| List
of Financial Management Standards |
 |
|
| Ref
Source |
Standard |
Components |
Checklist |
Comments |
|
FOR ALL
- OMB Circular A-127, Financial
Management Systems
- OMB’s Implementation Guidance
for the Federal Financial Management Improvement
Act (FFMIA) of 1996 (January 2001)
- JFMIP’s revised Core Financial
System Requirements(November 2001)
|
Core financial management |
Basic |
1.
Classify accounting transactions by the following structures:
·
Fund
·
Program
·
Organization
·
Project
·
Activity
·
Cost center-Accumulated Cost
·
Object class (Chart of accounts), and
·
Any other data elements needed to meet the data classification and/or
reporting needs of the organization.
2.
Fund structure that defines each entity for which separate accounting
and reporting are needed to meet legal and assigned
responsibilities and reporting requirements. This
structure should provide for identification of appropriation
or fund accounts through the
·
Budget process,
·
Receipt accounts,
·
Clearing accounts, and
·
Other accounts as may be deemed necessary.
3.
System provides the capability to establish an organization structure
based on responsibility segments, such as offices,
divisions, and branches.
4.
System provides for the ability to tie responsible organizational units
to programs and projects.
5.
System provides a project structure that is independent of the
other classification structures to allow multiple
organizations, programs, and funding sources to be
associated with a project.
6.
System provides a revenue source code structure to identify and
classify types of revenue and receipts received by
an organization so that they are represented properly
on the organization’s financial statements.
7.
System provides the capability to define additional data elements for
use in data classification for internal reporting
and/or control needs for organization-specific purposes.
8.
System derive the expanded accounting classification structure from abbreviated
user input so that user input is minimized, data entry
is made easier, and errors are controlled and reduced.
Examples of methods include entering “shorthand
codes” using a keyboard function to look up additional
elements, “clicking” on entries in a “lookup
table” or “pop-up menu,” and using a scanning
bar code.
9.
System provides flexibility to process additions, deletions, and changes
to accounting classification structure codes without
extensive program or system changes. Table-driven
systems, where frequently changed information is kept
in tables separate from program logic and under a
system administrator’s control, and database management
systems, are two examples of ways to provide such
flexibility.
System provides the ability to account
for budgetary resources at a lower level in the accounting
classification structure than they are budgeted and
controlled |
Segregation
of duties
This
is more relevant in case of multiple donor structure
Convey
in theory
Convey
in theory
|
| |
|
The
U. S. Government standard general ledger
(GL) process – account definition |
10.
System use a chart of accounts consistent with the basic numbering
structure provided in the GL. Any expansion to
the numbering system must roll up to the posting accounts
provided in the GL.
11.
System use account titles consistent with the account titles provided
in the GL.
12.
System supports the use of processing of information consistent with
the standard transaction identification process rules
from GL.
13.
System provides the capability to create additional sub-accounts
to the GL for organization specific tracking and control.
These sub-accounts will summarize and track back to
the GL accounts. |
To
be adopted in Pakistani context
To
be adopted in Pakistani context |
| |
|
The standard general ledger process
- transaction definition
|
14.
System use standardized transactions identified by reference codes to
control transaction editing, posting to the appropriate
GL accounts, and updating of other information maintained
in the system, such as document balances and available
funding.
15.
System allows standardized transactions, including system-generated
transactions, to be established, modified, or deleted
by authorized personnel.
16.
System provides for traceability of changes audit trail.
17.
System generates and post compound GL debit and credit entries (at
least four pairs) to the GL as a result of a single
transaction.
18.
System process system-generated transactions, such as automated
accruals, closing entries, cost assignment transactions,
recurring payments, and transactions that generate
other transactions in those cases where a single transaction
is not sufficient.
19.
System provides the capability to add, modify, and maintain editing
and posting rules through systems tables controlled
by authorized personnel.
|
Cost
effective functions
|
| |
|
Transaction control process – audit
trails
|
20.
System provides audit trails to trace transactions from source documents,
original input, other systems, system-generated transactions,
and internal assignment transactions through the system.
21.
System provides transaction details to support account balances.
22.
System provides audit trails to trace source documents and transactions
through successive levels of summarization to the
financial statements and the reverse.
23.
System provides audit trails to identify changes made to system parameters
and tables that would affect the processing or reprocessing
of any financial transactions.
24.
System provides audit trails that identify document input, change, approval,
and deletions by originator. |
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Transaction control process – transaction
processing
|
25.
System post to the current and prior months concurrently until
month-end closing, and maintains and provides on-line
queries and reports on balances separately for the
current and prior months. At a minimum, balances must
be maintained on-line for both the current and prior
months until prior month closing.
26.
System, at year’s end, post to the current year by month, as well
as to the prior year, regardless of when year
end closing occurs. For example, a user should be
able to post to the previous fiscal year while also
posting transactions to the current year. Balances
must be maintained and accessible through on-line
queries for both the current and prior fiscal years
until year-end closing.
27.
System provides control over the correction and reprocessing of
all erroneous transactions through the use of error
file(s) and/or suspense accounts. Erroneous transactions
must be maintained and tracked until either
corrected and posted or deleted at the specific request
of an authorized user.
28.
System provides standard record format(s) for interface of transactions
from other systems to the core financial system and
subjects all transactions from interfacing systems
to the core financial system edits, validations, and
error correction procedures. Erroneous transactions
must be maintained and tracked until either corrected
and posted or deleted by an authorized user.
29.
System supports both batch and real-time on-line data entry and
use the same edit and update rules as appropriate
for each mode.
30.
System supports simultaneous data entry/access by multiple users in
a variety of access modes.
31.
System supports management controls to ensure that transactions are processed
in accordance with government and USAID -prescribed
standards and procedures, the integrity of
data in the system is maintained, and access is
restricted to authorized users.
32.
System provides transaction edits that control, at a minimum, fund availability,
account structure, and tolerance levels between related
transactions, such as between an obligation and its
related accrual.
33.
System provides controls to prevent the creation of duplicate transactions.
34.
Do the system’s user entry and query screens support validation of codes
entered on the screen and assist users in determining
correct codes if an invalid code is entered.
35.
System provides for inquiry by the user to verify valid codes during
the data entry process.
36.
System provides the capability to enter and store for future processing
any transactions in the current month for processing
the subsequent month.
|
For the
organizations that have automated GL system.
Details
for all costs- no head of other expenses or miscellaneous
In
case of automation
In
case of automation |
| |
General ledger management |
General ledger posting process
|
1.
System post transactions to GL in
accordance with the transaction definitions established
by the core financial system management function.
2.
System maintains historical data
to produce comparative financial reports for management
use. |
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|
Accruals, closing, and consolidation
process
|
3.
System provides for automated
month-and year-end closing of GL accounts and
rollover of GL account balances (note that this includes
sub-accounts).
4.
System allows selected transactions
(i.e., adjustments) to be processed.
5.
System allow for accruals of contracts
or other items that cross fiscal years.
6.
System selectively generates
required transactions as needed by the year-end
closing procedures.
7.
System prepares trial balances
and other supporting information needed for
external reports and financial statements, including
consolidated statements.
8.
System provides for a year-end
rollover of appropriate system tables into the
new fiscal year, under the control of an authorized
system administrator.
9.
System provides the capability to
process, track, and control prior fiscal year adjustment
transactions. |
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General ledger analysis and reconciliation
process
|
10.
System report a comparison between
amounts in other components of the core financial
system and the related control accounts in the GL
and annotate out-of-balance accounts on the report.
11.
System provides control accounts
in the general ledger to balance between the general
ledger and other systems, such as property and
travel management.
12.
System provides the capability
for authorized users to correct out-of-balance conditions
discovered during the reconciliation process.
13.
System maintains an audit trail
of any such corrections.
14.
System provides for reconciliation
of all open accounting period (prior month, current
month, prior fiscal year, and current fiscal year)
balances to their respective subsidiaries through
on-line queries and reports. |
|
| |
Funds management |
Funds control process – funds availability
editing |
1.
System provides for online notification
of funds availability prior to the distribution of
lower level funding and the processing of commitment,
obligation, or expenditure transactions.
2.
System supports the timely recording
of transactions.
3.
System checks commitment transactions
against available funds.
4.
System includes adequate controls
to prevent the recording of commitments that exceed
available balances.
5.
System supports recording obligations
or expenditures that exceed available balances
and produce a report or otherwise provide a method
that allows management to review the cause of this
over obligation condition.
6.
System updates all appropriate
accounts to ensure that the system always maintains
and reports the status of funds for all open accounting
periods. |
Subject
to automation.
|
| |
|
Funds control process – commitments
|
7.
System maintains information related
to each commitment document, including amendments.
At a minimum, the system must capture requisition
number, accounting classification structures, and
estimated amounts.
8.
System allow for commitment documents
to be future dated, stored, and posted at the appropriate
date.
9.
System subject these documents to
edit and validation procedures prior to posting.
10.
System close commitment documents
under the following circumstances: (1) by the system
upon issuance of an obligating document, (2) by an
authorized user, and (3) as part of the year-end closing
if the commitment is in an annual appropriation or
in the last year of a multiyear appropriation. |
It
is a memorandum and not a commitment.
In
local context
|
| |
Payment management |
Payee information maintenance process
|
1.
System maintains payee information
that includes data to support obligation, accounts
payable, and disbursement processes.
2.
System allows multiple payment
addresses and/or bank information for a single payee.
3.
System provides a search capability
for payee information.
4.
System produces payee lists
based on organization-defined criteria, e.g., payee
name and number. |
|
| |
|
Payment warehousing process |
5.
System provides the capability
to capture, store, and process appropriate invoice
information, including:
I.
Invoice number,
II.
Invoice amount,
III.
Obligating document references,
IV.
Payee name and address,
V.
Discount terms,
VI.
Invoice amount,
VII.
Invoice date, and
6.
System records an accrued liability
upon receipt and acceptance of goods and services
and properly identifies them as capital asset, expense,
prepaid expense, or construction. |
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Payment execution process
|
7.
System automatically identifies
and select payments to be disbursed in a particular
payment cycle based on their due dates.
System
process transactions resulting from payments made
using other systems, such as payroll. |
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