4.7 Internal Financial Controls Policy

POLICY TYPE: 4.0 Financial
EFFECTIVE DATE: 2019-02-21	LAST REVISED: 2025-12-09
THIS POLICY APPLIES TO: Contractors – Individuals engaged to provide services under a contract with SelfDesign Learning Foundation Support Providers – Individuals engaged under a contract or agreement with SelfDesign Learning Foundation to provide services for a specific learner Families – Learners and parents(s)/guardian(s) of learners participating in SelfDesign Learning Foundation’s programs Volunteers – Individuals providing goods/services under the terms of an agreement with SelfDesign Learning Foundation Board Members – Members of the Board of Directors for SelfDesign Learning Foundation and the Foundation for SelfDesign (FSD)

Policy Statement

SelfDesign Learning Foundation (SDLF) is committed to minimizing errors and omissions, in addition to avoiding and detecting fraud. This policy is intended to ensure that there are internal checks and balances in place to safeguard the organization, maintain the integrity of our processes, and hold individuals accountable.

Definitions

Errors – an unintentional mistake in a company’s financial records that can range from a minor data entry issue to a significant misclassification. These errors are distinct from fraud and can result from incorrect amounts being recorded, transactions being duplicated or omitted, or transactions being posted with the wrong debit or credit.

Fraud – Wrongful or criminal deception intended to result in financial or personal gain. Fraudulent action may include, but are not limited to:

Any dishonest or fraudulent act.
Forgery or alteration of any document or account belonging to the organization.
Forgery or alteration of a cheque, bank draft, or any other financial document.
Misappropriation of funds, securities, supplies, or other assets.
Impropriety in the handling or reporting of money or financial transactions.
Profiteering as a result of insider knowledge or organizational activities.
Disclosing confidential and proprietary information to outside parties.
Disclosing to other persons security activities engaged in or contemplated by the organization.
Destruction, removal, or inappropriate use of records, assets or equipment.
Any similar or related inappropriate conduct.

Internal Controls – the policies, protocols, and procedures/processes established by the Chief Financial Officer in collaboration with organizational leadership to provide reasonable assurance on the safety, effectiveness, and efficiency of the organization’s operations, the reliability of financial and managerial reporting, our commitment to the protection of privacy of our learners, learners’ families, contractors, and volunteers, and the compliance with regulatory requirements.

Omissions – failure to record a transaction in a company’s financial records, either partially or completely. This can be an unintentional mistake, such as forgetting to enter a cash sale, a credit purchase, or an expense.

Policy

The Chief Financial Officer in collaboration with organizational leadership will establish controls to aid in the detection and prevention of fraud. SDLF will foster an organizational culture that emphasizes the importance of internal financial controls and continually maintains these controls.

Protocol

Detection and Prevention

SDLF takes continuous measures to ensure appropriate processes and efficiencies to monitor and minimize errors, omissions and fraud.

Investigation

All reported cases of fraud or suspected fraud will be investigated. Any investigative activity required to substantiate fraud will be conducted without regard to the suspected individual’s position/title, length of service, or relationship to SDLF.

Internal Financial Controls

The system of internal financial controls contains eight key components:

Segregation of duties – separating authorization, custody, and record-keeping roles to limit risk or fraud or error by one person.
Maintaining the highest standard – to ensure personal information is protected against unauthorized collection, use, and disclosure, including maintaining access to personal information based on pre-authorized least privilege principles.
Authorization of transactions – review of particular transactions by an appropriate person.
Retention of records – maintaining documentation to substantiate transactions.
Supervision or monitoring of operations – observation or review of ongoing operational activity.
Analysis of results – periodic and regular operational reviews, metrics, and other key performance indicators.
IT Security – usage of passwords, access logs, etc. to ensure access is restricted to authorized individuals.

SDLF shall require that no one person is to initiate, record, authorize, and/or reconcile a transaction. Duties may be separated by department or by individuals within a department. If the separation of duties is insufficient to adequately reduce the risk of errors, management oversight will be increased for that activity.

All transactions will be recorded in the relevant systems, and documentation (electronic or physical) will be obtained for each event or activity. Proper documentation provides evidence of what has transpired as well as provides information for researching discrepancies.