The Importance of Financial Policies
Financial policies and procedures are important to help ensure every business runs smoothly. Governmental entities are no exception. Financial policies and procedures help ensure proper management of a governmental entity. The intent is to steer the government over the long term, providing guidance in decision making, regardless of turnover in elected officials or staff. For example:
- Fund balance policy guides decisions in the annual budgeting and long-term capital planning processes.
- Investment policy ensures the government preserves capital and manages risk in the use of public funds.
- Procurement policy sets guidelines for significant purchases, often including multi-year contractual agreements.
The Government Finance Officers Association (GFOA) represents federal, state, and local finance officials across the United States. The GFOA provides best practices for many policies and procedures to help municipalities improve their governance and operations. Please access the GFOA best practices using this link… https://www.gfoa.org/best-practices.
Even if you have implemented some (or many) financial policies, it is important to review them to 1) ensure the government is complying and 2) determine whether the policies are up to date and reflect the current needs of the government.
Maner Costerisan professionals are very familiar with these best practices and can offer recommendations and help you implement them for your municipality. Give us a call 517.323.7500.