STANDARD OPERATING PROCEDURES SOP TITLE: General Office Expneses DOCUMENT LOCATION: Head Office, Branch Office, Factory

Office PURPOSE: To ensure that the proper accounting methods are being used to record and control general office expenses. SCOPE: All office expenses except purchase of raw materials, plant, machinery, equipment. RESPONSIBILITIES: Accounts Department. POLICY AND GUIDELINES: 1 Expense Documents and Forms: a. All expense documents must be printed or accompanied with printed company forms. b. All expense documents must be signed by at least three persons. One will prepare the documents, one will check the documents and another will approve. c. All expense documents must have dates themselves and dates by the signatories. d. All expenses will only be approved if they are approved in the previous budget. Documentation and Entry: a. Voucher: The accounts executive must prepare voucher of the transactions on the same day they occur. All vouchers must contain sufficient explanations. b. System Entry: The accounts executive must enter the transaction in the system on the same day they occur. c. Checking Vouchers and System Entry: The accounts manager will check and verify the vouchers and system entry on the same day. Accounting policies and laws: a. GAAP: The accountant must follow Generaly Accepted Accounting Principles to classify the expense transactions and entry properly. b. Local Law: The accountant is responsible of complying with local laws. Payment Procedures: a. The accountant will only make payments if only all the payment conditions are met. b. The accountant must not pay to anybody including directors without any writen approved documents. Sometimes the approval may come through emails. He should print out and attach to payment documents. c. The accountant must have the resolution copy as evidence if there is a regular or irregular fixed amount of payment. Expenses for directors: a. Regular fixed expenses: There must be a resolution containing the fixed amount and reasons passed by the board of directors. b. Regular variable expenses: There must be a resolution containing the maximum limit of the expenses passed by the board of directors. c. Irregular expenses: There must be a requisition to the chairman for the approval. The chairman will direct accordingly. All regular office expenses: a. Regular fixed and variable expenses: There must be a resolution for all such types of expenses passed by the managing director. All irregular office expenses: a. There must be a requisition to the managing director for the approval. All resolutions and requisitions must be prepared and communicated by the accounts department head. Payment Time: a. Payment for any office expenses is up to 4 o'clock every day. The accountant must not pay after that time. b. Payment against the bills submitted after 4o'clock will be paid on the following working day. KEY WORDS Expense Forms

Documentation and System Entry

Accounting Policy and Loacl Law

Payments

Director's Expenses

Regular Office Expenses

7 8

Irregular Office Expenses

Payment Time

10 Accounts department will make actual expense statements at the end of the month and send to internal audit department.

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