Transcript Document
Practical Aspects of Cash Management
(Real life problems)
Presented by
Mr Cheng Soon Keong, Director
16 Sep 2008
Agenda
The Perennial Resource / People Issue
Risks in Cash / Cheque Handling
Common Cash Management Tools
The Perennial Resource /
People Issue
$1.21 million
Sean Lee went missing in October 2005
The Perennial Resource /
People Issue
Roles and Responsibilities of Treasurer
Roles & Responsibilities of Treasurer
Is a member of the Board
Oversees finances of the organization
Responsible for annual budget
“Key person” for formulating financial policies and
procedures
Held responsible with personal liabilities?
The Perennial Resource /
People Issue
Finding the Right Person
Sources
Board members
Support groups like NVPC
Interest groups
Challenges
Time / attention
Honorarium?
Risks in Cash / Cheque Handling
Problems with cheques
Forgery
Room for “add-ons”
“Cash Cheques”
Who checked the supporting documents?
“ASSUME”
Hunting down the signatories?
“Boss say pay”
Risks in Cash / Cheque Handling
Problems with cheques: Space in front Cash
Cash
Twenty Two Thousand Only
2 2,000.00
Risks in Cash / Cheque Handling
Problems with cheques: Forged signature
ABC Pte Ltd
Two Thousand Only
2,000.00
Other Common Possible “Leakages”
Leakages in Revenue / Receipts
Forgot to bill
Forgot to collect
Fundraising cost
Leakages through Liabilities Commitment
Unauthorised commitment
Standard Payment
Controls Cannot
“Interested Party Transactions”
Detect
Bulk Purchases
Common Cash Management Tools
Tools
Pros
Cons
Resource intensive
Daily Monitoring
Detect
errors almost
immediately
Approval Limits
Prevent
Supporting
Documents
Proves
Can be duplicated
No time to review
Bank Reconciliation
Detect
Errors found out too
late
Budget Review
Board’s
Once a year
Lack of knowledge
unauthorised Small, broken down
vendor, commitment
payment amount
or payment
bypass Board’s
awareness
the validity of
the payment/receipt
errors usually
at month-end
scrutiny and
clarification enquiries
THE END