INTERIM FINANCIAL MANAGEMENT GUIDELINES FOR SECTORS BUDGETING BUDGET PREPARATIO AND BUDGET EXECUTION REPORT FINANCIAL STATEMENT REPORT

Budgeting preparation, Approved Budget: Budget prepared and approved by competent authority Approved Budget Reallocated Budget: Budget revised after six months (A) This Moth Expenditure: Expenditure of current month (B) Last period expenditure: Total expenditure of last month’s (C) Total expenditure: (B+C=D) Balance: (A-D=E) Performance/%: (D/A*100

Cash flow plan The accountant should prepare cash flow plan using the template used by the District and submit it the Executive secretary of the sector for review and approval

CASH FLOW PLAN Account JulyAugustSeptemberTotal Q1 Total Q2 Total Q3 Total Q4 Appoved budget 2211 Office suppliers 125, ,000 1,500, WATER AND ENERGY 31,333 93,999 94, , COMMUNICATIO N COST 91, ,500 1,098, PUBLIC RELATION AND AWARENESS 24,166 72,498 72, , PROFFESSION CONTRACTUAL 35, , ,000

BANKING, PAYMENT, ACCOUNTING AND REPORTING Operational bank account of the sector Opening account: This is opened by authorization of CBM Signatories: Executive Secretary of the Sector Civic Registration/Officer in Charge of Good governance NB: Any two of three signatories above must sign on the cheque Petty cash: Rwf 100,000 to cover expenditure of nominal nature with value not exceeding 20,000 Rwf Cash Safe: Petty cash is kept in cash safe Cash custody

Volume 1 Cash at hand must be kept in cash safe at all times. As much as possible cash safes should be built into walls to make them difficult to be moved. The key to a cash safe must be handed to the cashier is exchange of a written acknowledgement thereof. A spare key should be securely kept by the Chief Budget Manager. It is prohibited to procure a triplicate key for any cash safe. Loss of a key to any cash safe must be reported immediately to the Chief Budget Manager, who then arranges for the issuance of the spare key.

Cash custody The spare key may only be issued for the purpose of extracting the contents of the safe if the original key has been lost, and in no circumstances may government money be kept in a safe for which the original key has been reported lost, except where the cash safe lock is replaced with a new one. The cashier is required to carefully keep the cash safe key as its loss due to negligence may result in requiring the cashier to replace the lock or the cash safe.

Issuing of cheques A cheque shall be issued in such a way as to minimize the possibility of making any subsequent changes in figures No cheque may be drawn for less than one franc; Unless a cheque book has be exhausted, a new one shall never be used

Register of cheque Chq number Date of issue Amount Payee (person to whom it was issued Authorized signatories (Who signed the Cheque) Name of receiver/if hand deliver Date of delivery

Payment procedures Before pyt the following process must be made: Preparation purchase requisition Verification and approbation of purchase requisition this is don e after process of procurement Preparation of purchase order Delivery of goods

Payment procedures DELIVERY OF GOODS The supplier on receiving the purchase order delivers the goods within the agreed time RECEIVING GOODS The accountant confirms that the goods supplied correspond to what was ordered and countersign on DELIVERY NOTE (a delivery note must accompany the invoice for payment

Payment procedures INVOICING The supplier upon full delivery prepares an invoice and submits the accountant for payment processing) VERIFICATION OF SUPPORTING DOCUMENTS All the required supporting documents have been attached and correctly support the invoice. These will include service contract/agreement with the supplier, copy of purchase order, and Good Receiver Note (signed by relevant parties) Accountant also checks compliance with the established tendering/procurement regulations

Payment procedures SALARIES AND ALLOWANCES The accountant prepares schedule of payment for salaries and allowances as provided in the operational budget of the sector PREPARATION OF PAYMENT VOUCHER The accountant prepared 2 copies of payment voucher; one for the entity, and one for the supplier. The accountant then attaches to the payment voucher all the supporting documents and forward the voucher together with the attachments to Executive Secretary of the Sector

Payment procedures INITIAL REVIEW AND APPROVAL OF PAYMENT The ES of Sector verifies the payment voucher to ensure that procedures prescribed above have been properly performed and then approves it by signing. PREPARATION OF CHEQUE The cheque is prepared by the Accountant for payment CHEQUE APPROVAL The cheque is approved by Authorized bank signatories

Payment procedures Cheque disbursement The accountant makes a photocopy of the cheque for recipient to sign on collection CHEQUE COLLECTED THE SUPPLIER COLLECTS THE CHEQUE FOR PRESENTATION TO THE BANK FOR PAYMENT. ACKNOWLEDGEMENT OF PAYMENT The accountant should after processing payment, stamp documents supporting with a seal showing “PAID” indicating that they have been paid

Payment procedures PRESENTATION FOR PAYMENT AND OBTAINING RECEIPT The bank pays the amount to the supplier on presentation. The Accountant also receives the receipt of payment from the supplier.

POSTING OF TRANSACTIONS The accountant makes posting in the books of accounts, ensuring that the accounting classification regarding payment are correct with regard to the nature of transaction. Dr Expenses account xxxxxx Cr Bank account xxxxx

Supporting records (Volume ) In general, each entry in the books of account must be supported by proper accounting documents having at least the following characteristics: 1° Explains the nature and details of the transaction being recorded and showing the date of its occurrence. 2° Shows the persons who have authorized the transaction and the dates of authorization. The persons indicated must possess the necessary authority granted in accordance with the established financial authority regulations

Supporting records (Volume ) 3° Shows the full budget code, selected from the established uniform chart of accounts, to which the transaction is allocable. 4° Shows evidence that the prices involved were decided on the basis of arm length negotiation, and that as far as possible third party invoices or cash acknowledgement documents have been obtained and securely filed

Supporting records (Volume ) 5° Shows cross reference numbers to all the related documentation such as cheque numbers & bank accounts, supplier invoices received, purchase orders, delivery notes, invoices issued, tax assessments etc. 6° the dates the transaction was posted to the books of account and the persons responsible for that posting

Recording of transaction To enable the sector to record all transactions that have taken place during a particular day, month or year, it should maintain a cashbook. This shall be used to record all receipts and payment made through cash or bank. Payments are debited this account while receipts are credited. Each bank account should have its own cashbook to enable reconciliation of the cashbook with the corresponding statement of account from the bank.

(vi) Bank reconciliation procedure At the end of each month, a bank reconciliation statement should be prepared for operational bank account maintained by the Sector. This reconciliation provides an assurance that receipts and payments recorded in the cashbook as having been made through the bank are correct and accurate.

Custody of accounting records All transactions recorded should be well supported. The supporting records must be securely kept and protected from unauthorized access or destruction and in a manner that ensure easy retrieval when necessary for reference or for audit purposes.

Budget performance reports for the operational budget of sector The sector must prepare monthly, quarterly and annual financial statement. A complete set of financial statements should comprise of the following: A budget execution report showing the approved budget (original or revised), the funds received (cumulated), the actual expenditure and variance in respect of each budget line; Bank reconciliation; The cashbook; and Petty cash count certificate. The above reports shall be done in accordance with the templates used by district

Budget performance reports for the operational budget of sector Before submission of the financial statements to the SED, the SES shall perform the basic review of the financial statements to ensure accuracy and completeness.

Budget performance reports for the operational budget of sector The budget performance reports of the operational budget for the sector shall be consolidated by the District and shall form part of the consolidated Government financial stement

The cashbook Example

Reconciliation report Example