Two people on every payment: the simplest way to protect your society's money

Most problems with a housing society’s money don’t start with fraud. They start with one tired volunteer doing everything alone: collecting bills, writing cheques, recording them in the register, and checking their own work. Mistakes slip through, nobody notices for months, and by the AGM the questions are hard to answer.

There is a simple rule that banks and companies have used for decades, and it works just as well in a 40-flat building as in a 4-tower township: one person enters a payment, a different person approves it. Accountants call it maker and checker.

What maker and checker means

• The maker prepares the payment. In most societies this is the estate manager, the office staff or a committee member. They collect the vendor’s bill, check the amount and enter it.
• The checker looks at what the maker prepared and approves it, or sends it back with a question. This is usually the Treasurer.
• Nobody approves their own entry. If the Treasurer has to make an entry, someone else on the committee approves it.

Many societies already follow half of this rule without calling it that: their bye-laws ask for two or three office bearers to sign every cheque. Maker and checker takes the same idea one step earlier, so that the entry in the books is checked, not just the signature on the cheque.

Why it matters for a housing society

1. Honest mistakes get caught. A bill for ₹18,500 typed as ₹85,000, a vendor paid twice for the same month, GST added to a bill that already included it. A second pair of eyes catches most of these in seconds.

2. Volunteers are protected. Committee members give their time for free. When every payment has two names on it, no one person can be blamed for a decision, and no one has to defend themselves alone at the AGM.

3. Owners trust the accounts more. When an owner asks “who approved this?”, there is always an answer. Trust is what makes owners pay maintenance on time.

4. The audit is easier. Co-operative housing societies have to keep proper books and get them audited every year. An auditor who can see who entered and who approved each payment asks far fewer questions.

What the checker should look at

Approving is not just a signature. Before saying yes, the checker should be able to see five things:

1. The bill or invoice itself: a photo or scan, not just an amount.
2. Who the money goes to: the vendor’s name and bank account, matching the bill.
3. Why it is being paid: the work done, and the budget line it comes from.
4. The right deductions: TDS where it applies, and GST shown correctly.
5. Whether it needs one more approval: many committees decide that payments above a set amount also need the Chairman or Secretary.

If any of these are missing, the checker sends it back. That is the system working, not a delay.

How to set it up this month

You don’t need software to start. You need one committee decision and a little discipline.

1. Decide who makes and who checks. Write it in the minutes of your next committee meeting: who enters payments, who approves them, and who approves when the Treasurer is away.
2. Set a limit for large payments. Agree an amount above which a second office bearer must also approve. Record it in the minutes too.
3. Keep the proof with the entry. Every payment entry should have its bill attached. In a paper register, staple it. On a phone, keep the photo with the entry, not lost in a WhatsApp group.
4. Never pay from a personal account. All payments go from the society’s bank account, so every one of them shows up on the bank statement.
5. Check once a month. At each committee meeting, look at the month’s payments against the bank statement. Ten minutes is usually enough.

A good rule is boring. Nobody should need to think about whether a payment was checked; it simply always is.

Where Plainroof fits

Plainroof is built around this rule. The estate manager snaps the vendor’s bill and enters the payment; the Treasurer sees the bill, the budget line and the TDS together and approves it from their phone. Payments above your limit wait for a second approval, exactly as your committee decided. Nobody can approve their own entry, and nothing is ever deleted: a correction is a new entry with a reason.

Whether you use Plainroof or a paper register, the rule is the same. Two people on every payment. Start at your next committee meeting.

This article is general information for housing society committees, not legal or tax advice. For your society’s specific obligations, check your bye-laws and speak to your auditor or chartered accountant.