Accounting Best Practices, Fifth Edition

Chapter 18. Policies in Support of Best Practices

Best practices are most likely to succeed if the entire organization is fine-tuned to accept and support them. This calls for sufficient budgeted funds for each best practice, a supportive management team, and an employee reward system specifically constructed to focus attention on best practices success. In addition, a more subtle approach is to adopt a set of policies that assist in best practice implementations, either through specific policy wording or indirectly as the result of a general guiding principle. Only a subset of all best practices can be supported in this manner, since many occupy such specialized niches at a detailed procedural level that there is no way to create a supporting policy. Nonetheless, it is worthwhile to obtain management or even Board-level support for a set of policies in support of best practices.

This chapter contains a set of policies that can be adapted for inclusion into a corporate policy manual. They are sorted by chapter number, itemizing each policy, a brief discussion, and the titles of impacted best practices. Some chapters contain no best practices for which a supporting policy can be derived, and so are excluded from this list. Consequently, there are no policies listed for Chapter 5 (Budgeting), Chapter 12 (Financial Statements), and Chapter 14 (General Ledger).

The definition of a policy as used in this chapter is rather broad. The classical definitions of a policy are that it is ...