Bangladesh Mahila Parishad - Norad

476.1.2 Accounting SystemThe accounting system of BMP consists of the methods and records established toidentify, assemble, analyze, classify, record and report its transaction and to maintainaccountability for the related assets and liabilities.Transactions are usually initiated by raising requisition from the concerneddepartment, which is checked with budgetary provision by department head andrespective accounts in charge at the Accounting department and forwarded to theappropriate authority (as per Table of Authority) for approval. Once the transactionis approved, BMP Administration takes initiative to process the transaction as per theguidelines in the procurement policy. Once the goods or services are delivered,quality is assured and invoice is forwarded to Accounts for payments. Theaccounting department checks all relevant documents and prepare voucher forapproval by the appropriate authority. Once the voucher is approved, paymentrequisition is given and check is prepared for signature. Voucher along with thecheck is forwarded to cashier for disbursement. At this stage entry is made in thecash/bank book and ledger.In connection with project related expenses, once the requisition is approved,payment is made in cash to the respective program employee and booked as advance.As per financial manual of BMP, advance will be adjusted within 15 days from thedate of returning from the field. After the program is implemented, respectiveemployee submits expense summary statement. A voucher is prepared to book theexpense in the respective program head and advance is adjusted.Petty cash is kept together with general cash. Gain on foreign currency is nottransferred to the project bank account but kept in BMP Mother Account. Interestincome throughout project period and gain from foreign exchange is adjusted withfinal year budget.Books of accounts are maintained in Tally accounting software. This is a single userversion software and all entries are made through journal entries instead of themodules.Areas requiring improvement are as follows:Advance Paid to the BranchesDuring our review, we have observed that BMP Head Office pays advance to itsbranches and book them as expense. At branch level, funds received from headoffice are not fully expensed and remains unutilized in hand or at bank. Thisunitized fund is not accounted for at HO and thereby gets reported as expense.BMP informed us that liquidation reports are checked and placed to thesubcommittees prior to sending further funds to branches. The sub-committeechecks performance of branches before releasing funds. From documents availableat the time of review we however could not confirm this procedure but observedthat in some cases fund is released despite branches having adequate fund on the dayof transfer.