The Topsham Public Library strives to have the best possible system of internal controls and financial accounting. These financial policies are set by the Board of Trustees to guide the work of staff and outsourced financial management.
I. Finance Committee
The Board of Trustees of the Topsham Public Library will appoint a Finance Committee who works with the Board Treasurer and the Director to ensure the appropriate preparation of an annual budget, appropriate handling and distribution of funds, and the appropriate preparation and presentation of regular financial statements.
II. Approval of plans and commitments before they are implemented
The Board of Trustees will set the annual budget, based on the Topsham Public Library fiscal year (July through June), to direct how funds are spent. Board approval is necessary in order to spend funds or make financial commitments to projects that have not already been incorporated into the approved budget.
III. Accurate, timely financial reports and information returns
The Finance Committee oversees that the Topsham Public Library provides accurate, timely financial reports and information returns. The Finance Committee will review regular financial statements, including a balance sheet, a comparison of actual financial activity to the approved budget, and projected cash flow. The Office staff will maintain a calendar of report deadlines and will advise the Board of Trustees to ensure that all financial reports and information returns have been filed as required.
IV. Compliance with other government regulations
The Topsham Public Library will comply with all government regulations pertaining to grants and contracts. When new funds are awarded from a public entity via a contracting organization, staff will review the documentation to ensure the Topsham Public Library is in compliance with all regulations of the contracting organization as well.
V. Banking institutions and accounts
In order to minimize risk and maximize benefit, the Topsham Public Library utilizes only federally insured banking and savings institutions. All investments will be handled in accordance with the Topsham Public Library Investment Policies.
VI. Deposits
All income intended for the Topsham Public Library will be properly received, deposited, recorded, reconciled, and kept under adequate security. Any cash received must be promptly and fully deposited.
VII. Grants, gifts, and pledges
All grants and gifts will be properly received and recorded. Compliance with terms of any related restrictions will be monitored by staff and reported to the Finance Committee. Pledges are recorded at the time they are made.
VIII. Donated goods and services
Donated goods and services are recorded in an “In-kind ledger.” Estimates are recorded at fair market value. Services, including but not limited to volunteer hours (direct service, event, board and administrative) and professional services (dentists, doctors, legal, etc.) shall be computed at rates commensurate to the tasks performed. Annually, the Topsham Public Library Board will review the in-kind ledger.
IX. Fixed assets
Expenditures for land, building, and equipment are recorded at cost. Donated assets and capitalized donated leases are recorded at their estimated fair market values at the date of donation. Depreciation expenses are calculated using the straight-line method and the following estimated useful lives:
Buildings and improvements 10-35 years
Furniture and equipment 3-10 years
Vehicles 3-5 years
X. Petty cash
A petty cash fund may be maintained by staff to facilitate efficient operations. Such petty cash funds will be disbursed only for proper purposes, will be properly recorded, and will be adequately safeguarded at all times.
XI. Credit card
The Topsham Public Library may maintain a credit card account to facilitate efficient operations. Credit cards will only be issued in the name of specific employees with specific credit limits as appropriate and will be adequately safeguarded at all times. All credit card transactions will be only for proper purposes and will be properly recorded.
XII. Procurement and Purchasing
The Topsham Public Library will always seek to maximize value and cost-effectiveness in all procurement and purchasing.
XIII. Disbursements
The Board of Trustees specifies authority to approve payments for services and financial commitments of the Topsham Public Library. Funds will be disbursed only upon proper authorization of management and only for valid business purposes. All disbursements will be initiated only from properly authorized documentation and will be properly recorded. No check may be made out to Cash. The Board shall designate the Board Chair, the Board Treasurer, and any other Board member or staff member deemed appropriate as authorized signers of checks on behalf of the Topsham Public Library. No check signer may sign a blank check or a check payable to himself/herself.
XIV. Payroll
Payroll disbursements will be handled by the Town of Topsham pursuant to the stipulations of the Town of Topsham and the Topsham Public Library Personnel Policy and Manual.
XV. Reconciliation of banking/security statements
All banking/security statements will be delivered unopened to or retrieved on line by a designated individual who is not otherwise involved in the preparation of checks, the depositing of funds, or is an authorized signer of checks. This designated individual shall review and initial each statement on a timely basis.
XVI. Contracts
A. Procuring contracts:
All procurement transactions will be conducted in a manner to provide practical, inclusive and free competition. The Topsham Public Library shall be alert to organizational conflicts of interest as well as noncompetitive practices among contractors that may restrict competition or restrain trade. In order to ensure objective contractor performance and eliminate unfair competitive advantage, contractors that develop grant applications, specifications, requirements, statements of work, invitations for bids and/or will be made and documented in connection with every procurement action before a contract is awarded. Various ways of price analysis include comparison of price quotations submitted, market prices and similar indicia, together with discounts. Cost analysis is the evaluation of each element of cost to determine reasonableness, allocability and allowability.
B. Awarding Contacts:
Awards shall be made to the bidder whose bid is most advantageous to the recipient after considering all factors. The Topsham Public Library will clearly set forth all requirements that the bidder must fulfill in order for the bid to be evaluated by the recipient. Any and all bids may be rejected when it is in the Topsham Public Library’s interest to do so. No employee, officer or agent shall participate in the selection, award, or administration of a contract if a conflict of interest would be involved. Such a conflict would arise if the employee, officer or agent, or any member of their immediate family, their partner or an organization which employees are about to employ any of the parties indicated herein, has a financial or other interest in the firm selected for an award. Officers, employees, and agents of the recipient shall neither solicit nor accept gratuities, favors, or anything of greater than nominal monetary value from contractors, parties to sub-agreement, or parties receiving benefits or services from The Topsham Public Library. Any violations of such standards by officers, employers or agents of the Topsham Public Library shall be subject to disciplinary action. Any gifts of whatever value received at the Topsham Public Library will be considered gifts to the organization.
C. Contract administration
The Topsham Public Library will maintain a system for contract administration to ensure compliance with the terms and conditions of the contract, to ensure adequate and timely payment of all obligations, to ensure that contractors have met the terms, conditions and specifications of the contract, and to evaluate contractor performance.
Approved –May 19, 2009