Financial Controls Policy

Fact box

Policy owner: Vice President Operations
Policy category: Management: Finance
Policy status: Approved
Approval body: Council
Endorsement body: Executive
Related policies:
- Budget and Expenditure Policy
Last amended: 20th Dec. 2022
Relevant HESF:

Purpose

The purpose of this policy is to outline the internal control responsibility, objectives, principles and procedures for Alphacrucis University College (AC).

Scope

Whole of AC

Policy

The AC administration has the responsibility to establish and maintain an adequate system of internal control and to furnish to the AC, governmental agencies, AC creditors and other constituencies reliable financial information on a timely basis. This system promotes efficiency, minimizes risks of asset loss, helps ensure the reliability of financial information, and compliance with applicable laws, rules, and regulations.

Responsibility:

AC Council is responsible for setting the institutional expectations for internal control, ensuring upward communications channels are open through all levels of management, and evaluating management’s effectiveness in monitoring the control environment and implementing sound control policies and procedures;
individuals with delegated approval authority are responsible for establishing, maintaining, and supporting a system of internal controls within their areas of responsibility and for creating the control environment that encourages compliance with AC policies and procedures;
AC Finance Department, headed by the Vice President Operations, has the primary responsibility for internal control over financial reporting and compliance with applicable laws, rules, and regulations;
AC HR is responsible for internal controls over employee recruitment, hiring, separation, promotion, job classification, employee rights, and salary administration. The Human Resources Department will make resources available to assist in administering this policy;
external auditors are responsible for reviewing the adequacy of departmental and institutional internal controls and for reporting any weaknesses to the relevant supervisor and AC Council;
all levels of internal control are subject to examination by external auditors who will report on the adequacy of internal controls over finance and compliance;
department managers are responsible for prompt corrective action as directed by the VP Operations on all internal control findings and recommendations made by internal and external auditors. The audit process is completed only after managers receive the audit results and take action to correct internal control weaknesses, improve systems, or demonstrate that management action is not warranted; and
staff in leadership positions have the responsibility to ensure that those who report to them have adequate knowledge, skills, and abilities to function within, and contribute to, an effective internal control environment. This includes providing access to appropriate training on topics relevant to their job responsibilities.

The Finance Department is responsible for the following measurable outcomes:

reconciled bank statements;
weekly/monthly enrolment monitoring;
budgets reviewed and approved by Executive and Council;
monthly/quarterly Profit & Loss Statement and Balance Sheets;
monthly/quarterly Budget vs Actual Reports; and
audited Accounts presented to Council and Members.

Objectives:

AC administration will establish and maintain a system of internal controls that satisfies the AC objectives in the following categories:

risks are identified and effectively managed;
safeguarding AC assets;
reliability and integrity of financial information;
compliance with AC policies, plans, procedures, laws and regulations;
economical and efficient use of AC resources;
meeting established objectives and goals for AC operations and programs.

Principles

General internal control principles for campus units are:

Separation of duties
1. Duties are separated so that one person's work routinely serves as a check on another's work.
2. No one person has complete control over more than one key function or activity (e.g., authorising, approving, certifying, disbursing, receiving, or reconciling).
Authorisation and approval
1. Proposed transactions are authorised when proper and consistent with AC policy and the department's plans.
2. Transactions are approved by the person who has delegated approval authority, which is usually delegated on the basis of special competency or knowledge.
Custodial and security arrangements
1. Responsibility for physical security/custody of AC assets is separated from record keeping/accounting for those assets .
2. Unauthorised access to AC assets and institutional data is prevented.
Timely and accurate review and reconciliation
1. Accounting records and documents are examined by employees who have sufficient understanding of AC's accounting and financial systems to verify that recorded transactions actually took place and were made in accordance with AC policies and procedures.
2. Accounting records and documentation are compared with AC accounting system reports and financial statements to verify their reasonableness, accuracy, and completeness.
The general internal control principles should be applied to all of AC's operations, especially accounting records and reports, payroll, purchasing/ receiving/disbursement approval, equipment and supply inventories, cash receipts, petty cash, billing and accounts receivable.

Evaluations

All campus systems, processes, operations, functions, and activities are subject to evaluations of internal control systems.

Information and Communication

Information must be timely and communicated in a manner that enables people to carry out their responsibilities.

when a new budgetary unit, activity or project is established, the VP Operations will provide notification to the appropriate parties of the responsibilities incumbent on them;
AC staff will communicate significant information to AC’s administration; and
AC will communicate effectively with relevant stakeholders.

All levels of management must assess the costs, benefits, and risks when designing controls to develop a positive control environment and compensate for the risks of non-compliance, loss of assets, or unreliable reporting while accomplishing AC's mission.

Responsible for implementation

Vice President Operations

Key stakeholders

All staff and students

Procedures

Financial Controls Procedure

Procedure for Measurable Outcomes

	Previous day’s bank statement reviewed, posted	Accountant to Accounts Team	Daily
Monday	PayPal weekly activity downloaded for posting	Accountant to Accounts Team	Weekly
Friday	Bank Position (cash flow control)	Accountant to produce for VP Operations	Weekly
Feb/Mar Jul/Aug	Monitoring of enrolments	VP Operations to EC	Weekly

15th Every Month	Profit & Loss	Accountant to provide to VP Operations	Monthly
15th Every Month	Balance Sheet	Accountant to provide to VP Operations	Monthly
Every Month	Profit & Loss and Balance Sheet presented	VP Operations to provide to EC	Monthly
	Monitoring of enrolments	VP Operations to provide to EC	Monthly

	Monitoring of enrolments	VP Operations and Council	Quarterly
Dec/Mar/Jun/Sep	Quarterly Profit & Loss	Accountant to provide to VP Operations	Quarterly
Dec/Mar/Jun/Sep	Quarterly Balance Sheet	Accountant to provide to VP Operations	Quarterly
Feb/May/Aug/Nov	Quarterly Cash Flow	VP Operations to provide to Council	Quarterly
Feb/May/Aug/Nov	Quarterly Profit & Loss, Balance Sheet and Cash Flow Approval	Council	Quarterly

Semester Census Dates	Review Budgets against projected enrolments	VP Operations	Bi-Annually
June, December	Internal procedure review	VP Operations & CIO	Bi-Annually

January	TAS Certificates	VP Operations	Yearly
January	Register of Staff Reviews	Human Resources Department	Yearly
28th February	Yearly P&L and Balance Sheet prepared for Auditors	VP Operations, Accountant	Yearly
14th April	Audited Accounts	Auditors	Yearly
May	Audited Accounts approved	Council & Members	Yearly
Sept / Oct	Review Budget	VP Operations & EC in consultation with Department Heads	Yearly
30th October	Final Budget Paper	VP Operations, EC, Budget Committee, Department Heads	Yearly
November	Budget Recommendation	VP Operations and EC	Yearly
November	Revised Budget Approval	Council	Yearly