FINANCIAL POLICIES AND PROCEDURES - EthicsPoint

FINANCIAL POLICIES AND PROCEDURESModule:Authorization PolicyIssue Date: 02/02/10Page:1Table of ContentsTABLE OF CONTENTS .1OVERVIEW .3PURPOSE .3PRIOR PRACTICES REPLACED .3APPLICABILITY .3QUESTIONS .3GENERAL .4PURPOSE .4AUTHORIZATION POLICY .4BASIS OF AUTHORITY.4DELEGATION .4MANUAL APPROVAL .4SEPARATING EXPENSES PROHIBITED .4BALANCE SHEET AND REVENUE GENERAL LEDGER ACCOUNTS .5CONFLICT OF INTEREST .5WIRE TRANSFERS .6RESPONSIBILITY AND ENFORCEMENT .7POLICY RESPONSIBILITY .7AUTHORIZATION RESPONSIBILITY .7COST CENTER OWNER RESPONSIBILITY .7ENFORCEMENT .7NON-COMPLIANCE .7AUTHORIZATION LEVELS AND MONETARY LIMITS .8PURPOSE .8AUTHORIZATION LEVELS AND MONETARY LIMITS .8LEVELS 6 - 9 .9LEVELS 4 AND 5.11LEVELS 1 - 3 .11TEMPORARY ASSIGNMENTS .12MONETARY LIMIT EXCEPTIONS .12AUTHORIZATION FORM .16AUTHORIZED SIGNATURE FORM .16PROCESS FOR INITIAL ASSIGNMENT OF AUTHORIZATION .16PROCESS FOR EMPLOYEES WITH EXISTING PROFILE.17OPERATING EXPENSES .18PURPOSE .18PURCHASING POLICY .18AUTHORIZATION LIMITS .20CAPITAL EXPENDITURES .20NON-PO EXPENDITURES .20authorization policy.doc

FINANCIAL POLICIES AND PROCEDURESModule:Authorization PolicyIssue Date: 02/02/10Page:2INVOICE APPROVAL .20CONTRACTS .21PURPOSE .21POLICY .21POLICY DETAILS .21ACCOUNTING .22PURPOSE .22GENERAL LEDGER JOURNAL ENTRY TYPES.22RECURRING ENTRIES.23NON- RECURRING ENTRIES .24OTHER EXPENSES .25PURPOSE .25EXPENSE REPORTS .25PROCUREMENT CARD PURCHASES .25COMPANY CONTRIBUTIONS.26DISPOSAL OF PLANT ASSETS .26LEGAL SETTLEMENTS .27authorization policy.doc

FINANCIAL POLICIES AND PROCEDURESModule:Authorization PolicyIssue Date: 02/02/10Page:3OverviewPurposeThe purpose of this document is to establish policies for all Frontiercompanies including Mohave Cellular for authorization of business-relatedoperating expenses and other commitments of company funds.These policies are intended to ensure all employees have a clear andconsistent understanding of guidelines for making financial agreements onbehalf of the company and the correct level of authorization for such.Prior practicesreplacedThis policy replaces any previous authorization policies and proceduresissued by any Frontier Communications, Frontier, Electric Lightwave orMohave Cellular.ApplicabilityThis policy is applicable to all employees of: Frontier Mohave Cellular.QuestionsAny questions or concerns regarding this authorization policy and proceduresshould be addressed to Rosanne Szymanski, Manager Accounts Payable 570631-6232.authorization policy.doc

FINANCIAL POLICIES AND PROCEDURESModule:Authorization PolicyIssue Date: 02/02/10Page:4GeneralPurposeThe purpose of this section is to define the general policy, basis andresponsibility for authorizing commitment of company funds by Frontieremployees.AuthorizationpolicyIt is the policy of Frontier that all expenditures of company funds will havethe appropriate level of authorization prior to commitment of resources.There will be no distinction between budgeted and non-budgeted expenses.The cost center owner is accountable for the final approved budget numberfrom Senior Management.NOTE: Cost center owners are authorization levels 4 (Directors-career bandE) and 5 (Vice Presidents-career band F).Basis ofauthorityMonetary authorization levels for Frontier employees are assigned based oncareer bands and job responsibilities.DelegationIt is Frontier’s policy that, when authority responsibilities must be delegated,delegation of authority must be made upward.ManualapprovalWhen approving a source document manually, the employee must indicateapproval by signing appropriate source document with at least, his or her firstinitial and last name. The approver must also print his or her name below thewritten signature.SeparatingexpensesprohibitedEmployees are prohibited from separating expenses in order to circumventthe authorization process. This will be considered non-compliance with thispolicy and the non-compliance clause will be invoked, which states that noncompliance may result in employee disciplinary action up to and includingtermination.Continued on next pageauthorization policy.doc

FINANCIAL POLICIES AND PROCEDURESModule:Authorization PolicyIssue Date: 02/02/10Page:5General, ContinuedBalance sheetand revenuegeneral ledgeraccountsBalance sheet and revenue general ledger accounts are not listed in RAP, butexpenditures to these accounts require the same approval levels as in place forexpenses as noted on pages 7-11.Conflict ofinterestAn “interest” arises when an employee, any person(s) residing in anemployee’s household or a member of an employee’s family is an owner,partner, director, officer, or employee of an enterprise doing business withFrontier. A Frontier employee should avoid having any business, financial,or other relationship with suppliers that might impair or even appear to impairthe independence of any decision made on behalf of Frontier.If a situation should arise in which a business relationship between Frontierand an enterprise may constitute a conflict of interest or may be questionable,the following steps must be taken: Business relationship must comply with Frontier’s code of Ethics andBusiness Conduct. Frontier employee having interest in a supplier will be responsible fornotifying the Chief Financial Officer and Vice President of the cost centerof their interest in supplier and proposed transition with Frontier. Chief Financial Officer will be responsible for evaluation of proposedbusiness relation to ensure arms length transaction and to determine thatbusiness relationship brings best value to Frontier. Approval must be obtained from Vice President of the cost center andChief Financial Officer before business transaction is allowed to proceed.Continued on next pageauthorization policy.doc

FINANCIAL POLICIES AND PROCEDURESModule:Authorization PolicyIssue Date: 02/02/10Page:General, ContinuedWire TransfersNo additional approval from Don Shassian (EVP & Chief Financial Officer)is required for recurring wire transfers regardless of dollar amount. All nonrecurring wire transfer requests, not listed, greater than 100,000 requireapproval from Don Shassian before transaction can be completed.The Authorization Policy and RAP should be followed for proper approvalotherwise.Recurring, as noted: authorization policy.docInsurances (Aetna, Anthem, CIGNA, Excellus, Marsh, MVP, PreferredCare, Prudential, Sentry/Lockton, United Concordia)Interest PaymentsPARS & SettlementsUnion Dues401kFlex SpendingLegal FeesPostageRelay SurchargesPrivate JetDoor to Door SalesKiosk Management FeesRegulatory (State of Nebraska)Targeted Accessibility FundSplit Dollar Life InsuranceCitibank (fleet and one card)6

FINANCIAL POLICIES AND PROCEDURESModule:Authorization PolicyIssue Date: 02/02/10Page:7Responsibility and EnforcementPolicyresponsibilityThis policy is issued and maintained by the Chief Financial Officer ofFrontier Communications, who is responsible for its interpretation andrevision.AuthorizationresponsibilityIt is the responsibility of the employee approving the expenditure to ensure heor she has appropriate level of authorization.Cost centerownerresponsibilityEach cost center owner is responsible for determining authorization privilegesgranted to employees under that cost center, if any, and approving theAuthorized Signature form for the appropriate level of authorization based onthe employee’s job responsibilities.If an employee’s profile already exists in the Authorized Signature Database(RAP) an email notification to corporate accounting by the cost center owneris acceptable. The email should indicate the cost center and appropriate levelof authorization to be assigned to the employee.NOTE: A copy of the Authorized Signature form can be found on theBudgets and Reporting web sitehttp://home.fcinternal.net/budgets and s.EnforcementPurchasing, Accounting, and Internal Audit departments are responsible forreviewing transactions for compliance with this policy.NoncomplianceNon-compliance may result in employee disciplinary action up to andincluding termination.authorization policy.doc

FINANCIAL POLICIES AND PROCEDURESModule:Authorization PolicyIssue Date: 02/02/10Page:8Authorization Levels and Monetary LimitsPurposeThe purpose of this section is to provide an explanation of authorizationlevels, authorization (monetary) limits, and process for approval ofauthorization privileges.Authorizationlevels andmonetary limitsThere are nine levels of authority set by this policy.Continued on next pageauthorization policy.doc

FINANCIAL POLICIES AND PROCEDURESModule:Authorization PolicyIssue Date: 02/02/10Page:9Authorization Levels and Monetary Limits, ContinuedLevels 6 - 9These levels of authorization for any expenditure is limited to:Career Band: G, HProcess Managed by: Corporate AccountingMonetary limit: Level 9 – over 5,000,000Maggie Wilderotter, Chairman, President and Chief Executive OfficerAuthority at this level is not cost center restricted and is valid for allaccounting strings.NOTE: Dual signature is required for amounts in excess of 250k by anotherauthorized signer to the Cost Center/Operating Area as noted in RAP. Level 8 – up to 5,000,000Donald Shassian, EVP & Chief Financial OfficerAuthority at this level is not cost center restricted and is valid for allaccounting strings.NOTE: Dual signature is required for amounts in excess of 250k by anotherAuthorized signer who has authority to the Cost Center/OperatingArea as reflected in RAP. In the event that Don Shassian is the onlyAuthorized signer to a Cost Center/Operating Area combination,Maggie Wilderotter must be the second signer.Continued on next pageauthorization policy.doc

FINANCIAL POLICIES AND PROCEDURESModule:Authorization PolicyIssue Date: 02/02/10Page:10Authorization Levels and Monetary Limits, ContinuedLevels 6 - 9 (continued) Level 7 – up to 1,000,000Daniel McCarthy, Executive Vice President and COONOTE: Dual signature is required for amounts in excess of 250k by anotherAuthorized signer who has authority to the Cost Center/Operating Area asnoted in RAP. In the event that there is only one Authorized signer to a CostCenter/Operating Area combination, Donald Shassian must be one of thesigners. Level 6 –up to 500,000Cecilia K. McKenney, EVP, HR & Call Center Sales & ServicePete Hayes, Executive Vice President – Sales, Marketing & BusinessDevelopmentHilary Glassman, Senior Vice President - General Counsel & SecretaryMelinda White, Executive Vice President, General Manager, New BusinessOperationsNOTE: Amounts in excess of 250,000 by another Authorized signer whohas authority to the Cost Center/Operating Area as reflected in RAP. ForCost Center/Operating Areas that have only one Authorized signer, thesecond signature must be Donald Shassian’s.Continued on next pageauthorization policy.doc

FINANCIAL POLICIES AND PROCEDURESModule:Authorization PolicyIssue Date: 02/02/10Page:11Authorization Levels and Monetary Limits, ContinuedLevels 4 and 5These levels of authorization are limited to cost center owners: Cost Center Director (Level 4), andCost Center Vice President (Level 5), andCost Center Sr. Vice President (Level 5). ). See exceptions noted underLevels 6-9.Career Band: E, F, GProcess Managed by: Corporate AccountingMonetary limit: Level 5, Lynda Willis, AVP Procurement – up to 250,000 Level 4 - up to 100,000Levels 1 - 3Cost center owners (Levels 4 and 5) can assign levels 1-3 to the Career BandD employee based on the individual’s job responsibilities.Career Band: DDelegation of authority must be made upward.Authorization or Assignment by: These levels are optional to cost centerowners.Process Managed by: Cost center owners and Corporate AccountingMonetary limit: Level 3 – up to 50,000 Level 2 – up to 10,000 Level 1 - up to 2,500Continued on next pageauthorization policy.doc

FINANCIAL POLICIES AND PROCEDURESModule:Authorization PolicyIssue Date: 02/02/10Page:12Authorization Levels and Monetary Limits, ContinuedTemporaryassignmentsDonald Shassian (Chief Fina

the following steps must be taken: Business relationship must comply with Frontier’s code of Ethics and Business Conduct. Frontier employee having interest in a supplier will be responsible for notifying the Chief Financial Officer and Vice President of the cost center of their interest in supplier and proposed transition with Frontier.