Module-c community Based Financial Management

 Operation and Maintenance Management Manual 
Training Module - D 
Community Based Financial 
Management 
 
DEMEWOZ CONSULTANCY 
iv
Assets 
Balance Sheet 
Bills for Collection Report 
Assets are any resource controlled by the WB/WASHCO to derive 
benefits. As presented in the Balance Sheet in this Handbook, 
assets can be Current Assets or Fixed Assets. 
Current Assets are cash and other assets that may be converted to 
cash, sold or consumed within one year. Examples are Accounts 
Receivable, Advances to Employees, Advances to Third Parties, 
Merchandise Inventory and Prepaid Expenses. 
Fixed Assets are acquired for continued and long-term use in the 
operations of the WB/WASHCO. Examples are buildings, pumps, 
furniture, and vehicles. 
The Balance Sheet is a financial report showing the financial 
condition of the company as of a specific day (for example “as of 
Sene 30, 2006 EFY”). It is normally prepared as of the end of the 
financial year at the same time as the Income Statement. It may also 
be prepared any time of the year. It summarizes the balances of 
Assets, Liabilities and Capital as of the specified date. 
The Bills for Collection Report contains all Water Bills issued within a 
month. It is recorded in the numerical sequence following the water 
bill to ensure completeness. It is summarized monthly and the totals 
(per account) are posted to the ‘Accounts Summary Form’. 
Capital 
Capital Expenditure 
Cash Disbursements Book 
Cash Receipts Book 
Capital represents equity contribution of the owners in the CBO as 
well as donations from government and donors. 
Capital also includes Retained Earnings and the current Net Income. 
(See definition below) 
Is the expenditure incurred for the purpose of acquiring, extending or 
improving assets of permanent nature by means of which the 
business may be carried on, or for the purpose of increasing the 
efficiency of the project. 
The Cash Disbursements Book contains all Payment Vouchers 
issued. It is recorded in numerical sequence to ensure that all 
payments are recorded. It is summarized monthly and the totals (per 
account) are posted to the Accounts Summary form 
The Cash Receipts Book contains all Official Receipts issued for all 
cash collections. Recording Official Receipts in numerical sequence, 
including all canceled or spoiled Official Receipts ensures that all 
collections are accounted for. 
It is summarized monthly and the totals (per account) are posted to 

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Ministry of Water, Irrigation and Electricity