Written in a simple and direct style useful for training administrators of small groups or associations and those who manage development projects. Volume 2 of this guide covers all aspects of financing an association. The second volume looks at all aspects of financial management for small development NGOs and associations. Financing an association and its activities is considered first including non-financial resources, fundraising and local financing. It suggests credit and savings as a way to reduce dependency on donors. It continues with how to organise savings and credit systems and how to manage money with accounting systems, budgets and cash flows. Financial management of small projects, accounting systems and profit and loss accounts are considered in more detail. Case studies and sample forms are given at the back. As in the first volume, the index aims to guide readers to the section they want using keywords. A glossary explains all the financial terms used. The book would be useful to small organisations with little experience of financial management or as a training resource. It is also a good introduction to some alternatives to donor funding.

INTRODUCTION
Part I
FINANCING AN ASSOCIATION
AND ITS ACTIVITIES
A. The non-financial resources at hand 2
B. Internal financial resources 3
C. Possibilities of local financing 4
D. International fund-raising 5
E. How to create flexible funds or revolving funds 12
F. Planning for the end of aid 14
ANNEXES
1.1 List of persons/organisations who could support the
Association
1.2 Criteria for selection of projects
1.3 Summary of a request for financial aid for a local project
1.4 Summary of a project report to be forwarded when requesting
financial aid
1.5 (a) Specimen agreement between an Embassy and a local association
to obtain finance for a small rural development
project
1.5 (b) Funds governed by Missions (Embassies) - Approval document
of a project
1.6 Profile of a report requesting funds or a rural development
project
1.7 List of addresses of donors
1.8 Technical characteristics of flexible funds (SIX'S)
1.9 Peasants of the Sahel innovate a new international aidsystem
Part II
SAVINGS AND CREDIT SYSTEMS
A. A local level savings system 18
B. Access to credit 22
C. Collateral / Guarantee 28
ANNEXES
II. 1 Specimen Promissory Note
11.2 Specimen Personal Guarantee
11.3 Questionnaire to obtain a RAFAD Guarantee
Part III
SIMPLE ACCOUNTS, BUDGETS AND CASH-FLOWS
A. The accounting system 30
B. Accounting documents 31
C. Keeping the books of accounts 32
D. The budget 34
E. Cash-flows 43
F. Management of stocks 46
G. Management of vehicles 49
ANNEXES
111.1 Specimen CASH Vouchers
(a) Receipt for payment made by the Association
(b) Receipt acknowledging payment made to the Association
(c) Cash voucher
111.2 Specimen BANK Documents
(a) Opening of a Bank Account
(b) Cheques: crossed, nominative, bearer
(c) Debit Note
(d) Credit Note
(e) Transfer Order
111.3 OOODS Account Vouchers
(a) Order Form
(b) Delivery Form
(c) Invoice
111.4 Example - a km. cost calculation of a Toyota van.
Part IV
MANAGEMENT OF SMALL PROJECTS
A. Management of a cereal bank 54
B. Management of a rice mill 60
ANNEXES
IV. 1 Determining the estimated stock of a Cereal Bank
IV.2 Calculation of profit for a Rice Mill
Part V
ACCOUNTING SYSTEMS
A. Keeping accounts 66
B. Accounting procedures 67
C. The accounting system of a development association 68
D. Accounting methods 69
E. Classification of accounts 71
Part VI
PROFIT AND LOSS ACCOUNTS
A. Preliminary balance sheet 76
B. The distribution of income and expenditure 78
C. Depreciation 82
D. Cost calculations 85
E. Profit and loss account 88
F. Final balance sheet 90
ANNEXES
VI. 1 Example of a Profit and Loss Account of an irrigation
project for providing water to 10 hectares of riceland
VI.2 Practical exercice "Accounting of a local association"
Part VII
FINANCIAL CONTROLS AND JUSTIFICATION
OF EXPENSES RELATED TO GRANTS
A. Justification of funds received from donors 94
B. Financial control / auditing 96
ANNEXES
VII.1 Specimen of Accounting Documents submitted to donors
(a) Coveting letter
(b) Detailed Financial Statement
(c) Summary of the financial assistance received
VII.2 Cash Control Form
VII.3 Bank Reconciliation Form
VII.4 Expense Account
VII.5 Inventory of Goods
VII.6 Controls to be effected within an Association
INDEX and GLOSSARY

Fernand Vincent
Linden Vincent is Professor of Irrigation at t he Department of Irrigation and Soil and Water Conservation, Wageningen Agricultural University, The Netherlands, and was formerly a Research Fellow at t he Overseas Development Institute.