically, all financial accounts are reviewed and then closed out as of the company’s year-end. These practices are aimed at ensuring that the financial accounts are accurate, and if not, are properly adjusted to make them accurate, prior to closing.

What is an Accounting Review?

An Accounting “Review” refers to the procedures involved in examining the financial statement balances at any given period to ascertain their accuracy. Accounting is a double-entry system. Thus, each business transaction has two equal sides. Your accounting review ensures everything is in balance. Because of this interdependence, the accuracy of the income statement is dependent upon the accuracy of the balance sheet. Although, the impact of the actual transaction differs if your are using cash accounting or accrual accounting.

CASH ACCOUNTING REVIEW

Cash accounting is based on your cash transactions. Items are entered (dated) onto your financial statements when the cash transaction occurs.

For example, If you receive a bill for an expense, the entry is dated when the bill is paid. Paying an expense decreases cash on the balance sheet and increases an expense on the income statement. Getting paid for a service or sale increases cash on the balance sheet and increases revenue on the income statement.

ACCRUAL ACCOUNTING REVIEW

Accrual accounting is based on expectations of a future event. Sales are entered as they occur and a second entry is made in receivables, if we are waiting for the cash, or in a cash account if the sale was accompanied with a payment.

For example, (using accrual accounting) when a bill is received, an expense entry is made in the income statement and a corresponding entry is made increasing accounts payable on the balance sheet. Paying the expense decreases cash and accounts payable (a liability is the opposite of an asset) on the balance sheet.

Sales are entered in the income statement as they occur and a corresponding entry is made increasing accounts receivable on the balance sheet. Getting paid for a service or sale increases cash and decreases receivables (both assets) on the balance sheet.

Balancing the Balance Sheet

The balance sheet accounts are measured at a moment in time, like a snapshot. They reflect a total of items at any particular time: a total of cash, accounts receivable, inventory, fixed assets, accounts payable, debts, investments and earnings retained in the company.

The income statement accounts are measured over a period of time, like a movie. They represent the sum total of transactions: sales, purchases, payroll, etc. The difference in sales less all related expenses equals the net income or loss for the period of time being measured.

BALANCE SHEET ACCURACY

It is easier to prove the accuracy of the balance sheet. Adding up how much each customer owes the store or reconciling cash to the bank statement is a much simpler process than attempting to add up each individual sales transaction on the income statement. For this reason, more time is actually spent on proving the accuracy of the balance sheet.

Once the balance sheet is proven, the income statement, in total, must be right! The only errors would be misclassifications, (i.e.: the phone bill could be incorrectly posted to the rent expense account).

The accounts of the income statement are generally reviewed for reasonableness by comparing amounts to prior periods and analyzing ratios. However, the accounts of the balance sheet are compared to actual totals of items counted (cash, receivables, inventory, payables, fixed assets, etc.).

Accounting Review Responsibilities

It is the responsibility of the CFO, controller or accounting manager to understand these concepts and to take the initiative to keep the financial statements as accurate as possible, regardless of how much an outside accounting service is utilized.

The CFO is responsible for creating and reviewing all period-end activities to ensure the period-end financial statements accurately reflect the results of the Company’s activities. The CFO should be familiar with the specific software procedures for keeping the prior year open until all final closing adjustments have been made and approved by the CFO.

Accounting is responsible for gathering all documentation required to complete the period-end closing and completing all ledger adjustments.

Closing the Open Period

“Closing” is the process of advancing from one month or period to the next or from one year to the next. In most computerized accounting systems the periods are closed by executing a menu command. The accounting month end close checklist usually involves nothing more than entering the next month and responding to the program’s suggestion to print various month-end reports. Even after moving to the next month, many accounting systems allow the user to return to previous months to enter or edit transactions.

The yearly closing is more rigorous since it involves re-setting all income statement accounts to zero. Once a year is “closed”, some accounting systems do not allow the user to go back or open a closed period to make changes. So be careful, once the period is closed, it is official and any adjustments that are required will need to be made in the current or next open period.

The financial statement is the most important management tool in financial accounting. An orderly, timely and comprehensive accounting review of all general ledger accounts will ensure an accurate representation of the company’s financial statements allowing for comparisons from one period to the next. Everyone in management should understand their financial statements and what they mean for the company.

Developing and accounting policy and procedure for Period-End Review & Closing helps to communicate the steps involved in review and closing, the responsibilities for each step, and should provide metrics for a timely closing process. Download a free sample accounting procedures to use as your own starting point to developing your own accounting policy manual.

 

Receiving Inspection Procedure | PUR104

Receiving Inspection Procedure

The Receiving Inspection Procedure outline purchasing steps for receiving products and inspecting materials, components, parts, finished goods, etc., and stocking these items or disposing of rejected items.

All purchased parts, components, goods and materials should be received in an organized manner and inspected for conformance prior to stocking to provide an initial quality control inspection. Any items or shipments rejected should be properly quarantined from other inventory items until the materials or receiving products can be dispositioned.

The Receiving Inspection Procedure ensures goods and materials will be received in an organized manner and inspected for conformance prior to stocking to provide initial quality control.

The Receiving Inspection Procedure applies to the receipt of all inventory items and involves receiving and warehouse personnel, purchasing manager, accounting manager, accounts payable, and quality control manager. (10 pages, 1532 words)

Receiving Inspection Responsibilities:

The Receiving Manager and Warehouse Personnel are responsible for receiving, inspecting materials, and forwarding all paperwork to the Purchasing Manager.

The Purchasing Manager is responsible for accepting or rejecting damaged goods.

The Accounting Manager and Accounts Payable are responsible for payment of invoices only after satisfactory completion or delivery of goods or services has been made.

The Quality Control Manager will review and authorize all rejections.

Receiving Inspection Procedure Activities

  • Receiving Procedure
  • Receiving Inspection Procedure
  • Rejection, Discrepancies and Disposition
  • Stocking and Product Return

Receiving Inspection Procedure Forms

 

Sales Order Entry Procedure | REV101

Sales Order Entry Procedure

The Sales Order Entry Procedure sets guidelines for the sales order process from obtaining the sales order through shipping and billing to the customer. All customer orders will be processed in an efficient and organized manner to ensure accurate and prompt shipments.

The Sales Order Entry Procedure ensures accurate and prompt shipments through efficient and organized order processing, and it applies to all personnel involved in processing of sales orders, specifically in sales, customer service, credit, manufacturing and billing.

This procedure summarizes the preparation of documents, paperwork flow, and responsibilities by individuals and departments and is not intended to be inclusive of all steps and activities involved in the consummation of a sales transaction. Therefore, each individual involved in the Sales Order Processing Procedure will need to take the responsibility to determine that all required and necessary activities and documents are properly completed. (10 pages, 2183 words)

Sales Order Entry Responsibilities:

The Sales Representative is responsible for initiating the sales process and for obtaining/providing and reviewing all documents and information from a customer, in order to complete the sales order.

Customer Service Representatives are responsible for reviewing sales orders to ensure requirements are adequately defined, that the order is consistent with the quotation if one was provided, and that the company has the ability to meet the defined requirements.

The Sales Manager will be responsible for facilitating the sales order entry process and maintaining all sales records.

Sales Order Entry Procedure Activities

  • Sales Representative
  • Internet Orders
  • Credit Department
  • Sales Administration
  • Manufacturing/Shipping
  • Customer Service
  • Accounting/Billing
  • Changes to Orders
  • Additional Information Resources

Sales Order Entry Procedure Forms

Bank Account Reconciliations Procedure | CSH107

Bank Account Reconciliations Procedure

The Bank Account Reconciliations Procedure outlines monthly bank statement reconciliation practices to ensure the accuracy of your bank account records.

The bank statement reconciliation procedure demonstrates how to prove out your monthly balances in the bank’s account register. The Bank Account Reconciliations Procedure applies to all bank accounts maintained by your company. (8 pages, 1845 words)

Errors or omissions can be made to the company’s bank account records due to the many cash transactions that occur. Therefore, it is necessary to prove the monthly balance shown in the bank account register. Cash on deposit with a bank is not available for count and is therefore proved through the preparation of a reconciliation of the company’s record of cash in the bank and the bank’s record of the company’s cash that is on deposit.

Bank Account Reconciliations Responsibilities:

The CFO (Chief Financial Officer) is responsible for review and approval of all reconciliations.

The Controller is responsible for reconciling all checking accounts.

Bank Account Reconciliations Definitions:

Batch – All of the day’s credit card transactions are collected into a “batch” of transactions. The batch is closed, usually at the end of the day, and the result is submitted to the merchant processor as a single “batch”.

Settlement – The processor clears the credit card transactions in the batch and the result is “settled” to the designated bank account. Settlement varies by Credit Card Company but usually occurs in 2-3 days after a batch is closed.

Processor – The processor is responsible for authorizing credit card transactions and settling each batch. The processor is also the company that one must interface with on all discrepancies or “chargebacks.”

Chargebacks – A chargeback occurs when a customer (cardholder) disputes a charge that appears on their monthly credit card statement. If the dispute cannot be resolved, the transaction is charged back to the merchant. The processor charges the merchant and returns the cardholder’s money.

Bank Account Reconciliations Procedure Activities

  • Bank Statement Preparation
  • Computerized Format
  • Manual Preparation and Reconciling Items
  • Computerized Preparation and Reconciling Items
  • Adjustments and Other Troubleshooting

Bank Account Reconciliations Procedure Forms