fiscal policies & procedure policies and...various business office staff may request such...

Fiscal Management Policies & Procedures

Approved by the Board of Directors, DATE

Open Sky Community Services: Fiscal Management Policies & Procedures

Table of Contents

Accounting Procedures ............................................................................................... 1 Basis of Accounting ......................................................................................................................... 1 Journal Entries ................................................................................................................................. 1 Bank Reconciliations ........................................................................................................................ 2 Monthly Close .................................................................................................................................. 2 Recordkeeping ................................................................................................................................. 3

Internal Controls ......................................................................................................... 4 Lines of Authority ............................................................................................................................ 4 Conflict of Interest ........................................................................................................................... 5 Segregation of Duties ...................................................................................................................... 5 Physical Security .............................................................................................................................. 5

Financial Planning & Reporting ................................................................................... 5 Budgeting Process ........................................................................................................................... 6 Internal Financial Reports ............................................................................................................... 6 Audit ................................................................................................................................................ 7 Tax Compliance ............................................................................................................................... 8

Exempt Organization Returns ..................................................................................................... 8 Quarterly/Annual Payroll Reports ............................................................................................... 8

Revenue & Accounts Receivable.................................................................................. 8 Accounts Receivable ........................................................................................................................ 8 Revenue Recognition ....................................................................................................................... 9 Donations ........................................................................................................................................ 9 Cash Receipts ................................................................................................................................. 10 Deposits ......................................................................................................................................... 10

Expense & Accounts Payable ..................................................................................... 11 Payroll ............................................................................................................................................ 11 Fringe Benefits ............................................................................................................................... 11 Capital Procurement/Fixed Assets ................................................................................................ 12 Purchasing ..................................................................................................................................... 12 Consultant/Independent Contractors ........................................................................................... 13 Accounts Payable .......................................................................................................................... 14 Program Advances/Petty Cash ...................................................................................................... 15 Travel Expenses ............................................................................................................................. 16 Credit Cards ................................................................................................................................... 16 Expense Allocations ....................................................................................................................... 17

Asset Management ................................................................................................... 17 Investments ................................................................................................................................... 17 Short Term Investments ................................................................................................................ 19 Fixed Assets ................................................................................................................................... 20

Line of Credit/Borrowing ........................................................................................... 20

Affiliate Relationships ............................................................................................... 21

Financial Risk Management ....................................................................................... 22 Financial Risk Management Plan ................................................................................................... 22 Insurance ....................................................................................................................................... 22 Private Practice Counseling ........................................................................................................... 24

Open Sky Community Services: Fiscal Management Policies & Procedures Approved by the Board of Directors, DATE

Fiscal Policies & Procedures Page | 1

Accounting Procedures This section covers basic accounting procedures for the agency. The accounting procedures used by the agency shall conform to Generally Accepted Accounting Principles (GAAP) and Government Auditing Standards (GAS) to ensure accuracy of information and compliance with external standards.

Basis of Accounting Policy: The agency uses the accrual basis of accounting. The accrual basis is the method of accounting whereby revenue and expenses are identified with specific periods of time, such as a month or year, and are recorded as incurred. This method of recording revenue and expenses is without regard to date of receipt or payment of cash. Also, as a federal grantee, the agency must comply with federal guidelines pertaining to financial and compliance standards. These standards are outlined in the OMB Compliance Supplement. Procedures: 1. Throughout the fiscal year, expenses are accrued into the month in which they are incurred.

The books are closed no later than the third Tuesday of the subsequent month. Invoices received after closing the books will be counted as a current-month expense.

2. At the close of the fiscal year, this rule is not enforced. All material expenses that should be accrued into the prior fiscal year, are so accrued, to ensure that year-end financial statements reflect all expenses incurred during the fiscal year. Material expenses are greater than 5% of actual total revenue. Year-end books are closed no later than 60 days after the end of the fiscal year.

3. All material revenue is recorded in the month in which it was earned or pledged. Material revenue is greater than 5% of actual total revenue.

Journal Entries

Policy: The review and approval of General Ledger (GL) journal entries is the responsibility of the Vice President of Finance (VPF) and Senior Director of Accounting (SDA). Journal entries are either created manually or are system generated. Manual journal entries are either entered directly or electronically imported into the accounting system’s GL. Procedures: 1. System Generated Journal Entries: These entries are created automatically at regularly

scheduled time intervals determined by the Business Office to post the subsidiary ledger transactions (Accounts Payable, Fixed Assets, and Receivables) or recurring journal entries to the appropriate GL accounts.

2. Manual Journal Entries: These entries are directly input into the GL or imported from an excel template. They are reviewed and approved by the VPF or SDA. a) Standard Journal Entries: These entries are created at a regularly scheduled time

interval by an Accounting staff and include such items as depreciation, insurance, and management fee allocation. They are reviewed and approved by the VPF or SDA.

b) Reclass entries: These entries are to move revenues or expenses between programs to appropriately allocate the items. Various Business Office staff may request such reclassifications. These entries are prepared by the Accounting staff and reviewed and approved by the VPF or SDA.



c) Adjusting journal entries: These entries are prepared by the Accounting staff and reviewed and approved by the VPF or SDA.

Bank Reconciliations Policy: All bank statements will be opened/downloaded and reviewed in a timely manner. Each bank account will be reconciled monthly and within 20 business days of the end of the month. Any checks outstanding for longer than 6 months will be investigated. After an investigation of the outstanding check, a proper disposition of the check will be reached and implemented. Procedures: 1. Bank reconciliations are performed by a Business Office Staff assigned by the SDA. 2. The bank reconciliation will reconcile the bank balance to the GL balance. 3. A journal entry will need to be posted each month for items on the bank statements which

are not already recorded in the GL. These reconciling items may include: interest, service charges, NSF checks, direct deposits and other debit or credit memos.

4. The bank reconciliation will include a listing of outstanding checks arranged in numerical order and a listing of any deposits in transit.

5. Bank reconciliations along with supporting documentation will be turned into the SDA for review. Any discrepancies should be reported.

6. Identify from the outstanding checklist and bank reconciliation any checks which have not been cashed for a minimum of 6 months.

a) If possible, contact the recipient of the check to understand why it has not been cashed.

b) If contact with the recipient is not possible, the check will be declared “void” and the bank notified. The original account that was debited will be credited and cash will be debited. If in the event, the payee cashes the check at a future time, the entry will be reversed.

c) All disposition recommendations will be approved by the SDA.

Monthly Close Policy: The books will be closed by the third Thursday of the subsequent month. The statements will be generated by either the VPF or SDA and reviewed by the VPF, VPCB, SDA and other Business Office staff. Procedures: 1. The VPF and SDA will ensure all journal entries and invoices are entered into the accounting

system prior to the monthly close. 2. The bank reconciliations will be completed by the assigned Business Office staff prior to the

monthly close. 3. Once the statements are printed they will be reviewed by various Business Office staff to

ensure accuracy and completeness. 4. Any discrepancies will be noted and will either be adjusted in the current or subsequent

month at the discretion of the VPF.



Recordkeeping Policy: The agency is required by law to maintain all appropriate records in accordance with federal and state guidelines. Records are available on an as needed basis and availability is subject to confidentiality limitations. Records are retained in accordance with AAF CPAs Record Retention Program. Procedures: 1. The Vice President of Human Resources (VPHR) is responsible for staff records. The Payroll

and Benefit Administrators have access to the payroll and benefits portion of the personnel file. An employee and his/her manager have access to his/her file upon request.

2. The VPF is responsible for financial records. 3. The President/CEO or designee is responsible for legal and executive records 4. For electronic records, system users will be issued password commensurate with the

information they are privileged to access. 5. Certain financial information and personnel files are to be stored electronically in the

Docstar filing system. 6. Document Destruction timeline:

Type of Document Minimum Requirement

Finance Documents

Accident reports/claims 7 years

Accounts payable invoices, ledgers, schedules 7 years

Accounts receivable ledgers, schedules 7 years

Actuarial reports Permanently

Audit reports Permanently

Bank reconciliations 3 years

Bank statements 7 years

Budgets – projections 2 years

Cashbooks Permanently

Chart of accounts Permanently

Checks (see exception below) 7 years

Checks (for important payments and purchases) Permanently

Contracts, mortgages, notes, leases (expired) 7 years

Contracts, mortgages, notes, leases (still in effect) Permanently

Correspondence (with customers and vendors) 2 years

Deeds, mortgages, bills of sale Permanently

Depreciation schedules Permanently

Duplicate deposit slips 2 years

Employee expense records 3 years

Expense analyses/expense distribution schedules 7 years

Expense reports 7 years

Financial statements (year-end) Permanently

General/private ledgers, year-end trial balances Permanently

IRS determination/approval letters Permanently

Insurance policies (expired) 3 years

Insurance records, current accident reports, claims, policies, etc.

Permanently



Internal audit reports 3 years

Internal reports (misc.) 3 years

Inventories of products, materials, and supplies 7 years

Invoices of property Permanently

Invoices to customer, from vendors 7 years

Journals – all types Permanently

Petty cash vouchers 3 years

Property appraisals by outside appraisers Permanently

Property records including costs, year-end trial balance, depreciation schedules, blueprints, plans

Permanently

Purchase invoices 7 years

Purchase orders (except purchasing dept copy) 1 year

Purchase orders (purchasing dept copy) 7 years

Rep payee financial records 2 years

Subsidiary ledgers 7 years

Tax returns and worksheets Permanently

Timesheets 7 years

Vouchers for payments to vendors, employees, etc. 7 years

Withholding tax statements 7 years

Human Resource Documents

Employment applications 7 years

Garnishments 7 years

Payroll records and summaries 7 years

Personnel files (terminated employees) 7 years

Retirement and pension records Permanently

Training manuals Permanently

Executive Documents

Articles of incorporation Permanently

Bylaws Permanently

Correspondence (general) 2 years

Correspondence (legal and important matters) Permanently

Directives – executive Permanently

Minute books of directors, bylaws Permanently

Patents and related papers Permanently

Procedure records Permanently

System records Permanently

Trademark registrations and copyrights Permanently

Internal Controls The agency employs several safeguards to ensure that financial transactions are properly authorized, appropriated, executed and recorded.

Lines of Authority Policy and Procedures:



1. The Board of Directors approve the annual budget. Expenses are approved by designated staff in the Business Office. See detailed approval levels in the Purchasing and Capital Procurement sections of this document.

2. Board approvals are documented in the minutes. Expense approvals are documented with signatures on invoices and the PO log book.

3. Financial staff with the EVP/CFO develop fiscal policies and suggest amendments to the Finance Committee to recommend to the Board of Directors for approval.

4. Policies are reviewed annually. Any changes are brought to the Finance Committee to recommend to the Board of Directors for approval.

Conflict of Interest Policy: All employees and members of the Board of Directors are expected to use good judgment, to adhere to high ethical standards, and to act in such a manner as to avoid any actual or potential conflict of interest. A conflict of interest occurs when the personal, professional, or business interests of an employee or Board member conflict with the interests of the agency. Both the fact and the appearance of a conflict of interest should be avoided. See Board Policy Manual for complete Conflict of Interest Policy.

Segregation of Duties Policy: The agency’s financial duties are distributed among multiple people to help ensure protection from fraud and error. The distribution of duties aims for maximum protection of the agency’s assets while also considering efficiency of operations. Procedures: 1. Check signers will not be involved in cash reconciliations.

2. The receptionist will open all checks received.

Physical Security Policy: The agency maintains physical security of its assets to ensure that only people who are authorized have physical or indirect access to money, securities, real estate and other valuable property. Procedures: 1. Blank checks are stored in the safe closet. Only certain Business Office/HR staff will have

access. 2. Cash and checks are stored in the safe in the safe closet. Only certain Business Office staff

have the combination. Bank deposits are made at least weekly.

3. Passwords are used to access Business Office staff computers and the accounting system.

Financial Planning & Reporting The agency’s financial statements are prepared in accordance with Generally Accepted Accounting Principles (GAAP). The presentation of the Financial Statements shall follow the recommendation of the Financial Accounting Standards Board (FASB) No. 117, “Financial Statements of Not-For-Profit Organizations.” Under GAAP, revenues are classified based on the existence or absence of donor-imposed restrictions. Accordingly, the net assets of the agency are classified as net assets with donor restriction and net assets without donor restrictions.



Budgeting Process Policy: The budget planning process is based on the organizational and programmatic priorities set by the Board of Directors and management team, with input from program staff. This input is solicited through an annual review process, as well as regular quality assurance activities. The budget is prepared by the Vice President of Contracts & Budgets (VPCB) and approved by the Board of Directors prior to the start of each fiscal year. Procedures: 1. In February of each year, the formal budget process begins with a thorough review of the

current year’s fiscal performance and projected funding for the upcoming fiscal year. 2. The budgets will be reviewed by the VPCB and Business Manager (BM) for accuracy,

historical spending patterns and projected increases or decreases. 3. Draft budgets are developed by the VPCB and the BM and reviewed in detail with Directors. 4. Updated draft budgets will be reviewed with the EVP/CFO for feedback. 5. Updated budgets will be distributed by the VPCB for review and input by the EVP/CFO and

the President/CEO. 6. The finalized draft, including a proposed Capital budget developed by the Senior Vice

President of Administrative Operations, will be presented to the Finance Committee for review and recommendation to the full Board in June.

7. Board approval of the agency budget will be sought in June. 8. Final budgets will be distributed by the VPCB to Directors. 9. In the case of a new program starting mid-year, a budget will be created by the VPCB.

Budgets may be modified mid-year if major changes to the program or the environment in which it operates occur.

10. Monthly reports with actual and budgeted figures will be generated and distributed to Program Managers, Directors and Senior Management. Variances are reviewed, explained and corrective action plans are implemented when required.

Internal Financial Reports Policy: The agency prepares monthly consolidated financial statements. All reports are finalized no later than the 4th Tuesday of the subsequent month. Procedures: 1. The SDA and/or VPF will produce the following reports: Consolidated Statement of Financial

Position and Consolidated Statement of Activities. The reports compare monthly fiscal performance to budget and cumulative year-to-date fiscal performance to budget.

2. The VPCB will provide Senior Management with monthly financial statement summaries consisting of the Consolidated Statement of Financial Position and Consolidated Statement of Activities.

3. The BM will provide a monthly Statement of Activities to department heads and managers for their program.

4. Budget variances of general concern will be identified, and problem areas will be analyzed to determine cause.

5. The VPCB will review with each department head the reports of the programs for which they are responsible and determine problem areas.

6. The VPCB and Senior Management will review the financial trends and problem areas and determine corrective actions if necessary and fiscal projections.



7. The EVP/CFO will provide the Board with a summary of the agency’s financial status with trends and projections quarterly.

Audit Policy: The agency will undergo an annual independent audit, under the direction of the Audit Committee, to fulfill requirements established by federal and state regulatory bodies, as well as to ensure on-going accountability to its funders, members, constituents and the general public. Procedures: 1. The audit will be completed no later than four and a half months from the close of the

fiscal period (unless cause for delay can be substantiated and approved by the Audit Committee).

2. The audit will be conducted in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP).

3. The audit will encompass the entire scope of the agency's activities, including all departments, or entities that operate under TBA.

4. The audit shall utilize a 2-year reporting format on all financial statements. 5. Audit footnote disclosures will follow the disclosure requirements as set forth by the most

currently applicable accounting standards, and, at a minimum, include the following: a) Description of operations and non-profit status b) Description of significant accounting policies c) Description of net assets d) Summary of investments e) Summary of property and equipment f) Summary of debt g) Description of commitments and contingencies h) Summary of funding i) Concentrations of credit risk j) Description of retirement plan k) Related party transactions

6. The agency will annually receive a written management letter, addressing internal control issues.

7. The agency shall respond to all management letter issues identified in writing. The agency’s responses shall be incorporated into the body of the management letter.

8. The audit draft document and management letter will be: a) Presented to the Finance and Audit Committee for review b) Discussed initially with the auditor c) Discussed with management d) Considered and voted upon for approval and recommendation to the Board of

Directors for final action 9. The agency is also required to file Uniform Financial Statements annually by November 15th.

Certain sections of the report are prepared by the VPF, VPCB and SDA. After an internal review by the VPF, VPCB and SDA, the report is sent to the auditors.



Tax Compliance

Exempt Organization Returns Policy: The external auditors will complete Federal Form 990 and Massachusetts Form PC, annually for all agency affiliates, due November 15. Procedures: 1. The VPF and SDA will assist the external auditors with workpapers, documents, and

informational requests that are necessary to prepare Form 990 & PC. 2. Once the draft Form 990 & PC are received, the EVP/CFO, VPF and SDA will review the forms

for content and accuracy. 3. The agency will, as part of the review process, make available to all Board of Directors, draft

copies of Form 990 prior to filling with the Internal Revenue Service. 4. Once reviewed and approved by the Board of Directors and Management, the return will be

filed. 5. Once filed, the final return will be available for review on the agency website.

Quarterly/Annual Payroll Reports Policy: The agency outsources its payroll tax reporting to ADP Payroll Services. Procedures: 1. ADP will prepare employee W-2’s and the Payroll Administrators will review employee W-

2’s by January 31st each year. The Director of Human Resources oversees this responsibility to ensure accuracy and timeliness.

2. ADP Payroll Services will prepare the quarterly tax reports (Form 941) by the filing deadline. The SDA will download these tax reports in order to reconcile payroll.

Revenue & Accounts Receivable

Accounts Receivable Policy: All contracts, grants and projects are invoiced each month, or as required by the funder, to capture all billable time and expenses and ensure a regular healthy cash flow for the agency. Procedures: 1. Invoices are prepared monthly except for Day Habilitation billing, which is prepared weekly. 2. All invoices are to be prepared in accordance with state billing requirements. 3. Program contract billing is due to Accounts Receivable billing staff on the first business day

of the month following the billing month. 4. All state billing is due on the 10th of each month following the dates of service. 5. Counseling Center Billing:

Clinicians are responsible for completing billing tickets for delivered services at a minimum on Friday of each week. Clinicians must provide both the diagnosis and CPT code for each session billed. When intaking a new client, the clinician must provide Accounts Receivable with a copy of both the client’s Personal Information Form and the insurance card. Billing will not be accepted after 60 days from the date of service.



Invoices are coded, approved and entered into the computerized subsidiary ledgers when completed.

6. Cost Reimbursement Billing: Accounts Receivable will submit monthly invoices based on expenses reflected in the GL. Accounts Receivable will compile copies of paid invoices, if applicable, that will be kept with the invoice during the approval process. Account Receivable will also get a copy of payroll costs.

7. Credit memorandums must be approved by the VPF or VPCB. 8. An Accounts Receivable Aging report is prepared monthly and anything greater than 90 days

overdue is investigated. 9. Cumulative doubtful accounts greater than 5% of non-state receivable revenue are brought

to the attention of the Finance Committee. 10. Bad debts are written off at year end after review with the EVP/CFO. 11. Accounts Receivable subsidiary ledgers are reconciled monthly to the GL. 12. If there is a denial of payment under insurance or contractual arrangement the agency will:

1. Determine the basis for the denial of payment or coverage; 2. Follow up appropriately with the source of payment; 3. File a written appeal if it is reasonably assumed to be collectible.

13. Determination of ethical and professional responsibility to temporarily continue service past the contract funding date will be determined through aftercare and discharge process.

Revenue Recognition Policy: Revenues from program service fees and reimbursements are recorded as the services are provided. Included in program service fees is contract revenue which is recorded over the contract period as services are provided. Grants and contributions with and without donor restriction are recorded as revenue when received or unconditionally pledged. Gross patient service revenue is recorded at the full value of those services as assigned by the agency. Rental and all other income are recognized when earned Procedures: 1. The SDA reviews all grant and contribution revenue and indicates on the letter or copy of

the check how the revenue shall be recognized (as earned/contributed, conditional/unconditional and with restriction/without restriction).

2. Accounts Receivable is responsible for posting contract revenue into the GL in accordance with the determination made by the VPF or VPCB.

Donations Policy: The agency, being a non-profit organization, welcomes and greatly appreciates all donations and will acknowledge them in a timely manner. The agency also encourages the involvement of the community in the offering of services. Procedures: 1. Copies of checks and pledges for fundraising and/or donations are forwarded to

Advancement. Advancement will log the check into Donor Perfect and create an acknowledgement letter to include the following: “The Bridge and Alternatives has provided no goods or services in consideration of this contribution. For your tax records, our tax-exempt number is 04-2587863.”



2. Advancement provides the Business Office with a report listing donor, amount and purpose, so the check will be recorded accurately into the GL. Contributions are recorded as revenue when received or unconditionally pledged.

3. The Business Office deposits checks from Advancement into the Fundraising Account. 4. Credit card donations are acknowledged by Advancement and the information is forwarded

to the Business Office. The receipt of cash is verified, and the donation is recorded to the appropriate account.

5. If the contribution was given for a specific purpose, assurance is made that the contribution will be used for the purpose it was given. The donation is to remain in restricted funds until utilized.

6. Our books should reflect the total value of services provided to the agency. As such, to account for the value of donated services and items received, a description quantifying these services or goods should be obtained by the VP of Advancement. Once received in the Business Office, Advancement reports and agency fiscal reports will recognize these contributions. Items donated with an appropriate receipt and are greater than $5,000 will be booked as fundraising revenue and expensed, as related to the event/program.

Cash Receipts Policy: All cash and checks delivered to the Business Office should be handed directly to a member of the Business Office staff. Responsibility for cash receipts will be separated from the responsibility for cash disbursements. Annual vacations are required for all personnel handling cash transactions.

Procedures: 1. Daily, all checks are received and opened by the receptionist. All checks are then forwarded

to the Business Office. For any fundraising checks, a copy is forwarded to Advancement. 2. All cash is received by the Business Office and must be accompanied with a receipt, which

has been signed by both the payer and payee. 3. All cash and checks are placed in the appropriate deposit pouch in the safe, until the deposit

is prepared and brought to the bank. 4. Daily, the SDA reviews the bank activity for electronic cash receipts and weekly reviews the

vendor web for receipts related to contracts.

Deposits Policy: Bank deposits are made weekly, at a minimum, to ensure adequate cash flow for the agency. There should never be more than $50,000 in cash/checks held in the safe at any given time. Procedures: 1. The Staff Accountant prepares the deposit for the bank by logging the cash and checks

received on a spreadsheet and preparing a deposit slip. 2. The SDA reviews the deposit spreadsheet and deposit slip. 3. The Staff Accountant brings the deposit to the bank and returns with a receipt. 4. Checks that are not brought to the bank are scanned on the Telecheck machine by the Staff

Accountant. 5. Various Business Office staff review the deposit and provide coding before it is entered into

the accounting system.



Expense & Accounts Payable

Payroll Policy: Employees are paid bi-weekly for the previous two weeks. The HR department is responsible for the timely and accurate processing of payroll. All payroll changes are reviewed by authorized personnel. Procedures: 1. All employee salary and compensation are expended to the program in which they worked,

based on timecards or the predetermined allocation for certain employees. 2. All employees are responsible for timestamping/entering hours in the payroll system. 3. Employee timecards must be authorized by the Department Head/Program Manager. 4. The Payroll Administrators are responsible for verifying all timecards for accuracy and

approvals. 5. The Payroll Administrators and/or HR and/or the SDA review the payroll register before it is

submitted to the payroll service provider. 6. Payroll data is compiled bi-weekly and submitted to the payroll service provider for

computation and completion by the Payroll Administrator 7. Payroll is journalized and entered into the GL bi-weekly. The journal entry is checked to the

total gross payroll by the SDA. 8. Except for cost of living adjustments, all changes of payroll status, pay rates, position titles

or assignments must be approved by the Vice President of Human Resources and Vice President of Contracts and Budgets.

9. Accrued earned time will be paid upon termination of employment by the Payroll Administrator.

10. Earned Time will be accrued in accordance with personnel policies.

Fringe Benefits and Payroll Taxes Policy: Employee fringe benefits are set by the agency’s Board of Directors. The agency maintains all required state and federal fringe benefits for its employees, plus additional benefits provided by the agency for the employees' benefit. Required benefits provided are Social Security tax, unemployment tax, and Workers' Compensation insurance. Optional additional benefits are health insurance, dental insurance, life insurance, short-term disability, long-term disability, 403B Retirement Plan, 457 Plan for administrative staff, paid time off/earned time, and Dependent Care/Medical FSA accounts. Procedures: 1. The HR Department is responsible for the monthly maintenance and payment of all benefits. 2. The SDA reconciles fringe deductions monthly to the GL. 3. Our payroll service has been employed to file all state and federal tax deposits and reports. 4. The HR Department prepares monthly invoices for all other benefits. 5. The HR Manager supplies payroll with the appropriate benefit information on all new

employees. 6. The SDA accrues all earned time due to employees and records the accrual in the GL. 7. The HR Manager reconciles employee fringe deductions with each monthly invoice.



Capital Procurement/Fixed Assets Policy: Expenditures greater than $1,000 will be approved centrally to allow for better control of the purchasing and invoicing processes. This is particularly true when making substantial expenditures which require competitive bidding. Procedures: 1. All equipment, furniture, and renovations should be planned and requested in annual

budget submittals. 2. All major purchases and property renovations will be performed centrally through the

Business Office to ensure efficiency and cost effectiveness. The Business Office and Properties Department will make use of negotiated state purchasing contracts whenever possible.

3. For purchases and projects over $25,000, when appropriate, three comparative prices will be obtained and properly documented. These purchases and projects must be approved by the EVP/CFO.

4. For expenditures greater than $100,000, the agency will notify the Board of Directors and determine the process and competitively bid.

5. The agency will provide a detail of capital expenditures to the Bank semi-annually and the Finance Committee monthly.

6. In all cases where competitive bids are sought, the agency will attempt to solicit bids from a W/MBE.

7. In all cases the agency will require bidders to provide evidence of adequate insurance coverage.

Purchasing Policy: Major purchases will be approved centrally to allow for better control of the purchasing and invoicing processes. This is particularly true when making substantial purchases which require competitive bidding. Procedures: 1. A purchase order is required for purchases, vehicle and service expenditures over $1,000.

Program personnel should call the Purchasing/Contracts Manager (PCM), Director of Transportation (DT) or the Property Manager (PM) to obtain a PO.

2. All Invoices under $1,000 need written approval by the PCM, DT or PM. 3. All PO’s and purchases between $1,000-$5,000 can be approved by the VPCB and require

the approval of the Division Director. 4. All PO’s and purchases over $5,000 require approval of the EVP/CFO and require the

approval of the Division Director. 5. For purchases and projects over $25,000, when appropriate, three comparative prices will

be obtained and properly documented. These purchases and projects must be approved by the EVP/CFO.

6. The PCM, DT and PM maintain a log of all PO’s. 7. The PO’s are written for a specific dollar amount, if known, and a description of the items to

be purchased. If the dollar amount is not exactly known, then the PO’s are written with a “not to exceed” dollar amount. The log also includes date approved and date invoice received.



8. The PO log is kept on file in the Business Office. If there is any PO backup, the PCM, DT and PM keep it on file and attaches it to the invoices when they are received.

9. Program Purchasing: Most reimbursements received for purchasing will be received through the program's program advance account. It is important that all purchases are completed using the agency's tax-exempt status. Taxes for purchases made are a non-reimbursable cost, and only in very rare circumstances should sales tax be part of a purchase. Also, invoices for charged purchases (with the exception of gasoline) made by program staff should receive the prior approval of the VPF. In all cases, invoices should be sent directly to the Central Office address.

Consultant/Independent Contractors Policy: A consultant contract for services is required to acquire professional or technical services at the agency. Consultants are considered to be independent consultants and not employees of the agency. Consultants may be medical/professional staff/contractors and are hired on a contractual basis to provide services which the agency’s staff are not able and/or qualified to perform. The consultants must be licensed (when applicable), maintain appropriate malpractice or liability insurance, and meet the legal requirements of an independent contractor. Consultants are not eligible for any employee benefits such as FICA, state unemployment, and Workers' Compensation. The President/CEO and/or the EVP/CFO must execute all contractual agreements. Procedures: 1. A consultant agreement must be completed and signed prior to any work or provision of

services. The agreement will state the terms of the contract in regard to dates of service, rate of compensation, limit not to exceed, and reporting requirements. The consultant must provide all the necessary licensure and supporting documentation and include the business identification or social security number for annual Internal Revenue Service reporting. Also, the consultant may be required to meet state department or health regulations regarding absence of contagious or infectious diseases.

2. The agreement is signed by the Department Head, Clinical Director (if applicable), President/CEO, and/or EVP/CFO.

3. Consultant rates of physicians, psychologists, registered nurses, etc., will be within state approved limits.

4. Consultant agreements automatically renew annually, unless terminated according to the terms of the agreement. Consultant agreements are kept on file in the Business Office.

5. The consultant billing form must state days and hours worked, hourly rate being paid, and be confirmed by agency program staff.

6. Consultant agreements are for budgeted consultant services as listed on each program's approved budget. Exceptions are with the authorization of the President/CEO or EVP/CFO.

7. Annual consultant payments will be forwarded to the individual consultants and the Internal Revenue Service according to the Internal Revenue Service guidelines on the 1099 form.

8. Consultant hours and payments requested will also be verified by the Accounts Payable Accounting Assistant as each invoice is received.

9. Contract Reviews: a) The agency shall review all contractual agreements to ensure that policies and

operational procedures regarding confidentiality of persons served and professional conduct and practices are not violated by complying with the terms of the contract.



Any potential concerns or irregularities shall be presented to the Finance and Audit Review Committee of the Board of Directors.

b) Also, during this review, the agency shall ensure that contracts are not used as a means of being a fiscal conduit. Specifically, no verbal or written contract shall be entered that procures any goods or services not directly used by the agency for the provision of social, rehabilitative, health and/or special education services. This includes: ▪ The purchase of goods, services, and/or other non-direct care related items for

State employees, State agencies, and/or other provider agencies. ▪ The use of contracts to “pass-through” funds to other agencies.

c) In other words, fiscal conduit activity is prohibited. To prevent the occurrence of such activity, all agency staff involved in contracting and invoicing shall be educated in this area.

d) The review shall take place when each contract is renewed or established with a funding source.

e) The EVP/CFO and EVP of Service Operations shall ensure this process takes place.

Accounts Payable Policy: All invoices must be approved by Purchasing/Property Services/Transportation and Business Manager. Approved invoices will be paid within 30 days of receipt. Procedures: 1. Invoices received in the mail are date stamped by the receptionist and forwarded to

Accounts Payable. 2. The Accounts Payable Accounting Assistants will:

a) Match purchase orders to the packing slips. b) Check the invoice for accuracy and match the invoice to the packing slip. c) Purchasing, Property or Transportation will match the invoice to the PO and

reconcile any differences. d) Reconcile any differences between the invoice and packing slip. e) Put the proper GL account, program code and period to be charged on the invoice. f) Forward the voucher package to Purchasing, Property Services or Transportation

and then the Business Manager for review and authorization. g) Enter invoices into the accounting system. h) Review posting reports from the system and correct any errors. i) Maintain a copy of the unprocessed purchase orders and packing slips by program in

an open purchase order file. j) Unless otherwise instructed, an invoice must be paid such that payment is received

no later than the due date on the invoice or 30 days after the date of the invoice when there is no due date. When early payment incentives are offered and deemed worthwhile, they should be taken.

3. Prior to each check run, a Cash Requirements Report identifying invoices to be paid in this check run will be processed and printed. The Cash Requirements Report will be approved and initialed by the SDA prior to the check run.

4. The Accounts Payable Accounting Assistant will adjust the check run as instructed by the VPF or SDA and then process the check run.



5. Properly approved invoices must support each disbursement and accompany the checks at the time they are signed.

6. All checks greater than $5,000 should be signed by two authorized signers. 7. The Accounts Payable Accounting Assistant will verify that two signatures are present prior

to mailing. 8. Once signed, the Accounts Payable Accounting Assistant will attach the required

documentation to the check and prepare the payment for mailing. 9. Once prepared, the Accounts Payable Accounting Assistant will give the prepared payments

to the receptionist for mailing. 10. Paid invoices will be filed in DocStar. Hard copies of invoices will be maintained for 1 year.

Program Advances/Petty Cash Policy: Program advance expenditures should be monitored on a regular basis and reconciled minimally on a biweekly basis with the submission of each program advance reimbursement voucher. Procedures: 1. On a daily basis, program advance cash balances should be verified, and staff should verify

that the ATM card is double-locked on-site at the program. 2. There should never be more than $600 cash on hand at the program at any given time. The

ATM card and program cash should not be taken to staff residences at any time, unless approved in advance by the program’s Division Director and the VPF.

3. All agency staff are allowed access to the program advance ATM card and cash; however, each program may implement a more limited structure.

4. Staff should never use personal debit/credit cards or cash for program advance purchases, unless approved in advance by the program’s Division Director and the VPF.

5. Receipts, cash and bank account balances should always add up to the fund total assigned to the program, and programs are responsible to maintain internal bookkeeping records.

6. When submitting the program advance voucher, there should be the signature of the staff person who completed the voucher, and also the staff person who reviewed and verified all of the receipts and the amount of cash on hand. Internal bookkeeping records should also indicate who is responsible for any cash in and out of the account.

7. Receipts submitted for program advance reimbursement should be dated, initialed by the staff making the purchase, and marked as to the expense account (i.e., purchase of light bulbs should be marked House Supplies). Receipts cannot be tampered with, for example, portions of a receipt containing dates or payment information cannot be cut off.

8. On the occasion when a receipt is lost or not available from a vendor, a program advance receipt must be filled in completely and signed by the staff person who made the purchase, as well the Program Manager, and used in place of said receipt.

a. For a purchase of $50 or more, staff should go to the vendor to request a copy of the lost receipt. This copy can be submitted for reimbursement.

b. For a purchase of $100 or more, staff should go to the vendor to request a copy of the lost receipt, and in the event a copy cannot be obtained, an incident report must be completed and signed by the Division Director. The incident report and a completed generic receipt can be submitted for reimbursement.

9. In cases where the program advance funds are out of balance, or program advance funds have been lost or stolen, the VPF and SDA should be notified so that the account can be



properly reconciled. The improper, careless, or negligent handling of agency funds can result in required restitution of lost funds, disciplinary action, and could result in termination of employment.

Travel Expenses Policy: Mileage reimbursement forms are expected to be submitted monthly. They can be submitted biweekly on the Thursday after a pay date by 12:00pm to be paid in the following payroll. Procedures: 1. Mileage will not be reimbursed for any period exceeding one month after the period being

requested. (Ex. August mileage due September 30) June will be an exception and will be reviewed by mid-July for year-end purposes.

2. The mileage reimbursement rate will be determined and set by Administration. 3. Reimbursable mileage does not include your normal commute to and from work. When

business travel originates from your home, subtract your “normal round-trip” commuting miles from the total miles associated with the trip.

4. Employees who drive on the Mass Pike for agency related travel and use their Fast Lane Pass can be reimbursed under the following procedures. Submit evidence of Fast Pass usage for the travel dates needs to be submitted with the Staff Travel Reimbursement Form, (such as a copy of the payment, credit card billing, invoice, or receipt).

5. Mileage reimbursement forms must be approved and signed by your supervisor.

Credit Cards Policy: Purchases completed with an agency credit card is limited to employees that have obtained appropriate authorization. Procedures: Corporate Credit Cards 1. Corporate credits cards are to be used for agency-related expenses, not to exceed the limit

established for the credit line. 2. Credit card purchases must be accompanied by an approval, signed by an authorized

employee. a) Purchases under $1,000, an authorized employee is a Director or above. b) Purchases between $1,000-$5,000, must obtain a purchase order and approval of

VPCB. c) Purchases over $5,000, must obtain a purchase order and approval of EVP/CFO.

3. All receipts are sent to Accounts Payable. Each receipt should be itemized, original, signed and document the business purpose.

4. All expenses that are not accompanied by a detailed receipt, will be classified as non-reimbursable. They will require a notarized affidavit. Non-reimbursable costs should be kept to a minimum and not exceed Board approved limits. (The only staff who has a Board approved limit is the President/CEO)

5. These cards should not be used for personal or non-agency related purchases. Store Credit Cards 1. Store credit card purchases must be requested for use by an authorized employee as

follows:



a) Purchases over $50, must obtain a purchase order and approval of BM for purchases up to $1,000; approval of VPCB for purchases between $1,000-$5,000; approval of EVP/CFO for purchases over $5,000

b) A list of items needed, as well as an estimated amount to be spent must be included as part of the request.

2. Once the purchase has been approved, a staff member of the program may pick up the credit card at the Business Office, sign it out and proceed to make the purchase.

3. The card and receipt for the purchase will then be returned to Accounts Payable within twenty-four hours, unless a different time frame was agreed upon.

Grocery Cards 1. Grocery cards are to be used for agency-related expenses, not to exceed the limit

established for the credit line. 2. Grocery card purchases must be accompanied by an itemized receipt and turned into the

Business Office for review and processing.

Expense Allocations Policy: The agency maintains financial books and records which distinguishes direct expenses to each program. In certain cases, allocations of indirect expenses are done on a reasonable basis. Expense allocations are reviewed on a regular basis and changes are made when necessary. A cost allocation plan is completed each spring for the upcoming fiscal year. Procedures: 1. Allocations for fringe benefits, postage, office supplies and printing are allocated based on

the full-time equivalencies of each program. Administrative services, such as legal expenses, advertising, staff recruitment, typing, payroll, etc., when not directly attributable to a program, gets expensed to the administration.

2. Rental space, when shared by more than one program, is allocated based on the percentage of square footage utilized by a program. This would include an allocation of common space used by more than one program.

3. In situations where telephones are shared among different programs, costs are also allocated on a full-time equivalency basis, unless a program’s services require an extraordinary amount of telephone work or special services. In this situation, a special note would be included on the cost allocation summary sheet.

4. The bond expenses allocation is based on the square footage of program use of the buildings included in the bond.

5. Commercial insurances and Workers' Compensation are, when possible, expensed according to cost. In cases where most expenses are allocated, it is based on full-time equivalency, with adjustments made for different rates or liability exposures. In cases where adjustments are made, it shall be noted on the cost allocations breakdown summaries.

Asset Management

Investments Policy: The Board of Directors shall establish the investment objective. Preservation of capital, while limiting investment risk is the primary goal. Current income is a secondary goal.



This objective is to be implemented in a manner that is consistent with the responsibility that we expect our investment manager to fulfill. In meeting these objectives, the following guidelines are to apply:

Procedures: 1. The investment manager will accept at any time, assets turned over to it by The Bridge &

Alternatives “TBA” that it is legally qualified to hold and manage. 2. The ratio of investments by the classes of securities may range from 50-75% in equities, with

30-50% in fixed income investments. On average, an allocation of 60% equities and 40% fixed income is desired. It is understood that these ranges provide flexibility to respond effectively to changing market developments.

3. Equity portion of portfolio: Holdings may include common stocks, unit investment trusts and mutual funds. Foreign equity investments are acceptable provided they are traded on a major United States Exchange as American Depository Receipts (ADR). The following criteria should be considered:

a) All stocks must be liquid and listed and traded on one of the major domestic stock exchanges (NYSE, ASE, NASDAQ).

b) The company should reflect sound financial strength. c) The current price should reflect a price-to-earnings ratio consistent with the average

ratios of the Standard and Poors (S & P) 500. d) No industry concentration shall vary more than 500 basis points from the

composition of the S & P 500. 80% of the equity portfolio must be S & P 500 listed. e) No single security (excluding mutual funds) shall exceed 5% of the total market

value of the equity portion of the portfolio. Primary emphasis shall be on individual issue selection with timing playing a supporting role if the latter is utilized without unnecessarily jeopardizing the philosophy of the prime role of selection.

4. Fixed Income portion of portfolio: Holdings may include U. S. Treasuries, U. S. Government Agencies, corporate bonds, preferred stocks, convertible preferred stocks, foreign debt, convertible bonds, mutual funds and closed-end income funds. The following criteria should be considered:

a) The fund may invest in Moody or S & P “AAA”, “AA”,” A”, “BA” and “BB” rated securities; however, the average rating of the fixed income portfolio must have at least an “A” rating from S &P and/or Moodys at the time of purchase.

b) Un-rated or high-yield bond mutual funds may be included in the portfolio but are limited to a maximum of 10% of the fixed income portion of the portfolio.

c) No one investment shall exceed 5% of the total market value of the fixed income portion of the portfolio.

5. A degree of consolidation with respect to the number of separate investment instruments should be maintained. As noted in the preceding two guidelines, a degree of diversification should be employed with respect to the portfolio; the investment manager shall not retain token amounts in any one equity or fixed income issue.

6. The cash portion of the portfolio may be held in short-term investments such as certificates of deposit, bankers’ acceptances, commercial paper, Eurodollars, treasury bills, and money market funds to exercise flexibility on decisions as to the most judicious times to enter and withdraw from the market. Generally, however, unless the market situation dictates



judgment to the contrary, funds available for investment should be committed within 120 days. It is the intent that the funds be fully invested, unless otherwise directed by the Board of Directors. Notwithstanding the above, to the extent such investments are made in institutions covered by Federal Deposit Insurance, the total of all investments in any one such institution shall not exceed the Federally insured limit.

7. The investment objective is long-term in nature and short-term trading in the form of “in and out” entries into the marketplace should be minimized.

8. The long-term goal of the portfolio shall be to exceed the following recognized indices for the respective asset class:

a) For the equity portion of the portfolio: The S & P 500 Stock Index. b) For the fixed income portion of the portfolio: Lehman Brother’s Aggregate Bond

Index. c) For the total portfolio: the aggregate of 60% of the S& P 500 and 40% of the Lehman

Brother’s Aggregate Bond indices. 9. Unless authorized by TBA, the investment manager will not carry out actions on behalf of

the fund with respect to: a) Puts or Calls b) Short Sales c) Options d) Futures e) Commodities f) Assets designed to achieve a “multiplier” effect such as so-called “derivatives.

10. New assets turned over to the investment manager for this account not meeting these investment policy guideline criteria shall be converted into investments in line with this investment policy within 60 days.

11. The investment manager need not secure prior approval of TBA for effecting investment changes (with the exceptions noted in item #9), if they are carried out within these investment guidelines. It is understood that since the investment manager is granted the sole discretion within these guidelines to carry out transactions, alternatives will objectively evaluate the investment management performance of the investment manager on a continuing long-term (5-years) basis, with interim annual reviews.

12. THE PORTFOLIO MANAGER WILL MAKE A BEST EFFORT TO EXCLUDE INVESTMENTS THAT ARE CONSIDERED SOCIALLY IRRESPONSIBLE. TBA’ BOARD RESERVES THE RIGHT TO EXCLUDE SPECIFIC SECURITIES FROM THE PORTFOLIO.

13. It is understood that there will be many times when an opportunity may present itself or an unforeseen situation may pertain which does not conform to this policy. In such situations, where the investment manager deems it to be in the best interest of the portfolio, the investment manager may recommend a deviation from these guidelines. Such recommendations shall be implemented only after obtaining the verbal approval of the Treasurer, the Chairperson of the Board and the CEO. The investment manager will follow up with written description of the action taken and the reasons recommending that the action be taken. The deviation from these policy guidelines will be reviewed by the next meeting of the Finance Committee.

Short Term Investments Policy: Cash that is not needed to meet current obligation or cash that may be needed to meet future obligations will be invested in short term interest bearing accounts



Procedures: 1. The term of securities will be determined by projected future needs of cash. 2. Short term investments will be limited to government securities, special interest-bearing

bank accounts and certificates of deposits. 3. Investment accounts will always bear the name of Alternatives Unlimited, Inc.

Fixed Assets Policy: The agency maintains a computerized fixed asset subsidiary ledger to identify and control property and equipment acquired by the agency. Procedures: 1. The subsidiary ledger contains coding which identifies each item of property as follows: item

identification, description of property, in-service date, cost, accumulated depreciation, book value and property type.

2. Periodically an inventory will be taken of all assets for verification of property records. 3. The sale or disposal of any asset, (equipment or property), will be subject to prior approval

by the EVP/CFO. 4. The sale or disposal of any capital asset will be properly recorded and deleted from the

property records on a current basis. 5. Insurance will be secured on all assets. Limits of insurance coverage will be reviewed

annually for adequacy. 6. Capital assets are defined as assets having a useful life more than one year and a cost

exceeding $5,000. 7. Fixed assets are depreciated as follows:

o Residential Building 27.5 - 39 years o Non-residential Building 39 years o Building Improvements 20 years

▪ Carpets, vinyl, or plank flooring 7 years ▪ Minor plumbing, electrical, carpentry 5 years

o Equipment 10 years o Computers 3 years o Residential Furnitures & Fixtures 3 years o Office Furniture 7 years o Vehicles 5 years o Used Vehicles 3 years o Leasehold Improvements 5 years/terms of lease

Line of Credit/Borrowing Policy: The agency strives to maintain a positive balance sheet with adequate cash to meet working capital and contingency needs. However, to ensure an uninterrupted operation of business, the agency maintains a revolving line of credit. The following procedures are in place to monitor the agency’s working capital and contingency needs. Procedures:



1. On an ongoing basis, a total of expenditures and revenues are maintained, and the amount of available cash is determined.

2. If it is determined additional funds are required, the President/CEO, EVP/CFO and VPF are authorized to utilize the line of credit. Only the amount needed is requested. The EVP/CFO is to be made aware of all borrowing and repayments.

3. The President/CEO, EVP/CFO and VPF are authorized to draw up to $1,000,000 to meet payroll obligations.

4. Draw downs in excess of $1,000,000 require approval by the Chairperson and/or Treasurer of the Board of Directors.

5. As soon as cash flow needs are met, the line of credit loan is repaid. 6. Borrowing activity is reviewed at the monthly Finance Committee meeting.

Affiliate Relationships Alternatives Unlimited, Inc. (Alternatives) is a Massachusetts non-profit corporation. The agency has various operating affiliates described below. The Board of Directors of Alternatives entered into an affiliation agreement where Alternatives would be the sole member of North Central Human Services, Inc. (NCHS) and both NCHS’s affiliates, Educational Living Residences, Inc. (ELRI) and 35 Catherine Street, Inc. (Catherine Street). Alternatives also entered into an affiliation agreement with The Bridge of Central Massachusetts, Inc. (The Bridge) and The Bridge of Westborough, Inc. (The Bridge of Westborough). NCHS, ELRI, Catherine Street, The Bridge and The Bridge of Westborough are Massachusetts non-profit corporations NCHS, ELRI, Catherine Street and The Bridge hold title to certain real estate and other property used in carrying out the agency’s residential service programs. The rental properties are combined in the financial statements. The Bridge of Westborough owns property in Northborough, Massachusetts. This property is a group home for Massachusetts Department of Mental Health clients. The Bridge of Westborough is regulated by the U.S. Department of Housing and Urban Development (HUD) as to rent charges, operating methods, and cash escrows. The Bridge of Westborough receives significant rent subsidies from HUD for qualified tenants. Alternatives Apartments, LLC (the LLC) was established as a Massachusetts limited liability company. Alternatives is the sole member of the LLC. The LLC was formed to hold and manage six residential units within the Whitin Mill Redevelopment Project. The LLC is combined in the financial statements. Altco, Inc. (Altco) is a 501(c)(2) corporation, the purpose of which is to buy, lease, acquire, operate and hold title to real estate and personal property for the benefit of the agency. Altco currently leases the Ring Shop dam and holding pond on the Mumford River for the purpose of producing hydroelectricity. Altco is combined in the financial statements. ValleyCast, Inc. (ValleyCast) is a 501(c)(3) cultural organization. ValleyCast promotes and celebrates the arts, culture and science of the Blackstone River Valley



Alternatives, NCHS, Catherine Street, VallyCast, The Bridge and The Bridge of Westborough are exempt from Federal income taxes as organizations (not private foundations) formed for charitable purposes under Section 501(c) (3) of the Internal Revenue Code (IRC). Alternatives, NCHS, Catherine Street, ValleyCast, The Bridge and The Bridge of Westborough area also exempt from state income taxes. ELRI and Alto are exempt from Federal income taxes under Section 501(c)(2) of the IRC. The LLC has elected to be disregarded as a separate entity and is combined with Alternatives for tax purposes.

Financial Risk Management

Risk Management Plan Policy: The agency aspires to operate in a way that protects the health, safety and security of clients, staff, members and volunteers while lifting the agency’s mission and safeguarding assets needed for mission-critical programs and activities. See complete risk management plan in separate policy.

Goals: The safety of personnel receiving or engaged in delivering services sponsored by the agency shall at times be regarded as a top priority and this emphasis shall be communicated throughout the agency in order to ensure its understanding. General Safety Principles: The safety of personnel receiving or engaged in delivering services sponsored by agency shall at all times be regarded as a top priority and this emphasis shall be communicated throughout the organization in order to ensure its understanding. The agency seeks to involve appropriate personnel, whether board or staff, at all levels of the agency in the identification of risks and creation of practical strategies in order to make certain that the agency's approach to risk management considers diverse perspectives and that staff understand their responsibility to protect the confidentiality of our clients, the safety and security of our facilities, the integrity our reputation, the preservation and future growth of assets as well as the fulfillment of our mission.

Insurance Policy: The following is a generic summary of commercial insurance policies owned by the agency and does not necessarily reflect specific coverage or exclusions included in agency policies. All coverage is subjected to specific policy provisions. For specific questions or concerns regarding coverage, consult with the EVP/CFO.

Commercial Property Insurance This insurance package covers damages to the insured’s property. Property damage would include physical injury to, or destruction of, or loss of use of tangible property. This includes coverage for damage due to crime. Limit - Blanket Building Coverage $32,051,803 Limit - Blanket BPP $5,130,900 limit

Limit - Blanket Business Income & EE $6,784,400 Inland Marine Insurance Inland Marine insurance covers certain types of moveable property.

Limit – Blanket Electronic Data Process Equipment $619,686



General Liability Insurance General liability insurance provides protection against lawsuits alleging bodily or personal injuries or property damage caused by various actions or operations of the agency.

Each Occurrence - $1,000,00 Aggregate Limit - $3,000,000

Employee Benefits Liability Employee Benefits liability insurance provides protection against lawsuits alleging bodily or personal injuries or property damage caused by various actions or operations of the agency.


Professional Liability Insurance Professional liability insurance provides protection against suits arising out of professional actions. This coverage extends to both the agency and its employees and volunteers.

Each Occurrence - $1,000,000 Aggregate Limit- $3,000,000

Sexual/Physical Abuse Insurance Sexual/Physical Abuse liability insurance provides protection


Commercial Automobile Insurance Insurance which covers against loss due to damage to or destruction to automobiles, or due to claims for damages arising from the ownership, maintenance, or use of automobiles; also, loss to person insured in certain specific ways due to cost of medical, surgical, or hospital care necessitated by auto accidents.

Combined Singe Limit - $1,000,000 Umbrella Liability Insurance Umbrella liability insurance is a broad form of liability coverage, providing high-limit-excess coverage of all forms of liability to which the insured may be held, subject to policy provisions.

Aggregate Limit - $10,000,000 Management Liability Insurance Management liability insurance covers exposures faced by directors, officers, and managers that arise from governance, finance, benefits and management activities.

Aggregate Limit – 10,000,000 Crime Insurance Commercial Crime insurance protects the agency against the dishonesty of employees and losses resulting from employee theft. This coverage also protects the insured up to the amount of the bond for loss due to forgery or improper deposits or withdrawals by employees covered by the bond.

Limit - $2,000,000 Employee Theft Cyber Liability Insurance Cyber liability insurance provides protection against loss from data and cyber breach.

Aggregate Limit - $2,000,000 Workers’ Compensation Insurance Workers’ compensation insurance insures the employees’ responsibilities for injuries, disability, or death to persons in its employ, as prescribed by workers’ compensation law.



Unemployment Insurance Unemployment insurance is coverage for individuals who suffer involuntary loss of employment due to conditions, which would qualify claimants under Massachusetts Employment Security Law. The agency by its non-profit status has chosen to self-insure for successful claims made against it and does not pay into the unemployment compensation fund.

Private Practice Counseling Policy: The Administrative team of Open Sky Community Services may grant permission for the staff to conduct private practice counseling in agency facilities. Staff interested in conducting private practice shall submit a formal application to the Administrative Team to conduct private practice.

Procedures: Those applying must provide the following information: 1. Site at which private clients shall be seen. 2. Number of hours per week during which clients shall be seen. 3. Assurance that these hours shall be more than the hours required by full time employment

at the agency. 4. Documents that show that the worker has provided each private client with a clear, written

statement that the client is receiving professional services from the worker only and not from the agency.

5. Documentation that the worker has professional liability insurance which covers the worker for such private practice.

6. All applications shall be submitted to the Administration Team. Applicants must resubmit the above material on an annual basis for re-approval.