Aga Khan Rural Support Programme (a project of Aga Khan Foundation) Internship Report By Danish Aly Mehr Intern, Finance Section, akrsp regional Office Gilgit

Objectives of the study

• 
  To analyze the finance practices of an organization and how that activities of finance department of an organization runs smoothly.
  
• 
  How finance section apply GAAP (Generally Accepted Accounting Principles).
  

• 
  To study working environment of AKRSP.
  

I joined Aga Khan Rural Support Programme Gilgit (AKRSP) on 10 April 2011.It was first day there. I was eager to know about AKRSP, before that I had just heard about AKPSP.

Business Development Support and risk sharing during initial phase of business. Shortcomings, suggestions and interventions to avoid problems in future were also

Finance section

Introduction

Finance section plays an important role to run the activities of an organization efficiently. Finance section is very sensitive and crucial dimension of any organization, where all financial and economic activities are incurred to run organization effectively and efficiently. The progress of any organization is comprises of financial policies prepared under the Generally Accepted Accounting Principles (GAAP) and International Accounting Standers IAS.

In my internship, period first I got an overview of financial polices of AKRSP. Further I will discuss financial operations in AKRSP Gilgit from which I learnt during the limited tenure.

AKRSP works in close partnership with Government, other society organization and businesses. The main donors of AKRSP during the year 2008 were:

Aga khan Foundation (AKF)

Government of Canada (CIDA)

Government of United Kingdom (DFID)

Government of Norway (NORAD)

Pakistan Poverty Alleviation Fund (PPAF)

Financial Polices:

Iam not going to present the financial polices of AKRSP because it is a confidential documents of the organization therefore we will just look on over the theme of policies in key points.

• 
  Financial policies are made by the Board of AKRSP and it has the sole authority to bring amendments in it.
  
• 
  Financial period of AKRSP starts on the 1^st January and closes on 31^st December.
  
• 
  External audit is conducted annually and mandatory by law as per Companies’ Ordinance 1984.
  
• 
  Internal audit is also conducted but on the need basis of the sections.
  
• 
  Bank accounts are closed and opened after approval of BODs.
  
• 
  Separate bank accounts are maintained for projects run in AKRSP.
  
• 
  Crossed Cheques is issued to vendors for amount higher then 5000.
  

The expenditure for budget allocation is divided into three parts.

1. 
   Administrative Budget (i.e. office rent and training etc)
   
2. 
   Programme Budget (i.e. field Activities)
   
3. 
   Capital Budget (i.e. office equipments,vehicals etc)
   

1. 
   Inventory system of the organization is maintained under a systematic manner
   

2. 
   Assets are issue to staff from capital budget.
   

3. 
   All fixed assets have its different codes according to their region in Gilgit-Baltistan
   

4. 
   All fixed assets are depreciated annually.
   

1. 
   Accounting software Z-loader was in practice since 1986-2006 for book keeping and Reporting purpose of Finance Section of AKRSP Gilgit.
   
2. 
   In 2006, board gave an approved for new accounting software named as iScala for accounting Operations.
   
3. 
   Peach Tree Software is in practice for employees Provident Fund and operation of LSOs accounts in their respective offices.
   

1. There are three types of purchases in AKRSP.

1. 
   Equipment Purchases
   
2. 
   Maintenance Purchases
   
3. 
   Miscellaneous purchases
   

Purchase committee.

• 
  A purchases committee is organized for purchases consist of three members.
  

1. 
   Manager Administration
   
2. 
   Finance Manger
   
3. 
   Manager from the relevant section for whom purchases are made.
   

• 
  Purchase order form is initiated by section head that is approved by purchase committee. On the recommendation of purchase committee, RPM and GM approve for purchases up to the limit of Rs.150000 and Rs.300000 respectively.
  

• 
  . Quotations are call for the purchases of more then 10000 rupees.
  

1. 
   Expenditures are to be capitalized for more then of Rs.5000.
   
2. 
   Expenditures incurred less then Rs.5000 is to be treated as revenue expenditures
   

My work in the finance section carried out by payments of bills and bank reconciliation.

Payment procedure

The first procedure after receipt of bills is to verify them through costing and forward to Manager Finance for his approval to record transaction or activity in accounting software. Moreover, vouchers are made for data entry after joint signatories approve that payment.

In the accounting software, two modules followed for the payment of suppliers.

• 
  General Ledger:
  

• 
  Purchase Ledger
  

• 
  Travel Claim for Staff.
  

Bank reconciliations statements are prepared at the end of each month to reconcile general ledger versus Bankbook.

1. 
   AKRSP is very reputable organization where we saw practical work of any entity which will help us in our every field of life.
   
2. 
   I studied annual reports of AKRSP through which I came to know about major achievements and challenges faced by AKRSP in Gilgit and Chitral from on the day of inception.
   
3. 
   In finance Section of AKRSP, I prepared payment vouchers and saw payment procedure of organization.
   
4. 
   Costing of bills and supporting documents.
   
5. 
   We worked on Bank Reconciliation Statements.
   
6. 
   The interesting and useful experience was worked on iscala and Peachtree.
   

1. 
   Three months are insufficient to go through a practical experience; this period should consist of at least for five or six r months.
   
2. 
   We found lack of coordination with interns in different sections of AKRSP Gilgit.
   
3. 
   Orientations session was a progressive approach such type of opportunities should be given to all upcoming internship programs.
   
4. 
   AKRSP should try to get more financial support from donors.
   
5. 
   Internal audit should be conducted on daily activity bases to run organization effectively.
   
6. 
   All members of purchase committee should be aware about actual purchases.
   
7. 
   AKRSP should take a feedback from stakeholders about their activities through interactive programs and seminars or other gatherings, this act will remove the misunderstanding and challenges
   

I observed that AKRSP has very friendly and flexible environment. During three months, I got the basic knowledge about different sections and corporate culture of the Organization as well as finance section of AKRSP. Further, I also noticed that all the staff members of AKRSP are possessing high skills and are Specialists in their fields. I would like to get maximum knowledge from AKRSP, as it will be of great help for the future progress.

Annual report of AKRSP 2007

Annual report of AKRSP 2008