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• - .4 • ·CITY OF .ATL OFFICE OF MODEL CITIES PROGRAM 673 Capitol Avenue, S.W. Atlanta, Ga. 30315 404-524-8876 Ivan Allen Jr., Mayor J. C. Johnson, Director ACCOUNTING AND FINANCIAL MANAGEMENT PROCEDURES FOR OPERATING AGENCIES AND CITIZENS PARTICIPATION ORGANIZATIONS ..... I ::" �---·--·- 7 TABLE OF CONTENTS . . . Purpose and Accounting Page 1 Internal Control Books of Account and Records • 2 . . . . . . . . . 5 Brief Description of Account Classification. 7 Disbursement Procedure • • • 9 Eligible and Ineligible Costs • • . • • 10 Instructions for Completion of Monthly Administering Agency Project Reports • • • • • • • . • • • 13 ..... �J ,. ' PURPOSE These instructions prescribe the accounting procedures and related fiscal requirements to be followed by agencies which are awarded contracts with the Comprehensive Demonstration Agency to administer projects or activities as approved by the Department of Housing and Urban Development. The classification and description of - accounts are the minimum required by the Comprehensive Demonstration Agency. If the agency desires to establish accounts other than these prescribed herein, such accounts shall be established as subdivisions of the prescribed accounts and should be maintained in such a way that they can be readily combined into the prescribed classifications for uniform reporting purposes. ACCOUNTING The operating agency shall establish and maintain on a current basis an adequate accounting system on an accural basis in accordance with generally accepted accounting principles and standards. The accounting system, among other things, must be adequate to enable the preparation of a statement of financial condition and a cost control statement for submission to the Comprehensive Demonstration Agency on a current and timely basis. All such reports must be received by the Comprehensive Demonstration Agency time to permit the data contained therein to be incorporated into the CDA's records prior to the preparation and submission of its reports to HUD. - 1- �... •, INTERNAL CONTROL The operating agency shall .maintain an adequate system of internal control. Internal control comprises the plan of organization and all of the coordinate methods and measures adopted within an organization to safeguard its assets, check the adequacy and the reliability of its accounting data, promote operating efficiency, and encourage adherence to prescribed menagement policies . The characteristics of an adequate system of internal control include: a. A plan of organization which provides appropriate segregation of functional responsibilities. b. A system of authorization and record procedures adequate to provide reasonable accounting control over assets, liabilities, revenues, and expenses. c. Sound practices to be followed in performance of duties and functions of each of the organizational units. d. A degree of personnel competence commensurate with responsibilities. An adequate system of internal control contains the following features: a. No person should have complete control over all phases of any significant transaction. b. The flow of work should be from one employee to another so that the work of the second, without duplicating that of the first, provides a check upon it. c. Record keeping should be seperated from OP,erations or the handling and custody of assets, such as: (1) The function of receiving cash should be centrali z ed in one pe r son , who should not be conce rn ed in a ny wa y wi th approvin g or cer t i f ying vo u cher s, a cting a s imp rest fund c ash i er, pr e pa ring dep os it s , making disbur sements , o r k eeping ac c o un ting re cor ds . I n t h is conne ction, the p ers on who p r epar es ormakes depos i ts , appr oves o r c ertif ies vouche r s , o r di s bur ses cash s hould h ave n o acce ss to the ac c o un t ing recor ds . - 2- .. �(2) At as early a point as possible in the mail handling, preferably at the point where the envelopes are opened immediately upon receipt, all checks and negotiable instruments should be stamped with a restrictive endorsement, ail cash items should be listed in duplicate, and a c9py of the listing delivered to the person responsible for making bank reconciliations. (3) Periodic examination and count or other review of cash balances should be made by employees who do not handle or record cash or sign checks. d. Physical and mechanical facilities should be used to the fullest extent possible to insure security and accuracy, such as using security vaults or safe cabinets and check writing machines. e. Responsibilities should be clearly established and then accounted for as close as possible. f. Where feasible, employees are rotated to various assignments. g. Other control features pertaining to cash include: (1) All cash receipts shall be deposited as soon as possible, preferably the day received. (2) All cash receipts shall be deposited intact and for the full amount received. (3) Collections and all other funds held within an office , whether pending regular deposit or in imprest funds, shall be, where possible, restrictively endorsed and kept under complete control and under proper safeguards, preferably in a fire r es istant combination safe or safe-cabinet. (4) Uncollectible items and the related documents shall not be handled by the person making up d eposits or by the person h a ndling accounts receivable. (5) Persons preparing payrolls or time reporting records should not handle the related pay checks. - 3- �(6) The number of bank accounts and inter-bank transfers ~hould be kept to a minimum. A single bank account for the agency is preferred. ~- �BOOKS OF ACCOUNT AND RECORDS The following is a brief description of the books of accounts and records considered to be the minimum required for recording transactions relating to the project or activity. However, the agency may establish any additional accounting records it considers necessary to provide adequate financial control of its assets and liabilities and to account for project or activity cost. i A. General ledger shall be maintained in which to record a summarization of all accounting transactions relat i ng to the project or activity and to classify such transact i ons according to the accounts l i sted i n the project or activity budget. B. A cash receipt and disbursement register shall be maintained for the recording of funds received in connection with theproject or activity and for recording checks i ssued f or the withdrawel of funds from the project or a ctivity b a nk a ccount. All disbursements shall be made by prenumbered checks used in numerical sequence and must be supported by appropri a te documen t ation such a s payrolls, i nvoices , cont r a ct s , ~r a vel vouche rs, etc., evidencing t he n atu re a nd propriety o f e ach p a yment , a nd s howing the approval o f t h e p roj ect or activit y d ire c tor or other authorized official. If the volume of receipts and disbursements justify the seperation of the cash r e c e ipts and di s bursement r egisters, then the two should b e kept sep e r a t e . C. Jour n al v o u ch ers (or the a gency ' s s u itable s ub s t i tute therefor) shal l be used to docume n t and recor d tra nsactions i n t h e ge n e r a l l e dger wh i ch a re not r e corded . fr om t h e c ash rece ipts and di s bursement r e g ister s . Each j ourn a l v ouche r shal l c ontain a complete e x planatio n o f the tra n saction b e ing r e cor ded a nd re fer e nces t o the re l a t e d docu me nt s or othe r s ource s o f info rma t i on, i f app l icable . Journal v oucher s shall be numbe red c o ns e cutiv ely and fi l e d i n numerica l sequence. All j o urnal vouche rs shall b e approve d by an a u t hor ized official of t he a g e ncy . D. Basic payroll reco rds shall b e maintained to accumulate the p ayr oll d a t a r equir ed by Federa l , · State o r loc a l l aw wi t h r e spect t o e a ch employee, such a s g ross earnings, Federa l i n c ome tax withheld, State or local income tax withheld, · FICA withholdings, etc. The '.... record shall also include data relating to other I. - 5- . �deductions as may be required by the agency's personnel policies, including the employer's contribution to retirement plans, health insurance plans, etc. E. A record shall be maintained for each item of non-expendable property acquired for the project or activity. Non-expendable property is property which will not be consumed or lose its identity by being incorporated into another item of property, which cost $100 or more per unit and is expected to have a useful life of one year or more. Grouping of like items, such as chairs, with an aggregate cost in excess of $100 shall also be controlled and accounted for as non-expendable property even though the cost of a single item is less than $100. The record shall include: (1) Description of the item of property, including model and serial number, if applicable. (2) Date of acquisition (3) The acquisition cost or assigned value to the project or activity. (4) Information as to whether the property was new or used at time of acquisition. The a ggre gate of the individual costs shown on the r e cord c a rds s h a ll equa l the b a l a nce in the subs idiary cost account for non-expendable property. A physical inve ntory shall be taken and reconciled with the record card annually or as frequent as r e quired by t h e Mode l Cit ies Progra m, City of Atlanta. - 6(. �BRIEF DESCRIPTION OF ACCOUNT CLASSIFICATION ACTIVITY COST (1) Personnel Includes the cost of staff and support staff of the operating agency as spelled out in latest approved budget. (2) Consultant and Contract Services Includes the cost of services contracted to other agencies, firms or individuals according to a written contract with the operating agency. All contracts must be in writing and must have prior approval of the CDA. (3) Travel a. Auto allowance paid on the basis of actual mileage as spelled out in latest approved budget. b. Staff travel and e x penses according to latest approved budget. (4) Space Cost a. Monthly office rental. b. Telephone a nd telegraph expense if not included in Activity Cost (7) and contained in latest approved budget. c. Fire and e x t e nded coverage in s urance on building and contents if not inc l uded in activity cost (7) and contained in latest approved budget. 1 d. Utility cost if not included in activity coot (7). e. Building maintenance, if not included in Activity Cost (7) and contained in latest approved budget. (5) Consumable Supplies Includes the costs of blue prints, draf t ing materials, charts, graphics, maps, stationery and all small items of non-ex pendable property, the total cost of which does not e x ceed $100. (6) Renta l , lease or Purcha s e of Equipment a. Includes rental or l e ase cost of equipment not on loan or not purchas ed. b . Total cos t of equipment purcha sed. (7) Other Costs Costs n ot s p e c i ficall y covered in the above budget catego rie s · a c c ording to l ates t a p pr ove d budget . I .-----.. . , ._ PROJECT COST (8) (9) Property Acquisition The cost incident to the acquiring of land and structures and the cost of demolition if necessary. Land Improvement The cost .. of improving site to meet the qualifications for the - 7- ... �type construction anticipated. (10) Construction The cost of construction, rehabilitation, alteration and repair. (11) Professional Services The cost of professional services rendered by individuals or organization including legal, accounting and architectual ' services. (12) Carrying Charges The cost of items such as types, interest and insurance premiums incurred during construction. (13) Other Costs not included in the above budget categories for capital projects according to the latest approved budget. The description of the budget categories listed above is by no means exhaustive and in instances where there are questions as to the proper classification of a transaction, the latest approved budget and budget justification break down should govern. - 8- �DISBURSEMENT PROCEDURE 1. Disbursements (other than from Petty Cash) for goods, and for services of persons or firms not payrolled by the Operating Agency shall be supported by executed purchase orders or contracts. Purchase and contract procedures should follow CDA practice and policy. Such policies and procedures shall be approved by the CDA prior to implementation. 2. Disbursements must be supported by invoices or requisitions which can readily be traced to the contract or purchase order for the s e rvices, supplies, or e quipment (except as noted in Four (4) helow). 3. Disbursements shall be made by pre-numbered checks countersigned by two officers unless the amount of the individual disbursement is small (under $10) that payment from a Petty Cash Fund is more economical. 4. .A Petty Cash Fund may be established for use in making payment of minor items of expense whenever it is not practicable to issue a check. An authoriz e d official of the Operating Age ncy shall approve the establishment and the amount of the Petty Cash Fund. Each d isbur s e me nt from the Petty Cash Fund shall b e s upporte d by a rec e ipted bill or invoice . Howe ver, i f a r e c e i pte d b i ll or i nvoic e is not obtaina b le , the disbursement shall be supported by an itemized list of the items purchased and the list shall be approve d by an official o f the Ope rating Age ncy other than the custodian of the fund. Th e Pe tty Cash fund shall b e repl e nishe d at the end of each calendar quar ter or as f r e que ntly a s may othe rwise b e requir e d. - 9- �ELIGIBLE AND INELIGIBLE COSTS All cost must be reasonable and of a nature which clearly relates to the specific purposes and end product of the contract under which the . services are being performed. Care must be exercised by all concerned in incurring costs to assure that expenditures conform to these general standards and the following criteria for eligibility of costs. 1. To be eligible for inclusion in the program, cost must: a. Be necessary and reasonable for proper and efficient execution of the contractual requirements and in accordance with the approved budget. b. Not. be a general expense required to carry out regular responsibilities of the operating agency. c. B.e in conformance with any limitations or exclusions in these instructions, federal laws, city ordinances, or other governing limitations. d. Be no more liberal than policies, procedures, and practices applied uniformly to both federally assisted and other activities of the operating agency. e. Be accorded consistent treatment through application of accounting policy and procedures approved and/or prescribed herein. f. Not be allocable to or included as a cost of any other federally financed program in either prior or current periods. g. Be net of all applicable credits such as purchase discounts, rebates or allowances, sales of publication or materials , or other income or refunds. h. Be in accordance with budgetary or other restriction of e x penses established by the comprehensive Demonstration Agency (City of Atlanta) and approved by the Department of Housing and Urban Department. i. Be fully documented. .. - 10- �j. 2. Comply with polic i es governing administrative practices, including po l ic i es with respect to employment, salary and wage r a t e s, working hours, and hol idays, f r inge benefits (health and hopitalization insurance, retirement, etc.) vacation and sick leave privileges, and travel. The policies relating to the above must be in writing and appr oved by the governing body of the Agency, or Director, as authorized, as well as by the City. Such pol i cies and pra ctice s should t a ke account of situations where theoperating agency is a temporary, non-governmental entity composes primarily of part-time staff wh i ch may have full-time employment elsewhere. In add i tion to costs inel i gible under the above ceriteria, t he follow i ng costs a re speci fic a lly ine ligible: a. Accounting- Costs of maintaining central accounting records necessary for overall agency purposes, such as appropriat ion of f und a ccounts by the tre asurer or similar o ff icia l, are cons i d ered to be a general exp e n se of the a ge ncy a nd a re una llowable. However, the cost of esta blishing and mainta ining accounting or other informa tion sys tems required for the management of the contract is al l owable. This includes cos ts incurred b y c e ntral service agenc i e s f or t h ese purpo se s. b. Bad Debts- Any losses arising from uncollectable accounts and other claims, and related costs. c. Contin genc ies. Contribu tions t o a con tingency reserv e or any simi l ar provision for un f o rseen e v ents . d. Contribut i ons and Donations . e. Entertainmen t. Cos t s o f amus e me nt s , s ocia l activities, and incidental c o sts, such as meals beverages, lodgings, and gratuities, relating to enter t a inment. f. F i nes and Penalties. Costs resu lting fr om vio lation o f or fai l ure to c omply with federal, state, and l o cal laws and regulations. g. I nte r es t a nd o t h e r F i n a n c i a l Costs . Interes t on borrowing (h owe ver represented ) , cost of financing and refinancing operations, and legal and professional fees p a id in conne ction therewith. - 11- �h. Legal expenses. Legal expenses for the prosecution of claims against the Federal Government. However, the costs of legal expenses required directly for the administration of the program are allowable. i. Membership Expenses. Cost of membership in an organization which devotes a substantial part of its activities to influencing legislation. j. Travel. Costs in excess .of those allowed by the City of Atlanta for its equivalent employees. In a case, the difference in cost between first-class air accomodations and less-than-first-class air accomodations is not allowed expect when less-than-first-class air accomodations are not available and is so documented. k. Meeting Attendance. Costs of attending meetings which are not open for attendance on a non-segreated basis. 1. Executive Expenses~ The salary and expenses of the chief executive officer of the agency are considered a cost of the agency and are not allocable in any way to the project or activity. - 12 - �.' INSTRUCTIONS FOR COMPLETION OF .MONTHLY AD.MINISTERING AGENCY PROJECT REPORTS This report is to be delivered to .Model Cities prior to the fifth day of the month following the reporting month. This deadline is imperative in order to report expenditures to HUD. J. The heading of this report includes lines for Agency Name and Address, Project Name, and .P roject Number. The Reporting Period i tern should reflect beginning and ending dates (usually first to last of month) of the report. The Cum. Supplemental Expenditures item should contain a total of all funds designated supplemental which have been expended 9n the project to date. The Cash Received item refers to supplemental funds that have been deposited to. your agency. The Balance item should reflect the amount of supplemental funds expended but not yet received by your agency. The Cost Statement section of the report is a breakdown of expenditures by line item and by source of funds. For projects which receive supplemental funds, costs for each line item for the Current Period should be listed. These should be broken down between Supplemental funds and Other funds if the project or activity is jointly funded. For projects t hat do not involve the use o f .Model Cities supplemental funds, it is requested ~hat a total amount e x pended on the p r oject for the curr e nt period be entered by line item 13 (non-con= tracted agency). Under the Cumrnulative Total column, funds expended to date on the project should be broken down in the same manner as current period e x penditures. The Wo r k Program Status section of the Administerin g Agency Pr oject Report is d e signed to report ag a inst the Project Work Program whi ch was-.. f ormul a t e d by y our a gency in cooperation with Mode l Citie s Pe rsonnel . Each month the various task s listed on the wo r k program should be a n a lyzed to determine if they are being started and comp leted in the planne d time frame . Any t asks which will have different s t a r t and complete dates s h oul d be lis ted u n der the "Description of Task " c olumn o f t h e a g ency p r oj e ct report. Th e applic able r e v ised sta r t a n d c ompl e te dat es s h ould t h e n be e n t e red i n the r epo r ting month , t hat t ask s houl d be entered under th e "De sc r iption of Task" col umn an d the actual complete date shown . - 13- �Start or complete dates for a task wili be considered on schedule if they are within three weeks of the originally planned time frame. A variance of more than three weeks in a task should be reported as described above. Every effort should be made to report time revisions as soon as they become evident. For example, if it becomes apparent that some operational phase of a project will be delayed due to problems in acquiring equipment, this should be reported as soon as it is known rather than at the time the operational phase is to begin. The Project Highlights section of the report should be used to briefly summarize project activity for the month and to list any unusual cirsumstances concerning the project. Amplifying information about revised start or complete dates should also be given in this section. An example of a completed Administering Agency Project Report follows these instructions. ( - 14- �ADMINISTERI NG AGENCY PROJECT RE'PORT \ Georgia State Em2loyment S~;i;:vic!; PROJECT_ Emplo¥er Ser~d ces No. 1 Peachtree Room 4 08 Atlantat Georgia 30301 NUMBER IQ 2 2 AGENCY ADDRESS I I ol I CUM . SUPPLEMENT AL EXPENDITURES REPORT I NG PERIOD: FROM 8/1/69 TO 8/31/69 $30,000 CODE PERSONNEL 01 I CONSULT ANTS, CONT SERV 02 TRAVEL 03 SPACE · 04· CONSUMABLE SUPPLIES 05 RENT, LEASE, PURCH EQP 06 OTHER 07 PROPERTY ACQUISITION 08 LAND IMPROVEMENTS 09 CONSTRUCTION 10 PROFESSIONAL SERV 11 CARRYING CHARGES 12 NON-CONTRACTED AGENCY 13 SUPPLEMENTAL OTHER ·s. ooo 10 000 -0- 1,000 1,500 300 500 $ 5. 1,000 CUMMULATIVE TOTAL . SUPPLEMENT Al 20.000 2,000 OTHER 1o onn 1 000 4,000 2 ·: 000 ~~'": ;r~- · :·...~ -~ ~..-;~::;;::->' " .--~"~:-<fl>::~: "~~• ~::- .

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12,300 7,000 ( WORK PROGRAM STATUS DESCRIPTION OF TASK 000 3.L 000 l 000 ... • TOTAL BALANCE $25,000 CURRENT PERIOD COST ST ATEMENT COST CATEGORY CASH RECEIVED ACTUAL COMPLETE Occupy temporary facility

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30,000 13,000 REVISED COMPLETE REVISED START 9/8/69 Establish contact with 66 employers in MNA 10/6/69 Acquire supplies 8/15/69 Personnel o rienta tion 8/20/69 9/19/69 4/30/70 - PROJECT HIGHLIGH'rS: Dur ing the month o f August project personnel were given orienta tion sessions concerning project tasks and obj ectives. All supplies have been purchased, but oc cupation of the temporary fa cility is being delay ed due to a carpenter's strike . This delay will als o delay establishing contacts with employers. Sample inquiries to emplo yers have produced enthusiastic responses a n d it appears that the project will e x ceed its objective of develo ping 2 00 jobs . (USE REVERSE, IF REQUIRED) THE UND ERSI GNED CERl lF IES THAT TH E ABOVE INFORMATION IS CORRECT . SIGNATU RE AND TI TLE · (FORM MOD. 9) r/4_,n (; <,f ,n:11f f-J tJ. //J C. C. ~2 I J/

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DATE SeEt • 2, 1969-" �