Finance Policy Manual

The Finance Policy Manual covers the common finance requirements and best practices. It is intended only to provide an example of wording that might be used in a Manual of this type. This sample wording can be helpful in generating ideas for developing a manual for your own company.  However, finance policies should be drafted as appropriate and necessary to accurately reflect your company’s internal financial policies and standards. (40 pages, 8217 words)

The purpose of the Finance Policy Manual is to document the principles and policies governing the company’s financial practices. The principles and policies provide:

• A foundation for an effective system of internal controls;
• Guidance in current financial activities;
• Criteria for decisions on appropriate financial treatment; and
• Financial management with direction and guidance with regard to policies, procedures, and reports that should be uniform throughout the company.

 
When consistently applied throughout the company, these principles and policies assure shareholders that financial statements issued by the company accurately reflect the status of the company’s operations. By developing and implementing this manual, the company is declaring its intent to comply with standards and regulations governing internal controls and risk management.  These issues have always been important, but they have recently received significant attention in the business environment, in the media, and in the courts.  The company’s systems of internal controls and risk management are based, in part, on the recommendations of the Committee of Sponsoring Organizations (COSO) contained in two documents, “Internal Control – an Integrated Framework” and “Enterprise Risk Management Framework.” Properly designed, implemented, and maintained internal controls are a system of checks and balances, intended to:

• Ensure the effectiveness of the financial management system (FMS);
• Ensure that financial objectives are met;
• Identify irregularities;
• Prevent or minimize waste, fraud, and abuse; and
• Assist in resolving discrepancies that may be accidentally introduced into the operations of the business.

 
All additional departmental or functional policies and procedures written should conform to or parallel the policies in this manual.  All changes to policies and procedures must be reviewed to ensure that there are no conflicts with policies stated in the Finance Policy Manual. This policy manual covers:

PURPOSE

SCOPE

RESPONSIBILITY

EXCLUSIONS

• Accounting
• Payroll
• Information Systems.
• Security Planning
• Disaster Recovery

 
MANAGEMENT RESPONSIBILITY

FINANCE ORGANIZATION

• Finance Department Organization Chart
• Chief Financial Officer Responsibilities
• Treasury Responsibilities
• Controller Responsibilities

 
MANAGEMENT COMMITMENT

FINANCE POLICY

PLANNING

• Finance Objectives
• Financial System Planning
• Referenced Procedures

 
RESPONSIBILITY, AUTHORITY, AND COMMUNICATION

• Responsibility and Authority
• Management Representative
• Internal communication
• Referenced Procedures

 
MANAGEMENT REPORTING

• General
• Review input
• Review output
• Referenced Procedures

 
BUSINESS CONDUCT

• Related Party Disclosure
• Referenced Procedures

 
FINANCIAL MANAGEMENT SYSTEM

OBJECTIVES

REQUIREMENTS

• Overview
• Internal Controls
• Audit Opinions
• Referenced Procedures

 
TRANSACTIONS

• Authorization
• Timing
• Amounts
• Accuracy

 
DOCUMENTATION

• Finance Policy Manual
• Control of Documents
• Control of Records
• Referenced Procedures

 
SECURITY

• Continuity
• Physical Security
• Disaster Recovery
• Information Security
• Referenced Procedures

 
PROCESSES AND CONTROL

ADMINISTRATIVE PROCEDURES

RAISING CAPITAL PROCEDURES

TREASURY MANAGEMENT PROCEDURES

FINANCIAL STATEMENTS PROCEDURES

INTERNAL CONTROL PROCEDURES

RESOURCE MANAGEMENT

PROVISION OF RESOURCES

HUMAN RESOURCES

• Finance Staff
• Competence, Awareness, and Training
• Separation and Supervision of Duties
• References

 
INFRASTRUCTURE

WORK ENVIRONMENT