FINANCE & LEGAL�STANDARDS
Last updated on 15th May 2023
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FINANCE AND LEGAL STANDARDS
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FINANCE AND LEGAL STANDARDS
FINANCE AND LEGAL STANDARDS
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STANDARDS
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FINANCE AND LEGAL STANDARDS
ECOSYSTEM
STANDARDS
CHECKLIST
EDUCATION
MEASUREMENT
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FINANCE & LEGAL STANDARDS IMPLEMENTATION DASHBOARD
Contact AI / RO / GFB to get the link for the dashboard. You can use the dashboard to check the implementation progress and use it to prioritise the standards implementation for your entity.
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Objective of the standard
Legalities standard provide the minimum requirements for an entity to maintain the legal status and conduct operations of the entity in a legal manner. The standard intends to protect our members, customers and partners from any adverse effects arising from non compliance in legal requirements.
Why is it relevant to AIESEC
This covers the aspects that you need to cross check and see if your entity is up-to date and if you have the required documents to prove the legal position of the entity. The standard not only limits to legal registration, but also concerns about legal operations and compliance requirements.
LEGALITIES
LEGALITIES
Legal registration of AIESEC in the country / territory
National compendium and/or constitution
Criteria for LC membership in the national compendium
Full membership in global membership status
MC bank account under the legally registered AIESEC entity
Tax status is defined and paid
Trademark registered
Legal registration of LCs
Employment contracts and/or volunteers agreements for MC members including NDA
Volunteer agreements for LC members including NDA
Exchange participant and opportunity provider contracts
Partnerships & Participants agreements
Visa / Work permit for employees (MC) / volunteers (MC)
Visa for exchange participants
100% GDPR Compliance of MC (and LC)
Have at least one MC member as a legal representative to the entity
Have a contact of a legal professional advisor
100% APIP compliance
Explanations of each standard
Legal registration of AIESEC in the country / territory
AIESEC is registered officially in the country / territory as a legal entity. The category of registration should allow AIESEC to conduct its operations legally and generate revenue through operations.
How to implement and resources and how to fulfil GFB check
Check aies.ec/pfacademy-mcvp.
National compendium and/or constitution
AIESEC entity should have a national compendium and/or a constitution as a part of their governance system. The compendium and/or constitution needs to be legislated by the national plenary. The compendium should follow and not contradict the laws of the country / territory and should follow the AIESEC global compendium. If the compenium is in a language other than English, there should be a translated version of the latest version of the compendium to English. The compendium should be updated at-least once a year.
How to implement and resources and how to fulfil GFB check
Check aies.ec/pfacademy-mcvp.
You can find the global compendium at aies.ec/globalcompendium
Explanations of each standard
Criteria for LC membership in the national compendium
The national compendium (section(s), article(s) or clause(s)) should have legislated the criteria for an Local Committee to be formed and the minimums to maintain membership. The criteria should be be reviewed (this does not mean changing, but to check if it is up to date) once a year.
How to implement and resources and how to fulfil GFB check
Check aies.ec/pfacademy-mcvp.
Full membership in global membership status
The AIESEC entity should hold full membership in the global plenary. The full membership criteria can be f
How to implement and resources and how to fulfil GFB check
Check aies.ec/pfacademy-mcvp and the full membership criteria should be followed as per the global compendium. You can find the global compendium at aies.ec/globalcompendium. The entity status can be checked and tracked at aies.ec/msc-tracker.
Explanations of each standard
MC bank account under the legally registered AIESEC entity
There should be at least one bank account under the legally registered AIESEC entity. The operating instructions of the bank account should be defined. The bank statements should be collected and stored at-least digitally in a monthly basis.
How to implement and resources and how to fulfil GFB check
Check aies.ec/pfacademy-mcvp.
Tax status is defined and paid
The legal AIESEC entity needs to be registered for tax (if applicable, some entities might be tax exempted based on the type of legal registration and the law of the country / territory). All taxes should be duly paid and any tax liability should be recorded and reported in the financial statements.
How to implement and resources and how to fulfil GFB check
Check aies.ec/pfacademy-mcvp.
Explanations of each standard
Trademark registered
AIESEC official logo should be registered as trademark in the country / territory.
How to implement and resources and how to fulfil GFB check
More information (EU, WIPO trademark registration information) check aies.ec/pfacademy-mcvp
Legal registration of LCs
All local committees needs to be registered as a legal organisation which is established either with affiliation to the MC / legal entity and/or the respective University (if applicable). The MC should review this registration every year.
How to implement and resources and how to fulfil GFB check
Check aies.ec/pfacademy-mcvp.
Explanations of each standard
Employment contracts and/or volunteers agreements for MC members including NDA
Every MC member should have signed an employment contract or a volunteer agreement (if the MC members are working as volunteers) before the start of the term and a copy should be with the employee and the employer. This contract should also include a non disclosure agreement. These contracts needs to be checked and approved by a lawyer or a professional legal advisor. These contracts are required to be signed irrespective if the role is virtual or physical. The contracts need to be reviewed every year and should not contradict with the national compendium.
How to implement and resources and how to fulfil GFB check
Check aies.ec/pfacademy-mcvp.
Volunteer agreements for LC members including NDA
Every LC member should have signed a volunteer agreement before the start of the term / role and a copy should be with the member and the executive board. This contract should also include a non disclosure agreement.
How to implement and resources and how to fulfil GFB check
Check aies.ec/pfacademy-mcvp.
Explanations of each standard
Exchange participant and opportunity provider contracts
Every opportunity provider for GTa, GTe and GV should sign a contract with the AIESEC entity with requirements as per AEPP and all exchange participants should sign a contract with AIESEC entity with requirements as per AEPP. The contract needs to be checked and approved by a lawyer or a professional legal advisor
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June. You can find the AEPP and APIP documents through aies.ec/aeppic2020.
Partnership agreements
All partnerships including but not limited to BD partnerships, grants, sponsorships, vendor agreements, service agreements should have a partnership agreement signed by the authorised person from AIESEC and the partner.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Visa / Work permit for employees (MC) / volunteers (MC)
All international MC employees or volunteers (if working physically) is required to have a valid work permit and/or visa that allows them to work in the country / territory legally.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Visa for exchange participants
All exchange participants (incoming and outgoing both) are required to have a valid work permit and/or visa that allows them to work / volunteer in the country / territory legally.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
100% GDPR Compliance
All AIESEC entities should proactively takes measures to protect the personal data of their members, customers and partners. The entity membership should be thoroughly educated on the regulation and how to protect their personal data and how to handle the personal data controlled by the AIESEC entity. At minimum the entity should be 100% GDPR compliant according to the AIESEC checklist.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June. You can find GDPR education resources at aies.ec/gdprfundamentals and progress tracker at aies.ec/gdpr
Have at least one MC member as a legal representative to the entity
There should be atleast one MC member as the legal representative of the registered AIESEC entity. This MC member should be able to represent the organisation in legal matters concerning the entity. Special cases may apply.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Have on demand support of a legal professional advisor
The entity needs to have a contact of a professional legal advisor for on demand support. This does not mean the entity needs to pay for a law firm or keep hiring a lawyer. However, the entity needs to have a legal advisor to get support on demand (paid or unpaid ex: alumni).
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
100% APIP compliance
The entity needs to be 100% compliant with the APIP requirements implementation.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June. You can check the APIP implementation progress at aies.ec/apipimplementationplan.
Explanations of each standard
Publish the MC/Entity annual report
The entity needs to publish (for the respective stakeholders) the annual report for the term including the externally audited or reviewed financial statements at most after 12 months after the end of the fiscal year.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
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Objective of the standard
Accounting standard provides the minimum requirements for an entity to conduct its accounting procedures according to the generally accepted accounting principles (GAAP). The standard aims to improve the accuracy of financial statements generated by entities following the correct accounting principles. In the long run this provides accurate data for decision making and thus a sustainable AIESEC.
Why is it relevant to AIESEC
Financial accounting is a non negotiable for an organisation. However, in AIESEC we have very limited knowledge and skills in accounting and finance to do it accurately. This standard will educate and guide you to conduct the accounting requirements inside your entity effectively.
ACCOUNTING
ACCOUNTING
Double entry bookkeeping software for MC and LC
Accruals basis accounting
Follow accounting principles when doing accounting
Review your chart of accounts at least every year
Reporting on Global Chart of Accounts
LCs follow the chart of accounts provided by the MC
Trial balance and general ledger are generated monthly
Reconcile all accounts every month
All transactions should have a source document
Store all accounting documents virtually and/or physically
Credit policy and receivables collection process defined
Receivables should be followed up every two weeks after the deadline for payment
Routine with accountants defined (If there is an accountant)
Explanations of each standard
Double entry bookkeeping software
The AIESEC legal entity is required to use double entry bookkeeping software (eg: accounting software). The accounting for the MC can be done by a separate accountant using accounting software. The LCs are highly recommended to use accounting software.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Accruals basis accounting
All accounting by the entities should be carried out in the accruals basis.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Follow accounting principles when doing accounting
All accounting needs to be carried based on the accounting principles defined and followed by the country / territory. (Eg: GAAP).
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Reconcile accounts and generate trial balance every month
At the end of every month all accounts needs to be balanced reconciled and generates a trial balance. This allows the prepaid expenses and prepaid income to be correctly recognized and check on aspects such as but not limited to undeposited and/or unrealised cheques, bank fees and, refunds.
If the entity accounting is handled by an accountant, this can be requested to be carried out by the accountants.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Review your chart of accounts at least every year
The entity can have their own chart of accounts based on the requirements of the entity. (However, the entity will report to GFB based on the global chart of accounts). The entity needs to review their chart of accounts every year to see if the chart of accounts provide the best method to record the data. However it is not recommended to have separate chart of accounts locally for LC, but to align with the national chart of accounts or global chart of accounts
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Reporting on Global Chart of Accounts
All entities to be reporting to the Global Finance Board survey based on the Global Chart of Accounts. Entities can have a national chart of accounts to conduct their internal accounting however, the submission to GFB needs to be aligned to the global chart of accounts. This is to ensure that global finance data is consistent and data analysis can be conducted to analyse the global state of finances and support global plenary decision making
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June. You can find the global chart of accounts at aies.ec/chartofaccounts
Explanations of each standard
LCs follow the chart of accounts provided by the MC
It is recommended that all LCs follow the chart of accounts provided by the MC so that the data collected from the LCs are consistent and can be used to for decision making from the MC and LCs.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
General Ledger is generated monthly
The general ledger can be generated from the accounting software. This is generated monthly to understand the full range of transactions and to understand if all the transactions are accounted properly.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Credit policy and receivables collection process defined
The is a policy on receivables that will be defined in the entity which states the duration for certain types of credit (eg: payment from partners for GT, payment terms for BD partners). This policy should also include the receivables collection and follow up procedure including the responsibilities of collection.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Receivables follow up procedure
The receivables need to be followed up with reminders (verbal and written) after the deadline. This should be done at least in every two weeks.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Routine with accountants defined (If there is an accountant)
If you have an accountant who does the accounting of the MC and LCs then a routine is needed to be defined which should be at least once a month to ensure the month accounting is carried out.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
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BUDGETING
Objective of the standard
Budgeting standard provides the minimum requirements for an entity to conduct budgeting requirements for the term. This is a non-negotiable financial management activity every entity needs to conduct. The standards aims to achieve financial sustainability through improvement financial management practices. The standard also provides education and tools to help entities do budgeting effectively.
Why is it relevant to AIESEC
Preparing budgets for the entity is one of most crucial activities to ensure transparent financial management. This standard provides guidance into doing budgeting and cash flow planning including the tools and framework for it. Maintaining and managing a budget will ensure financial sustainability to the entity.
BUDGETING
Annual budget of the MC and LC is prepared before the respective term starts
All annual budgets are prepared with monthly breakdown
All annual budgets are planned in accruals basis
All budgets are planned in profit & include revenues and expenditures
Annual cash-flow plan of the MC and LC is prepared before the term starts
All cash-flow plans prepared with monthly breakdown
MC annual budget and its revisions are approved by the board of directors and/or national plenary
LC annual budget and its revisions are approved by the defined body responsible
Annual MC and LC budgets are review and if required re-planned once per semester
Budgets are aligned according to the chart of accounts used in the accounting software
Budget execution should be the same as accounting records
Budget submission to GFB should be aligned to Global CoAs
Distribution model should be reviewed once a year
All conferences (virtual and/or physical) are planned in profit
All products are be planned in profit
Explanations of each standard
Annual budget of the MC is prepared before the MC term starts
The budget for the upcoming MC term needs to be prepared before the start of the respective term. This budget can be prepared based on the suitable template used by the MC (with the required budget lines). However note that the annual budget needs to also be submitted to the GFB under the Global Chart of Accounts.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June. You can find the GFB budgeting tool at aies.ec/mcbudget-tool
Annual budget of the LC is prepared before the LC term starts
The budget for the upcoming LC term needs to be prepared before the start of the respective term. This budget can be prepared based on the suitable template used by the LC / provided by the MC (with the required budget lines). However note that the annual budget needs to also be submitted to the GFB under the Global Chart of Accounts.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June. You can find the GFB budgeting tool at aies.ec/lcbudget-tool
Explanations of each standard
All annual budgets are prepared with monthly breakdown
The annual budget will be prepared with a monthly breakdown to be able to track the monthly budget execution. The also allows to find the variance in the budget execution and take corrective actions.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
All annual budgets are planned in accruals basis
The accruals budget and the cash flow plan needs to be separately done. The main tool for budgeting the year will be based on the accruals principle.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
All budgets are planned in profit & include revenues and expenditures
All budgets are planned in profit including the annual budget for the term. The monthly breakdowns may or may not be in a profit, however the cumulative budget for the year needs to be planned in profit. The budget should have both the revenues and expenses sections..
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Annual cash-flow plan of the MC and LC is prepared before the term starts
Similar to the annual MC and LC accruals budget, the cash flow plan needs to be prepared before the term starts and the cash flow plan will allows to identify any months with negative cash flow and avoid those by adjusting the plan.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
All cash-flow plans prepared with monthly breakdown
Similar to the accruals budgets all cash flow plans are planned with a monthly breakdown.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
MC annual budget and its revisions are approved by the board and/or national plenary
The MC budget should be approved by the board and or the national plenary before the term starts and any revisions that are made to the budget should also be re-approved by the board and or the national plenary.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
LC annual budget and its revisions needs to be approved
All the LC all budgets for the term and its revisions are required to be approved by the respective bodies defined in the national compendium.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Annual MC and LC budgets are reviewed and if required re-planned once per semester
MC and LC annual budgets should be continuously reviewed and can be adjusted according to hte requirements. However if there is a requirement for replanning it is recommended for to be carried out once per semester.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Budgets are aligned according to the chart of accounts used in the accounting software
The budgets should be directly aligned with the chart of accounts used in the entity. This can be different from the global chart of accounts, however to make budget execution comparison efficient and also to ensure that budget execution and accounting records can be easily reconciled budgets should be aligned with the chart of accounts used in the accounting software.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Budget execution should be the same as accounting records
The budget execution (which is done on the accruals basis) should be the same as the accounting records for the period. The financial statements generated for the period should be the same as the values in the budget executed. There could be small differences due to banking costs and unreconciled transactions which should be reconciled and fixed every month.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
MC and LC budget submission to GFB should be aligned to Global CoAs
The annual budgets of the MC and LCs that are submitted for GFB data submission should be aligned to the global chart of accounts.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June. The global chart of accounts are at aies.ce/chartofaccounts
Distribution model should be reviewed once a year
The MC should review the financial distribution model of the entity once a year. This allows the entity to check the effectiveness of the model and have a fairer distribution to the LCs.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
All conferences (virtual and/or physical) are planned in profit
All conferences which will have separate budgets should be planned in profit.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June. aies.ec/conferencesustainability
All products are be planned in profit
All the ELD and EwA products should be planned in profit for the year. These plans should be reflected in the annual budget.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
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REPORTING
Objective of the standard
Reporting standard provides the minimum requirements for an entity to conduct its reporting to its stakeholders. This standard aims to improve the transparency and accountability of the entity.
Why is it relevant to AIESEC
AIESEC in a not for profit organisation and a global association. There is a high accountability system and many stakeholders that we are working with and we should demonstrate the highest level of transparency and accountability to the stakeholders. This standard provides the minimums we can do to accomplish that.
REPORTING
Monthly and YTD* (year to date) MC & LC financial statements (profit and loss, balance sheet & cash flow) should be generated
Bi-weekly MC budget execution and variance should be reported to the MC
Quarterly MC budget execution and variance should be reported to the LCPs
Quarterly LC budget execution and variance should be reported to the Local Plenary
Bi-weekly LC budget execution and variance should be reported to the LC EB
Monthly LC budget execution and variance should be reported to the MC
Submit duly completed monthly GFB survey
Monthly financial report should be prepared, presented and stored physically and/or virtually
Annual financial report should be prepared, presented and stored physically and/or virtually
Sustainability reporting done at least annually
* YTD is since the start of the term
Explanations of each standard
Monthly and YTD MC financial statements
The MC is required to generate the trial balance, profit and loss statement, balance sheet & cash flow statement on a monthly basis and on year to date basis on a set date after the month. These statements should be generated using the accounting software. The generated financial statements are required to be at least presented to the MC team monthly.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Bi-weekly MC budget execution and variance should be reported to the MC
The MC budget execution should be reported to the MC team on a bi-weekly basis to follow-up on each budget line responsible. Any variances should be discussed and taken proactive action.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Quarterly MC budget execution and variance should be reported to the LCPs
The MC budget execution should be reported to the LCPs at-least on the quarterly basis in order for the national plenary to understand the current status of execution and be accountable and transparent to the plenary.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Monthly and YTD LC financial statements should be generated
The LCs are required to generate the trial balance (if they use accounting software), profit and loss statement, balance sheet & cash flow statement on a monthly basis and on year to date basis on a set date after the month. These statements are recommended to be generated using the accounting software. The generated financial statements are required to be at least presented to the MC and other stakeholders (if applicable) on a monthly basis.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Monthly LC budget execution and variance should be reported to the MC
The LC budget execution should be reported to the MC on a monthly basis to ensure transparency and accountability of the LC. The MC shall also give support for financial management in case its required or there are large variances.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Bi-weekly LC budget execution and variance should be reported to the LC EB
The LC budget execution should be reported to the LC EB team on a bi-weekly basis to follow-up on each budget line responsible. Any variances should be discussed and taken proactive action.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Submit duly completed monthly GFB survey
LCs should submit their monthly financial statements (GFB survey submission template) according to the global chart of accounts to the MC. The deadline for submission will be determined by the MC. And the MC should submit MC data and duly completed consolidated LC data together to GFB through the submission template. It is recommended to have clauses in the compendium to make the submission compulsory as this is the global membership criteria.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Monthly financial report should be prepared, presented and stored physically and/or virtually
Both MC and LC will be creating a monthly financial report which includes but not limited to financial statements, statements analysis should be stored virtually for at least 3 years. This is for the use of MC teams or LC EBs to use to identify and understand the financial situation of the entity.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Annual financial report should be prepared, presented and stored physically and/or virtually
LCs should submit their monthly financial statements (GFB survey submission template) according to the global chart of accounts to the MC. The deadline for submission will be determined by the MC.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Sustainability reporting done at least annually
The entity to report not only on the financial status and sustainability, but also to provide more holistic and integrated report on the actions towards sustainability including but not limited to the environment.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June. You can find reference for advanced reporting through the Global Reporting Initiative (www.globalreporting.org)
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ANALYsing
Objective of the standard
Analysing standard provides the minimum requirements for an entity to conduct its analysis on financial data. The role of finance is to be proactive and direct the entity towards sustainable decision making. Analysing standard provides the guidance required to do it effectively.
Why is it relevant to AIESEC
Data driven decision making and proactive measures such as prediction and forecasting is not strong in AIESEC. This standard is focused on giving the education and minimums entities can adopt to improve their analysis and better decision making based on data.
ANALYsing
Financial ratios are calculated, interpreted and reported every month
Product profitabilities of the MC and LC are analysed and reported
Create a financial analysis framework for decision making
Store and backup raw financial data at least for the past 5 years digitally
Analyse and interpret the forecast of (year-to-go) YTG budgeted revenues, budgeted costs and cash flow every quarter
Pricing of products (including other portfolios) for partners and youth are reviewed every year
External conditions of the country / territory should be monitored at-least once a semester
Explanations of each standard
Financial ratios are calculated, interpreted and reported every month
At minimum the Financial ratios of gross profit margin for products and entity, net profit margin for products and entity, product contribution margin, liquidity ratios, debt ratios, return on equity and, months of cash reserves. These ratios will be calculated on a monthly basis, for the last 12 months and a year to date basis (YTD means from the start of the respective MC or LC term). The calculations can be represented in a dashboard and used for monthly reporting with the respective inferences for the ratios.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Product profitabilities of the MC and LC are analysed and reported
Financial ratios specifically for products will be calculated and analysed for the inferences regarding product performance. These data will be compared with other data such as exchange process data and sales process data.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Create a finance analysis framework for decision making
The entity should create a framework that will be used to bring finance data, insights and inference for decision making. This could be a collection of dashboards or data sources. The framework will define what analysis to be conducted and what each of the analysis will infer about.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Store and backup financial data at least for the past 5 years
All financial data including but not limited to trial balances, accounting transactions, bank transactions, financial statements should be stored for at least 5 years to be used for analysing.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Analyse and interpret the forecast of YTG (year-to-go) YTG revenues, costs and cash flow every quarter
The forecast analysis focus on the expected revenue, costs and cash flow for from the current date to the end of the term. This analysis allows the entity to be proactive and make proactive decisions and not only focus on past data to make decisions.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Pricing of products (including other portfolios) for partners and youth are reviewed every year
While the pricing review remains with the product responsible, the MCVP Finance is required to check the profitability of the products and the effect of the existing price on the product financially.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June. For the framework of pricing aies.ec/pricing
Explanations of each standard
External conditions of the country / territory should be monitored regularly
Apart from the internal financial data analysis, the MCVP Finance should also monitor external factors such as PESTLE environment. Mainly this would cover the analysis and monitoring of economic situation which effects factors such as exchange rate and inflation which can directly affect our operations. Other conditions such as political and legal aspects should be monitored as a part of risk management.
How to implement and resources and how to fulfil GFB check
More information will be downscaled soon.
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INVESTING
Objective of the standard
Investing standard provides the minimum requirements for an entity to conduct its savings and investments supporting the long term sustainability of the entity. The standard focus on guiding to build reserves and funds to the entity and also to conduct investments in a sustainable manner.
Why is it relevant to AIESEC
AIESEC is a not for profit organisation and thus in order for AIESEC to continue to focus on the primary objective sustainably, it is required to build reserves and funds to support the organisation in times of crisis and challenges.
INVESTING
MC has a separate bank account under the legal entity for reserves
Have at least one restricted reserve fund for the MC and LC
Have at least one unrestricted reserve fund for MC and LC
All restricted and unrestricted funds should be legislated in the compendium with the respective criteria
MC and LC financial reserve plans are created
All MC and LC investments for the year should be in the respective annual MC and LC budgets
All investments should have calculated ROI
Explanations of each standard
MC has a separate bank account under the legal entity for reserves
The MC will be required to have a separate bank account to maintain the reserve funds other than the main transactional bank account. However if this is not possible due to increase in costs, there should be a system set up in place to maintain the receive funds in the same account.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
MC and LC financial reserve plan is created
The MC/LC should create a plan for the reserves that will be accumulated throughout the year. The reserve plan will include what fund to be maintained and for which reasons and how money will be transferred to these funds. This should also specify the savings goal for the year with breakdowns.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
All restricted and unrestricted funds should be legislated in the compendium with the respective criteria
The type of restricted and unrestricted funds should be legislated in the compendium along with the purpose of the use of the funds and the method to apply for the funds.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Have at least one restricted reserve fund for the MC and LC
The restricted funds will have a specific purpose for the fund to be used and both MC and LC should define the requirement of certain funds based on the risk assessment and the strategy of the entity.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Have at least one unrestricted reserve fund for MC and LC
The unrestricted funds allow more scope for the usage of the funds and the purpose. These funds allow direct the entity to save more reserves which are not directly for a specific fund.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
All MC investments for the year should be in the annual MC and LC budgets
The investments that are being carried out throughout the year should be included in the MC and LC budgets respectively. There should be supporting documents which explains the investments and the return on investment.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
All investments should have calculated ROI
All investments should be carried out after an analysis of the return of investment. Entities can follow the AIESEC ROI Calculation Tool.
How to implement and resources and how to fulfil GFB check
Find the template in this link: HERE
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AUDITING
Objective of the standard
Auditing standard provides the minimum requirements for an entity to conduct its internal and external audits to be transparent of their activities of the organisation.
Why is it relevant to AIESEC
AIESEC is a global association and a network organisation. We need to have a system which ensures that all entities are conducting their activities with integrity and to check if the entity adopts the required control measures to reduce any risks to the organisation.
AUDITING
Unqualified external audit report
Internal auditor is appointed for the MC
Financial internal audit of LCs is carried out at least every quarter
Financial internal audit of MCs is carried out at least every semester
Implement internal controls aligning controls to the AIESEC Financial Procedures Manual
Legal internal audit for MCs and LCs are carried out every at least every quarter
Explanations of each standard
Unqualified external audit report
The legal entity needs to complete the external audit for the immediate fiscal year ended. The audit should cover the scope of the legal registration (ex: if the bank accounts of LCs are under the MC, then the audit should cover all the finances). These audit reports should be stored physically and/or digitally.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Internal auditor is appointed for the MC
Appointment of an internal auditor for the MC who will be responsible for auditing the internal processes, finance and governance of entity on-behalf of the national plenary. The internal auditor can be an alumni of the entity.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Financial internal audit of LCs is carried out at least every quarter
The financial internal audit will only cover the scope of controls for financial management of the LC. This should be carried out by the MC which can be delegated to an independent body such as the EFB or an internal auditor.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Financial internal audit of MCs is carried out at least every semester
The financial internal audit will only cover the scope of controls for financial management of the MC. This should be carried out by an independent body such as an internal auditor.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Implement internal controls align controls to the AIESEC Financial Procedures Manual
The entity will adopt the internal controls based on the requirement of the entity using the manual of procedures. The internal audit will determine the effectiveness of the controls adopted busing test of controls.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Legal internal audit for MCs and LCs are carried out every at least every quarter
The legal internal audit will check if legal documents such as but not limited to contracts of the entity (MC and LC) are in place using an internal audit procedure. The audit can be conducted by an internal auditor.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
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RISK MANAGEMENT
Objective of the standard
Risk Management standard provides the minimum requirements for an entity to ensure that the entity is reducing its exposure to risks and taking proactive action to safeguard the entity from adverse effects and ensure sustainability.
Why is it relevant to AIESEC
The standard provides education for risk management and tools and frameworks supporting risk management. But fulfilling this standard the entity can ensure that they have taken the minimum actions required to reduce the exposure to risks and adverse outcomes.
RISK MANAGEMENT
Risk management process defined and implemented
Risk register should be there for MC and each LCs
Identified risks and their responses should be stored at least for 5 years
Debt risk management criteria legislated
Have debt repayment plans
Revenue stream distribution and diversification plan should be reviewed at least every semester
National finance education cycle is delivered
MCVP Finance position is not be a shared position
LCVP Finance position is not a shared position
Finance succession planning
100% completion of finance & legal transition
Sustainable conferences
Explanations of each standard
Risk management process defined and implemented
The method of risk management will be defined which includes but not limited to the process of identifying, analysing, evaluating and decision making regarding the risks. These risk identification goes in every function, product and overall of the entity. All risk management process should be documented. The risk management tool should be submitted as a part of the planning
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June. The fundamentals and a recommended framework for risk management is provided at aies.ec/riskmanagement and aies.ec/riskmanagement-tool
Risk register should be there for MC and each LCs
Both MC and LC should have a risk register which includes all the risks identified and their responses to the risks. The risk register is used to document all the identified risks and their evaluation and responses with respective dates. The risk register will be a continuous tool used by the entity to centralise all the risks identified and bring a holistic risk management approach to the entity.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June. The AIESEC risk register is at aies.ec/riskmanagement-tool
Explanations of each standard
Identified risks and their responses should be stored at least for 5 years
This standards connects with the previous one of the risk register. If the entity is adopting multiple risk registers, the previous risk registers should be stored for at least 5 years to refer back to understand the risks identified and the decisions made in the past. The risk register should be used during planning to understand the current risk situation of the organisation.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Have debt repayment plan
If the entity is in debt with AIESEC International and/or an external party the entity will create a debt repayment plan and integrate the plan into the planning process and the budget. The debt payment plan should be reflected in the profit planning and cash flow planning of the entity. If (MC) is in long term debt towards AIESEC International or to any external party the entity (MC) the debt repayment plan should also be presented to the national plenary for accountability. If an LC is in debt to MC, another LC or external party, the LC the should have a repayment plan with the respective stakeholders. The MC should track the LCs on the repayment plans.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Debt risk management criteria legislated
The process of how the entity deals with debt should be created as a criteria and be legislated in the compendium. This creates more accountability towards proactive measures if the entity comes into debt. The criteria should cover the cases of both MC and LC.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
National finance education cycle is delivered
The national finance education cycle for finance should be delivered throughout the year. The respective platforms required to deliver the plan should be utilised such as but not limited to Google Classroom, LMS systems.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
MCVP Finance position is not be a shared position
It is not recommended for the MCVP Finance position to be shared with other roles. In the case of MCP and MCVP Finance shared position the entity needs to evaluate the threat for governance and financial control in the organisation.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
LCVP Finance position is not a shared position
It is not recommended for the LCVP Finance position to be shared with other roles. In the case of LCP and LCVP Finance shared position the LC needs to evaluate the threat for governance and financial control in the LC based on the authority provided to each of the roles.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
Finance succession planning
There should be a succession planning program to ensure there is pipeline build for the positions of finance in any part of the AIESEC structure including but not limited to MCVP Finance, LCVP Finance, EST Finance, NST Finance, GST Finance, RST Finance, EFB positions and GFB positions. Succession planning could be a specific plan with elements such as but not limited to mentoring, sessions for personal development, consultancies, trainings related to finance.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Revenue stream distribution and diversification plan should be reviewed at least every semester
The revenue stream distribution is an essential part of the entity sustainability. Determining and planning revenue streams to be able to diversify revenue streams will be an essential part of planning. Reviewing the revenue distribution semesterly is recommended at planning and replanning.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
Explanations of each standard
100% completion of transition
There should be a finance & legal transition framework. The MCVP should be selected at least two months before the term starts and at least 100% of the transition tool should be completed before the term starts.
How to implement and resources and how to fulfil GFB check
More information will be downscaled in June.
FINANCE AND LEGAL STANDARDS
FINANCE AND LEGAL STANDARDS