Update on Policies and Procedures Financial Operations.

Update on Policies and Procedures

Financial Operations

RMIT University©2010 Financial Services, Financial Operations 2

Definitions of Policies and Procedures

• Policy on policies

• Intent and objectives

• To ensure that University policies and procedures are necessary, current, relevant and useful by providing a framework for their design, approval, implementation, monitoring and review.

• That University policies and procedures are clear, concise and consistent, and are communicated to staff and students as appropriate; that the content is up-to-date and reflects the requirements of the University.

• Scope

• All RMIT policies.

• Exclusions

• None

• Provisions

• 1. Policy

• 1.1. A policy is a formal statement of the University’s position which enables decision-making and has ongoing application across RMIT.

• 1.2. There is only one level of policy - University-wide.

• 1.3. Policies shall be consistent with relevant Federal and State legislation, and University Statutes and Regulations.

• 1.4. Policies shall normally be reviewed every five years and developed, amended or updated as required.

• 2. Procedures

• 2.1. A procedure documents the processes or actions required to implement a policy.

• 2.2. All procedures relate to a policy and are consistent with the policy to which they refer.

• 2.3. There is only one level of procedure - University-wide.

• 2.4. Procedures shall normally be reviewed every five years.

• 3. Policy and Procedure Development

• 3.1. The University will develop and maintain a set of policies and procedures and set priorities for development and review.

• 3.2. A policy and its procedures are to be developed by the appropriate organisational unit in consultation with relevant stakeholders, committees and the University Secretary.

• 3.3. Policies and procedures will be sponsored by a member of the Vice-Chancellor’s Executive before development can commence.

• 3.4. The University Secretariat will provide advice and sign-off on policy and procedures before they are submitted to the relevant approval authority.

• 3.5 A review schedule is maintained by the University Secretariat and reported to the Vice-Chancellor on an annual basis.


Definitions of Policies and Procedures continued

• 4. Policy Implementation Plan

• The Policy Implementation Plan shall describe the actions and resources required by the operational area responsible to communicate and/or implement the policy and procedures or the amendments to the policy and procedures. The Implementation Plan shall be submitted to the relevant authority for approval together with the policy and procedures.

• 5. Approval of new policies and procedures

• 5.1. All new policies and procedures and major revisions of policies and procedures shall be submitted to the Vice-Chancellor’s Executive for consideration prior to being submitted for approval.

• 5.2. All new academic policies and procedures and major revisions of academic policies and procedures shall be submitted to the Academic Board for comment. The comments will be taken into account in preparation of final documents for approval.

• 5.3. Governance policies shall be approved by Council.

• 5.4. Governance procedures shall be approved by the Vice-Chancellor and reported to Council.

• 5.5. Academic policies and procedures shall be approved by the Academic Board. Decisions shall be reported to Council.

• 5.6. Services policies and procedures shall be approved by the Vice-Chancellor. Decisions shall be reported to Council.

• 6. Amendments to policies and procedures

• 6.1. Substantive amendments to policies and procedures shall be approved by the relevant approval body (as outlined in clause 5).

• 6.2. Minor nomenclature changes, changes to correct errors or clarifications of wording shall be approved by the University Secretary.

• 6.3. Minor amendments to academic policies and procedures to reflect legislative changes or for consistency between policies and procedures shall be approved by the Vice-Chancellor and reported to Academic Board and to Council.

• 6.4. Minor amendments to services and governance policies and procedures to reflect legislative changes or for consistency between policies and procedures shall be approved by the Vice-Chancellor and reported to Council.


List of updates to Financial Operations’ Policies and Procedures

Policy Links: Supporting documents and information in new policy

Credit cards policy Credit card holder roles and responsibilties

URL of New Policy Credit card aquittal procedure

http://www.rmit.edu.au/browse;ID=wsvulwes73utz RMIT Corporate Card ICMS User ManualReplaced Policy Delegations Policy and schedulesRMIT corporate card policy Property, plant and equipment (PPE) and intangible assets policy

Credit card purchase – without a purchase order policy and procedure Property, plant and equipment (PPE) and intangible assets procedure

Expenditure and accounts payable procedure

Credit card use procedure

Process flow chart: Credit-card purchase without purchase order


Doubtful and Bad Debts Policy Doubtful and bad debts procedure

URL of New Policy Delegations Policy and schedules

http://www.rmit.edu.au/browse;ID=2su9eg8lfpwo Trade debtors invoicing procedure


Expenditure policy Delegations Policy and schedules

URL of New Policy Expenditure and accounts payable procedure

http://www.rmit.edu.au/browse;ID=tvmot6ga7yup Revenue recognition policy

Revenue recognition procedure

Policy Links: Supporting documents and information in new policyProperty, plant and equipment (PPE) and intangible assets policy Delegations Policy and schedules

URL of New Policy Property, plant and equipment (PPE) and intangible assets procedure

http://www.rmit.edu.au/browse;ID=kjli62in51d9z Motor vehicles procedureReplaced Policy Expenditure and accounts payable procedure

Fixed assets policyDepreciation and amortisation of property , plant and equipment (PPE ) and intangible assets operating procedure

Intellectual property policy


Revenue recognition policy Delegations Policy and schedules

URL of New Policy Revenue recognition procedure

http://www.rmit.edu.au/browse;ID=q3nj7zqin4fr Trade debtors invoicing procedure

Doubtful and Bad Debts Policy

Doubtful and bad debts prodecure


List of updates to Financial Operations’ Policies and Procedures continued

Procedure: Name Links: Supporting Links in new procedure Links: URL

Trade debtors invoicing procedure Revenue recognition policy http://www.rmit.edu.au/browse;ID=q3nj7zqin4fr

URL of Procedure Delegations policy and schedules http://www.rmit.edu.au/browse;ID=8w5tfuzlbqy3z

http://www.rmit.edu.au/browse;ID=0vg5ji86e88n Doubtful and bad debts prodecure http://www.rmit.edu.au/browse;ID=bw2u2yif5w7p

Forms: New Name as per procedure Form: URL

Application for Customer Form http://mams.rmit.edu.au/k0szufjsxafy.doc


Credit card acquittal procedure Credit Cards Policy http://www.rmit.edu.au/browse;ID=wsvulwes73utz

URL of Procedure Credit card use procedure http://www.rmit.edu.au/browse;ID=rp6ift8q3fp1

http://www.rmit.edu.au/browse;ID=hq0721daeio2 Credit card holder roles and responsibilties http://www.rmit.edu.au/browse;ID=u5q4rvr7og0s

Replaces: Procedure Delegations policy and schedules http://www.rmit.edu.au/browse;ID=8w5tfuzlbqy3z

RMIT corporate card – acquittal of monthly statements procedure

Procedure: Name Links: Supporting Links in new procedure Links: URLCredit card holder roles and responsibil ities procedure Credit Cards Policy http://www.rmit.edu.au/browse;ID=wsvulwes73utzURL of Procedure Delegations Policy and schedules http://www.rmit.edu.au/browse;ID=8w5tfuzlbqy3z

http://www.rmit.edu.au/browse;ID=1s9kr2dvlbiuz Credit card use procedure http://www.rmit.edu.au/browse;ID=rp6ift8q3fp1

Replaces: Procedure Credit card aquittal procedure http://www.rmit.edu.au/browse;ID=hq0721daeio2

RMIT corporate card - roles and responsibil ities procedure Forms: New Name as per procedure Form: URL

Cardholder Maintenance Form http://mams.rmit.edu.au/cxepifq9brip1.pdfCBA Customer Investigation Request for Disputed Business Card Transactions http://mams.rmit.edu.au/6155dsvvn6cv1.pdf


Credit card use procedure Credit Cards Policy http://www.rmit.edu.au/browse;ID=wsvulwes73utz

URL of Procedure Credit card holder roles and responsibilties http://www.rmit.edu.au/browse;ID=1s9kr2dvlbiuz

http://www.rmit.edu.au/browse;ID=rp6ift8q3fp1 Credit card aquittal procedure http://www.rmit.edu.au/browse;ID=hq0721daeio2Replaces: Procedure Delegations Policy and schedules http://www.rmit.edu.au/browse;ID=8w5tfuzlbqy3z

RMIT corporate card – usage procedureProperty, plant and equipment (PPE) and intangible assets pol icy http://www.rmit.edu.au/browse;ID=kjl i62in51d9z

Credit card purchase – without a purchase order policy and procedureProperty, plant and equipment, and intangible assets procedure http://www.rmit.edu.au/browse;ID=y8xrov1b8ib8z

RMIT corporate card - PCard holders procedureProcess flow chart: Credit-card purchase without purchase order http://mams.rmit.edu.au/2c3jbm67jzx01.doc

Forms: New Name as per procedure Form: URL Request to Purchase Asset Form http://mams.rmit.edu.au/7dzptz1rb9jrz.docPurchase Request http://mams.rmit.edu.au/7dzptz1rb9jrz.doc




Doubtful and Bad Debts procedure Doubtful and bad debts policy http://www.rmit.edu.au/browse;ID=2su9eg8lfpwo

URL of Procedure Trade debtors invoicing procedure http://www.rmit.edu.au/browse;ID=0vg5ji86e88n

http://www.rmit.edu.au/browse;ID=bw2u2yif5w7p Revenue recognition procedure http://www.rmit.edu.au/browse;ID=3bzb66xo14pr

Delegations Policy and schedules http://www.rmit.edu.au/browse;ID=8w5tfuzlbqy3z


Bad Debt Write-off Request Form http://mams.rmit.edu.au/84zqadu2fqo61.xls


Expenditure and accounts payable procedure Expenditure policy http://www.rmit.edu.au/browse;ID=tvmot6ga7yup

URL of Procedure Delegations Policy and schedules http://www.rmit.edu.au/browse;ID=8w5tfuzlbqy3z

http://www.rmit.edu.au/browse;ID=9b0vjc9oeya4z Credit card use procedure http://www.rmit.edu.au/browse;ID=rp6ift8q3fp1

Replaces: Procedure Credit card holder roles and responsibilties http://www.rmit.edu.au/browse;ID=1s9kr2dvlbiuz

Staff expenses reimbursement procedure Credit card aquittal procedure http://www.rmit.edu.au/browse;ID=hq0721daeio2

Cash float claim and reimbursement guidelines Per Diem Travel Reimbursement Procedure http://www.rmit.edu.au/browse;ID=exy2zvl0084nz


Staff Reimbursement Form http://mams.rmit.edu.au/eu7p5z40gn0t.doc

Claim for Car Allowance Form http://mams.rmit.edu.au/2h3ndaq671b1.pdf

Petty Cash Forms http://mams.rmit.edu.au/8xfurq8pki5h.xls

RAMA SAP forms claim form http://mams.rmit.edu.au/rii2gzgs53w7z.doc


Motor vehicle procedure Property, plant and equipment (PPE) and intangible assets pol icy http://www.rmit.edu.au/browse;ID=76ya3tbiumrq

URL of ProcedureProperty, plant and equipment (PPE) and intangible assets procedure http://www.rmit.edu.au/browse;ID=agtifxxotk0r

http://www.rmit.edu.au/browse;ID=w1c4z5r9sx9q Delegations Policy and schedules http://www.rmit.edu.au/browse;ID=8w5tfuzlbqy3z

Forms: New Name as per procedure Form: URL Executive Vehicle Request Form http://mams.rmit.edu.au/rtr6o5lan4gf.docMotor Vehicle Request Form for the Pool Car http://mams.rmit.edu.au/f4is6krq8ibf.doc




Property, plant and equipment (PPE) and intangible assets procedureProperty, plant and equipment (PPE) and intangible assets pol icy http://www.rmit.edu.au/browse;ID=kjli62in51d9z

URL of Procedure Delegations Policy and schedules http://www.rmit.edu.au/browse;ID=8w5tfuzlbqy3z

http://www.rmit.edu.au/browse;ID=y8xrov1b8ib8z Motor vehicles procedure http://www.rmit.edu.au/browse;ID=w1c4z5r9sx9qReplaces: Procedure Expenditure and accounts payable procedure http://www.rmit.edu.au/browse;ID=9b0vjc9oeya4z

Fixed assets procedure Depreciation and amortisation operating procedure http://www.rmit.edu.au/browse;ID=lhcgx3sfv5ha


Capital Expenditure Proposal Form http://mams.rmit.edu.au/co2wlec436gd.doc

Asset Transfer Form http://mams.rmit.edu.au/6o8tgw26u38ez.doc


Revenue recognition procedure Revenue recognition policy http://www.rmit.edu.au/browse;ID=q3nj7zqin4fr

URL of Procedure

http://www.rmit.edu.au/browse;ID=3bzb66xo14pr

Procedure: Name Links: Supporting Links in new procedure Links: URLDepreciation and amortisation of property, plant and equipment (PPE) and intangible assets operating procedure

Property, plant and equipment (PPE) and intangible assets pol icy http://www.rmit.edu.au/browse;ID=kjli62in51d9z

URL of Procedure Delegations Policy and schedules http://www.rmit.edu.au/browse;ID=8w5tfuzlbqy3zhttp://www.rmit.edu.au/browse;ID=lhcgx3sfv5ha Motor vehicles procedure http://www.rmit.edu.au/browse;ID=w1c4z5r9sx9q

Property, plant and equipment (PPE) and intangible assets procedure http://www.rmit.edu.au/browse;ID=y8xrov1b8ib8z

Procedure: Name Links: Supporting Links in new procedure Links: URLProvisions and contingent l iabil ities Procedure Delegations Policy and schedules http://www.rmit.edu.au/browse;ID=8w5tfuzlbqy3z

URL of Procedure Financial delegations schedule http://mams.rmit.edu.au/fhr11xlzcclk.xls http://www.rmit.edu.au/browse;ID=8ajgru4jms2b Doubtful and bad debts prodecure http://www.rmit.edu.au/browse;ID=bw2u2yif5w7p

Doubtful and bad debts policy http://www.rmit.edu.au/browse;ID=2su9eg8lfpwo


Payroll accounts reconcil iation procedure List of balance sheet accounts related to salaries Not Linked as yetURL of Procedurehttp://www.rmit.edu.au/browse;ID=pphnvyfzng6b


Important highlights in the latest Policies and Procedures

Doubtful and Bad Debts, Trade Debtor Invoicing

• All sales made to customers who have not been approved for credit are to be made on a ‘cash on delivery’ basis only.

• Bad debts are expensed against the relevant school/department.

• During the financial year estimated provision for doubtful debts is recorded based on the aged trial balance:

360 days overdue100% ,271–360 days overdue 50%1, 81–270 days overdue 40%

• Credit Limits [note: government agencies and departments are not subject to credit limits]:

$5,000 Business check only; $5000 to $50,000 Payment analysis, $50,000 to $100,000 Payment analysis and ASIC check, $100,000 ‘Credit Check’ report except government agencies

Expenditure

• The University will ensure that all expenses it incurs are based on contracts with suppliers (external public and private sector organisations and individuals).

• Contracts must be signed on behalf of RMIT University only by persons who are fully aware of the University’s obligations attached to the expenses incurred and in accordance with the Delegations Policy and schedules.

• Be aware that a new Contract Policy is in place that highlights details of the legal obligations of the person signing the contract.

• Small-value transactions should be paid by departmental Pcard where possible.

• Purchases can be made without purchase orders for the following:

1. physical goods less than $20,000

2. procurement of emergency replacement items

3. recurring services up to the total value of $20,000

4. travel arrangements facilitated by the travel approval process.

• Exceptions to this rule are for the Library, where all purchase orders and invoicing for books, periodicals and subscriptions are made via the ILMS system and then uploaded to SAP.

• If the total value of goods or services is higher than $20,000 a purchase order must be raised.


Important highlights in the latest Policies and Procedures continued

Property, Plant and Equipment (PPE) and Intangible Assets Policy

PPE is defined as Property, Plant and Equipment with a capitalisation value as approved by RMIT’s Council on an

annual basis and with a useful life over one year:

• plant

• office furniture

• motor vehicles

• land and buildings

• furniture and fittings

• equipment

• artwork

• library collection

• leasehold improvements

• leased assets acquired under finance lease or hire purchase arrangements

• assets held off-campus

Intangible Assets, for the purpose of their management at RMIT, are defined as:

• goodwill

• intellectual property



Approvals are required for all new or replacement items:

• The expenditure of University funds on capital items with a value over $50,000 requires approval from the Capital and Investment Review Board (CIRB), and sign-off by the relevant Head of School or equivalent Pro Vice-Chancellor.

• Assets under $50,000, but exceeding in aggregate the College/Portfolio’s discretionary allocation previously approved by CIRB, must go to CIRB for approval.

• Equipment purchased under a specific grant does not require CIRB approval.

• To obtain CIRB approval, the College/Portfolio must submit to the board a Capital Expenditure Proposal Form and supporting details for the acquisition. CIRB will advise the College/Portfolio directly regarding their approval to

purchase. • For vehicle purchases, the type of vehicle will be determined by the university’s budget and is limited to four-cylinder

or six-cylinder cars or station wagons. The university will acquire vehicles with regard to their fitness for purpose and total cost of ownership.

• The preferred vehicles are Holden, Ford or the limited number of other Australian-manufactured cars. Modifications to vehicles are limited to airconditioning, ABS brakes, automatic transmission, cruise control and a cargo barrier for a wagon.

• Capital and Investment Review Board (CIRB) grants approval for the acquisition of departmental/pool vehicles on request of the relevant head of school/department.

• Pool vehicles are not to be used for private purposes unless approved by the relevant Vice-President.

• If a pool vehicle is used by school/portfolio staff for personal purposes for more than 25% of the year or for less than 20,000 km per year, the use of the vehicle may be withdrawn unless a claim is made to substantiate the use in the following year.



• Purchases can be made without purchase orders for the following:

• physical goods less than $20,000

• procurement of emergency replacement items

• recurring services up to the total value of $20,000

• travel arrangements facilitated by the travel approval process.

• Exceptions to this rule are for the Library, where all purchase orders and invoicing for books, periodicals and subscriptions are made via the ILMS system and then uploaded to SAP.

• If the total value of goods or services is higher than $20,000 a purchase order must be issued. For one off purchases without the purchase order

• Where the amount to be expended is estimated to be

• Minimum quotation/tender requirement unless exemption granted $2,500 or less One verbal or written quote. Between $2,500 and $25,000 One written quote.

• Building, infrastructure & equipment:

• Where the amount to be expended is estimated to be

• Minimum quotation/tender requirement unless exemption granted $25,000 or less One written tender / proposal which is consistent with current market prices.


Draft Cost Capitalisation Procedure

Items can be recognised as capital only if the appropriate authorisation process was adhered to as per Property Plant and Equipment Policy and Procedure.

Treatment of costs – Capital versus ExpenseProject Stage/ Phase, Other details Activity/ Cost I tem description Expenditure Type

Preliminary (initial investigation, scoping and feasibility

Project scoping tasks including: Conceptual formulation of alternatives, evaluation of alternative feasibility study. Design and documentation. Includes tender drawings and documentation. Relocation of existing clients and staff members. Business case analysis and the management and planning functions for the project. Expense

Construction Stage

Detailed design and specification. Obtaining planning and building permits. Construction. Project management costs of externally appointed Project Managers directly attributable to that project. Fit out costs (excluding any items that are furniture or equipment items that have to be capitalised as a separate items) Remedial work unto of warranty period. Capital

Contamination of buildings or land related to capital projects on existing or new buildings

Various contaminations including but not limited to lead paint, found on large capital projects during preliminary investigation or once the project has started. Capital

Contamination found during maintenance work

Various contaminations including but not limited to lead paint, found on large capital projects during preliminary investigation or once the project has started. Expense

Post Construction Phase

Removalist costs to relocate tenants back to the building. Ongoing maintenance costs. Expense

All stages of projects Internal salary costs Expense


Weblink for Financial Services Policies and Procedures:

http://www.rmit.edu.au/browse;ID=perwdpeb8h53

Procedure currently under development:

Third Party Invoicing

Contact:

Please call deputy Director Financial Operations – Natalia Hawkins x50651 if you have any questions, amendments, suggestions, etc on Financial Policies and Procedures.

http://www.rmit.edu.au/browse;ID=perwdpeb8h53

Update on Policies and Procedures Financial Operations.

Documents

Transcript of Update on Policies and Procedures Financial Operations.