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Stratas in BC › Internal Controls

Expenditure Controls

Expenditure controls include:

  • Budgeting the amount of expenditures to be made annually, or monthly
  • Signing authorities for cheques
  • Purchase orders for significant expenses to ensure acquired work is approved by the Board
  • Obtaining quotes for significant contracts
  • Approval of invoices
  • Review of financial statement results by the Board
  • Approval of expense posting to GL accounts

The ability to apply internal controls will depend on the size and structure of the organization and management.

The following are some suggested controls, that may be useful

  • Someone should review and approve the account distribution and approve the invoice for payment.
  • Supporting documentation should accompany cheques presented for signature.
  • Invoices can be marked as paid to prevent duplicate payment.
  • Pay from invoice only, and not the statement
  • Only authorized persons should have access to blank cheques
  • Cheque signers should be authorized by the Board of directors
  • Cheques should not be signed in advance or made out to cash
  • Cheques should be signed by two persons
  • Bank reconciliations should be prepared and reviewed
  • Procedures should be in place to ensure all invoices pertaining to the fiscal year are accrued.