Department of Financial Affairs is the department concerned with arranging and recording the Organization’s financial activities in terms of receiving funds from Member States and disbursing them in the designated aspects according to the financial system of the organization.

The department formed since the establishment of the organization in the year 1969, in order to monitor the movement of funds to/from the organization and to submit periodic financial reports that assist the OIC Secretary-General and his assistants in various aspects of the organization’s activities and programs.

The Department’s vision is to provide highest quality financial data with qualitative characteristics applying the optimal financial standards derived from the OIC financial system.

Financial Department is concerned with applying accounting concepts and standards to financial data. The Financial Department monitors the financial statements from primary sources such as Purchase Orders, Payment Notes, Budget Note, etc.

This data is categorized based on its section type (payment or receipt), then tabulates it in tables that are easy to be entered into the electronic accounting system. For instance, customer invoices are recorded in customer sub-record, Employee salaries are recorded in the expense register in different items divided into basic salaries, housing allowance, cost of living allowance, transportation allowance, etc. The purchase of assets is recorded in a book of fixed assets, which shows all types of assets that have been purchased and that will be disposed of by obsolescence or depreciation. This register provides clear data on the current state of organization’s properties. Whatever paid in cash or through the bank is recorded in the Cash Book, which includes all bank accounts. These recorded data are sent for approval through the approval cycle.

All these recording operations take place in a specific framework called accounting entries, which are stacked together with certain numbers and sequences.

At the end of each financial period, which is often a month, the financial statements that were recorded in the form of accounting entries are transferred from the subsidiary records to the main record called the General Ledger. The General Ledger is credited and the quarterly data for that month is extracted.

The financial reports include the financial position (Financial Statements) income and expenses statement, Suppliers statement, Member States’ arrears statement, expenditure statement divided into (employee entitlements, recurring expenses, renewal of fixed assets, and activity program expenses).

Preparing the estimated budgets of the Organization.

The Sections under the supervision of Finance Department are:

1. Member States contributions (Account receivable).
2. Accounts Payable (Account Payable) – Suppliers.
3. Fixed Assets.
4. Overseas offices accounts.
5. Cash and Banks.
6. Miscellaneous expenses.
7. Estimated budgets.
8. General Ledger.

Financial Department works on the following files:

1.  Member States’ contributions (mandatory or voluntary)

The Department, records the estimated budget data in the ERP electronic accounting system based on the estimated budgets approved by the Council of Foreign Ministers, this file serves as the standard for all type of payments during the year.

2.  Purchasing of the Organization’s supplies

All purchases are made by issuing Purchase Orders and dispatched to suppliers.

3.  Following up the Organization’s properties

The process of keeping and following up the organization’s assets of all types carried out through the fixed assets register. In this register, properties are classified into cars, computers, offices, and electrical equipment.

4.  Overseas Offices accounts

All financial transactions related to overseas offices are recorded at Finance Department of the OIC General Secretariat. At the end of each financial period, financial reports are issued reflecting the overseas financial position.

5.  Cash and banks

Payments of the General Secretariat’s staff entitlements, including monthly salaries, school fees and travel tickets are made through bank transfers to employees’ accounts in the bank. Suppliers’ dues are also paid in the same way. Other small Transactions are paid from a fund located in the Finance Office.

6.  The Organization’s Expenses

Expenses are classified into employee entitlements, recurring expenses such as electricity and bank bills, renewal of the organization’s assets and expenses of programs and activities implemented by the organization.

7.  General Ledger

This file is the backbone of all operations takes place in the organization. It contains all the totals at the end of each period and represents the basis for all financial reports.

8.  The Estimated Budgets

This file is concerned with departments’ requests (sub-budgets) that are sent to the Finance, in addition to a comprehensive plan that gives main trends for the performance of the organization as a whole. All spending items are collected in this plan and the final amount that is produced is assigned to Member States according to the previously agreed ratios. It also includes a detailed explanation of the Human Resources that are assigned to each department in the organization to perform its tasks and programs. The departments’ data converted later into Financial Statements express the expected costs of implementing the planned activities and programs in the same period covered by the estimated budget.

Some of Department’s activities done in cooperation with other departments:

1.  The work of the Financial Control Organ (FCO).

The 41st and 42nd session, to review the organization’s budgets for the year 2019 and 2020.

2.  The work of the permanent financial committee (PFC).

The 50th session to discuss the financial statements for the year 2019 and 2020. Also discussing the estimated budget for the year 2022.

3.  The 48th session of the Council of Foreign Ministers in Pakistan.

4.  An intensive training course held recently for the organization’s employees on the ERP electronic accounting system.