SIP Law Firm is a business entity in the form of a firm, referring to a civil partnership to run a joint business. The business is owned by two or more people, or partners, that have a stake in the ownership. The owners each are liable for all business obligations.
In a firm, the owners’ personal assets are counted as capital in accordance with the provisions stated in the deed of establishment. For this reason, every capital, asset, and debt is recorded in the name of each owner, not on behalf of the firm, in the accounting records. The consequence is that every profit or loss of a firm has a direct impact on the assets of the owners.
The management of SIP Law Firm follows the ISO 26000 standard to achieve and maintain sustainable business development. In an effort to achieve business sustainability, SIP Law Firm strives for a balanced business activity with a focus on People (manpower), Planet (environment), and Profit .
One of the indicators related to Profit is healthy finances reflected in the smooth cash flow and profits/profits obtained. On this basis, SIP Law Firm develops and strives to maximize financial processes.
In general, the financial processes SIP Law Firm follow the financial system standards that have been set. This financial standard covers the revenue cycle consisting of a sales order system and a cash receipt system, as well as an expenditure cycle, which consists of a purchasing system and a cash disbursement system.
Each working agreement with the client shall be authorised in the form of a document, which is the basis for billing by the finance department. In general, there are two types of billing: periodical billing and a billing for each service provided.
Each billing must be completed with complementary documents, such as cooperation agreement documents, report documents, tax documents and other documents required. These documents must be approved by the relevant parties to ensure a smooth billing process.
Billing is recorded carefully to facilitate billing monitoring, which is done periodically to ensure smooth cash flow.
In the billing process, tax is an important aspect to note. There are several types of collection-related taxes such as value added tax, income tax and service tax. Thus, the nominal bill must be completely clear on the value of the Basic Tax Collection (DPP) to avoid errors in the taxation aspect.
SIP Law Firm receives payment of the bill through the bank. Payments that have been received are then recorded in accounting and taxes.
The income is used to finance business activities, particularly in the process of getting clients, billing and maintaining clients. In addition, income is used to pay tax, capital addition or withdrawal.
SIP Law Firm uses providers of goods and services. Each invoice for the cost of goods and services must also comply with the applicable accounting provisions.
Each invoice for the provision of goods and services must be accompanied by required documents. The approval for the invoice payment shall be done in stages. If the invoice is considered appropriate and complete, the finance department shall treat it as a debt and follow the payment schedule. The tax for each bill is also carefully taken care of to comply with applicable regulations.
When the bill is in the payment schedule, all documents will be proceed to the payment process. In this process, a final check and approval shall be done. After obtaining final approval, the payment process for the bill is done based on the applicable regulations.
The payment for the invoices can be done either through the bank and through petty cash.
- BankThe payment of the bills for through a bank shall be done by clearing and/or internet banking. The payment through current account clearing requires the signature of an authorized officer. After the current account is signed, the payment process can be carried out.Payments via internet banking can be processed according to the payment schedule. In this process there is a multilevel authorization system for the party making the payment (maker) to the party making the approval (approver) and execution (releaser).
- Petty CashThe payment through petty cash is generally related to daily office operations. The nominal is set at a certain number or comes from a place where the seller of certain goods/services has been approved.The payment through petty cash is generally done due to an urgent need. Due to its urgent nature, the payment does not have to wait to be scheduled as is the case with bank payments.In addition, payment requests for reimbursement from employees can also be made through petty cash. Requests for reimbursement payments must also be accompanied by supporting documents with multilevel approval. After all supporting documents are assessed as appropriate and complete, petty cash funds can be released.
To monitor and ensure business continuity, the finance department is required to produce periodic financial reports. The report must be understood by the leadership to support the business activities in the future.
The report contains information about income that has or has not been received, expenses that have been and will be paid, as well as obstacles faced in relation to the revenue cycle such as bills that have not been billed or related to the expenditure cycle such as the ability/condition of cash flows to finance business activities.
SIP Law Firm uses a reliable and updated financial application system. The development of the financial system continues to be carried out in accordance with accounting standards and technological advances.
Currently, SIP Law Firm is developing technology applications to make it easier for related parties to consolidate financial data. The application system, named e-SIPro 2.0, was created to assist clients in monitoring work progress, including updates related to finances. In addition, this application is developed to maximize operational processes as an effort to improve the service to all clients and ensure the sustainability of SIP Law Firm.
Author / Contributor:
| Marchelina Tivani, S.E.|
Mail : email@example.com
Phone : +62-21 799 7973 / +62-21 799 7975
Author / Contributor:
| Ibadurrahman, S.Psi, MM|
Mail : firstname.lastname@example.org
Phone : +62-21 799 7973 / +62-21 799 7975