SOPs or standard operating procedures for bank cash disbursements are standard operating procedures that are used as guidelines for regulating all activities related to bank cash disbursements.
Financial management, especially cash receipts and payments, is very important for the company’s survival process.
Both established companies and companies that are just starting out.
Especially for companies that are in financial trouble.
One tangible form of the implementation of cash disbursement system management is to formulate standard operating procedures for bank cash disbursements.
And this time I present an example of SOP for bank cash disbursements and simple tips for making the SOP for the company.
Let’s start step by step. ..
Table of Contents Article [ Open ]
01: Standard Operating Procedures for Bank Cash Disbursements
A: Definition of SOP for Bank Cash Disbursements
Cash registers are one of the most important controls for protecting cash received from cash sales.
Most companies use electronic funds transfers to increase control over cash receipts and payments.
Bank accounts help control cash by reducing the amount of cash available and facilitating the transfer of cash between companies and locations.
In addition, a checking account allows the company to match cash transactions recorded in accounting records with those recorded by the bank.
The separation of duties between the cash manager and recording cash is also a control.
The voucher system is a control system for cash payments.
A system of controls that uses a set of procedures to authorize and record payments of liabilities and cash.
Due to the importance of cash management, companies / entities / organizations need to make standard operating procedures (SOPs) for bank cash disbursements.
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So, the SOP for Cash Disbursements is a document that contains work procedures that will serve as guidelines and references for cash management.
And in this opportunity, the financial management blog will present an example of a financial management SOP, more specifically about the standard operating procedure (SOP) for bank cash disbursements and the steps to create them.
B: Format and Components of SOP for Bank Cash Disbursements
Standard Operating Procedure (SOP) Format
Before we create and compile the components of a standard operating procedure (SOP), we first have to choose and determine the SOP format that will be used to make the SOP for Bank Cash Disbursements.
There are several standard operating procedure formats that can and are popularly used by profit-oriented and non-profit organizations, including:
- Standard operating procedure format – Narrative
- Standard operating procedure format – Hierarchy
- Standard operating procedure format – Fig
- Standard operating procedure format – Video
The next question is, which format is the best?
There is no best or worst ?
All standard operating procedure formats mentioned above can and are suitable for use according to the needs and types / fields of business.
If a company feels that it is sufficient with a simple narrative format, then use that format.
There are also companies that require a detailed and very detailed explanation of work procedures.
So they use a combination of narrative, flowchart / image and video formats.
So, everything goes back to the company’s needs.
The simple term is “if it’s enough with the simple, why use the complicated”
Don’t turn it around, okay ?
And to compile this SOP for bank cash disbursements, I use a combination of narrative formats and pictures / flowcharts to explain the implementation of work procedures.
In my opinion, this format is good enough to be used to create a standard operating procedure for cash management of this bank.
Standard Operating Procedure (SOP) components
What are the components or elements of a standard operating procedure (SOP) for bank cash disbursements?
In general, there are 3 main components of standard operating procedure, namely:
- Component Attributes, header and footer sections.
- Main Components, content section
- Attachment Components
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And here are the main components and elements of a Financial Management SOP – a bank cash disbursement system:
01. Scope
This procedure starts from the creation of Cash Out / Bank Evidence by the division concerned and ends after cash disbursement by the cashier.
Or giving proof of transfer by the Finance Department to those concerned.
02. Internal Control
- Supporting documents must first be approved by the head of the relevant supervisory department.
- Proof of cash / bank exit must be verified by the head of finance and added with the account code.
- The money recipient must put a signature and clear name as a receipt on the Proof of Cash Out (BKK) / Proof of Bank Exit (BKB).
03. Authorization System
Approval of cash / bank disbursements is made by the Head of Financial Accounting.
- Related Parties
- Divisions concerned
- Accounting and finance
- Cashier
- Finance Manager
05. Documents
- Proof of Cash Out (BKK) / Proof of Bank Exit (BKB)
- Other supporting documents
06. Activity Procedure
- Divisions with an interest, make BKK / BKB as needed and attach supporting evidence.
- Get approval and initials for the head of the relevant department.
- Submit it to financial accounting for verification.
- The financial accounting department checks the correctness of the evidence and supporting documents. Requires an account code and initials as a verifier.
- The head of financial accounting shall authorize cash / bank disbursements which are supported by evidence / documents.
- The financial manager approves cash / bank financing.
- The cashier makes payments to the division concerned.
07. Implementation procedure flowchart
Example of SOP Flowchart for Bank Cash Disbursements
02: Examples of Standard Operating Procedures for Bank Cash Disbursements
An example of an SOP is made by taking and combining the elements above into a complete form of a cash disbursement SOP.
There is an addition to the header section which is the identity of Standard Operating Procedures.
The header section contains several important things, including:
- Company / entity identity
- Title of Standard Operating Procedure
- An explanation of the time the SOP is valid,
- Repair (revision), and
- Number of pages of Standard Operating Procedures document.
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For more details, here is the complete form and format of the SOP for Financial Management – bank cash disbursements:
Standard Operating Procedure for Cash Disbursements, page # 1 :
Example of company SOP – Cash Disbursements: Page 1
Standard Operating Procedures for Cash Disbursements, page # 2 :
Example of SOP for Financial Management – Flowchart 2
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And to refresh about the material on this bank cash disbursement system, watch the following short, useful video ….
03: Conclusion
Cash management or cash management that is good and right must be done by a company or non-profit organization.
Why is that?
“Yes”
Because the existence of cash is very much needed by companies and other organizations, even if they are not profit-oriented organizations.
Cash receipts and cash disbursements must really be the concern of management.
How and where did the cash receipts take place?
How to optimize revenue in order to increase company profits.
How and for what purpose did the cash disbursement occur?
How to identify and classify expenses and expenses that affect the company’s net income?
And one of the management’s commitments to implement a good cash management system is to create and compile an SOP for Bank Cash Disbursements.
How the format, components, and examples of standard operating procedures (SOP) for financial management – bank cash disbursements have been presented above.
All you have to do is study and then compile your own SOP for your business and business.
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This is an example of material that I can share regarding Financial Management SOPs – bank cash disbursements and the steps for making them.
If you want to know examples of other company SOPs and their implementation support tools, just go to SOP & Accounting Tools .
