General

The purpose of PASSIA's Accounting Manual is to explain accounting policies and procedures adopted by PASSIA. Compliance with the stated procedures and policies of PASSIA's donors is mandatory to provide the following:

1. Accurate and complete disclosure of the financial results of activities or programs
2. Effective control over the accountability of all funds, property and assets.

Accounting, Audit and Records:

PASSIA maintains its financial records and supporting documents in accordance mainly with the International Accounting Standards or by standards mandated by the grantor of an award to PASSIA, in addition to local legislative laws. PASSIA's financial records are retained for a period of three years from the date of the last audited financial statements. A yearly audited report is carried out by one of the prominent Palestinian auditing firms. In addition, PASSIA is subject to periodical reviews by the inspector appointed by the grantor to review and check the grantee's records.

Authorizing Payments:

The accounting office carries out all payments on behalf of PASSIA. Payments are made only upon receipt of proper authorization. Payments are made in a variety of ways, including checks, bank transfer and cash (in special/exceptional cases).

Before any payment is made, the accounting department has to ensure the following:

•  Correct authorization of the payment
•  Payment is made against the proper budget line item
•  Payment is made against actual delivery of proper goods and services.

In general, only Dr. Mahdi Abdul Hadi, head of PASSIA, authorizes payments on behalf of PASSIA. This authorization is granted to him by of the board of directors.

Carrying Out Payments:

The payment is carried out when the following documents are properly authorized and presented to the accounting officer:

1. Original approved invoice
2. Actual Goods or Services are received .
3. Payment in compliance with proper budget line item.

Accounting Software:

Signing Agreements: Upon signing an agreement between the PASSIA and donor, the approved budget line item is entered, as a cost center, into Bisan accounting software (general ledger) in order to ensure proper compliance and reporting with approved budget line items. The actual vs. budget line item is maintained to ensure no over spending. Financial reporting is presented monthly or as per donor requirements.

Petty Cash:

Small items of expenditures may be claimed from petty cash. The petty cash is maintained by the office administration. Periodically the petty cash is reconciled with the accounting department and replenished.

Reporting System:

PASSIA's reporting system is governed by the grantor's requirements of financial information, in addition to local government requirements. Therefore, a variety of reports are prepared in order the meet the demand of the respective donor. Nevertheless, a monthly statement of receipts and disbursements is prepared for PASSIA's Board of Trustees, in addition to the yearly audited financial statements.

Bank Reconciliation:

A monthly bank reconciliation is prepared to reconcile bank statements with the bank ledger from the accounting software. The bank reconciliation is prepared by the accountant.

Procurement Procedures:

PASSIA's procurement procedures ensure:

1. Avoidance of purchasing unnecessary items.
   
   
2. A clear and accurate description of the technical requirements for the material, product or service to be procured. In competitive procurements such a description shall not contain features which unduly restrict competition.
   
   
3. Requirements which the bidder must fulfill and all other factors to be used in evaluating bids or proposals.
   
   
4. Specific features such as brand name descriptions that bidders are required to meet when such items are included in the solicitation.

These procedures and policies are to maintain a proper internal control system in order to ensure the safeguard of assets and to ensure reliability of financial reports. These adopted policies and procedures are approved by PASSIA's management as well as PASSIA Board of Trustees.