Policies and Procedures
Finance, Accounting, and Treasury Department Policies and Procedures – A 360-Degree Approach
Ensuring Financial Governance, Compliance, and Risk Management for Mega Construction Projects
1. Introduction
The Finance, Accounting, and Treasury Departments at BEC Arabia operate under structured financial policies and procedures to ensure:
Accurate financial planning, cost control, and budget management
Compliance with Saudi regulations, IFRS/SOCPA accounting standards, and tax laws
Liquidity management, treasury operations, and investment risk mitigation
Financial risk prevention, fraud detection, and internal control frameworks
Efficient contract finance, supplier payments, and procurement compliance
This 360-degree policy framework ensures financial integrity, transparency, and operational efficiency while supporting BEC Arabia’s large-scale construction projects.
2. Financial Planning and Budgeting Policies
2.1 Budgeting and Cost Control
All project budgets must be approved by Finance and aligned with project execution plans.
Cost projections must be based on historical data, risk analysis, and contingency planning.
Variance analysis must be conducted monthly to assess deviations from the approved budget.
Key Deliverables:
Annual Corporate Budget & Financial Strategy Reports
Project Cost Estimation and Budget Approval Documents
Monthly Budget Deviation and Variance Analysis Reports
Compliance Benchmark: Project cost deviations should not exceed 5% of the allocated budget.
2.2 Capital Expenditure & Investment Policy
Capital investments must be evaluated based on ROI, project feasibility, and risk assessment.
All capital expenditures (CAPEX) must be approved by the CFO and executive management.
Treasury must monitor and track all financial commitments related to long-term investments.
Key Deliverables:
CAPEX Justification & Return on Investment (ROI) Reports
Investment Approval and Risk Assessment Documents
Annual Financial Planning & Capital Structuring Reports
Compliance Benchmark: All CAPEX investments must align with long-term financial sustainability goals.
3. Accounting and Financial Reporting Policies
3.1 Financial Reporting and SOCPA/IFRS Compliance
All financial statements must be prepared in accordance with IFRS and SOCPA accounting standards.
Monthly, quarterly, and annual financial reporting must be completed on schedule.
Financial reports must be auditable, transparent, and free from discrepancies.
Key Deliverables:
Monthly and Annual Financial Reports (Balance Sheet, P&L, Cash Flow Statement)
Quarterly SOCPA & IFRS Compliance Audits
Financial Performance Review and Adjustments Reports
Compliance Benchmark: 100% accuracy in financial reporting and external audit compliance.
3.2 Internal Controls & Audit Procedures
Internal audits must be conducted quarterly to detect financial risks, fraud, or errors.
All financial transactions must be documented, traceable, and stored digitally.
Finance and Accounting teams must maintain segregation of duties to prevent unauthorized transactions.
Key Deliverables:
Internal Financial Audit Reports and Risk Assessments
Fraud Prevention and Financial Governance Compliance Logs
Regulatory Compliance Audit Reports
Compliance Benchmark: Zero critical findings in external financial audits.
4. Taxation and Compliance Policies
4.1 VAT & Corporate Tax Compliance
All invoices must comply with Saudi VAT regulations (15%) and corporate tax laws.
Tax filings must be completed on time to avoid regulatory penalties.
Withholding Tax (WHT) must be deducted accurately on foreign transactions.
Key Deliverables:
Quarterly and Annual VAT Filing Reports
Withholding Tax Compliance Logs
E-Invoicing (FATOORA) Compliance Reports
Compliance Benchmark: Zero tax penalties due to non-compliance.
4.2 E-Invoicing (FATOORA) Compliance
All invoices must be electronically generated and stored to meet ZATCA e-invoicing requirements.
VAT invoices must be verified, approved, and matched with procurement transactions before submission.
Key Deliverables:
ZATCA E-Invoicing Compliance Reports
Supplier and Client VAT Invoice Verification Logs
Compliance Benchmark: 100% compliance with Saudi e-invoicing regulations.
5. Treasury & Liquidity Management Policies
5.1 Cash Flow & Working Capital Management
Treasury must ensure sufficient liquidity to cover operational and project expenses.
Cash flow forecasts must be updated monthly to reflect real-time financial conditions.
Bank accounts must be monitored daily to prevent overdrafts and liquidity shortfalls.
Key Deliverables:
Monthly Cash Flow Forecast Reports
Liquidity Monitoring and Bank Reconciliation Reports
Compliance Benchmark: Maintain a liquidity ratio above 1.2:1 for operational stability.
5.2 Treasury Risk & Foreign Exchange Management
All foreign currency transactions must be hedged to minimize forex risks.
Treasury must monitor credit facilities, financial guarantees, and investment risks.
Key Deliverables:
Forex Risk Hedging Strategy and Compliance Reports
Banking Credit Facilities and Financial Guarantees Logs
Compliance Benchmark: 100% compliance with Saudi banking regulations and treasury risk controls.
6. Procurement & Contract Finance Policies
6.1 Supplier Payments & Contract Financial Obligations
Supplier payments must follow approved contract financial terms and milestone payment schedules.
No payments will be processed without proper verification, VAT compliance, and procurement approval.
Key Deliverables:
Supplier Payment Approval Logs
Procurement Cost Allocation and Financial Tracking Reports
Compliance Benchmark: 100% on-time supplier payments with full financial verification.
6.2 Procurement Financial Risk Control
Procurement transactions must comply with Etimad e-Procurement regulations and FIDIC contract financial terms.
All financial commitments related to procurement must be assessed for risk, cost impact, and regulatory compliance.
Key Deliverables:
Procurement Financial Risk Reports
Contract Payment Compliance and Financial Risk Logs
Compliance Benchmark: Zero unauthorized procurement payments or financial mismanagement.
7. Digital Financial Compliance & ERP Integration
7.1 Integration of Financial Policies with ERP Systems
Technology
Functionality
Application in Finance & Accounting Policies
ERP System
Budget Control, Financial Reporting, Cost Tracking
Ensures financial transparency and compliance with SOCPA & IFRS
Aconex
Contract Finance & Payment Tracking
Manages financial governance in contract administration
Power BI Dashboards
Financial Risk Monitoring & Compliance Reporting
Provides real-time financial oversight
Banking & Treasury Systems
Liquidity Management & Treasury Risk Monitoring
Ensures financial risk mitigation and regulatory banking compliance
Benchmark: 100% of financial transactions and compliance reports must be digitally tracked.
8. Conclusion
The Finance, Accounting, and Treasury Departments at BEC Arabia ensure:
Accurate financial planning, cost control, and budget compliance
Regulatory adherence to Saudi financial, taxation, and procurement laws
Seamless treasury management, liquidity optimization, and forex risk mitigation
Structured financial governance and fraud prevention frameworks
Integration of digital financial solutions for enhanced transparency and compliance
By implementing structured policies and procedures, BEC Arabia ensures sustainable financial management, compliance with Saudi regulations, and operational excellence in all financial functions.
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