Module-c community Based Financial Management

Introduction 
to financial 
controls 
Facilitator to make a presentation to introduce the topic. 
Financial controls are a set of procedures that assist the WASHCO and its 
members to have confidence that: 
 
Funds are being spent in line with intended use and according to the 
Tools for Financial Controls 
 
Approved Annual Budget; 
 
Bank Reconciliation; 
 
Financial Report; 
 
Internal Audit Report; 
 
External Audit Report; 
 
Procurement Guidelines; 
 

Procurement Report.

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Ministry of Water, Irrigation and Electricity 
 Operation and Maintenance Management Manual 
Training Module - D 
Community Based Financial 
Management 
 
DEMEWOZ CONSULTANCY 
61
approved budget; 
 
That discrepancies in financial records are noticed early on and rectified; 
 
That revenue is in line with expected amounts and any discrepancies are 
noticed and acted on; 
 
That procurement activity follows the guidelines agreed by the WASHCO or 
as set out in the Constitution or by-laws. 
Step 2: Role 
Play 
 
Use the following role play to help illustrate the need for proper and regular 
financial controls. 
Undertake the role play involving the trainer, the WASHCO chairman, the treasurer 
and community members. 
In moderating the role play, the facilitator should draw out the following points: 
1) Is there an approved annual budget? 
2) Does anyone check monthly income and expenditure against the approved 
budget? 
3) What should the project do if the treasurer is unwell and cannot perform 
his/her duties? Why did the problem persist for six months? 
4) What is the procedure for checking monthly income and expenditures 
against the bank accounts and petty cash box? (Monthly bank 
reconciliation) 
5) Why was the motorbike purchased without being budgeted for and how 
should this be avoided in future? What systems does the project have to 
move funds from one budget line to another?