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General Overview Accounting&Reconciliation

Bölgesel Rekabet Edebilirlik Operasyonel Programı’nın Uygulanması için Kurumsal Kapasitenin Oluşturulmasına Yönelik Teknik Yardım Technical Assistance on Institutional Building for the Implementation of RCOP in Turkey. General Overview Accounting&Reconciliation.

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General Overview Accounting&Reconciliation

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  1. Bölgesel Rekabet Edebilirlik Operasyonel Programı’nın Uygulanması için Kurumsal Kapasitenin Oluşturulmasına Yönelik Teknik Yardım Technical Assistance on Institutional Building for the Implementation of RCOP in Turkey General Overview Accounting&Reconciliation This project is co-financed by the European Union and the Republic of Turkey

  2. This project is co-financed by the European Union and the Republic of Turkey General Overview for Accounting and Reconciliation

  3. Accounting This project is co-financed by the European Union and the Republic of Turkey The accounting at the OS of transactions relating to EC financial assistance and co-financing is based on double entry, analytical and accrual basis accounting system. The accrual method of accounting records income when it becomes due, rather than when it is received, and expenditures when the obligation is incurred, rather than when it is paid. This method requires knowledge of accounting principles. Accrual Basis: Tahakkuk esası (gelir ve gider kalemlerinin nakit olarak alınmamış veya ödenmemiş olsa da kazanılmış ya da sarf edilmiş gibi varsayıldığı muhasebe sistemi

  4. Main Principles This project is co-financed by the European Union and the Republic of Turkey • Accounting period is determined as calendar year, i.e. starting from 1st of January and ending 31st of December. • Economic activity is measured in Euro and control documents will be printed in English.

  5. Responsibilities of the accounting section This project is co-financed by the European Union and the Republic of Turkey • The Accountant has following duties: • Organises the book-keeping activity; • Ensures appropriate book-keeping and registration for each programme, Priority, Project, contract; • Offers consultancy and draws up reports on accounting, payment and financial issues

  6. Responsibilities of the accounting section This project is co-financed by the European Union and the Republic of Turkey • Senior Accountant has the following duties: • Performs checking operations and under signature, submits them for approval of the OS management • Bank, National Fund, Contractors and MIS system reconciliation (If applicable) • Controlling the monthly, quarterly and annual reports

  7. Accounting System This project is co-financed by the European Union and the Republic of Turkey • The OS accounting system should be designed to separate accounting for each measure down to the contract level. Analytical needs are executed through additional numbers following the account number • This enables to keep tract of: • Priorities and Measures • Projects • Contactors

  8. Accounting System This project is co-financed by the European Union and the Republic of Turkey For example the number combination of 234.501.001.001.01 would stand for: • 234 = number of primary account; • 234.501 = number for priority. • 234.501.001 = number of project in the project of the relevant priority. • 234.501.001.001 = number of the contractor in the project. • 234.501.001.001.01 = sources of the Fund, i.e. 01 for EU contribution, 02 National contribution.

  9. Commitments and transactions This project is co-financed by the European Union and the Republic of Turkey • The accounting is designed for recording commitments and transaction on the sub-accounts. • Commitments are; • Commitment from and to the NF • Commitment from and to Contractors • Transactions on bank sub-accounts are; • Incoming transfers on the sub-accounts • Outgoing transfers from the sub-accounts • Interests on sub-accounts (if applicable) • Costs related to sub-accounts (if applicable)

  10. Record Keeping This project is co-financed by the European Union and the Republic of Turkey • Transactions are recorded based on the nature of the primary documents. • Primary documents (or source documents) are the documents supporting the records of the operations. • Each accounting entry is supported by a dated item of documentary evidence (primary document), established on paper

  11. Primary Documents This project is co-financed by the European Union and the Republic of Turkey • Contract (accrual) • Approved request of funds • Bank disposition for deposits • Debit note (for recovery of funds) • Letter of Guarantee • Invoices • Requests of Funds • Payment order • Debit note • Bank statements (for bank charges) • Operational Programme

  12. Entering the transaction This project is co-financed by the European Union and the Republic of Turkey • Having signature of the Senior Account, the Accountant uses his/her software and affirms that the registrations concerned be validated. • In the computerized accounting system, as soon as data entries are made, the journal records(yevmiye defteri/günlük defter), the ledger records and the trial balance(mizan) are updated, as a real time data processing. • Journal entries which are broken down in accordance with the codification of accounts number are posted to the ledger by software automatically.

  13. Accounting Controls This project is co-financed by the European Union and the Republic of Turkey • The accounting operations are controlled on a real time basis by a Senior Accountant • Reviewed on a monthly basis by the Head of Financial Management Unit • Reviewed on quarterly basis by Director of IPA CI Center

  14. Accounting Controls This project is co-financed by the European Union and the Republic of Turkey • The OS’s financial statements (i.e. Balance Sheet, Cash-flow Statement and Notes on the Accounts) are reviewed and signed by the Director on a quarterly basis. • EC control bodies and/or authorized EC representatives may control the accounting process or conduct on-the-spot checks of the accounting process at any time

  15. Reconciliation (1) This project is co-financed by the European Union and the Republic of Turkey Every month, the following reconciliation shall be operated: • Between bank account statements and bank accounts balances in the books of the Contracting Authority: • The status of the account versus the bank book shall be shown in a bank reconciliation form. Any differences have to be traced and cleared. • Reconciliation under any format which may be required by the EC in the context of electronic exchange of data.

  16. Reconciliation (2) This project is co-financed by the European Union and the Republic of Turkey • Comparing the sub-account balances as per the Central Bank’s monthly account statements with the account balances stated in the programme bank books of the OS, with the account balances as per the accounting system, and with the account balances as per the EC and the information entered into the MIS • Ensuring the entire process is documented in a bank reconciliation form • This function is usually performed by Head of Financial Management Unit or Senior Accountant and never by the Accountant or Financial Control Experts responsible for entering the data.

  17. This project is co-financed by the European Union and the Republic of Turkey Thank you!

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