Humanitarian aid resource and delivery framework - EY · PDF filePage 2 Humanitarian aid...

Humanitarian aid resource anddelivery framework

Improving internal controls: the EY guide forhumanitarian aid organizations

2015

Humanitarian aid resource and delivery framework

ForewordHumanitarian aid resource and delivery framework

Relief, development and non-governmental organizations do exceptional andinspiring work in the immediate aftermath of disasters and, longer term, inhelping communities to rebuild and local economies to recover.

A major challenge for many of these agencies is managing the influx ofdonations they receive when disaster strikes.

How effectively organizations manage these funds not only affects the people thedonations are meant to help, but also the trust people have in the relief effortsand those leading them. If funds aren’t managed well, it can challenge theperceived value that an organization delivers and may damage the image of theaffected country or community. It can also jeopardize future donations.

To help relief, development and non-governmental agencies manage donationsand operate transparently we publish and distribute this free toolkit. It was firstproduced in 2005 in response to the Indian Ocean tsunami. It provides aframework for humanitarian aid resourcing and contains procedures that canimprove operational efficiency and transparency for any organization tasked withresponding to a disaster.

The guide has been used as the basis for disaster-relief training workshopsacross the globe. We hope it continues to be a valuable resource for reliefagencies as they continue their important work.

Mark A. Weinberger,Global Chairman & CEO

Disclaimer and intellectual property clauses

► Please note that the information contained in this document is for reference only. The informationcontained in this document has been prepared solely for the purpose of providing information tointerested parties about establishing proper systems of accountability and internal control within theirorganizations.

► This document is not intended to constitute advice in any particular circumstances. It has beencompiled in good faith by EY, but no representation is made or warranty given (either express orimplied) as to the completeness or accuracy of the information it contains in relationship to yourorganization. You are therefore requested to verify and adjust this information to fit yourorganizational requirements before you act upon it.

► EY gives you no warranty or assurance about the document and neither we nor any of our affiliates,nor any partner, officer agent, employee, or sub-contractor of EY or any of our affiliates, will be liableto you or anyone else for any losses or damages arising in connection with it. As a result, you shouldnot rely on this document in any way, and you use it at your own risk. You should consult your usualEY contact on any specific matter.

► The copyright of the material contained in this document belongs to and remains solely with EY.Your access to it does not imply a license to reproduce and/or distribute this information, and youare not allowed to undertake any such act without the prior approval of EY.

For reference only.


What is in the guide?

EY developed Improving internal controls: the EY guidefor humanitarian aid organizations to document theoperating processes and procedures applicable to a non-governmental organization (NGO). It also incorporates theinternal controls that are intended to improve theeffectiveness and efficiency of an NGO’s operationalactivities.

Improving internal controls begins with our HumanitarianAid Resource and Delivery Framework, which depicts thethree cycles of aid resource and delivery:

► Receipt — establishing agreements betweendonor(s) and the NGO

► Expenditure — procuring, delivering, disbursing,accounting and reporting of aid delivery

► Requisition — telling the donors what and how muchis needed, as well as acknowledging receipt ofaid given

Within each of the three cycles, Improving internalcontrols is structured as a series of process modulessetting out the various information, document andtransaction flows.

These process modules identify and describe the controlpoints and give “what can go wrong” scenarios todetermine if the internal controls are working.

It is meant to be a reference guide for an NGO about theprocess modules that are relevant to its operations,starting with the core modules common among most:cash receipts, inventory management, purchase, humanresource management, delivery, cash disbursement, pettycash, accounting, reporting, budget preparation andrequisition approval, recipient requisition, andrecipient receipt.

In this way, Improving internal controls becomes aresource to help an NGO overcome one of its keychallenges of aligning the needs of its recipients with theongoing purchase, delivery and receipt of aid. This guidewill also will help to establish levels of accountability andtransparency intended to satisfy donor objectives.



Contents► Core module details

► Expanded module details

► “Pick list”

In the accompanying booklet:► Introduction

► Who is this guide for? How does it fit your NGO?

► Structures and levels of controls within an NGO

► Tailoring Improving internal controls for yourorganization

► Core modules

► Expanded modules

► Glossary of terms

► Frequently asked questions

6

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Core Module Details


Humanitarian Aid Resource and DeliveryFramework — core modules


B.03 Inventory Management

B.07 Human Resource Mgmt.

B.08 Delivery

Accounting Reporting(Financial/Mgmt) Bu

dget

and

Anal

ysis

Recipient Requisition Recipient Receipt

Budget Preparationand Requisition

Approval

Funding and Donation Mechanisms

Rec

eipt

Cyc

le

B.02 Cash Receipts

Donor Objectives/Goals

Expe

nditu

reC

ycle

Petty

Cas

hC

ash

Dis

burs

emen

t

Rea

cqui

sitio

nC

ycle

B.05 Produce/Build

B.04 Purchase

B.06 Assets Management

A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Core modules


B.01 Budget preparation and requisition approvalB.01.1 Budget preparationB.01.2 Recipient data maintenanceB.01.3 Additional fund requisitionsB.02 Cash receiptsB.02.1 Bank receiptsB.03 Inventory managementB.03.2 Receipt of goods or servicesB.04 PurchaseB.04.1 Vendor assessmentB.04.2 Direct appointmentB.04.3 TenderB.04.4 ContractsB.04.5 PO managementB.04.6 Vendor database maintenanceB.07 Human resources managementB.07.1 RecruitmentB.07.2 PromotionsB.07.3 TerminationsB.07.4 Resignations

B.07.5 Employee master dataB.07.6 PayrollB.08 DeliveryB.08.1 Delivery schedulingB.08.2 Goods deliveryB.09 Cash disbursementB.09.1 Accounts payableB.09.2 Bank paymentB.10 Petty cashB.10.1 Petty cash and replenishmentB.11 AccountingB.11.1 Journal entriesB.11.2 ReconciliationB.12 ReportingB.12.1 Closing and reportingC.01 Recipient requisitionC.01.1 Recipient requisition of goods or servicesC.02 Recipient receiptC.02.1 Recipient receipt of good or services

Budget preparation and requisitionapprovalB.01.1 Budget preparationTo prepare budgets that are accurate, complete and reasonable

To 1 Assess Proposed Budget/Additional Fund Requisition inWorkflow Modeler: A.02.1 Funding and Donation

Mechanisms

To 1 Prepares Budget analysis monthly in Workflow Modeler:B.13 Budget Analysis

from 3 Analyze Survey Results in Workflow Modeler:C.01.2 Recipient Satisfaction Survey

1Disaster data gathering

2Conduct meeting on

information/datagathering

3Budget preparation

4Review and approve

Field Community Staff

Community Relation

Executive Directorand Trustee

Donors


B.07 Human Res our ce Mgmt.

B.08 Delivery

Acc ounting Reporting( Financial/Mgmt) Bu

dget

and

Anal

ysis

Recipient Requis ition Recipient Receipt

Budget P reparationand Requisition

Approval


Rece

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B.02 Cash Receipts


Exp

endi

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Petty

Cash

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Disb

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B.05 Produc e/Bui ld

B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11




Activity:1. Field/community staff gathers preliminary data to assess the recipient’s requirements (R1).2. Field coordinator discusses with the team regarding the information/data gathering process and determines whether

sufficient work has been done as the basis for the budget.3. Field coordinator prepares budget for prospective donors. Proposed budget consists of estimated number of

recipients, description of relief aid, implementation plan and the total project value (R2).4. Executive director and trustee review the completeness and reasonableness of the proposed budget, making sure

that the proposed budget is aligned with the NGO’s objectives, and approve proposed budget for submission toprospective donors.

Function(s) involved:► Field/community staff► Field coordinator► Executive director► Trustee► Donors



B.08 Delivery


dget

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Approval


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B.02 Cash Receipts


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11



What can go wrong? Key control point checklist

R1 — Data not accurate or incomplete (C1)

R2 — Proposed budget is incomplete andinaccurate (C1, C2)

Performed by field coordinator

C1 — Reviews the completeness and accuracyof needs assessment (R1, R2)

Performed by executive director

C2 — Clearly state/formalize and communicatethe assumptions underlying theproposed budget to related implementingpartners (R2)



B.08 Delivery


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Budget preparation and requisitionapprovalB.01.2 Recipient data maintenanceTo create and update recipient’s number/code and other

To 2 Input the RecipientCode/Number and AnalyzeRequisitions in WorkflowModeler: C.01.1 RecipientRequisitions-Goods/Services


Field Coordinator

Recipient

from Recipient code available?in Workflow Modeler: C.01.1

Recipient Requisitions-Goods/Services

1Assess new

applicants based onthe NGO's pre

determined requirements

2Inform Applicants

3Review and ApproveAccepted Applicants

4Input new recipients’Data into the System

PassYes

No

PurchaseRequisition




B.08 Delivery


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B.02 Cash Receipts


Exp

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11



Activity:1. Field/community staff checks new applicants’ data and information for completeness and verify against

predetermined requirements based on the organization’s regulations (i.e., identification card, family card, eligibilitystatement from district supervisor, etc.) (R1, R2).

2. Field/community staff informs recipients that their needs requisition form has not been accepted.3. Field coordinator should review new recipient data, check data for completeness, and make sure that the applicants

satisfy the NGO’s criteria as recipients prior to approval.4. Field/community staff inputs new recipient data that has been approved by field coordinator into the system. The

system will generate new recipient number (R3, R4).Function(s) involved:► Field/community staff► Field coordinator► Recipient



B.08 Delivery


dget

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B.02 Cash Receipts


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11




R1 — Duplication of recipient data in thesystem (C1)

R2 — Acceptance of ineligible recipients (C1)

R3 — Inaccurate data entry of requisitioninformation (C2)

R4 — Unauthorized entry of requisitioninformation into the system (C3)

Performed by coordinator:

C1 — Verify new and existing recipient data inthe system (R1, R2)

C2 — Verify and authorize entry of requisitioninto the system (R3)

C3 — Access to make changes to data onrecipients in the system is restricted toauthorized NGO staff through use ofpasswords (or physical controls formanual records) (R4)



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B.02 Cash Receipts


Exp

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Budget preparation and requisitionapprovalB.01.3 Additional fund requisitionsTo obtain additional funds from the donors to support ongoing NGO activities

1Prepare AdditionalFund Requisition

Proposal

2Review and Approve

Additional FundRequisition Proposal

To 1 Assess Proposed Budget/Additional FundRequisition in Workflow Modeler: A.02.1Funding and Donation Mechanisms

from Need additional fund?in Workflow Modeler: C.01.1



Field Coordinator

Executive Directorand Trustee

Prospective Donors




B.08 Delivery


dget

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Approval


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B.02 Cash Receipts


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11



Activity:1. Field coordinator prepares a proposal for additional funds requisition when the NGO’s available funds are not

sufficient to cover the costs associated with recipient requisitions received and the NGO’s operating costs. Theproposals should include the number of potential recipients, amount of funds required by the NGO’s communitydevelopment plan and estimated costs for the NGO’s operations (R1, R2, R3).

2. Executive director and trustee:► Review additional fund requisition proposals for completeness and reasonableness► Make sure that proposal accommodate the donor’s objectives► Verify draft proposals by comparing them to budget/organization work plan► Approve the additional fund requisition proposal

Function(s) involved:► Field/community staff► Field coordinator► Executive director► Trustee► Prospective donors



B.08 Delivery


dget

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11




R1 — Proposed funds are not enough tocover the recipient’s needs (C1)

R2 — Inadequate information in theproposal (C2)

R3 — Proposed funds are not in line with theNGO’s and donor’s objectives (C1, C2)


C1 — Review and approve the proposal forcompleteness and accuracy (R1, R3)

C2 — Review NGO’s and donor’s objectivesand requirements (if any) (R2, R3)



B.08 Delivery


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Cash receipts

B.02.1 Bank receiptsTo record bank account receipts properly in the organization’s books

2Print Credit Notes

3Record Bank

Receipts

To 12 in Workflow Modeler: B.11.1 Journal Entry

from Cash or Goods in Workflow Modeler: A.02.1Funding and Donation Mechanisms

Donors

Bank

Finance Staff

Finance and AdministrationManager

from 5 Dispose/sell the fixed assets in WorkflowModeler: B.06.4 Fixed Assets Disposal

1Fund transfers

4Review and

Approve BankReceipt Vouchers

TransferSlip

Credit Note




B.08 Delivery


dget

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Cash receipts



Activity:1. Donor transfers funds to the NGO’s bank account and sends proof of transfer slip to the NGO.2. Bank sends credit notes for all funds transferred into the NGO’s bank account.3. Finance staff:

► Reviews bank receipts and other supporting documents for completeness► Records bank receipts into the system and print-out cash/bank receipt vouchers (R1, R2, R3).

4. Finance and administration manager reviews and approves bank receipt vouchers before entry into the system.Function(s) involved:► Donors► Bank► Finance staff► Finance and administration manager



B.08 Delivery


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


Cash receipts



R1 — Not recorded on a timely basis(C1, C2, C4)

R2 — Incorrect amount recorded (C1)

R3 — Entry by unauthorized personnel (C3)

Performed by finance andadministration manager:

C1 — Verify and approve bank receiptvouchers (R1, R2)

C2 — Reconcile bank statements and theNGO’s books on a monthly basis (R1)

C3 — Verify and authorize entry of bankreceipts into the system (R3)

C4 — Donor receipts should be into bankaccounts held in the name of the NGOand dedicated to activities of theNGO (R1)



B.08 Delivery


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Inventory management

B.03.2 Receipt of goods or servicesTo perform the receipt of goods/services from donors and/or vendors according to NGO’s policies and procedures and inan efficient manner

1Receive

purchased/donatedGoods/Servicesand sign DeliveryOrders (DOs) as

well as TransferredFixed Assets

from Cash or Goods in Workflow Modeler:A.02.1 Funding and Donation Mechanism

Donors

Inventory (Warehouse)Staff

Accounting Staff

Inventory And DistributionManager

From 6 Send POs and Follow upoutstanding PO in Workflow Modeler: B.04.6

PO Management

Vendor/Supplier

To 1 Obtain data input in WorkflowModeler: B.11.1 Journal Entry

To 5 in Workflow Modeler: B.03.5Inventory Monitoring

To 11 in WorkflowModeler: B.09.1Accounts Payable

Donatedgoods?

7Verify and approve

data on Goods/Services enteredinto the system

6Input Data of

Acceptedand Rejected

Goods/Services

5Send Rejection

Letterto Vendor (including

returned goods)

Rejection Letter and Returned Goods/Material

4Review and

ApproveReceiving Report or

Rejection Letters

3Prepare RejectionLetters (includingreturned Goods)

2Prepare Receiving

Reports

Accept?

No

Yes

No

Yes




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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11




Activity:1. Inventory (warehouse) staff receive goods/services with delivery order from vendors/donors, performs physical and

quality check, and count of goods received and observe services to ascertain goods/services received correspond tothe purchase orders (POs)/pledges. In addition, inventory (warehouse) staff also receives transferred fixed assets(R1, R2).

2. Inventory (warehouse) staff prepares pre-numbered receiving reports for accepted goods/services (R3, R4).3. Inventory (warehouse) staff prepares rejection letters for rejected goods/services (R5, R6).4. Inventory and distribution manager reviews and approves receiving reports or rejection letters for goods and services

accepted or rejected.5. Inventory (warehouse) staff sends the rejection letters and returned goods to vendors.6. Inventory (warehouse) staff enters data on accepted and rejected goods/services into the system based on receiving

reports and rejection letters. Information entered into system may include (R7):► Received date► Type of goods/services► Quantity of goods/services► Name of inventory (warehouse) staff who received the goods/services► PO numbers: received date



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A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11




Activity:7. Inventory and distribution manager verifies summary of data input, receiving report and rejection letter. For

purchased goods, sends receiving report to accounting staff for accounts payable entry.

Function(s) involved:► Donors► Vendor/supplier► Inventory (warehouse) staff► Inventory and distribution manager► Accounting staff



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C.02C.01

B.09

B.10

Core modules

B.11





R1 — Received goods/services do notcorrespond with order specifications/pledgeletters (C1)

R2 — Goods received are not recorded(C1, C2)

R3 — Incorrect information in receivingreports (C3)

R4 — Receiving report are prepared for rejectedgoods/services (C3)

R5 — Incorrect information in therejection letters (C4)

R6 — Rejection letters are sent for acceptedgoods/services (C4)

R7 — Incorrect data entry (i.e., quantity of goods,type of material, type of service, etc.) (C5)

Performed by inventory and distribution manager

C1 — Match receiving reports with the deliveryorders, POs or pledge letters (R1, R2)

C2 — Accounting for numerical sequence ofreceiving reports (R2)

C3 — Review receiving reports and check thatrejected goods/services are excluded(R3, R4)

C4 — Review and compare rejection letterswith receiving reports and POs fromsuppliers (R5, R6)

C5 — Review and approve summary ofgoods/services data entry (R7)



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A.02

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B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Purchase

B.04.1 Vendor assessmentTo evaluate vendors’ qualification and capabilities effectively, and prepare a list of the most qualified vendors based on anevaluation of vendor capability and reliability

2Perform Vendor

Assessment

To 1 Review approved vendor listin Workflow Modeler: B.04.3Direct Appointment

To 2 Update information changes invendor database in Workflow Modeler:B.04.1 Vendor Database Maintenance

Procurement Staff

Procurement Manager

Coordinator

from 8 PR approval process (depending on internal policyfor Level of Authorization) in Workflow Modeler: B.06.1

Fixed Assets Requisition

1Obtain and input

vendor data into thesystem

No

3Approve Vendor

Assessment

Approvedvendors?

Yes




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A.01

A.02

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B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Purchase



Activity:1. Prepare a list of documents required from vendors and inform vendors (including contractors and consultants) to

submit their most recent data to be considered in the NGO’s approved list. Prequalification documents may include(R1, R2):► Certificates from professional associations► Tax documentation including taxpayer code number (NPWP) and evidence of tax payment in the past years► Financial documentation such as the most recent audited balance sheets and/or other financial reports (income statements and

statements of cash flows)► Legal requirements such as a statement stating that the vendor does not have any legal obligation and

is not under the court’s surveillance or in bankruptcy process► References from previous clients

Vendor data should be entered into the system.2. Procurement manager performs vendor assessment and prepares vendor assessment report. Vendor assessment

report includes information on:► Quality of material/services sold► Delivery of material/services► Price competitiveness► Historical performance



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B.09

B.10

Core modules

B.11

Purchase



Activity:Procurement manager compares the result of vendor assessment against the NGO’s policies for vendor selection, whichmay include policies on (R3, R4, R5):► Complying with requirements► Product quality assurance► Product delivery

3. Coordinator reviews and approves vendor assessment reports, and assesses and categorizes vendors into differentratings based on their administrative, technical, financial and support capabilities.

Function(s) involved:► Procurement staff► Procurement manager► Coordinator



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A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


Purchase



R1 — Unauthorized vendor data entry to thesystem (C1)

R2 — Incorrect data entry: vendor name,goods/services offered (C1)

R3 — Incomplete vendor assessment (C2, C3)

R4 — Incorrect result of vendor assessment(C2, C3)

R5 — Subjective vendor assessment (C2, C4)

Performed by coordinator

C1 — Supervise and verify supportingdocuments with the entry (R1, R2)


C2 — Supervise vendor assessment process(R3, R4, R5)

C3 — Verify vendor assessment resultsagainst documents received fromvendor (R3, R4)

C4 — Confirm vendor referencesperiodically (R5)



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B.09

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Core modules

B.11

Purchase

B.04.2 Direct appointmentTo provide procedures for directly appointing vendor(s) to procure goods/services

Field Coordinator

Procurement Manager

Coordinator

1Review approved

vendor list

To 10 in Workflow Modeler:B.04.5 Contracts

Requirecontract?

6Review and

approvethe final vendor

5Discuss and

negotiate price,lead time,

guarantee andother terms

from Direct Appointment/Tender? inWorkflow Modeler: C.01.1 Recipient

Requisitions-Goods/Services

4Request

quotationsfrom selected

vendor(s)

No

Yes

from 4 in WorkflowModeler: B.04.2Vendor Assessment

2Select vendor(s)based on desiredquality and price

To 15 in Workflow Modeler:B.04.6 PO Management

To 2 Update information changesin vendor database in WorkflowModeler: B.04.1 Vendor DatabaseMaintenance

Approve?

3Approve selected

vendor(s) for directappointment

Approved?No Yes

Yes

No




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C.02C.01

B.09

B.10

Core modules

B.11

Purchase



Activity:1. Procurement manager reviews approved vendor list and ranks vendors based on the procurement requirements and

each vendor’s performance rating.2. Procurement manager selects vendor(s) based on the appropriate quality and price offered (R1).3. Coordinator approves the vendor(s) selected by the procurement manager for direct appointment.4. Procurement manager requests quotations from the selected vendor(s).5. Based on the quotations received from the selected vendor(s), procurement manager discusses and negotiates

price, lead time, guarantee and other terms before proposing final vendor to coordinator (R2, R3).6. Based on the proposed vendor received from the procurement manager, coordinator issues an approval for a

final vendor.Function(s) involved:► Field coordinator► Procurement manager► Coordinator



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B.09

B.10

Core modules

B.11


Purchase



R1 — Vendor(s) are selected based on wronginformation, i.e. wrong performancerating (C1)

R2 — Negotiated price is higher thanbudget (C2)

R3 — Negotiated price is higher thanmarket rate (C3)


C1 — Verify the selected vendor informationagainst the vendor’s performance ratingin the system (R1)

C2 — Verify negotiated price against approvedbudget (R2)

Performed by procurement manager

C3 — Conduct market comparisonon price (R3)



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A.01

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B.12 B.13

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B.09

B.10

Core modules

B.11

Purchase


B.04.3 TenderTo select the most suitable vendor from the different vendors who participate in the bidding process to provide therequired goods/services

To 10 in WorkflowModeler: B.04.5Contracts

from Direct Appointment/Tender?in Workflow Modeler: C.01.1


Tender committee

Procurement Manager

Coordinator

Executive Director

Field coordinator

9Review and

approvethe tender

result

8PrepareTenderReports

7Performtender

process

6Register

and screentender

participants

5Announce

tender

4Preparetender

documents

1Receive

informationto perform

tender

2Form aTender

Committee

3ApproveTender

Committee

Approved?Yes

No



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C.02C.01

B.09

B.10

Core modules

B.11

Purchase



Activity:1. Procurement manager receives information to select a supplier through a tender process.2. Coordinator forms a Tender Committee. Members of a Tender Committee should consist of representatives from

procurement, field coordinator, finance and administration departments and from thecoordinator (R1).

3. Executive director approves the members of the Tender Committee.4. Tender Committee prepares tender documents. The tender documents must be prepared in such a way that

prospective suppliers of goods/services can easily understand them. These documents mayinclude (R2, R3):► Letter of invitation to tender► Prequalification guidance► Instruction to tender participants► Bill of quantities► Technical specification and pictures (if any)► Terms of reference (TOR)► Contract templates► Owner estimates/self-estimated prices



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C.02C.01

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B.10

Core modules

B.11

Purchase



Activity:5. The Tender Committee announces open tender on printed media, official announcement boards and, if possible,

through electronic media (R4).Tender announcement should contain at least the following information:► Name and address of the organizations that are invited to tender► Brief explanation of the scope of work to be carried out► Required information from tender participants► Place, date and time for tender registration

6. All tender participants must be registered, and the Tender Committee screens the participants based onqualifications. A list of the prospective participants is prepared and includes those participants who have passed thescreening process. These participants are then invited to submit the required tenderdocuments (R5, R6).

7. Tender Committee should perform tender process. Participants should be provided with sufficient information on howthe tender process will be performed. This information may include (R7, R8, R9, R10, R11):► Method of organizing the tender► Method of bid submission► Bid submission deadline► Documents required for bid submission► How a participant can be disqualified from the tender► Contract templates► Bid evaluation method and guidance



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C.02C.01

B.09

B.10

Core modules

B.11

Purchase



Activity:8. Tender Committee prepares a tender report that includes the result of tender evaluation. The report contains the

tender result and method of evaluation (R12, R13).9. Tender Committee reviews and approves the tender result based on the report and announces the winner.Function(s) involved:► Tender Committee► Field coordinator► Procurement manager► Coordinator► Executive director



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B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


Purchase



R1 — Tender Committee members do nothave appropriate and relevantskills (C1)

R2 — Tender documents are preparedincorrectly (C2)

R3 — The content of tender documents isincomplete (C2)

R4 — Error in tender announcement (C3)

R5 — Registration data is incomplete (C4)

R6 — Errors in registration data (C4)

R7 — Participants involved in the tenderprocess are not qualified (C5)


C1 — Review of relevant skills of TenderCommittee members (R1)

Performed by chairman of Tender Committee

C2 — Review list of tender documents andthe content of tender documentsreceived (R2, R3)

C3 — Review tender announcement prior topublishing it (R4)

C4 — Validate the registration data and thesupporting documents of tenderparticipants (R5, R6)

C5 — Verify the tender participants with a listof participants who have passed thetender evaluation (R7)



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B.10

Core modules

B.11


Purchase



R8 — Proposals are received later than thebid submission dateline (C6)

R9 — Proposals are not evaluated based onthe predetermined bid evaluationmethod and guidance (C7, C8)

R10 — The tender process is not objective andnot transparent (C9)

R11 — Members of the Tender Committeehave a conflict of interest due toassociation with tenderparticipants (C10)


C6 — Review the date proposal received andletter of acceptance of proposal (R8)


C7 — Verify the proposal evaluation againstthe predetermined bid evaluationmethod and guidance and theallocated budget (R9)

C8 — Sign-off letter of acceptance forproposal evaluation (R9)

C9 — Maintain objectivity and transparencyin the tender process (R10)

C10 — Members of Tender Committee arerequired to disclose any conflict ofinterest they may have with the tenderparticipants (R10, R11)



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B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


Purchase



R12 — The Tender Repot is not accurate(C10, C11)

R13 — The proposed winner is not the mostqualified tender participant (C12)


C10 — Members of Tender Committee arerequired to disclose any conflict ofinterest they may have with the tenderparticipants (R10, R11)

C11 — Verify tender report with theprocurement documents and approvethe result (R12)

C12 — Validate supporting documents oftender process (R12)



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C.02C.01

B.09

B.10

Core modules

B.11

Purchase

B.04.4 ContractsTo develop a formal and legal written agreement with vendors in delivering goods/services based on agreed-upon timeframe, cost and performance criteria


To 1 form a Project Committee in WorkflowModeler: B.05.1 Planning and Scheduling

from Require contract? in Workflow Modeler: B.04.3Direct Appointment

Procurement Manager

Field Coordinator

Procurement Staff

Coordinator

from 9 Review and approve the tender result inWorkflow Modeler: B.04.4

1Prepare/

revisecontracts

No

from 4 Approve change request proposal in WorkflowModeler: B.05.4 Project

from 2 Ask vendor to fix the project in order to complywith the contract in Workflow Modeler: B.05.5

Project Acceptance/Delivery

To 15 in Workflow Modeler: B.04.6PO Management

2Review

contracts(legal

aspects)

3Review price,

quality anddelivery and

approvecontracts

4Input contractin formation

in to thesystem

5Submit signed

contracts tovendors

Accepted?

Approved?Yes

No

Yes



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B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Purchase



Activity:1. Procurement manager prepares/revises contracts based on standardized templates. The procurement manager also

obtains legal inputs, standard framework agreement from legal department and other relevant information from users.Contracts should include (R1, R2, R3):► Terms and conditions► Rights and obligations of both parties► Contract amounts

2. Field coordinator reviews contracts (terms and conditions, rights and obligations, and legal inputs) and providesnecessary inputs to procurement manager.

3. Coordinator reviews price, quality and delivery and approves final contracts before submitting contracts to vendors.4. Procurement staff inputs contract information into the system that may include the following (R4, R5):

► Contract numbers► Contract amounts► Terms and conditions► Scope of work► Time frame



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B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Purchase



Activity:5. Once a selected vendor signs a contract or an agreement, the contract should be signed by the coordinator/executive

director in accordance with the NGO’s Articles of Association. Finance and administration manager maintains theoriginal contract documents.

Function(s) involved:► Procurement manager► Field coordinator► Procurement staff► Coordinator



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B.09

B.10

Core modules

B.11


Purchase



R1 — Monetary amount in the contract isdifferent from the agreed-uponprice (C1, C3)

R2 — Contract is not aligned with approvedbudget (C2)

R3 — Incomplete terms and conditions, rightsand obligations, and legal inputs in thecontract (C3, C4)

R4 — Entry by unauthorized person (C5)

R5 — Data entry error (C5)

Performed by finance and administration manager

C1 — Verify the contract amount withsupporting documents (R1)

C2 — Verify the amount of contract withbudget (R2)


C3 — Verify contract with the terms andconditions, rights and obligations, andlegal aspects (R1, R3)

Performed by coordinator/executive director

C4 — Review and approve contract with theterms and conditions and rights andobligations (R3)


C5 — Review and approve contract supportingdocuments with the entry (R4, R5)



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Core modules

B.11

Purchase

B.04.5 PO managementTo prepare purchase orders (POs) as the basis for ordering goods/services from vendors

from 4 Review reportagainst the system inWorkflow Modeler: B.03.1Inventory Planning

from Repeated Order?in Workflow Modeler: C.01.1


Procurement Manager

Procurement Staff

Vendor/Supplier

from 5 Submit signed contracts to vendorsin Workflow Modeler: B.04.5 Contracts

3Review and

authorizePO

from Require contract? in WorkflowModeler: B.04.3 Direct Appointment

To 22 in Workflow Modeler: B.03.2Receipt of Goods or Services

1Review

incomingPR

(PurchaseRequisition)

2Generate

POs(Purchase

Orders)

4Print POs

5Review andsign POs

6Send POsand follow

upoutstanding

PO

List ofOutstanding

PO




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C.02C.01

B.09

B.10

Core modules

B.11

Purchase



Activity:1. Procurement staff reviews incoming purchase requisitions (PRs) by system on a daily basis. Received PRs are

tracked and recorded for monitoring purposes.2. Procurement staff generates POs that should contain (R1, R2):

► PO number (consecutive number generated by the system)► Contract number► Vendor’s name and address► Description of items ordered (brand and general descriptions, including clearly defined unit of measurement and specifications)► Quantity to be ordered► Unit price► Total price► Discount (if any)► Delivery date► Payment terms and conditions

3. Procurement manager reviews the accuracy of POs and makes sure that goods and services ordered, as well as thedelivery time, match with user’s requirements. POs are revised when there are inconsistencies between PRs and therelevant POs; if none, procurement manager will authorize POs to be printed.



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B.09

B.10

Core modules

B.11

Purchase



Activity:4. Procurement staff print POs from the system and sends them to procurement manager for signature (R3).5. Procurement manager reviews and signs POs. Any POs over an internal policy threshold amount

(e.g., US$5,000) require an additional signature from someone with a higher level of authority.6. Procurement staff sends newly approved POs to vendors and follows up on the list of outstanding POs received from

the inventory and distribution department.Function(s) involved:► Procurement manager► Procurement staff► Vendor/supplier



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C.02C.01

B.09

B.10

Core modules

B.11


Purchase



R1 — Editing and release of POs areperformed by unauthorized user(C1, C3)

R2 — Inaccurate and/or incomplete informationin POs (C2, C3)

R3 — Incorrect PO printed for vendor (C4)


C1 — Verify authorized PO against PR (R1)

C2 — Clarify and validate the negotiated pricesand/or volumes in POs (R2)

C3 — All POs approved by an authorizedperson (R1, R2)

C4 — Verify PO printout with PR and/orcontract (R3)



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Core modules

B.11

Purchase

B.04.6 Vendor database maintenanceTo maintain and update vendor database

Vendor/Supplier

Procurement Staff

Procurement Manager

2Update informationchanges in vendor

database

1Inform NGO of anychanges to vendor

information

3Validate updatedvendor database

from 7 in Workflow Modeler: B.04.3Direct Appointment

from 4 in Workflow Modeler: B.04.2Vendor Assessment




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B.09

B.10

Core modules

B.11

Purchase



Activity:1. Vendors should inform NGO of any changes to vendor details, such as:

► Addresses► Telephone numbers► Contact persons► Bank account number

Vendors must submit information changes to procurement department by letter/fax.2. Procurement staff updates vendor database based on letter/fax received from vendors (R1, R2).3. Procurement manager should validate updated vendor database. On a random basis, the procurement manager

should confirm changes directly to vendors.Function(s) involved:► Vendor/supplier► Procurement staff► Procurement manager



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B.10

Core modules

B.11


Purchase



R1 — Unauthorized vendor data entry in thesystem (C1, C2)

R2 — Incorrect data entry: vendor name,goods/services offered (C1)


C1 — Review and validate the changes ofvendor database in the system (R1, R2)

C2 — Restrict access to make changes tovendor database in the system toauthorized NGO staff through use ofpasswords (or physical controls formanual records) (R1)



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Core modules

B.11

Human resources

B.07.1 RecruitmentTo meet the organization’s human resources requirements and to make sure that recruited individuals are qualified to fulfillthe job requirements

User

Finance andAdministrationManager

Coordinator/Executive Director

2Review RecruitmentRequisition Forms

1Fill out RecruitmentRequisition Forms

To 8 in Workflow Modeler:B.07.5 Employee Master Data

GA Staff

ApproveRRF?

4Select candidates for

testing andinterviewing

3Search for new

employee

AcceptCandidate?

Yes

No

No

Yes




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B.10

Core modules

B.11

Human resources



Activity:1. Requests for new hires come directly from managers by submitting a recruitment requisition form (RRF) to the finance

and administration manager, who will review the form. RRFs should indicate whether the employees are to be hired ona permanent or on a contract basis. If the position is for a level below managerial level, then the RRF needs to beapproved by the coordinator. If it is for a managerial position or higher, then the RRF must be approved by theexecutive director.

2. Finance and administration manager collects and reviews RRFs for completeness.3. Once RRF has been approved, the GA staff begins searching for candidates suitable for the position.4. GA staff selects candidates from the applications received based on the organization and user

requirements (R1, R2).Function(s) involved:► Users► Finance and administration manager► Coordinator/executive director► GA staff



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Core modules

B.11


Human resources management



R1 — Candidates selected are not qualified forthe position (C1, C2)

R2 — Nepotism (C1, C2)


C1 — Candidates are required to submitreference letters that indicate theirrelevant experiences (R1, R2)

C2 — Users are involved directly in theinterviewing and selecting process(R1, R2)



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Core modules

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B.07.2 PromotionsTo make sure that promotion process meets the applicable procedures and that all master and payroll data are updated

Manager/Coordinator


Executive Director

2Assess and

approveperformanceevaluations

1Propose forpromotion


GA Staff

Promote?

5Inform promotedemployee andother relevantdepartments

3Propose SalaryAdjustment for

promotedemployees

No

Yes4

Review andApprove

Promotions

Approvepromotion?

Yes

No




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Core modules

B.11




Activity:1. Employees’ performance are evaluated by their direct supervisors. Based on good performance, direct supervisors

propose for the employees to be promoted (R1).2. Finance and administration manager assesses and approves promotions based on feedback/evaluations received on

staff performance (R2).3. Once the finance and administration manager decides to promote an employee, he/she then will propose salary

adjustment based on grading level and prepare a promotion letter (R3, R4).4. Executive director reviews and approves promotions for manager and above positions.5. Finance and administration manager informs promoted employees and GA staff of the promotion so employee master

data and payroll data can be updated.Function(s) involved:► Manager/coordinator► Finance and administration manager► Executive director► GA staff



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B.09

B.10

Core modules

B.11





R1 — Not objective promotion (C1)

R2 — Incorrect assessment on staffperformance (C2)

R3 — Inaccurate grading level (C3)

R4 — Unfair pay adjustment (C3)


C1 — Gather evaluations/feedback from othermanagers on the staff performance (R1)

Performed by organization level

C2 — NGO needs to have a set of criteria thatmust be met before promotion isgranted (R2)


C3 — Review and approve salary adjustments(R3, R4)



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Core modules

B.11


B.07.3 TerminationsTo make sure that employee terminations are done fairly and according to the organization’s policies and relevant laborlaws and regulations


Related Employee

1Prepare Notice for

Termination


GA Staff

4File Clearance Sheet

2Meeting with theemployee to be

terminated

3DischargeProcess




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Core modules

B.11




Activity:1. Finance and administration manager receives notice for employee termination, which may come from two sources: (1)

employee’s direct supervisor because the employee does not perform or because of the end of the employee’scontract; (2) executive director because of the organization’s downsizing plan.

2. Finance and administration manager meets with the employee to be terminated, providing the reasons for terminationand informing of other termination procedures (R1).

3. Once an employee has been terminated, the employee will have to complete several activities prior to leaving theorganization. These activities include returning all organization assets (i.e., computers, files, mobile phones), filling outclearance sheet and participating in exit interview (R2).

4. Finance and administration manager fills out the completed clearance sheet and prepare a reference letter, ifnecessary.

Function(s) involved:► Finance and administration manager► Related employee► GA staff



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Core modules

B.11





R1 — Employee may take legal action if notgiven the benefit he/she is entitled to attermination (C1)

R2 — Employee still has access into theorganization’s database (C2)


C1 — Check the relevant labor laws and otherbenefit entitlement (R1)

Performed by GA staff

C2 — Make sure that all organization assetsare returned and that the terminatedemployee’s access into the system iscancelled (R2)



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Core modules

B.11


B.07.4 ResignationsTo make sure that the resignation process is performed according to organization policies and other related regulations


Related Employee

Direct Supervisor


2Review

Resignation Letters

1Prepare

Resignation Letter

To 8 in Workflow Modeler: B.07.5Employee Master Data

GA Staff

4Fill out Clearance Sheet

3Exit Interview

5File Clearance Sheetsand prepare Reference

Letters



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Core modules

B.11




Activity:1. Resigning employees submit resignation letters, at least one month prior to their resignation date, to their direct

supervisors.2. Supervisors review and discuss resignation letters with the resigning employees.3. Finance and administration manager meets with the resigning employee in an exit interview.4. Resigning employees fill out clearance sheets to make sure that they return all organization assets (R1, R2).5. Finance and administration manager files the completed clearance sheets and prepares reference letters for the

resigning employees.Function(s) involved:► Related employee► Direct supervisor► Finance and administration manager► GA staff



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B.09

B.10

Core modules

B.11





R1 — Resigning employees do not return allorganization assets, including importantdatabases (C1)

R2 — Employees still have access into theorganization’s database (C2)


C1 — Obtain a list of items that are in theemployee’s possession so that themanager can use the checklist toconfirm that the employee has returnedall organization property (R1)

C2 — Make sure that all organization assetsare returned and that resignedemployees’ access into the system iscanceled (R2)



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Core modules

B.11


B.07.5 Employee master dataTo maintain and update employee database and make sure that employee information is current

Employee

GA Staff

1Inform updates on

employee data

To 2 Update Attendance Summaryin Workflow Modeler: B.07.6 Payroll

Finance andAdministrationManager 3

Review and approveemployee data in

database

2Input and update

Employee Master Datainto the database

from Accept Candidate?in Workflow Modeler: B.07.1 Recruitment

from 5 Inform promoted employee and other relevantdepartments in Workflow Modeler: B.07.2 Promotions

from 4 File Clearance Sheetin Workflow Modeler: B.07.3 Terminations

from 5 File Clearance Sheets and prepare ReferenceLetters in Workflow Modeler: B.07.4 Resignations




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B.12 B.13

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B.09

B.10

Core modules

B.11




Activity:1. Employees relate changes/updates to their personal data.2. GA staff inputs and updates employee master data, including the following information:

► Employee data (name, date of birth, education, department, address, contact number, marital status, number of dependents).► Recruitment-, promotion-, termination- and resignation-related information: result of test and interview for enrollment, joining date, level

(staff/manager) including new level if promoted, amount of salary including salary adjustment, employment status (i.e.,permanent/contract, including terms and agreement for contract employee), insurance (if any), date resigned from the organization,reason for leaving the organization, clearance sheet (returning computer, phone, car, company loan, ID card, etc.) (R1, R2, R3).

3. Finance and administration manager reviews and approves employee data in database.Function(s) involved:► Employee► GA staff► Finance and administration manager



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B.09

B.10

Core modules

B.11





R1 — Unauthorized employee data entry to thedatabase (C1, C3)

R2 — Incorrect employee data entry to thedatabase (C1)

R3 — Employee master data includes fictitiousemployee (C2)


C1 — Review and approve changes ofemployee information in the database(R1, R2)

C2 — Review employee master data on aregular basis and compare it with theprevious-period employee masterdata (R3)

C3 — Restrict access to make changes toemployee master database to authorizedNGO staff through use of passwords (orphysical controls for manualrecords) (R1)



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B.09

B.10

Core modules

B.11


B.07.6 PayrollTo perform payroll calculations accurately based on employee attendance and employee master data

to 1 Prepare Cash/Bank Payment Voucher inWorkflow Modeler: B.09.2 Bank Payments

from 3 Review and approve employee data in database inWorkflow Modeler : B.07.5 Employee Master Data

Staff

Accounting Staff

Finance AndAdministrationManager

Finance Staff

GA Staff

1Fill in Attendance

Sheets

2Update Attendance

Summary

3Calculate Payroll

for the period

4Review Payroll

Calculations

Payroll Calculation




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B.09

B.10

Core modules

B.11




Activity:1. Employees should sign in at the beginning of work day and sign out at the end of the day. This activity allows the

payroll department to calculate any overtime hours (R1, R2).2. On a regular basis (usually monthly), GA staff updates attendance summary to submit to accounting staff for payroll

preparation. Attendance summary includes regular time, overtime, sick leave, annual leave/vacation and excusedleave (R3).

3. Accounting staff calculates payroll payment, including all required tax calculations (withholding tax and Social Security)upon receiving employee master data for payroll from GA staff. Payroll is processed on a periodical basis (R4, R5).

4. Finance and administration manager reviews and approves payroll calculations prepared by the accounting staff.When approved, the finance and administration manager signs payroll calculation sheet and forwards it to the financestaff for making salary payment.

Function(s) involved:► Staff► GA staff► Accounting staff► Finance and administration manager► Finance staff



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Core modules

B.11





R1 — Attendance sheets do not reflect truehours worked (C1)

R2 — Absent employee is signed in by anotheremployee (C1)

R3 — Incorrect entry to attendancesummary (C2)

R4 — Incorrect payroll (salary, withholding taxand Social Security) calculation (C3)

R5 — Payments are made to formeremployees who have retired, resigned orterminated (C3, C4)

Performed by each department head

C1 — At the end of the day, review andapprove attendance sheets (R1, R2)


C2 — Review and approve hours worked inattendance summary (R3)

C3 — Review payroll calculations on a regularbasis and compare it with employeemaster data (R4, R5)

C4 — Review the pay total by employee fromcurrent period to prior period andinvestigate significant differences (R5)



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B.09

B.10

Core modules

B.11

Delivery

B.08.1 Delivery schedulingTo distribute goods of the right quantity efficiently and in a timely manner


To 1 Prepare Delivery Order (DO) inWorkflow Modeler: B.03.3 Goods Issuance

from 4 Review PR and Approve inWorkflow Modeler: C.01.1 Recipient

Requisitions-Goods/Services


Inventory (Warehouse) Staff

Delivery (Distribution) Staff

Coordinator

Field Coordinator

1Prepare a

Distribution Plan

2Generate a List ofRecipient Address

per Area

3Review

Distribution Plan

4Prepare DOs and

distribute toWarehouse

Inventory and DistributionManager

To 1 Material/Goods Delivery in WorkflowModeler: B.08.2 Goods Delivery

from 1 in Workflow Modeler:B.08.2 Goods Delivery

Revised?

To 1 Distribute Questionnaire/Interview in WorkflowModeler: C.01.2 Recipient Satisfaction Survey

DistributionPlan and DO

No

Yes

5Approve DOs



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Core modules

B.11

Delivery



Activity:1. Field/community staff prepares and makes a distribution plan based on recipient requisition data and recipient

locations to provide for efficient distributions (R1).2. Delivery (distribution) staff generates a list of recipient locations from the system and categorizes the locations based

on area. Data on recipient locations can also be obtained from recipient requisition data maintained by thefield/community staff.

3. Coordinator reviews distribution plan, which includes loading plan, in order to enable the least costly or the mosteffective goods distribution.

4. Based on approved distribution plan, delivery (distribution) staff prepares delivery orders (DOs) for distributing goodsto recipients.

5. Inventory and distribution manager approves DOs.Function(s) involved:► Field/community staff► Field coordinator► Inventory (warehouse) staff► Delivery (distribution) staff► Inventory and distribution manager► Coordinator



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Core modules

B.11


Delivery



R1 — Distribution plan is ineffective andinefficient (C1)


C1 — Review the distribution plan and makeany necessary correction (R1)



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Core modules

B.11

Delivery

B.08.2 Goods deliveryTo make sure that goods purchased/donated are distributed and received by the intended recipients

from 5 Approve DOs in WorkflowModeler: B.08.1 Delivery Scheduling

Vendor/Supplier

Transporter



1Material/Goods

Delivery

2Unloading

materials/goods

4DO and goods

acceptance

To 1 Distribute goods in WorkflowModeler: C.02.1 Recipient Receipt

from 13 in WorkflowModeler: B.03.3 Goods Issuance

No

Yes

3Record incorrectitems and returndamaged goods

5Recording &

Reporting

DistributionPlan and DO

Damagedgoods

Signed DOand

DamagedGoods

To 1 Prepare a DistributionPlan in Workflow Modeler:B.08.1 Delivery Scheduling

Damaged Goods

Meets therequirements?

Signed DO and Damaged Goods




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B.09

B.10

Core modules

B.11

Delivery



Activity:1. Transporter loads material/goods into selected transportation mode, and the transporters acknowledge DOs and

deliver the materials/goods (R1, R2).2. Field/community staff unloads the materials/goods and physically checks the materials/goods against DOs.3. Field/community staff records any incorrect items on DOs (quantity, type of items, etc) and signs off. Damaged goods

should be returned to the warehouse/vendors.4. Field/community staff signs DOs, acknowledging date and time.5. Delivery (distribution) staff generates and reloads incorrect items, allocates products, sends DOs for incomplete items

to field/community staff and sends damaged goods to suppliers/vendors.Function(s) involved:► Vendor/supplier► Transporter► Delivery (distribution) staff► Field/community staff



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Core modules

B.11


Delivery



R1 — Incomplete material/goods (C1)

R2 — Material/goods not delivered or stolen(C1, C2)


C1 — Verify inventory completeness comparedwith DOs (R1, R2)

C2 — Transporters are accompanied bydelivery (distribution) staff (R2)



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Cash disbursement

B.09.1 Accounts payableTo correctly process invoices payable for goods and services received from vendors


To 14 in Workflow Modeler:B.11.1 Journal Entry

from 4 Contacts the service provider to service thefixed assets in Workflow Modeler: B.06.6

Fixed Assets Maintenance

Inventory and distribution manager

Accounting Staff

Vendor

from 3 Prepare Project Acceptance Letter inWorkflow Modeler: B.05.5 Project

Acceptance/Delivery

1ReceiveInvoice

document

from Approve Memorandum of Project Completion?in Workflow Modeler: B.05.3 Project Inspection

from Donated goods? in WorkflowModeler: B.03.2 Receipt of Goods or Services

To 1 Prepare Cash/BankPayment Voucher inWorkflow Modeler:B.09.2 Bank

2Verify POs,

DOs andInvoices

3CompleteDocument

4PaymentSchedule

Accept?

No

Yes

Projectacceptance

letter

PO,invoices,

DO



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Core modules

B.11

Cash disbursement



Activity:1. Accounting staff receives invoice documents, such as (R1, R2):

► POs from procurement staff► Invoices and tax invoices from suppliers► DOs

2. Accounting staff verifies POs, DOs, invoices and related tax calculations. Any incomplete documents are returned tosource (i.e., vendors) for completion.

3. Vendors complete all required accounts payable documents and send them back to accounting department.4. Accounting staff prepares payment schedule based on information received from related departments.Function(s) involved:► Inventory and distribution manager► Accounting staff► Vendor



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Core modules

B.11


Cash disbursement



R1 — Invoice documents (invoice, PO, etc.)are illegitimate (C1, C2)

R2 — Invoice documents (invoice, PO, etc.)are incorrect/incomplete (C1, C2)

Performed by accounting staff and finance andadministration manager

C1 — Verify and validate document receipt andperform matching of POs, invoices andDOs (R1, R2)

C2 — Review accounts payable listing(R1, R2)



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Core modules

B.11

Cash disbursement

B.09.2 Bank paymentsTo make cash/bank payments as required and on a timely basis


Executive Director/Coordinator/Finance and Admin Manager

Finance & Administration Manager

Finance Staff

Accounting Staff

from 4 Review Payroll Calculations in WorkflowModeler: B.07.6 Payroll

from Approved? in Workflow Modeler: B.10.1Petty Cash and Replenishment

1Prepare

Cash/BankPayment Voucher

from 4 Payment Schedule in WorkflowModeler: B.09.1 Accounts Payable

To 14 in Workflow Modeler: B.11.1Journal Entry

2Prepare

cheques/banktransfer orders

5Make

Payments

4Authorizecheques/

bank transfers

Cheque andBank Transfer

3Verify andauthorize

cheques/BankTransfer Orders

PayrollCalculation



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B.10

Core modules

B.11

Cash disbursement



Activity:1. Finance staff prepares cash/bank payment vouchers for approved invoices, salary requisitions, etc. (R1, R2)2. Finance staff prepares checks/bank transfer orders for authorization based on the cash/bank payment vouchers

(R3, R4).3. Finance and administration manager verifies checks/bank transfer orders against vouchers and other supporting

documents.4. Assumptions:

► Checks/bank transfers should be signed by two senior management executives.► Policies on authorization limits should be defined.

5. Executive director, coordinator or finance and administration manager should approve and sign checks/bank transferorders (according to the authorization table).

6. Finance staff sends out payments to vendors and other cash disbursement (including payroll). Cash/bank paymentvouchers are then sent to accounting staff for inputting into payment system/module. Finance staff is to maintain proofof bank disbursements as well as proof of salary distribution signed by individual employees (R5, R6).

Function(s) involved:► Executive director/coordinator► Finance and administration manager► Finance staff► Accounting staff



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Core modules

B.11


Cash disbursement



R1 — Incorrect/incomplete voucherpreparation (C1)

R2 — Unauthorized voucher preparation (C1)

R3 — Incorrect/incomplete checks/banktransfer orders are prepared (C2)

R4 — Unauthorized check/bank transfer orderpreparation (C2)

R5 — Cash payment is received byunauthorized person (C3)

R6 — Duplicate payments (C2, C4)

Performed by finance staff and finance andadministration manager

C1 — Verify cash/bank payment voucheragainst supporting documents (R1, R2)

C2 — Verify checks/bank transfer ordersagainst supporting documents(R3, R4, R6)

C3 — Payments disbursed in cash are signedby the receiver on cash vouchers (R5)

C4 — Update accounts payable list againstpayments (R6)



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Core modules

B.11

Petty cash

B.10.1 Petty cash and replenishmentTo make sure that petty cash is available when needed and that petty cash replenishment is conducted on time


To 1 Prepare Cash/BankPayment Voucher inWorkflow Modeler: B.09.2Bank Payments

User

Finance andAdministration Manager

Finance Staff

1Submit Petty

Cash AdvanceRequests

2Decline Petty

Cash AdvanceRequest

3Verify Petty

Cash AdvanceRequests

7Prepare Petty

CashReplenishment

Voucher

PettyCash AdvanceRequest over

threshold?

No

Yes

4Issue cash

5Receive cash

6Update Petty

CashDisbursements

Book

Pettycash at minimum

balance?

8Review and

approve PettyCash

ReplenishmentVouchers

Approved?

Yes

No

Cash

Yes

No

Petty cash disbursementdocument



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Core modules

B.11

Petty cash



Activity:1. Users submit petty cash advance requests, which must indicate the purpose of the petty cash advance (R1, R2).2. If a request is declined, finance staff informs users that the petty cash advance request has been declined and

provides explanation why.3. Finance staff verifies the completeness and validity of petty cash advance requests based on the organization’s

policies and the authorization of requisition.4. Once approved, finance staff issues cash and files the authorized document for petty cash reimbursement process

(R3, R4).5. Users receive cash and sign petty cash vouchers (R5).6. Petty cash disbursements are recorded and the balance is updated. Finance staff records amounts disbursed,

purpose of disbursements and the remaining balance of petty cash (R6, R7).7. when petty cash has reached its minimum balance, the finance staff prepares a petty cash replenishment voucher for

the finance and administration manager’s approval (R8).8. Finance and administration manager reviews and approves for completeness and validity of petty cash replenishment

vouchers and cashbook, along with supporting documents.Function(s) involved:► User► finance and administration manager► finance staff



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B.10

Core modules

B.11


Petty cash



R1 — Petty cash advance request forms areprepared by unauthorized person (C1)

R2 — Petty cash is not for organization-relatedpurposes (C2, C3)

R3 — Cash issued by unauthorized person(C4)

R4 — Incorrect amount of cash disbursed (C5)

R5 — Cash is not received by the designatedperson (C6)

Performed by finance staff

C1 — Verify authorization on petty cashadvance requests (R1)

C2 — Verify the purpose of petty cashadvance (R2)

C5 — Finance staff (cashier) is required tore-count amount of cash disbursed (R4)

C6 — Verify that cash receipts have beensigned by the designated persons (R5)

Performed by user manager

C3 — Authorize petty cash advancerequest (R2)


C4 — Review petty cash disbursementdocuments (R3)



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B.10

Core modules

B.11


Petty cash



R6 — Cash payments are not recorded whendisbursed (C7)

R7 — Incorrect amount of recorded cashpayment (C7)

R8 — Request is for incorrect replenishmentamount (C8, C9)

Performed by accounting staff

C7 — Prepare reconciliation and agreepayments to supporting documentation(R6, R7)

C8 — Prepare reconciliation and agreepayments to supportingdocumentation (R8)


C9 — Perform a count of petty cash balanceon a weekly basis and compare withbalance per petty cash disbursementsbook (R8)



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C.02C.01

B.09

B.10

Core modules

B.11

Accounting

B.11.1 Journal entriesTo record transactions into accounting records accurately and completely


Inventory and Distribution Manager

Financial and Adminstration Manager

Vendor

1Obtain

data input

To 1 Obtain data forreconciliation in WorkflowModeler: B.11.2Reconciliation

3Review and

approvedjournal

vouchers

2Preparejournal

vouchers

6Posting to

GL

from 4 Review and Approve Bank ReceiptVouchers in Workflow Modeler:

B.02.1 Bank Receiptsfrom 5 Review the report of difference and instruct

for adjustment in Workflow Modeler:B.03.4 Physical Count

from 5 Determine the classification of the fixedassets in Workflow Modeler: B.06.2 Fixed Assets

Received, Capitalization and Identification Tagfrom 9 in Workflow Modeler: B.06.2 Fixed Assets

Received, Capitalization and Identification Tagfrom 5 Review and approves the exception

report in Workflow Modeler: B.06.5Fixed Assets Physical Inspection

from 2 in Workflow Modeler: B.09.1Accounts Payable

from Donated goods? in Workflow Modeler:B.03.2 Receipt of Goods or Services

from 5 Make Payments in WorkflowModeler: B.09.2 Bank Payments

from 6 Update fixed asset register in WorkflowModeler: B.06.4 Fixed Assets

4Input

journalentries

5Review and

approvetransaction

input



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Core modules

B.11

Accounting



Activity:1. Accounting staff obtains data input. Data input consists of:

► Internal organization document sources, such as:► Approval memo by authorized person► Payroll calculations► Petty cash replenishment vouchers► Cash/bank payment voucher► Receiving reports► Routine journal adjustments (Process B.8.1)

► External organization document sources, such as:► Receipts from donor entity► Invoices► Delivery orders► Credit/debit notes

2. Accounting staff prepares journal vouchers based on supporting documents (R1).3. Finance and administration manager reviews and approves journal vouchers to make sure that:

► Journal vouchers are supported by source document► Account coding is to correct account (classification of account)

4. Accounting staff enters journal entry in the system (R2).



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Core modules

B.11

Accounting



Activity:5. Transaction inputs are checked and reviewed by finance and administration manager before posting in the system to

be sure that data is complete and accurate.6. Accounting staff posts journal entries to general ledger after being reviewed and approved by the finance and

administration manager.Function(s) involved:► Finance and administration manager► Accounting staff



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Core modules

B.11


Accounting



R1 — Misclassification of account (C1, C2, C3)

R2 — Incomplete or inaccurate inputs (C3, C4)


C1 — Journal vouchers are checked andreviewed by authorized person (R1)

C2 — Use of chart of accounts to determineaccount posting allocation (R1)

C3 — Transaction inputs are checked andreviewed before journal posting insystem to be sure that data is completeand accurate (R1, R2)

C4 — Access to posted journals in the systemis restricted to authorized NGOaccounting staff through use ofpasswords (or physical controls formanual records) (R2)



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B.09

B.10

Core modules

B.11

Accounting

B.11.2 ReconciliationTo ensure that general ledger accounts are reconciled and that there are no long-outstanding items or abnormal balancesin the general ledgers


from 6 Posting to GL in WorkflowModeler: B.11.1 Journal Entry

Accounting Staff

Financial and Adminstration Manager

3Review

reconciliationreports

Adjustment?

No

Yes1

Obtaindata for

reconciliation

2Monthly

reconciliation

4Follow up

To 1 Prepare routine journalentry in Workflow Modeler:B.12.1 Closing and Reporting

Need Followup?

Yes

No



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Core modules

B.11

Accounting



Activity:1. Accounting staff obtains data for reconciliation. Data reconciliation consists of:

► Bank statements► Trial balance► Detail of sub-ledger (e.g., accounts payable listing, inventory records, fixed assets register)

2. Accounting staff prepares monthly reconciliation (R1, R2):► Reconcile bank statements with bank account balance per general ledger► Reconcile general ledger accounts with sub-ledger► Prepare reconciliation worksheets► Check outstanding items against source documents to determine appropriate treatment

3. Finance and administration manager reviews reconciliation reports and worksheets for unrecorded and unexplaineddifferences and to make sure long-outstanding or abnormal balances are followed up.

4. Accounting staff follows up with relevant persons regarding unreconciled differences and long-outstanding or abnormalbalances and verifies to source documents.

Function(s) involved:► Accounting staff► Finance and administration manager



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Core modules

B.11


Accounting



R1 — Long outstanding of reconciling items(C1, C2, C3)

R2 — Suspense accounts or abnormalbalances are not cleared on a timelybasis (C1, C2, C3)


C1 — Review reconciling items to make surethat long-outstanding or abnormalbalances are followed up (R1, R2)

C2 — Reconciliation worksheet is preparedand reviewed (R1, R2)

C3 — Aging reports of reconciling items andsuspense accounts are prepared anddistributed to appropriate level ofmanagement, depending on the age ofreconciling items (R1, R2)



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Core modules

B.11

Reporting

B.12.1 Closing and reportingTo conduct the financial close and reporting process efficiently with all transactions affecting the NGO’s financial positionrecorded in an accurate and timely basis. The financial close should result in the preparation of financial statements thatconform with the generally accepted accounting principles of the specific country.


Accounting Staff

Finance and Administration Manager

Coordinator

Donor

Executive Director

Approved?

No

2Reviewroutine

journal entry

3Approveroutine

journal entry

6Reviewfinancialreports

from Adjustment? in WorkflowModeler: B.11.2 Reconciliation

1Prepareroutine

journal entry

4Input routinejournal entry

5Prepare and

printfinancialreports

Agreed?

7Prepare

ManagementReportingPackage

Statement of cash receipt andcash disbursement

Financial Statement

Financial Statement

No

Yes Yes



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Core modules

B.11

Reporting



Activity:1. Accounting staff prepares routine month-end journal entries, which may include adjustments in (R1):

► Depreciation► Amortization► Accrual:

► Interest expenses/income► Overhead expenses► Income tax payable

2. Finance and administration manager reviews routine journal entries to verify accuracy of journal voucher and that it isconsistent with underlying source documents and NGO accounting policies. Consider need for non-routine transactionjournal entries, such as unexpected inventory losses.

3. Finance and administration manager approves routine journal entries.4. Accounting staff inputs routine journal entries (R2).



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B.10

Core modules

B.11

Reporting



Activity:5. Accounting staff prepares monthly financial reports, which consist of (R3):

► General ledger► Trial balance► Balance sheet and income and expense statement► Other special purpose reports, such as a statement of cash receipt and cash disbursement by project► On an annual basis, the NGO is also required to prepare financial statements in accordance with generally accepted accounting

principles comprising a statement of financial position, statement of activities, statement of cash flows and accompanying notes.

6. Finance and administration manager reviews financial statements to make sure that:► Financial statements conform with the generally accepted accounting principles of the specific country.► Accuracy of financial statements.► All known transactions are recorded in a timely manner.► Additional information required in the notes to the financial statements is correct.



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B.10

Core modules

B.11

Reporting



Activity:7. Finance and administration manager prepares the management reporting package (MRP) for the information of the

trustees and the executive director. The MRP is prepared for presentation at the monthly (or quarterly) trustee meetingand contains the following reports:► Balance sheet and income and expense statement► Monthly inventory report (refer to Expanded module B.03.5 Inventory monitoring)► Project status report (refer to Expanded module B.05.2 Project execution and monitoring)► The budget compared to actual performance report (refer to Expanded module B13.1 Budget analysis)► Results of recipient satisfaction survey (refer to Expanded module C.02.2 Recipient satisfaction survey)► Other special-purpose reports

Function(s) involved:► Accounting staff► Finance and administration manager



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Core modules

B.11

Reporting



R1 — Adjustments are not complete,calculated inaccurately and notrecognized in a timely basis (C1)

R2 — Incomplete or inaccurate inputs (C2)

R3 — Inaccurate reporting (C3, C4)


C1 — Supervise and review routine month-endjournal entries to ensure accuracy andcompleteness (R1)

C2 — Transaction inputs are checked andreviewed before posting to generalledger in the system to ensure that datais complete and accurate (R2)

C3 — Financial reports and financialstatements are checked, reviewed andapproved before distribution tousers (R3)

C4 — Detailed supporting preparation of thefinancial statements is available and isreviewed for accuracy and completenessas compared with underlying accountingrecords (R3)



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Core modules

B.11


Recipient requisition

C.01.1 Recipient requisition of goods or servicesTo identify recipient needs for goods/services by using needs requisition (NR) forms


Recipient


1Prepare

PurchaseRequisitions

To 1Review

approvedvendor list in

WorkflowModeler:

B.04.3 DirectAppointment

Field Coordinator

from 4 Input new recipients'Data into the System in

Workflow Modeler: B.01.2Recipient Data Maintenance

Recipientcode

available?

2Input theRecipient

Code/Number& Analyze

Requisitions

3Check Budget

Availibility

4Review PR

andApprove

DirectAppointment

To 1Receive informationto perform tender inWorkflow Modeler:

B.04.4 Tender

To 15in Workflow

Modeler:B.04.6 PO

Management

To 2Generate a List of

Recipient Address perArea in Workflow Modeler:B.08.1 Delivery Scheduling

To 1Prepare AdditionalFund Requisition

Proposal inWorkflow Modeler:B.01.3 AdditionalFund Requisitions

to 1Assess new applicants

based on the NGO‘s predetermined requirements

in Workflow Modeler:B.01.2 Recipient Data

Maintenance

Needadditional

fund?

Purchase Requisition

Purchase RequisitionApproved

PRRepeated

Order?

DirectAppointment/

Tender?

No

Yes Tender

Yes

NoYes

No



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Core modules

B.11




Activity:1. Needs requisition (NR) is the basic document used to identify the needs of the recipients. On a periodic basis,

recipients fill out NRs and submit them to the NGO’s field/community staff.2. Field/community staff inputs recipient codes/numbers from NR into the system and check whether the recipients have

been registered. If registered, make sure that requisitions follow the organization’s standards and that there are noduplicate or unreasonable requests for goods or services. If not yet registered, see recipient data maintenance(R1, R2, R3, R4, R5).

3. Field/community staff checks whether funds are sufficient for fulfilling recipient NR. If funds are not sufficient to fulfillNR, inform field coordinator so additional fund requisition proposal can be prepared (see “Additional fund requisitionprocess”).

4. NR should be reviewed and approved by field coordinator before being sent to the procurement department forcreating POs.

Function(s) involved:► Recipients► Field/community staff► Field coordinator



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B.11





R1 — Approval of duplicate requisition/unreasonable requisition (C1)

R2 — The quantity and/or type of itemsrequested exceed the approvedbudget (C2)

R3 — Incomplete recipient information in thePR (C2)

R4 — Input of PR by unauthorized people(C3, C4)

R5 — Error on PR data inputting (C2)


C1 — Compare requisitions with historicalrequisition information in the system (R1)

C2 — Verify the amount, completeness andaccuracy of requisitions and compare toapproved budget (R2, R3, R5)

C3 — Verify and authorize requisition data entryinto the system (R4)

C4 — Restrict access to process recipientsrequests in the system to authorized NGOstaff through use of passwords (orphysical controls for manual records) (R4)



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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Recipient receipt

C.02.1 Recipient receipt of goods or servicesTo make sure that goods purchased/donated are distributed and received by the intended recipients



Recepients

Community Relation

1Distribute goods

2Receiving goods

4Authorized

recipients receipt

Meetrequitition?

3Record incorrectgoods received

Yes

No

from 0 in Workflow Modeler: B.08.2Goods Delivery

5Obtain Recipient

Receipt Forms andmonitoring



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Approval


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A.01

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B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Recipient receipt



Activity:1. Field/community staff distributes goods to the intended recipients.2. Individual aid recipients receive materials/goods directly from the NGO’s field/community staff. The recipients sign-off

on the recipient receipt forms (R1, R2, R3, R4).3. Recipients record any incorrect items (quantity, type of items, etc.) on recipient receipt forms.4. Recipients sign-off on recipient receipt forms based on the goods received.5. Field coordinator collects the signed-off recipient receipt forms and verifies them against DO report in database, inputs

data into the system for monitoring and periodically surveys recipients to find out whether goods delivered have mettheir expectations.

Function(s) involved:► Recipients► Field/community staff► Field coordinator



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Approval


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A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


Recipient receipt



R1 — The materials/goods are not received bythe intended recipients (C1, C2)

R2 — The materials/goods received aredifferent from what was ordered (C1, C2)

R3 — The materials/goods received are not inthe right quantity (C1, C2)

R4 — The materials/goods received are not ofthe acceptable quality (C1, C2)


C1 — Verify the recipient receipt forms againstDO report in the database (R1, R2,R3, R4)

C2 — Periodically survey recipients to find outwhether goods delivered have met theirexpectations (R1, R2, R3, R4)



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Approval


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A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Expanded module details


Humanitarian Aid Resource and DeliveryFramework — expanded modules




B.08 Delivery

Accounting Reporting(Financial/Mgmt) Bu

dget

and

Anal

ysis

Recipient Requisition Recipient Receipt

Budget Preparationand Requisition

Approval


Rec

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B.05 Produce/Build

B.04 Purchase


A.01

A.02

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Expanded modules

Expanded modules


A.02 Funding and donation mechanismsA.02.1 Funding and donation mechanismsB.03 Inventory managementB.03.1 Inventory planningB.03.3 Goods issuanceB.03.4 Physical countB.03.5 Inventory monitoringB.05 Produce and buildB.05.1 Planning and schedulingB.05.2 Project execution and monitoringB.05.3 Project inspectionB.05.4 Project amendmentB.05.5 Project acceptance/delivery

B.06 Asset managementB.06.1 Fixed asset requisitionB.06.2 Fixed asset receipt, capitalization and

identification tagB.06.3 Fixed asset transfersB.06.4 Fixed asset disposalsB.06.5 Fixed asset physical inspectionB.06.6 Fixed asset maintenanceB.13 Budget and analysisB.13.1 Budget analysisC.02 Recipient receiptC.02.2 Recipient satisfaction survey

Funding and donation mechanisms


A.02.1 Funding and donation mechanismsTo provide an overview of the activities that donors/prospective donors carry out upon receiving proposedbudget/proposals or additional fund requisitions from NGOs

NGO

Prospective Donors

Executive Director

1Assess ProposedBudget/AdditionalFund Requisition

2Fund Raising

Approve &Donate?

No

from 4 Review and approve inWorkflow Modeler: B.01.1

Budget Preparation

3Receive

Pledges/DisbursementSchedules

Cash or goods

To 1 Fund transfers in WorkflowModeler: B.02.1 Bank Receipts

from 2 Review and Approve Additional Fund RequisitionProposal in Workflow Modeler: B.01.3 Additional FundRequisitions

To 22 in Workflow Modeler:B.03.2 Receipt of Goods orServices

Yes

Goods

Cash



B.08 Del iver y

Accounting Reporting(Financ ial /Mgmt) Bu

dget

and

Anal

ysis

Rec ipient Requis ition Recipient Receipt

Budget Preparationand Requis ition

Approval


Rec

eipt

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B.02 Cas h Receipts


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ycle

B.05 Produce/Build

B.04 Purchase

B.06 Ass ets Management

A.01

A.02

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Expanded modules

Funding and donation mechanisms


A.02.1 Funding and donation mechanismsTo provide an overview of the activities that donors/prospective donors carry out upon receiving proposedbudget/proposals or additional fund requisitions from NGOs

Activity:1. Donors receive proposed budget or additional fund requisition from NGOs and determine whether to pledge for

donations based on the donor’s objectives and goals. Once the donors decide to contribute, they will submit theirpledges and disbursement schedule to the NGOs.

2. When Donors have decided to contribute to the proposed budget and/or additional fund requisition, the donors willraise funds or collect goods/services to be donated.

3. NGO executive director reviews the completeness of the pledges/disbursement schedules and compares them to theproposed budget and additional fund requisitions. If necessary, budget amendment are made to take into account thedifference between the proposed budget or additional fund requisition and the pledge approved by donor.

Function(s) involved:► Donors/prospective donors► Executive director



B.08 Del iver y

Accounting Reporting(Financ ial /Mgmt) Bu

dget

and

Anal

ysis

Rec ipient Requis ition Recipient Receipt

Budget Preparationand Requis ition

Approval


Rec

eipt

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B.02 Cas h Receipts


Exp

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B.05 Produce/Build

B.04 Purchase

B.06 Ass ets Management

A.01

A.02

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Expanded modules



B.03.1 Inventory planningTo make sure that goods ordered are received according to the schedule agreed with vendors


Inventory & Distribution Manager

3Check into the systemwhether goods to bedelivered have been

received

4Review report against

the system

To 6 Send POs and Follow up outstanding POin Workflow Modeler: B.04.6 PO Management

1Prepare Schedule of

Goods to be Received

2Reviews Schedule ofGoods to be Received

List ofOutstanding

PO



B.08 Delivery


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Approval


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A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11



B.03.1 Inventory planningTo make sure that goods ordered are received according to the schedule agreed with vendors

Activity:1. Inventory (warehouse) staff prepares schedule of goods to be received based on POs received from procurement.

Schedule of goods to be received documents the quantity of goods expected to arrive from vendors and the timing ofdelivery (R1, R2).

2. Inventory and distribution manager reviews schedule of goods to be received based on POs received fromprocurement.

3. Inventory (warehouse) staff checks into the system whether goods to be delivered have been received. Inventory(warehouse) staff also prepares a report for goods scheduled to be delivered but not yet received. This report issubmitted to procurement department for follow up with vendors as to reasons for the delay (R3).

4. Inventory and distribution manager reviews report against the system.Function(s) involved:► Inventory (warehouse) staff► Inventory and distribution manager



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Approval


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11




B.03.1 Inventory planningTo ensure that goods ordered are received according to the schedule agreed with vendors

R1 — Unintentional errors in preparingschedule of goods to be received (C1)

R2 — Schedule of goods to be received isincomplete or not updated (C2)

R3 — Inaccurate report (goods that have beenreceived are still included in the report;goods that have not been received arenot included in the report) (C3)


C1 — Review Schedule of goods to bereceived based on POs received fromprocurement (R1)

C2 — Re-check the schedule of goods to bereceived with field coordinator (R2)

C3 — Report is reviewed against thesystem (R3)



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Approval


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11



B.03.3 Goods issuanceTo perform the issuance of goods to recipients in an efficient manner



3Update bin card andprepare summary of

goods issued

5Update the inventorydatabase to reflect

goods issued

To 5 in Workflow Modeler:B.03.5 Inventory Monitoring

1Prepare Delivery

Order (DO)

2Locate, count,

check andissue goods

4Compare DO and

summary ofgoods issued

To 1 Material/Goods Delivery in WorkflowModeler: B.08.2 Goods Deliveryfrom 5 Approve DOs in Workflow

Modeler: B.08. 1 Delivery Scheduling

Accounting Staff




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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11




Activity:1. Delivery (distribution) staff prepare delivery order (DO) based on approved distribution plan. DOs should consist of the

following information (R1, R2):► Delivery date► Type of goods► Quantity of goods► Description of goods and distribution staff who issued the goods► Recipient purchase requisition

2. Inventory (warehouse) staff locates goods in the warehouse, performs physical check, and counts and issues goodsaccording to the DOs (R3).

3. Inventory (warehouse) staff updates bin card and prepares summary of goods issued (R4, R5, R6).4. Inventory and distribution manager compares DOs and summary of goods issued.5. Accounting staff updates inventory database based on approved DOs and summary of goods issued (R7, R8).Function(s) involved:► Delivery (distribution) staff► Inventory (warehouse) staff► Inventory and distribution manager► Accounting staff



B.08 Delivery


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Approval


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11







B.08 Delivery


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and

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Approval


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B.02 Cash Receipts


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

R1 — Unauthorized DOs (C1, C2)

R2 — DOs prepared do not match withdistribution plan (C1)

R3 — Goods issued are not in accordance withDO (C3)

R4 — Inaccurate update of bin card (C4)

R5 — Bin card is not updated in a timelymanner(C4)

R6 — Summary of goods issued is inaccurate(C5)

R7 — Inaccurate input of information to thesystem (C6, C7)

R8 — Issuance of goods are not inputted to thesystem (C2, C7)


C1 — Validate and approve DO (includematching to distribution plan) (R1, R2)

C2 — Use of prenumbered DOs (R1, R8)

C3 — Re-check or re-count the goods to beissued (R3)

C4 — Periodic physical count of inventory(R4, R5)

C5 — Compare summary of goods issued toDO (R6)

C6 — Review and verify data input (R7)

C7 — Reconcile total quantity per DO with totalgoods issued in the system (R7, R8)



B.03.4 Physical countTo check that inventory items physically exist and are in usable condition



B.08 Delivery


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Approval


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


5Review the report of

difference and instruct foradjustment


1Prepare InventoryCount Instruction

2Perform physical

count

4Prepare report of

inventory count result

3Perform

reconciliation

Inventory (Warehouse) Staff andAccounting Staff

Inventory & Distribution Manager and Finance &Administration Manager






B.08 Delivery


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Approval


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Activity:1. Inventory and distribution manager prepares inventory count instruction.2. Inventory (warehouse) staff and accounting staff perform physical count and inspection on regular basis based on

inventory count instructions (R1, R2, R3, R4, R5).3. Inventory (warehouse) staff and accounting staff perform reconciliation between quantity of inventory per count and

per accounting record.4. Inventory (warehouse) staff and accounting staff prepare report of inventory count result, including any obsolete or

spoiled inventory.5. Inventory and distribution manager and finance and administration manager review (and investigate if necessary) then

approve the report of difference between inventory quantity per count and per accounting records and instructaccounting staff to make the adjustment.

Function(s) involved:► Inventory (warehouse) staff► Accounting staff► Inventory & distribution manager► Finance & administration manager







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Approval


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

R1 — Inaccurate inventory list per accountingrecord (C1, C2)

R2 — Inaccurate inventory measurement (e.g.,dozen vs. unit; pounds vs. kilograms) (C3)

R3 — Usable inventory is considered asobsolete (C4)


C1 — Review inventory list and ensure timelyand accurate entry of receiving andissuance of inventory (R1)

C2 — Review and ensure that only authorizedaccounting staff can access or changethe inventory list (R1)

Performed by finance and administration managerand inventory and distribution manager

C3 — Ensure the unit of measurement in thesystem is the same as that in physicalcount (R2)


C4 — Review list of obsolete inventory andensure the inventory included in the listis actually obsolete (R3)




B.03.4 Physical countTo check that inventory physically exist and are in usable condition



B.08 Delivery


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Approval


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

R4 — Inventory is received and issued duringphysical count (C5)

R5 — Double or uncounted inventory (i.e.,unallocated) during physical count(C6, C7, C8)


C5 — Review receiving and issuance ofinventory report during inventorycount (R4)


C6 — Inventory items are stored in an orderlymanner in the warehouse to enable anaccurate count (R5)

Performed by inventory (warehouse staff) andaccounting staff

C7 — Count inventory using staff not usuallyresponsible for its safeguarding (R5)

C8 — Use inventory tags (R5)



B.03.5 Inventory monitoringTo provide NGO management with an overview of inventory levels and turnover



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Approval


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Coordinator


2Prepare MonthlyInventory Report

3Review and give

feedback

from 5 Update the inventory database to reflect goods issued inWorkflow Modeler: B.03.3 Goods Issuance 1

Monitor InventoryTurnoverfrom 7 Verify and approve data on Goods/Services entered into the

system in Workflow Modeler: b.03.2 Receipt of Goods or Services






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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Activity:1. Inventory and distribution manager should monitor and check the following inventory data from the system: inventory

balance, inventory receipt and issuance, and inventory obsolescence. If there is an anomaly, inventory and distributionmanager should trace the supporting data and inquire with the related departments (e.g., procurement, fieldcoordinator, finance and administration).

2. Inventory and distribution manager prepares monthly inventory report, which consists of (R1):► Inventory on hand and receiving/issuance statistics► Obsolete inventory report

3. Coordinator reviews and gives feedback on monthly inventory report for matters requiring investigation and feedbackby the inventory and distribution manager.

Function(s) involved:► Inventory and distribution manager► Coordinator







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B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

R1 — Data is inaccurate, incomplete and is notrecorded in a timely basis (C1)


C1 — Ensure all inventory receipt andissuance transactions have beenrecorded in the system prior to themonth-end financial close (R1)

Produce and build


B.05.1 Planning and schedulingTo plan and schedule the project so that the project objectives are achieved



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C.02C.01

B.09

B.10

Core modules

B.11

Coordinator

Project Manager

4Review and approve

Project Charter

To 1 Monitor the progress of theproject execution in WorkflowModeler: B.05. 2 ProjectExecution & Monitoring

1Form a Project

Committee

2Review Project

Committee

3Prepare Project

Charter

from 5 Submit signed contract s tovendors in Workflow

Modeler: B. 04.5 Contracts

Project Committee

Executive Director/Trustee

Approved?

Approved?

No

Yes

No

Yes

Produce and build





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C.02C.01

B.09

B.10

Core modules

B.11

Activity:1. Form the Project Committee; members should consist of field coordinator, coordinator, executive director and trustee

representatives (R1).2. Executive director and trustee review and approve the Project Committee structure to ensure that the Project

Committee consists of qualified members.3. A project charter is prepared by the contractor/consultant and agreed by the Project Committee. A project charter

should include project objectives, background, scope, approach, cost analysis and a detailed schedule of projecttiming with milestones (R2).

4. Project Committee reviews and approves project charter.Function(s) involved:► Coordinator► Executive director► Trustee► Project manager► Project committee


Produce and build





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C.02C.01

B.09

B.10

Core modules

B.11

R1 — Project Committee members do nothave the appropriate/relevant skills (C1)

R2 — Project charter does not reflect projectobjectives (C2)

Performed by trustee

C1 — Review relevant skills of ProjectCommittee members (R1)

Performed by Project Committee

C2 — Review project charter to ensure that it isaligned with the project objectives (R2)

Produce and build


B.05.2 Project execution and monitoringTo execute and monitor the project in accordance with the project charter and NGO policies



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C.02C.01

B.09

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Core modules

B.11

Contractor/Consultant

Project Manager

4Prepares Project

Status Report

2Prepare ProjectProgress Report

from Approved? in Workflow Modeler: B.05.1Planning and Scheduling

3Reviews and analyzesprogress report from

the vendor

1Monitor the progress of

the project execution

Produce and build





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C.02C.01

B.09

B.10

Core modules

B.11

Activity:1. Project manager monitors the project execution progress to be sure that the project is completed as planned. Any

exceptions or deviations to the project execution should be communicated directly to the contractor/consultant (R1).

2. Contractor/consultant prepares project progress report and submits it to the project manager on a regular basis (R2).3. Project manager reviews progress report from the contractor/consultant and analyzes the differences between the

project charter and the project’s actual progress.4. Project manager prepares project status report based on the progress report received from the contractor/

consultant and submits it to the Project Committee.

Function(s) involved:► Project manager► Contractor/consultant


Produce and build





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B.02 Cash Receipts


Exp

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ture

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Petty

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Disb

urse

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t

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ition

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

R1 — The project execution is not in line withthe project charter (C1)

R2 — The progress report fromcontractor/consultant is inaccurate (C2)

Performed by project manager

C1 — Compare project’s actual progress withproject charter (R1)

C2 — Compare progress reports fromcontractor/consultant with the project’scurrent progress (R2)

Produce and build


B.05.3 Project inspectionTo check that project stages of completion satisfy the project objectives as stated in the project charter



B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

ipt

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B.02 Cash Receipts


Exp

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ition

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


Project Manager

2Accept Memorandum ofProject Completion andInspect Actual Project

To 11 in Workflow Modeler:B.09.1 Accounts Payable

3Correct or complete

project phase

1Prepare Memorandum of

Project Completionby Phase

ApproveMemorandum of

ProjectCompletion?

Yes

No

Produce and build





B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

ipt

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B.02 Cash Receipts


Exp

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ture

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Activity:1. Contractor/consultant prepares memorandum of project completion by phase as certain phases of the project are

finished. Completion of a certain phase of the project may be an indicator for the contractor/consultant to obtainprogress payment from the NGO (R1).

2. Project manager receives memorandum of project completion by phase received from contractor/consultant andinspects the actual progress of the project to ascertain that the particular project phase has been completed (R2).

3. Contractor/consultant corrects or completes project phase.Function(s) involved:► Contractor/consultant► Project manager


Produce and build





B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

ipt

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B.02 Cash Receipts


Exp

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

R1 — Memorandum of project completion isprepared for a phase that has not beencompleted (C1)

R2 — Project manager does not have therelevant expertise for inspecting theproject (C2)


C1 — Review memorandum of projectcompletion and compare it to the actualprogress of the project

Performed by Project Committee

C2 — Hire a qualified third-party surveyor toevaluate and confirm project status

Produce and build


B.05.4 Project amendmentTo properly execute project amendments and revise related documents accordingly



B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

ipt

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B.02 Cash Receipts


Exp

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Project Manager

Project Committee

4Approve changerequest proposal

To 10 in Workflow Modeler:B.04.5 Contracts

3Review change requestproposal from contractor

and propose budgetamendment

1Identifies any changes in

technical design

2Inform contractor for the

required changes

Produce and build





B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

ipt

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B.02 Cash Receipts


Exp

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Activity:1. Project manager identifies any necessary changes in technical design. Any changes should be approved by Project

Committee (R1, R2).2. Project manager informs contractor/consultant of the required changes.3. Project manager reviews change request proposal to make sure that all required changes are incorporated and

proposes budget amendment.4. Project Committee approves change request and proposed budget amendment.Function(s) involved:► Project manager► Project committee


Produce and build





B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

ipt

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B.02 Cash Receipts


Exp

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

R1 — Identification of the changes is nottimely/too late (C1)

R2 — Improper or unnecessary changes in theproject (C2)


C1 — Inspect physical progress of the projectregularly and obtain progress report fromcontractor on a timely basis (R1)

C2 — Proposed changes should be approvedby Project Committee (R2)

Produce and build

B.05.5 Project acceptance/deliveryTo ensure the project has been completed in accordance with project charter



Project Manager

Project Committee

1Accept Completed

Project

3Prepare Project

Acceptance Letter

Acceptcompletedproject?

No

4Project handover to

the community

To 11 in Workflow Modeler:B.09.1 Accounts Payable

To 10 in Workflow Modeler: B.04.5Contracts

Yes

2Ask vendor to fix the

project in order to complywith the contract

ProjectAcceptance

Letter



B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

ipt

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B.02 Cash Receipts


Exp

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urse

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Produce and build



Activity:1. Project manager checks that the completed project has met all required specifications (R1).2. Project manager asks vendor to fix the project in order to comply with the contract.3. Project manager prepares project acceptance letter (R2).4. Project Committee conducts project handover to the community.Function(s) involved:► Contractor/consultant► Project manager► Project Committee



B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

ipt

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B.02 Cash Receipts


Exp

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urse

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


Produce and build



R1 — Completed project does not meet allrequired specifications (C1, C2)

R2 — Project acceptance letter is prepared forproject that has not been completed (C3)


C1 — Inspect the completion of the project andcompare with the contract and projectcharter (R1)

C2 — NGO engages third-party qualifiedsurveyor to evaluate and confirm projectcompletion (R1)

C3 — Review project acceptance letter forcompleteness and sign the projectacceptance letter (R2)



B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

ipt

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B.02 Cash Receipts


Exp

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Asset management

B.06.1 Fixed asset requisitionThe requisition of fixed assets is undertaken for necessary items that fulfill the NGO’s objectives




B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

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B.02 Cash Receipts


Exp

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

User

Financial and Administration Manager 4Check the

availability of thefund to purchasethe fixed assets*

To 1 Obtain and inputvendor data into thesystem in WorkflowModeler: B.04.2Vendor Assessment

1Identify and

determine fixedassets needs

2Prepare List of

fixed asset needs

3Review and

approve the Listof fixed asset

needs

To 4 locate and propose available fixedassets to user in Workflow Modeler: B.06.3Fixed Assets Transfer

Coordinator/Executive Director

Procurement Staff

UsedFixed Assets

available?

Fundsavailable?

Yes

Yes

Procurement Manager

5Identify the

alternative fixedassets

6Prepare PurchaseRequisition (PR)

7PR approval

process

8PR approval process

(depending on internalpolicy for level of

authorization)

from Repair or purchase? inWorkflow Modeler: B.06.6Fixed Assets Maintenance

No

Yes

No

Asset management



Activity:1. All users identify and determine their fixed asset needs and submit approved fixed asset requisitions to

GA staff.2. Procurement staff prepares list of fixed asset needs and maintains list of approved fixed asset requisitions.3. Procurement manager reviews and approves the list of fixed asset needs (R1, R2, R3).4. Finance and administration manager checks the availability of funds to purchase the fixed assets.5. Finance and administration manager identifies the alternative fixed assets (e.g., transfer).6. Procurement staff prepares purchase requisition (PR) and obtains approval from procurement manager (R4, R5).7. Procurement manager approves PR.8. Coordinator/executive director approves PR (depending on value of item).Function(s) involved:► User► Procurement staff► Procurement manager► Finance and administration manager► Coordinator► Executive director



B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

ipt

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B.02 Cash Receipts


Exp

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urse

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


Asset management



R1 — Duplicate requisitions for the same itemare approved (C1)

R2 — Unnecessary requisition for items notconsistent with NGO objectives (C2)

R3 — Unbudgeted fixed assets or actual pricefor fixed assets exceeds budget (C3)

R4 — Unreasonable requisition (C2)


C1 — Review purchase requisition andcompare with list of approved fixed assetrequisitions (R1)

C2 — Verify and review the reasonableness offixed asset requisitions (R2, R4)


C3 — Compare budget and fixed assetrequisitions (R3)



B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

ipt

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B.02 Cash Receipts


Exp

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urse

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Asset management

B.06.2 Fixed asset receipt, capitalization and identification tagTo ensure that all purchased fixed assets are a) received in accordance with the purchase order and in good condition, b)capitalized/recorded in accordance with approved accounting policy, and c) registered and tagged for monitoring purposes

Procurement Staff

GA Staff

To 12 inWorkFlowModeler:B.11.1Journal Entry

1Compare and check

the fixed assetsreceived

3Prepare Goods

Receiving Report

4Determine whether thefixed assets should becapitalized or expensed

User


Acceptor not?

Yes

Financial & AdministrationManager

No 2Return fixed

assets to vendor

7Sign Fixed AssetsDeployment Form

5Determine the

classification of thefixed assets

6Check, print out andattach the identifying

tag number to therelated fixed assets

8Update the fixed assetsregister and match with

Fixed AssetsDeployment Form

9Review and approvefixed assets register

periodically

To 12 in WorkflowModeler: B.11.1Journal Entry



B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

ipt

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B.02 Cash Receipts


Exp

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Disb

urse

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


Asset management



Activity:1. Procurement staff compares fixed assets received with POs and checks the condition of fixed assets (R1, R2, R3, R4,

R5, R6, R7).2. Procurement staff returns rejected fixed assets to vendor.3. Inventory (warehouse) staff prepares goods receiving report.4. Finance and administration manager determines whether the fixed assets should be capitalized or expensed in

accordance with fixed assets capitalization policy (R4).5. Finance and administration manager determines the classification of the fixed assets (office equipment, vehicles, etc.)

in accordance with organizational policies (R4).6. GA staff checks, prints out and attaches identifying tag number to the related fixed assets.7. Users sign fixed assets deployment form to show they have taken custody of the fixed assets.8. Accounting staff updates the fixed assets register and matches it with the fixed assets deployment form.9. Finance and administration manager periodically reviews and approves fixed assets register.Function(s) involved:► Procurement staff► Inventory (warehouse) staff► GA staff► Accounting staff► Finance and administration manager



B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

ipt

Cyc

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B.02 Cash Receipts


Exp

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ture

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Disb

urse

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


Asset management



R1 — Accepted fixed assets do not agree withPO (in quantity and specification) and/orare not in good condition (C1)

R2 — Purchases are received but fixed assetsare not recorded (C2, C5)

R3 — Fixed assets are not properly classified(C3)

R4 — Fixed assets capitalized are not inaccordance with fixed assetscapitalization policy (C3)


C1 — Verify the quantity, specification andcondition of fixed assets receivedagainst PO (R1)

C2 — Prenumbered goods receiving report iscompared with POs and DOs (R2)


C3 — Review the classification andcapitalization of fixed assets (R3, R4)

C5 — Review fixed assets register on aperiodic basis (R2, R5, R6, R7)



B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

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B.02 Cash Receipts


Exp

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urse

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


Asset management





B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

ipt

Cyc

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B.02 Cash Receipts


Exp

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Disb

urse

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

R5 — Multiple numbering of a fixed asset(C4, C5, C6)

R6 — One number for several fixed assets(C4, C5, C6)

R7 — Fixed assets register is not updated andis inaccurate (C5, C6)


C4 — System will reject an already usednumber used or fixed assets alreadynumbered (R5, R6)

C5 — Review fixed asset register on a periodicbasis (R2, R5, R6, R7)


C6 — Perform periodic physical inspection andcompare the result to the fixed assetsregister (R5, R6, R7)

Asset management

B.06.3 Fixed asset transfersTo properly record and monitor fixed assets transfers between users




B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

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B.02 Cash Receipts


Exp

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

GA Staff

To 1 Summarize fixed assets to bedisposed in Workflow Modeler: B.06.4

Fixed Assets Disposal

2Check the

condition of thefixed assets

User


Reusable?

No

Financial & AdministrationManager

Yes3Update the fixed

asset register

7Release assigned

fixed assets

9Review and

approve fixedassets register

periodically

1Return fixed

assets that are nolonger use

8Update the fixedassets register

6Sign fixed assetsdeployment form

5Reviews and

approves FixedAsset Transfer

Form

4Locate and

propose availablefixed assets to

userfrom UsedFixed Assetsavailable? in

WorkflowModeler: B.06.1

Fixed AssetsRequisition

Yes

Asset management



Activity:1. Old users return fixed assets that they no longer use to GA department.2. GA staff checks the condition of the fixed assets.3. GA staff updates the fixed assets register and sends to warehouse: user name = none/unassigned.4. GA staff locates and proposes available fixed assets to user by submitting fixed assets transfer form to finance and

administration manager for approval (R1).5. Finance and administration manager and coordinator (if necessary) review and approve fixed asset transfer form.6. New users sign fixed assets deployment form.7. Inventory (warehouse) staff releases assigned fixed assets (R1).8. GA staff updates the fixed assets register and matches with fixed assets deployment form (R2).9. Finance and administration manager reviews and approves fixed assets register periodically.Function(s) involved:► User► GA staff► Finance and administration manager► Inventory (warehouse) manager



B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

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B.02 Cash Receipts


Exp

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Disb

urse

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


Asset management





B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

ipt

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B.02 Cash Receipts


Exp

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

R1 — Transferred fixed assets are notapproved by authorized persons (C1)

R2 — Users’ names and departments are notupdated in fixed assets register (C2)

Performed by inventory (warehouse) staff

C1 — Verify fixed asset transfer form that isalready signed off by finance andadministration manager (R1)


C2 — Perform periodic physical inspection andcompare the result to the fixed assetsregister (R2)

Asset management

B.06.4 Fixed asset disposalsFixed asset disposals of unused or obsolete items are undertaken on a timely basis and enable the NGO to receive adisposal price indicative of the asset’s current value and condition




B.08 Delivery


dget

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Anal

ysis



Approval


Rece

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B.02 Cash Receipts


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

GA Staff


Coordinator

2Review and

approve fixedasset to bedisposed

5Dispose/sell

the fixed assets

To 1 fund transfers in WorkflowModeler: B.02.1 Bank Receipts

3Determine theresale value of

the fixedassets

Accounting Staff

1Summarize fixed

assets to bedisposed

6Update fixedasset register

4Review and

approve fixedasset

(incl. resale value)

To 14 in Workflow Modeler: B.11.1Journal Entry

from 4 Prepare report of FA inspectionresult in Workflow Modeler: B.06.5

Fixed Assets Physical Inspectionfrom Reusable? in Workflow Modeler:

B.06.3 Fixed Assets Transfer

Asset management



Activity:1. GA staff summarizes fixed assets to be disposed and submits to finance and administration manager for approval

(R1, R2, R3, R4).2. Finance and administration manager reviews and approves fixed assets to be disposed (R2).3. Finance and administration manager determines the resale value of the fixed assets (R5).4. Coordinator reviews and approves fixed assets to be disposed (including resale value).5. Finance and administration manager disposes/sells the fixed assets of high value through tender process (R5).6. GA staff updates fixed assets register, and accounting staff records to journal entry (R6).Function(s) involved:► GA staff► Accounting staff► Finance and administration manager► Coordinator



B.08 Delivery


dget

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Anal

ysis



Approval


Rece

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Exp

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urse

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


Asset management





B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

ipt

Cyc

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B.02 Cash Receipts


Exp

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urse

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

R1 — Fixed assets are disposed withoutapproval (C1)

R2 — Rationale for disposing fixed assets isnot reasonable (C1, C2)

R3 — Fixed asset disposals are recordedwithout proper documentation (C3)

R4 — Fixed assets to be disposed can still beused by other departments (C1, C2)

R5 — Fixed asset to be disposed is grosslyundervalued (C4)

R6 — Fixed assets register is not updated toreflect fixed assets disposal (C5)


C1 — Review and approve disposal of fixedassets (R1, R2, R4)

C2 — Review the condition and usage of fixedassets to be disposed (R2, R4)

C3 — Review the disposal journal entry andrelated supporting document (R3)

C4 — Resale value is determined based on themarket value and/or through tenderprocess (R5)

C5 — Periodic physical inspection and theresult compared to the fixed assetsregister (R6)

Asset management

B.06.5 Fixed asset physical inspectionTo check that fixed assets per the register physically exist and are in a usable condition




B.08 Delivery


dget

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Anal

ysis



Approval


Rece

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Finance & AdministrationManager

GA Staff andAccounting Staff

2Perform physical

inspection

4Prepare report of FA

inspection result

To 1 Summarize fixed assets to bedisposed in Workflow Modeler: B.06.4Fixed Assets Disposal

3Perform reconciliation and

update fixed assetregister

1Prepare Fixed AssetsInspection Instruction

5Review and

approves theexception report


Asset management



Activity:1. Finance and administration manager prepares fixed asset inspection instruction.2. GA staff and accounting staff perform physical inspection on regular basis based on fixed assets inspection

instructions and fixed assets register (R1, R2, R3, R4, R5).3. GA staff and accounting staff perform reconciliation between fixed assets register, accounting record and physical

check, and they update the condition, location and user of fixed asset in fixed assets register.4. GA staff and accounting staff prepare report of fixed assets inspection result, identifying any damaged/obsolete fixed

assets (R5).5. Finance and administration manager reviews and approves the exception report for any remaining unexplained

differences and instructs accounting staff to make the appropriate adjustment.Function(s) involved:► GA staff► Accounting staff► Finance and administration manager



B.08 Delivery


dget

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Anal

ysis



Approval


Rece

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B.02 Cash Receipts


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


Asset management





B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

ipt

Cyc

le

B.02 Cash Receipts


Exp

endi

ture

Cyc

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Petty

Cash

Cash

Disb

urse

men

t

Reac

quis

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

R1 — Fixed asset not in location at time ofphysical inspection (C1, C3)

R2 — Fixed asset has no tag number or code(C1)

R3 — Inaccurate fixed assets register (C2)

R4 — Double-counted or uncounted fixedasset during physical inspection (C2,C4)

R5 — Damaged and idle fixed assets were notidentified during the physical inspectionand hence the carrying value has notbeen adjusted (C1, C4)

Performed by GA staff and accounting staff

C1 — Check fixed asset location, condition anduser in accordance with the fixed assetsregister and ensure all fixed assets havetag number or code in accordance withthe fixed assets register (R1, R2, R5)

C2 — Reconcile periodically between fixedassets register and accounting record(R3, R4)

C3 — Trace to log book (R1)

C4 — Fixed assets instruction is detailed andclear (R4, R5)

Asset management

B.06.6 Fixed asset maintenanceTo properly organize the maintenance activities for fixed assets so they can be used effectively for the full period of theirestimated useful life




B.08 Delivery


dget

and

Anal

ysis



Approval


Rece

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B.02 Cash Receipts


Exp

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

User


Coordinator

2Determine the cost

estimation for the repairand maintenance

To 1 Identify and determine fixed assets needs inWorkflow Modeler: B.06.1 FixedAssets Requisition

Procurement Manager

1Propose maintenance

services of fixed assets

3Reviews and approvesthe schedule of fixed

asset maintenance andcost estimation

4Contacts the service

provider to service thefixed assets

Repair orpurchase?

Repair

Purchase

To 11 in Workflow Modeler: B.09.1Accounts Payable

Asset management



Activity:1. Users propose maintenance services of fixed assets to finance and administration manager (R1, R2).2. Finance and administration manager determines the cost estimation for the repair and maintenance, compares the

cost of repair and maintenance with the cost of new asset, and submits assessment to coordinator for approvals.3. Coordinator reviews and approves the schedule of fixed asset maintenance and cost estimation (R3).4. After obtaining approval from the coordinator, procurement manager contacts the service provider to service the

fixed assets.Function(s) involved:► Users► Finance and administration manager► Procurement manager► Coordinator



B.08 Delivery


dget

and

Anal

ysis



Approval


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B.02 Cash Receipts


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


Asset management





B.08 Delivery


dget

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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

R1 — Fictitious proposed repair andmaintenance (C1)

R2 — Maintenance of fixed assets is not inproper period (C1)

R3 — Wrong analysis in deciding repair orpurchase (C2)

Performed by GA staff and accounting staff

C1 — Finance and administration managercompares the budget for repair andmaintenance with the cost estimationand also reviews the timing andreasonableness of the cost (R1, R2)

C2 — Coordinator compares the cost of repairand maintenance with cost for thepurchase of new assets (R3)

Budget and analysis

B.13.1 Budget analysisTo monitor actual results compared with budgeted amount, communicating the budget analysis to the NGO executivedirector and trustee


from 4 Review and approve in WorkflowModeler: B.01.1 Budget Preparation

1Prepares budgetanalysis monthly

2Communicate budget

analysis to the Financeand Administration

Manager and ExecutiveDirector

Finance Staff



B.08 Delivery


dget

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Anal

ysis



Approval


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Budget and analysis



Activity:1. Finance staff prepares budget analysis on a monthly basis. The budget compared to actual performance report takes

budgeted income and expenditure for the reporting period and compares it with the actual income and expenditure forthe same period. The difference between the two figures is the “variance” and should be investigated if significant.Significant differences between budget and actual results should be investigated by the finance staff through therelevant department (e.g., field coordinator, inventory and distribution, procurement).The budget analysis should include a narrative report that describes the reasons for the most significant variancesfrom the budget for the period (R1).

2. Finance staff communicates budget analysis to the executive director and trustee to enable them to monitor progressof the NGO’s aid programs and make decisions about the future management of the organization.

Function(s) involved:► Finance staff



B.08 Delivery


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ysis



Approval


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


Budget and analysis





B.08 Delivery


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and

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Approval


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

R1 — Data is inaccurate, incomplete and nottimely (C1, C2)


C1 — Review and approve data to be used byfinance staff in budget analysis to ensuredata is accurate, complete andtimely (R1)

C2 — Review and approve the budgetcompared to actual performance reportand the sufficiency of the reasons givenfor significant variances in the narrativereport (R1)

Recipient receipt

C.02.2 Recipient satisfaction surveyTo obtain feedback from the recipients on the relief aid they are receiving from the NGO, from which the NGO candetermine whether it has achieved its goals and objectives


from 2 Generate a List of RecipientAddress per Area in Workflow Modeler:

B.08.1 Delivery Scheduling

1Distribute

questionnaire/interview

2Summarize

Questionnaire andInterview Results


Field Coordinator

3Analyze

Survey Results

To 3 Budget preparation in WorkflowModeler: B.01.1 Budget Preparation



B.08 Delivery


dget

and

Anal

ysis



Approval


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

Recipient receipt



Activity:1. Field/community staff distributes questionnaires to recipients to assess their satisfaction with the goods/

services provided to them by the NGO and whether those fulfill their needs. If recipients cannot read or write, theyshould be interviewed directly (R1, R2, R3).

2. Field/community staff summarizes questionnaire and interview results in order to gain an understanding of the level ofsatisfaction with the goods/services the NGO has provided to the community. Some of the criteria that can be used forsummarizing the results may be (R2, R4):► Quality of goods/services provided► Timeliness of aid received► Whether the aid fulfills recipients’ needs

3. Field coordinator analyzes the survey results and discusses the results with the coordinator and trustee in order toascertain whether the recipients have received the goods/services they have requested. The survey results also canbe used for making decisions about varying the type of relief goods/services provided. This forms an input for planningadditional fund requisitions and in preparing proposed budget for the next period.

Function(s) involved:► Field/community staff► Field coordinator



B.08 Delivery


dget

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ysis



Approval


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B.04 Purc hase


A.01

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B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11


Recipient receipt



R1 — Questionnaires are biased and thechoices for answers are limited (C1)

R2 — Recipients do not answer truthfully (C2)

R3 — Questionnaires are not returned orreturned blank (C1)

R4 — Survey results are inaccurate because ofmistakes made in summarizing thequestionnaire or interview results(C2, C3)


C1 — Review questionnaires prepared by thefield/community staff and check that therecipients provide explanations to theiranswers (R1, R3)

C2 — Review the recipients’ responses forreasonableness, i.e., compare theresponses of one recipient to another(R2, R4)

C3 — Review the clerical accuracy of theworksheets used to summarize data bychecking against supportingquestionnaires on a sample basis (R4)



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Approval


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B.04 Purc hase


A.01

A.02

B.01

B.12 B.13

C.02C.01

B.09

B.10

Core modules

B.11

“Pick List”


Tailoring the guide for your organization


Answer Yes/No to the questions in the Pick List Pick List�

What are the typeresources that your areallocated or received?

Applies toour NGO?(Yes or No

Relevantmodule

Relevantprocess(es)

Allocated monies aretransferred or received

Yes Cash receipts B.02.1 Bankreceipts

Allocated/donated goods orservices are received

Yes Inventorymanagement

B.03.2 Receipt ofgoods or services

Select the appropriate modules/processes as indicated Core modules�

Cash receipts Petty cash

Bank Receipts Petty cash payment andreplenishment

Inventory management Accounting

Receipt of goods or services

Remap the framework indicating only the modulesrequired

Humanitarianaid resourceand deliveryframework

�

As a guide, EY has developed a “Pick List” to captureoperational factors that would indicate what modules areappropriate and should be adopted.How to use the “Pick List”The “Pick List” will ask you to answer some simplequestions about your organization. Different modules willbe recommended depending on the responses you give.

Find the “Pick List” in the Framework manual andanswer Yes to each question that is applicable toyour NGO.Look at the list of modules (core or expanded) andfind the module or modules that match eachaffirmatively answered question.Gather the applicable modules and remaptheframework by highlighting only those that youwill need.

This will be your guide for selecting the applicableprocesses and procedures for implementation. Be sure toinclude the recommended internal control points as well.

3

1

2

“Pick List”


Read through the list of statements below. If the statement applies to your organization, indicate YES in the check boxand refer to the relevant module and process(es).

Applies toour NGO?(Yes or No) Relevant module Relevant process(es)

What are the sources of your findings or donations?

We receive donations from individual donors Yes Funding and donationmechanism

We receive cash directly Yes A.02.1 Funding and donation mechanism

We receive bank transfers or accept credit card Yes A.02.1 Funding and donation mechanism

We receive goods or services Yes A.02.1 Funding and donation mechanism

We receive donations from institutional donors Yes Funding and donationmechanism

We receive cash directly Yes A.02.1 Funding and donation mechanism

We receive bank transfers Yes A.02.1 Funding and donation mechanism

We receive goods or services Yes A.02.1 Funding and donation mechanism

“Pick List” (contd)




What do you do to request for funding or prepare a budget?

We analyze or try to understand the needs of therecipients

Yes Budget preparation andrequisition approval,Recipient requisitionand recipient receipt

C.01.1 Recipient requisition of goods or servicesC.01.2 Recipient receipt of goods or servicesB.01.2 Recipient data maintenance

We prepare proposals or budgets for our proposedhumanitarian aid

Yes Budget preparation andrequisition approval andRecipient requisition

C.01.1 Recipient requisition of goods or servicesB.01.1 Budget Preparation

We prepare requests for additional funding Yes Budget preparation andrequisition approval andRecipient requisition

C.01.1 Recipient requisition of goods or servicesB.01.1 Budget Preparation

What are the type resources that your are allocated or received?Allocated monies are transferred or received Yes Cash receipts B.02.1 Bank Receipts

Allocated/donated goods or services are received Yes Inventory management B.03.2 Receipt of Goods or Services





What are the different kinds of payments that you make?

We make payments for goods or materials Yes Cash disbursement B.09.1 Accounts payableB.09.2 Bank payment

We make payments for services Yes Cash disbursement B.09.1 Accounts payableB.09.2 Bank payment

We give funds or donations to other charitableorganization

Yes Cash disbursement B.09.2 Bank payment

We make payments for human resources/employees Yes Cash disbursement B.09.2 Bank payment

We make payments for capital assets Yes Cash disbursement B.09.1 Accounts payableB.09.2 Bank payment

What type of people you employ or contractor for?

We hire full or part-time employees Yes Human resourcemanagement

B.07 Human resources management — allprocesses

We hire contractors or temporary employees Yes Human resourcemanagement

B.07 Human resources management — allprocesses





What are the different types of things that you purchase?

We purchase goods, materials or supplies … Yes Purchase and inventorymanagement

For our operations Yes B.04 Purchases — all processes andB.03 Inventory management — all processes(if necessary)

For our humanitarian aid Yes B.04 Purchases — all processes andB.03 Inventory management — all processes(if necessary)

For conversion, production or building Yes B.04 Purchases — all processes andB.03 Inventory management — all processes(if necessary)

We purchase services … Yes Purchase

From subcontractors Yes B.04 Purchases — all processes

From logistics Yes B.04 Purchases — all processes

From other service providers Yes B.04 Purchases — all processes





What are the different types of things that you purchase? (contd)

We purchase other things, such as … Yes

Electricity, water, gas or other utilities Yes Cash disbursement B.09.1 Account payable

The rent of our office, warehouse or other facilities Yes Cash disbursement B.09.1 Account payable

Other things of small amounts or value Yes Petty cash B.10.1 Petty cash and replenishment

We purchase fixed or capital assets Yes Purchase and assetmanagement

B.04 Purchases — all processesB.06 Asset management — all processes

What other activities do you do?

We store goods (and inventory them) Yes Inventory management B.03 Inventory management — all processes

We track (or inventory) services that have beendonated

Yes Inventory management B.03 Inventory management — all processes

We build or produce things Yes Produce/Build B.04 Purchases — all processesB.05 Build/produce — all processes andB.03 Inventory management — all processes(if necessary)

We own/manage fixed or capital assets Yes Asset management B.06 Asset management — all processes

We deliver/transport goods, services or people fromcentral locations or suppliers into the field

Yes Delivery and inventorymanagement

B.08 Delivery — all processes andB.03.3 Goods issuance (if necessary)

We distribute goods or services to recipients Yes Recipient receipt C.02.01 Recipient receipt of goods or services





What type of accounting, reporting and analysis do you do?

We prepare and accounts for our activities Yes Accounting B.11.1 Journal entriesB.11.2 Reconcilliation

We prepare financial and/or managerial reports of ouractivities

Yes Accounting andreporting

B.11.2 ReconcilliationB.12.1 Closing and reporting

We analyze or try to understand the needs of therecipients

Yes Budget preparation andrequisition approval,Recipient requisitionand recipient receipt

C.01.1 Recipient requisition of goods or servicesC.01.2 Recipient receipt of goods or servicesB.01.2 Recipient data maintenance

We analyze variances between our budget andactual amounts

Yes Accounting, reportingand Budget andanalysis

B.11.2 ReconcilliationB.12.1 Closing and reportingB.13.1 Budget analysis

We try to understand (and improve) the quality ofour service

Yes Recipient receipt C.02.2 Recipient satisfaction survey




Applies toour NGO?(Yes or No)

Estimated transactionvolumes

Manual vs. computer-based accountingsystem

What kind of accounting records do I need?

The volume of my transactions …

For receipts are

Yes Less than 12/year Manual-based accounting system may besufficient

Yes Equal to or more than12/year

Consider using a computer-based accountingsystem

For disbursements are

Yes Less than 60/month Manual-based accounting system may besufficient

Yes Equal to or more than60/month


For purchasing are




For payroll are







Applies toour NGO?(Yes or No)

Estimated transactionvolumes

Manual vs. computer-based accountingsystem

What kind of accounting records do I need? (contd)

The volume of my transactions … (contd)

For warehousing are




For distribution/delivery are

Yes Less than every day Manual-based accounting system may besufficient

Yes Equal to or more thanevery day


Towards recipients are

Yes Less than 100/day Manual-based accounting system may besufficient

Yes Equal to or more than100/day


For more information


Adlai GoldbergMaagplatz 1Zurich 8005 SwitzerlandP: +41 58 286 44 88F: +41 58 286 3004E: [email protected]

Thank you


EY | Assurance | Tax | Transactions | Advisory

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