ML Final SSF Fy 09

SAO SARY FOUNDATION
MEMORANDUM OF INTERNAL
ACCOUNTING CONTROLS
FOR THE PERIOD

SEPTEMBER 01 2008 TO AUGUST 31 2009

SAO SARY FOUNDATION
MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS
CONTENTS Pages
1. FINANCIAL REPORTING 1
1.1 Monthly financial reports for management 1
1.2 Recording and documentations of financial transactions 1
2. FIXED ASSETS 2
2.1 Fixed assets listing 2
3. CASH RECEIPTS 3
3.1 Documentation of income 3
3.2 Official receipt 3
3.3 No account description 4
4. EXPENSES 4
4.1 No Approval on the voucher 4
4.2 No Address or Phone number on the receipt 5
4.3 No distribution list 7
4.4 No stamp “Paid” 8
4.5 Price quotations 8
4.6 No approved by on the voucher 9
4.7 Non preparation of loan agreement for the beneficiary 10
4.8 Non preparation of finance voucher 10
4.9 No description of expenses in the system 12
4.10 Non preparation of rice monitoring register or logbook 14
4.11 Lost receipts and invoices 14
5. PAYROLL 16
5.1 Employment contracts 16
5.2 Pay slips 16
5.3 Payroll summary 17
SAO SARY FOUNDATION
1. FINANCIAL REPORTING AND RECORDING
1.1 Monthly financial reports for the management
Observation
During our examination we noted that the Accountant does not prepare monthly financial report
for the management. Therefore the management was not able to monitor the income, expenses
and fund balance properly. In addition, there was no fund reconciliation made with the actual
cash on hand and cash in bank; hence it is difficult to determine the correctness of the fund
balance of projects of the Organization.
Recommendation
We recommend that the Accountant should prepare monthly project financial statements
checked and approved by the ED or other senior personnel for submission to the management.
These financial reports should consist of the Balance Sheet, Statement of Receipts,
Disbursements and Fund Balance and supporting schedules like bank reconciliations and other
important schedules. These reports should be printed out, signed as prepared by the AS,
checked and approved by the CEO or other senior personnel. A copy of the financial report
should be submitted to the management and another copy will be filed at the accounting room
for future checking and verification of the accounts by the management and external parties.
Financial Reports should be comprehensive and easy to read for management to effectively
monitor the finances of the Organization. Moreover, financial report is a good financial tool in
assessing and reviewing the Organization’s results of operations and financial position.
Management Comment
SSF agreed with the recommendation. The reason wasn’t produced the monthly financial report
due to SSF accountant was part-time employed and she was recruited later than three-month the
financial year began. She needs to review and learn everything about SSF accounting system
before she could handle the position. Another importantly, before 2009 financial year SSF
hadn’t accountant so all accounting data is on paper basis.
1.2 Recording and documentation of financial transactions
Observation
We noted that during our examination the Accountant does not record the financial transactions
on time or a regular basis. Therefore the recording was delayed and the financial reports for the
year were not prepared on time. At the time of audit, the financial reports were still being
prepared by the Accountant. According to the Executive Director (ED) the financial reports are
delayed because the Accountant only works part time because there was no budget for a full
time work and the financial transactions are not a lot.
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In addition, the Accountant does not also write the reference numbers on the payment vouchers
therefore it is difficult to trace the expenses from the accounting system to the vouchers and
supporting documents and vice versa.
Recommendation
We recommend that the Accountant should ensure that financial transactions are recorded on
time, so that monthly financial reports are prepared promptly especially during year end closing.
Through this the management will be able to monitor the finances of the Organization and make
proper and wise decision.
We also suggest that the Accountant should assign reference numbers on accounting or payment
vouchers so that all expenses recorded in the system are traceable to the vouchers and
supporting documents for management and external parties’ verifications. The Accountant can
assign codes before the number to facilitate easy tracing of project expenses to the supporting
documents.
Management Comment
Agreed. This will be improved at 2010 financial year. Before 2009 financial year SSF didn’t
have accountant so everything was messy and sooner the accountant was recruited sooner she
tried to put everything into a system.
2. FIXED ASSETS
2.1 Fixed assets listing
Observation
The Organization does not maintain its fixed asset register since the start of the Organization
physical count made on the assets of the Organization.
Recommendation
We recommend that the Organization should prepare a fixed asset register that contains the
detailed information of the asset and this should be checked or verified by senior personnel for
counter checking of the records. The fixed asset register should include the date of purchase,
brand names or details of the asset, location of the assets and condition of the assets. Detailed
schedules will provide effective control over fixed assets – in keeping track of all fixed assets
acquired, sold, transferred or donated. These records would also facilitate identification of
physical existence of fixed assets.
Physical asset count should also be performed at least once a year and the list should be updated
with relevant information from time to time. After the count is performed, the list should be
signed by the staff that counted and checked by the staff who witnessed the count. The fixed
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asset list should then be kept in accounting and a copy should be given to the Project Manager
or Chairman of the Executive Committee for counter checking, verification and reference.
Management Comment
Agreed. Due to lack of human resources and even the Executive Director was volunteered with
his position. He was also the founder of the organization so he needs to work with another
organization to raise SSF. When SSF has a minimum budget for hiring the executive director
and other staff therefore everything will be one time and accuracy.
3. CASH RECEIPTS
3.1 Documentation of income
Observation
During our test of cash receipts we noted that the Accountant does not prepare the Income or
Accounting Voucher to document the fund donations received since the start of the
Organization. The Accountant just records the income directly in the accounting system and
there was no proper documentation made to support the recording in the system.
Recommendations
We recommend that the Organization should prepare the voucher for all income or donation
received by the Organization. This is to ensure that all funds received by the Organization have
been properly recorded and approved by the Director.
Management Comment
Agreed. Need to be improved against this recommendation starting from 2010 financial year
3.2 Official receipt
Observation
We noted that the Organization does not issue the official receipt for every income or donation
received by the Organization during the year. Hence there was no complete accountability of the
income received by the Organization.
Recommendation
We recommend that Official Receipts should be issued to all income or donations received by
the Organization. Official receipts should be pre-numbered and prepared in three copies one for
the donor and another copy should be attached to the journal voucher and another copy should
be retained in the receipt book for reference and monitoring. The Official receipt should then be
kept in the lock cabinet and be maintained with a logbook or register to account the usage of
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Official Receipts. This is to ensure that all funds received by the Organization has been properly
recorded and accounted for usage of the Official Receipts.
Management Comment
Agreed. This will need to improve in 2010 financial year. At the beginning due to we would
like to reduce paper work while we have lacked human resource so we decided only record
within database system.
3.3 No account description
Observation
During our test of receipts we observed that the Accountant records the income in the system
but does not indicate the accounts description therefore there is no sufficient detail of income
received by the Organization. The Management cannot immediately identify the nature and
details of the income received until it is being traced or verified in the supporting documents.
Recommendation
We recommend that the Accountant should always indicate the accounts description in the
system in order that all income received have sufficient information of the income received in
the system for immediate verification of the income received by the management and external
parties like donors and auditors. The system has the sufficient information to account
completely all the income received of the Organization.
Management Comment
In fact, SSF has account description but due to we store them in different sheets so Account
wasn’t submitted to the auditor at the same time request was made. SSF will try to consolidate
them into a system where easily to access by third persons in the future.
4. EXPENSES
4.1 No Approval on the voucher
Observation
During our test of disbursements we observed that most of the payment vouchers have no
indication that the expenses were approved by the Director. Details of non approval of expenses
on the vouchers are as follows:
No Date Description Account Name USD KHR

Digital camera (FUJI S- Office
1 3-Sep-08 $ 334.00
5800) equipment/furniture
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Hand pump installation and

platform constructions in Water and sanitation
2 26-Apr-09 Krang Lhong Village facilities( ring-well, $1,800.00
Samrong Tong District cement, etc.) support
Kampong Speu Province
Vegetable/meat/spice
3 26-Apr-09 Purchased sugar and oil & ingredient/drinking 180,000.00
water
Cooking/kitchen
4 23/05/09 Purchase water jars 184,000.00
utensils
5 5-Jul-09 Expense for label marking Signs or label making $ 50.00
Total $ 2,184.00 R 364,000.00
Recommendations
We recommend that all expenses should be approved first before payment is made. No cash
should be paid out unless proper approval has been obtained. If the approving officer is not
around and expenses needs to be paid, a verbal approval should be obtained first through phone
and signature should be obtained later. This is to ensure that expenses paid and recorded are
properly authorized.
Management Comment
Agreed. SSF will need to improve on this matter when we have enough human resources sitting in the
positions. All payments without signed approval so far because those expenses were made directly by
the Executive Director while insufficient staff.
4.2 No Address or Phone number on the receipt
Observation
We noted during our test of disbursements the following expenditures have no address or
contact numbers of the seller or vendor:

Telephone calls and
1 5-Sep-08 phone cards 15.00
communication
2 30-Oct-08 School Uniforms School Uniforms 328,000.00
3 30-Oct-08 Sport Clothes Sport Clothes 289,500.00
4 30-Oct-08 Footwear Footwear 275,000.00
Purchased dishes, spoon, Cooking/kitchen
5 12-Nov-08 22.00 75,500.00
ladle.ect.. utensils
Vegetable/meat/spice &
6 20-Nov-08 (Vegetable, Meat, Spices) ingredient/drinking 42,300.00
water
7 29-Nov-08 (Vegetable, Meat, Spices) ingredient/drinking 41,900.00
water
8 21-Jan-09 Crop seeds support and Crop seeds support 145,000.00
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water sprinkler
9 1-Feb-09 (Vegetable, Meat, Spices) ingredient/drinking 50,500.00
water
Purchased cement, Training materials
10 5-Feb-09 reinforced concrete supply (makers, IEC, 179,000.00
pipe….. flip-chart and ect.)
11 16-Feb-09 (Vegetable, Meat, Spices) ingredient/drinking 63,900.00
water
Purchased net
Training
12 28-Feb-09 ,hoc,meter,nail,saw and 129,500.00
equipment/furniture
trap
Purchased bamboo ,
small wood , thatch and
13 17-Apr-09 Life-skills cost 497,000.00
transport cost for chicken
cage construction
100 mosquito nets
14 8-Jul-09 Mosquito nets 500.00
($5/100)
15 25-Jul-09 (Vegetable, Meat, Spices) ingredient/drinking 44,500.00
water
16 27-Jul-09 (Vegetable, Meat, Spices) ingredient/drinking 63,000.00
water
17 2-Aug-09 ingredient/drinking 55,300.00
water
18 8-Aug-09 (Vegetable, Meat, Spices) ingredient/drinking 66,600.00
water
water
water
water
22 28-Mar-09 Purchased white rice White Rice 90,000.00
Total $ 537.00 R 2,567,900.00
Recommendation
We recommend that the Accountant or Project Staff should ensure that all receipts and invoices
should have sufficient information of the seller or vendor such as address or telephone to extent
possible. Should there be cases that the seller or supplier was not able to provide complete
information on the receipt, the staff that paid the expense should provide explanation on the
receipt and this should be noted by the manager who approves the expenses. This is to
substantiate the expenses and establish authenticity of the receipt. This will also facilitate
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verification and confirmation of expenses by management and external parties like auditors and
donors in the future.
Management Comment
SSF agreed some receipts didn’t have enough information about addresses and phone numbers
due to many reasons; buying goods from local retailers that the owners didn’t have such
contacted facilities, the vendors didn’t give us the information per request or they didn’t issue us
the receipts or invoices as they are just local people and etc. SSF will need to design own
invoice to record if the vendors haven’t. This will need to improve starting from 2010 financial
year.
4.3 No distribution list
Observation
We noted that there were no distribution lists prepared for the items or support distributed to
children or beneficiaries amounting to US$913.00 and R 1,346,500.00. Details are shown
below:

Purchase used bicycle
1 25-Oct-08 Bicycle plus lock purchase 135.00
for children
Material for child
2 25-Oct-08 Stationery and textbooks 153.50
study
Toothpastes &
Clothes/Hygiene
3 26-Oct-08 brushes, soap and 173,000.00
materials/health care costs
detergent
Crop seeds support
7 21-Jan-09 Crop seeds support 145,000.00
and water springkler
Telephone calls and
8 5-May-09 phone cards 15.00
communication
Purchased towel for Clothes/Hygiene
9 8-May-09 72.00
children materials/health care costs
Purchase 15 belt for
10 9-May-09 Accessories (belt, etc.) 37.50
children
Purchase scarves for
11 2-Jun-09 Office stationery 136,000.00
visitors
100 mosquito nets
12 8-Jul-09 Mosquito nets 500.00
($5/100)
Total 913.00 1,346,500.00
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Recommendations
We recommend that the Organization should prepare distribution list for every support given to
the children or beneficiaries. The distribution list should contain necessary information such as
name of the beneficiaries, description of the item supported, quantity, dates of the seminar for
travel or per diem allowance and should be properly signed received to ensure the support given
have been received by the intended beneficiaries. The distribution list should also be signed as
prepared by the project staff and checked or approved by the Project Officer or Manager to
ensure that the beneficiaries are legitimate beneficiaries and the items distributed are sufficient
or reasonable in order the achieve the goals of the project.
Management Comment
In fact, SSF has distributed list in soft copy. Every distribution we had the list but due to
printing cost is expensive and SSF doesn’t have enough budget covering overhead so a lot of
documents are prepared and kept in soft copies rather printing out.
4.4 No stamp “Paid”
Observation
We observed during our test of disbursements that most of the receipts and invoices were not
stamped “Paid” after payment was made.
Recommendation
We recommend that all vouchers and its supporting documents like receipts and invoices should
be stamped “Paid” to avoid resubmission and double payment of the same.
Management Comment
Agreed. This will need to improve starting from 2010 financial year
4.5 Price quotations
Observation
We noted during our test of disbursements that the following purchases were not obtained with
three prices quotations from three different shops or vendors:
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Office
1 3-Sep-08 Digital camera (FUJI S-5800) 334.00
equipment/furniture
Hand pump installation and platform
Water and sanitation
construction in Krang Lhong Village
2 26-Apr-09 facilities( ring-well, 1800.00
Samrong Tong District Kampong
cement, etc.) support
speu Province
$ 2134.00
Total
Recommendation
We recommend that the Organization should strictly follow up its policy on obtaining three
price quotations for any purchase of more then US $ 200.00 to ensure that the Organization
maximizes the use of project fund and avails of the best product quality and best price. The
quotations should then be prepared with quotation summary to analyze the quotations properly
and chose the best quality at the reasonable price. The quotation summary should contain
therein the reason for the selection and the decision of the management on the quotations.
Should it be difficult to obtain quotations, the project staff should explain or note this in the
quotation summary and approved by ED. Through this all capital purchases have followed the
procurement policy of the Organization and have availed the best quality at a reasonable price
of the item(s) to be purchased.
Management Comment
Agreed. So far, SSF doesn’t have policy regarding to quotation selection before purchasing yet. All
purchases so far with more than a hundred US dollar are spending by director only. Even though, there is
no quotation in paper but all purchases or contracts were made during the 2009 financial year were at
least contacted to three different companies or agents to estimate about the quality and price. Reduce
paper work and time regarding to those administration tasks during SSF hadn’t enough human resources
are the best way where we can do.
4.6 No approve by on the voucher
Observation
During our examination we observed that all the payment has no approval from Director or
Manager on the voucher.
Recommendations
We recommend that all expenses should be approved first before payment is made. No cash
should be paid out unless proper approval has been obtained. If the approving officer is not
around and expenses needs to be paid, a verbal approval should be obtained first through phone
and signature should be obtained later. This is to ensure that expenses paid and recorded are
properly authorized.
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Management Comment
Agreed. Starting from 2010 financial year and after SSF has enough human resource to fulfill
their positions so SSF will follow your recommendations.
4.7 Non preparation of loan agreement for the beneficiary
Observation
We noted that the Organization has provided loans to its beneficiaries; however, there was no
loan contracts prepared between the Organization and the beneficiaries. Details of the loans
given to beneficiaries are as follows:

Increasing number of consumable
Consumables for
1 21-Sep-08 items against the market needs during 100.00
cottage industry
Phcum Ben
Repay moneylender back on behalf of Emergency
2 5-Dec-08 170.00
Keav Savy family aid/grant
270.00
Total
Recommendation
We recommend that the Project Manager should prepare contract with the beneficiaries for any
loan given. The contract should contain the terms and condition of the project like the expected
output of the Organization, the duties and responsibilities of the beneficiaries, the support given
and other important provisions to ensure that the project goals and objectives are met. Through
this, all loans, grants or support given to the beneficiaries are properly supported with sufficient
documentation.
Management Comment
Agreed. SSF has only loan request form so far. When a beneficiary was decided to support so
SSF will fulfill the form and signed approval on both parties (beneficiary and SSF) was made.
One copy of the form was kept at SSF filing system while another was with the beneficiary.
4.8 Non preparation of finance voucher
Observation
During our test of disbursements, we observed that there were expenses paid and recorded but
were not prepared with finance vouchers as presented below.

1 22-Feb-09 Seang Sreytouch Daily Pocket Money 6,000.00
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2 22-Feb-09 Mao Sreyneang Daily Pocket Money 9,000.00

3 22-Feb-09 Phan Samphas Daily Pocket Money 9,000.00
4 22-Feb-09 Phan Sopha Daily Pocket Money 9,000.00
5 22-Feb-09 Kang Phalla Daily Pocket Money 9,000.00
6 22-Feb-09 Tim Sreyneath Daily Pocket Money 9,000.00
7 22-Feb-09 Ek Chan Daily Pocket Money 9,000.00
8 22-Feb-09 Phan Sophea Daily Pocket Money 9,000.00
9 22-Feb-09 Creb Saroeun Daily Pocket Money 9,000.00
10 22-Feb-09 Seung Reasmei Daily Pocket Money 9,000.00
11 22-Feb-09 Hoeurng Phalika Daily Pocket Money 9,000.00
12 22-Feb-09 Sok Phanna Daily Pocket Money 9,000.00
13 22-Feb-09 Hoeurng Naing Daily Pocket Money 9,000.00
14 22-Feb-09 Mon Sreymom Daily Pocket Money 9,000.00
15 22-Feb-09 Chhaem Sokha Daily Pocket Money 9,000.00
16 22-Feb-09 Deu Dy Daily Pocket Money 9,000.00
17 22-Feb-09 Hoeurng Piseth Daily Pocket Money 50,000.00
18 22-Feb-09 Ek Chanba Daily Pocket Money 6,000.00
Expense for student ID Student
19 27-Oct-08 5,500.00
of Hoeung Naing ID/Photographs
20 28-Oct-08 Purchaed Monitor Computer Utility 27.00
21 12-Apr-09 Tep Sokha Daily Pocket Money 12,000.00
22 12-Apr-09 Mao Chaneang Daily Pocket Money 12,000.00
23 12-Apr-09 Phan Sophea Daily Pocket Money 12,000.00
24 12-Apr-09 Phan Samphas Daily Pocket Money 12,000.00
25 12-Apr-09 Saem Sokhea Daily Pocket Money 12,000.00
26 12-Apr-09 Deu Dy Daily Pocket Money 12,000.00
27 12-Apr-09 Kang Phalla Daily Pocket Money 12,000.00
28 12-Apr-09 Sok Phanna Daily Pocket Money 12,000.00
29 12-Apr-09 Creb Saroeun Daily Pocket Money 12,000.00
30 12-Apr-09 Tim Sreyneath Daily Pocket Money 12,000.00
31 12-Apr-09 Lim Kunthea Daily Pocket Money 12,000.00
32 12-Apr-09 Mon Sreymom Daily Pocket Money 12,000.00
33 12-Apr-09 Hoeurng Naing Daily Pocket Money 12,000.00
34 12-Apr-09 Saing Kimsuor Daily Pocket Money 12,000.00
35 12-Apr-09 Ek Chan Daily Pocket Money 12,000.00
36 12-Apr-09 Chhaem Sokha Daily Pocket Money 12,000.00
37 12-Apr-09 Nguon Kunthea Daily Pocket Money 12,000.00
38 12-Apr-09 Hoeurng Phalika Daily Pocket Money 12,000.00
39 1-Dec-08 Expense for gasoline Travel (gasoline, etc.) 66,000.00
40 3-Dec-08 Gasoline Travel (gasoline, etc.) 96,000.00
41 28-Jan-09 Purchase white rice White Rice 25.00
42 31-Jan-09 Gasoline Travel (gasoline, etc.) 60,000.00
43 1-Feb-09 Purchase white rice White Rice 180,000.00
(Vegetable, Meat,
44 1-Feb-09 & ingredient/drinking 50,500.00
Spicies)
water
45 3-Feb-09 Gasoline Travel (gasoline, etc.) 64,000.00
(Vegetable, Meat,
46 16-Feb-09 & ingredient/drinking 63,900.00
Spicies)
water
47 28-Mar-09 Purchased white rice White Rice 90,000.00
48 10-Apr-09 Purchase new hard drive Maintenance/repairing 100.00
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for ED laptop and sparepart

Domestic materials
49 19-Apr-09 Solex lock 15.00
and equipment
50 31-Jul-09 Photo document Photocopies/printing 26,800.00
51 1-Aug-09 White Rice White Rice 22.00
Total 189.00 1,115,700.00
Recommendation
We recommend that all expenses should be prepared with finance vouchers signed as prepared
and checked by the Administration Officer, Approved by the Executive Director and received
by the payee, seller or vendor. This is to ensure that all payments are properly documented and
will show evidence that the transaction is carefully processed - that the supporting receipt or
invoice and mathematical accuracy has been checked and approval has been made.
Management Comment
Agreed. So far, SSF has only receipts and invoices that we received or made with vendors or
payees only. In 2009 financial year, we tried our best to reduce paper work while we didn’t have
enough human resource as well as the Executive Director was only volunteer and part-time
work basis with the organization. SSF will improve this point during 2010 financial year.
4.9 No description of expenses in the system
Observation
We observed during our test of disbursements that the following expenses have no description
on the ledger or system. Detail shown as bellow:

Material for Childs Stationery and
1 25-Oct-08 153.50
study textbooks
5 11-Nov-08 (Office rental) Residential shelter rents 160.00
(Vegetable, Meat, Vegetable/meat/spice &
6 16-Nov-08 40,000.00
Spices) ingredient/ water
7 20-Nov-08 42,300.00
8 29-Nov-08 41,900.00
9 3-Dec-08 38,700.00
10 3-Dec-08 Gasoline Travel (gasoline, etc.) 96,000.00
11 5-Dec-08 49,000.00
12 6-Dec-08 (Vegetable, Meat, Vegetable/meat/spice & 50,900.00
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13 3-Jan-09 45,700.00
14 4-Jan-09 42,000.00
15 7-Jan-09 39,500.00
16 18-Jan-09 47,000.00
17 20-Jan-09 45,500.00
18 31-Jan-09 Gasoline Travel (gasoline, etc.) 60,000.00
19 1-Feb-09 50,500.00
20 16-Feb-09 63,900.00
21 7-Mar-09 54,200.00
Bicycle
22 29-Mar-09 Repair Bicycle 159,500.00
maintenance/repair
23 5-Jul-09 Office rental Residential shelter rents 160.00
Transportation fee for
Transportation & travel
24 19-Jul-09 Farmer Came back 55,000.00
cost
home.
25 25-Jul-09 44,500.00
26 27-Jul-09 63,000.00
Spices) ingredient/water
27 31-Jul-09 Photo document Photocopies/printing 26,800.00
29 2-Aug-09 55,300.00
ingredient/ water
30 8-Aug-09 66,600.00
31 25-Aug-09 41,700.00
32 28-Aug-09 47,500.00
33 29-Aug-09 42,200.00
34 29-Aug-09 Social Welfare Meal for farm animals 56,400.00
Total 495.50 2,358,100.00
Recommendation
We recommend that the Accountant should always indicate the description or memo of the
expenses in the system in order that all expenses paid have sufficient information of the
expenses in the system for immediate verification of the income received by the management
and external parties like donors and auditors. The system has the sufficient information to
account completely all the expenses paid of the Organization.
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Management Comment
Disagreed. All accounting records we have description but those descriptions are only putting
them into categories than detailing. For Some missing were re-entered already during we
worked with the auditor. Please refer to a file named “SSF_FY2009_expenditures_final
dd151009.xlsx”
4.10 Non preparation of rice monitoring register or logbook
Observation
During our examination we observed that there were four payment vouchers of rice which were
not prepared with monitoring logbook for the receipts and withdrawal or consumption of the
rice. Details are shown as below:

1 28-Jan-09 Purchase white rice White Rice 25.00
2 1-Feb-09 Purchase white rice White Rice 180,000.00
Expense for purchased 50kg of Consumables
3 5-Apr-09 white rice for Same for cottage 85,000.00
Samart'family industry
Total 47.00 265,000.00
Recommendations
We recommend that the staff should prepare a logbook with complete recording and proper
monitoring of rice. The monitoring logbook should contain information like the date purchase,
the receipts and withdrawal and the balance everyday in the logbook for easy and fast checking
of rice purchases and consumption and ensure that there is enough supply of rice or not.
Management Comment
Agreed. SSF will need to improve starting from 2010 financial year
4.11 Lost receipts and invoices
Observation
We noted during our test of expenses that there are twenty two expenses were the receipts and
invoices are lost or not on file. Detail shown as bellow:

Training materials
1 25-Oct-08 Flip cart, markers & etc 125,000.00
supply (makers, IEC,
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flip-chart and ect.)

2 25-Oct-08 Office stationery 125,000.00
Expense for woods for
3 2-Nov-08 Life-skills cost 438,000.00
do the cage of chicken
4 24-Nov-08 GO wired Bank Charges 20.00
5 16-Dec-08 Repayment the debt Micro-loan 330.00
Clothes/Hygiene
Purchased mosquito net
6 6-Feb-09 materials/health care 256,000.00
and scarfs for chils
costs
7 18-Feb-09 GO wired Bank Charges 20.00
Domestic materials
8 29-Mar-09 Bowl 800,000.00
and equipment
9 12-Apr-09 multi-vitamins Meal for farm animals 73,500.00
10 12-Apr-09 110,000.00
& ingredient/water
Training materials
Water baskets and plate
11 28-Apr-09 supply (makers, IEC, 97,000.00
for chicken
flip-chart and ect.)
Training
12 2-May-09 233,000.00
equipment/furniture
13 16-May-09 Purchased telephone Telephone connection 17.00
Food allowance and
14 16-May-09 Milk for Phannith 158,500.00
accommodation
Water and electricity
15 27/05/09 electricity 172,800.00
monthly expense
16 29-May-09 A4 paper Office stationery 16.00
Detergen and liquid
17 13-Jun-09 Cleaning supplies 36,500.00
cleanser
18 2-Jul-09 GO wired Bank Charges 20.00
Food allowance and
19 18-Jul-09 Milk for Phannith 156,000.00
accommodation
Purchased backpack for
20 5-Aug-09 Bag/backpack 74.50
children
Cooking/kitchen
21 23-Aug-09 Purchase water filter 25.00
utensils
Purchase detergent and
22 25-Aug-09 Cleaning supplies 34,500.00
dish washing liquid
Total 527.50 2,815,800.00
Recommendation
We recommend that all receipts, invoices, and other relevant supporting documents should be
properly bind and filed in a folder kept in a secured cabinet after the transactions were paid.
This is to avoid loss of accounting documents. This procedure is also in adherence to the
funding agreement with the donors and government requirement which requires that the
accounting documents should be properly kept for a period of time from the termination of the
project for donor or government audit and other third party checking and verification.
Management Comment
We agreed for some invoices or receipts were lost during this financial year due to
Page 15 of 17
SAO SARY FOUNDATION
SSF doesn’t have proper filing system. Even though we assigned a staff to maintain
those invoices/receipts but however due to mismanagement so sometime our kids
got them to use for their purposes. Not all above said invoice/receipt(s) we
recognized to lose; some receipts and invoices we found here at SSF office after we
transferred most part to audit company and some other we recognized by our
accountant were transferred to the audit company already. If possible please check
them again.
5. PAYROLL
5.1 Employment contracts
Observation
We observed during our test of payroll that the staffs have been receiving salaries or allowance
were not prepared with employment contracts signed by the staffs and the Organization but only
the job description.
Recommendation
We recommend that employment contracts should be prepared for all staffs and signed by the
staff and the Board of Director or Executive Director because these serve as the main source
documents for salary payments.
Management Comments
Agreed. This will be improved starting from 2010 financial year.
5.2 Pay slips
Observation
We noted that salaries payment has no indication that it approved by the Director shown in the
pay slips.
Recommendation
We recommend that the salaries payment should be approved first before the payment is made
to the staffs to ensure that all project expenses were properly checked and authorized before the
payment is made.
Management Comments
Page 16 of 17
SAO SARY FOUNDATION
Agreed. SSF will improve this matter starting from 2010 financial year. Due to the workload
and part-time work basis as well as lack human resources at SSF so we decided to reduce paper
work for the 2009 financial year.
5.3 Payroll summary
Observation
During our test we observed that the Organization did not prepare the payroll summary form for
salaries payment.
Recommendation
We recommend that the Organization should prepare payroll summary for the salaries payment
with detail of basic salaries, allowance, benefit, taxes and net pay. The payroll summary should
be prepared, checked and approved by the Director.
Management Comments
Agreed. This will need to improve and put into practice starting from 2010 financial year.
Page 17 of 17

ML Final SSF Fy 09

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ML Final SSF Fy 09

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SAO SARY FOUNDATION

FOR THE PERIOD

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

1. FINANCIAL REPORTING AND RECORDING

1.1 Monthly financial reports for the management

1.2 Recording and documentation of financial transactions

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

2.1 Fixed assets listing

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

3.1 Documentation of income

3.2 Official receipt

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

3.3 No account description

4.1 No Approval on the voucher

No Date Description Account Name USD KHR

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

Hand pump installation and

4.2 No Address or Phone number on the receipt

No Date Description Account Name USD KHR

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

4.3 No distribution list

No Date Description Account Name USD KHR

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

4.4 No stamp “Paid”

4.5 Price quotations

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

No Date Description Account Name USD KHR

4.6 No approve by on the voucher

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

4.7 Non preparation of loan agreement for the beneficiary

No Date Description Account Name USD KHR

4.8 Non preparation of finance voucher

No Date Description Account Name USD KHR

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

2 22-Feb-09 Mao Sreyneang Daily Pocket Money 9,000.00

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

for ED laptop and sparepart

4.9 No description of expenses in the system

No Date Description Account Name USD KHR

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

Spices) ingredient/ water

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

4.10 Non preparation of rice monitoring register or logbook

No Date Description Account Name USD KHR

4.11 Lost receipts and invoices

No Date Description Account Name USD KHR

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

flip-chart and ect.)

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

5.1 Employment contracts

Agreed. This will be improved starting from 2010 financial year.

5.2 Pay slips

MEMORANDUM ON REVIEW OF INTERNAL ACCOUTING CONTROLS

5.3 Payroll summary

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