Reporting and Operations
Posted: March 30, 2009
Size of Organization:
- Involve as many people as possible.
- Use only pre-numbered checks.
- Use accounting software to print checks if at all possible.
- Keep all unused checks in a locked cabinet or closet.
- Limit the number of people with access to the checks.
- Limit check signers to trustees and management.
- Pay only from invoices. Do not process statements from vendors.
- NEVER pay a vendor without a valid invoice or contract.
- Mark invoices “paid” to avoid duplicate payments.
- Follow the same procedures for wire transfers as for checks.
- Someone other than the person writing the check should review the documentation and sign the check.
- Require two signatures for amounts above a set threshold. When setting the amount consider:
- A set dollar amount.
- Whether certain checks can be excluded from the requirement. For example, a set amount is paid for rent each month based upon a signed lease. As long as the rent is for the amount noted in the lease, a second signature is not required.
- Consider the "positive pay" program now being offered by most banks. The organization submits a list of checks written on any particular day to the bank. The bank will then take responsibility for ensuring duplicate check numbers with different payees are not processed. It should be noted that this service can be relatively expensive, so it may not be appropriate for all organizations.
- Someone other than the person writing and mailing the checks should receive the unopened bank statement and review the contents before it is reconciled.