The term financial controls could sound a bit daunting. What it really means is that you have policies, procedures, and systems in place so that your decision-making is easier, everyone knows who’s doing what, and when. Financial controls also give your management and board a guide as to what needs to be considered in that particular decision-making process. Your association’s members delegate power to your board to govern and manage its day-to-day operations. 

Having policies, procedures, and systems in place will take a lot of the stress out of decision-making for you. It also means that your members, volunteers, and staff are confident that there is consistency in your decision-making process. In your structure, you would also include monthly and yearly reporting cycles to your board, auditor, members, and regulators. The other good thing about control systems is that they can also help to detect and prevent errors, theft, or fraud. There are some things that you need to consider and here’s a list of useful questions to ask in relation to financial controls. 

Are all of your completed association’s financial records and transactions included in your board reports? Are the amounts being correctly reported under the appropriate account names? Does your association have the appropriate authorities in place? Are the expenses valid? Should you be paying those amounts? Are the payment timelines valid? What do you need to know about the contracts you’ve committed to? Does your association have appropriate procedures in place to ensure that errors are identified and corrected? What about the processes that are in place to separate financial duties? In this video, we’ve explored why you need financial controls, that financial controls consist of policies, procedures, and systems, and some useful questions to ask to check that you’ve got adequate financial controls in place.