Hubbell Policies

JOURNAL ENTRY POLICY

English

Owner : Vice President, Controller

Last Review: 2014.08.10

FIN – 32

Department: Finance

POLICY

This policy requires that all journal entries posted in the business unit’s general ledger and associated subledgers are posted by an authorized user within the Finance and Accounting function and approved by the appropriate individuals per the platform’s signature matrix. No employee outside of the Finance and Accounting function is permitted to make manual journal entries to the general ledger. All journal entries must represent valid business transactions, include supporting documentation and must be recorded timely.

SCOPE

This policy applies to all Hubbell business units.

PURPOSE

The objective is to ensure compliance with Hubbell’s documentation standards as well as those prescribed by the Sarbanes-Oxley Act of 2002 and apply consistency across all Hubbell business units.

PROCEDURE All journal entries posted to the business unit’s ge neral ledger and associated sub ledgers including either system- generated or manual journal entries and must comply with the following. • Represent valid business transactions. • Posted by an individual or system with proper authorization. • Include adequate supporting documentation to justify the entry that could be understood by an independent accountant. A. System-Generated Journal Entries: System-generated journal entries are any entries that are posted without manual intervention or posted by a sub ledger and could include the following: • Entries driven by an inventory sub ledger (e.g. goods receipt, shipments, etc.) • Entries driven by an accounts receivable sub ledger (e.g. cash received, etc.) • Entries driven by an accounts payable sub ledger (e.g. payments to vendors, etc.) • Entries driven by a fixed asset sub ledger (e.g. fixed asset additions, fixed asset disposals, depreciation, etc.) • Entries drive by automated data loads with no manual user involvement. All system-generated journal entries must contain proper system-generated controls and should be monitored on a periodic basis to ensure the timely, accurate and complete processing of the system- generated journal entries. B. Manual Journal Entries: A manual journal entry is any entry in which an authorized user must initiate the posting of the journal entry. Manual journal entries are further defined as either standard or non- standard.

112