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EXHIBIT 3 <br /> 5 HB Fiscal Polices tt Procedures <br /> The payroll process consists of processing payroll and remitting amounts due to employees, <br /> the government, and other agencies such as health insurers, retirement plan trustees, etc. <br /> Key steps in this area are: <br /> • Obtaining and gathering information for processing <br /> • Preparing payroll checks and depositing payroll taxes <br /> • Performing month-end reconciliation procedures <br /> • Preparing quarterly payroll tax returns <br /> • Preparing W-2s, the W-3, and other annual payroll tax returns <br /> IV. General Ledger and Financial Statements <br /> The general ledger process consists of posting the period's transactions to the general ledger and <br /> preparing the financial statements. <br /> Key steps in this area are: <br /> • Preparing monthly journal entries <br /> • Reconciling bank accounts and other general ledger accounts <br /> • Monitoring and reconciling prepaid, accrued, deferred, and fixed asset accounts <br /> • Reviewing general ledger activity and posting adjusting journal entries <br /> • Producing the general ledger and financial statements <br /> C. Key Details <br /> 1. Fiscal Year <br /> HB's fiscal year is July 1 - June 30. <br /> 2. Accrual Accounting <br /> HB is on the accrual basis of accounting and uses this system when preparing the organization's <br /> financial statements. Unlike cash basis accounting, which records revenue and expenses based on <br /> the timing of cash receipts and disbursements, accrual accounting recognizes revenue when it is <br /> receivable and expenses when incurred. <br /> 3. Approvals <br /> As an internal control, approval may be required for many of the processes and transactions <br /> outlined in this manual. In general, staff will obtain approval from a supervisor. For processes and <br /> transactions made by the ED, this individual must obtain approval from the Board of Directors <br /> (Board). <br /> 4. Board Involvement <br /> The day-to-day fiscal responsibilities of HB are assigned to its management and fiscal staff. <br /> However, ultimate responsibility for the overall fiduciary oversight of the organization rests with <br /> the Board. <br /> 5. Software and Applications <br /> HB uses the following to process and track financial information: <br /> • Accounting Software: QuickBooks Desktop, Enterprise Version <br /> • Development Software: Raiser's Edge <br /> Last updated September 2022 <br />