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PC Financial regs

SWERFORD PARISH COUNCIL -

FINANCIAL REGULATIONS

NOVEMBER 2018

1. GENERAL

1.1 These Financial Regulations govern the conduct of financial management by the Council and may only be amended or varied by resolution of the Council. The council is responsible in law for ensuring that its financial management is adequate and effective and that the council has a sound system of financial control which facilitates the effective exercise of the councilís functions, including arrangements for the management of risk and for the prevention and detection of fraud and corruption. These financial regulations are designed to demonstrate how the council meets these responsibilities.

1.2 The Responsible Financial Officer (RFO) is a statutory office and shall be appointed by the council. He/she shall:

- (under the policy direction of the Council), administer the Council's financial affairs in accordance with proper practice (see 1.4 below);

- shall determine on behalf of the council its accounting records, and control systems;

- ensure that the control systems and records are observed and maintained up to date in accordance with proper practice;

- produce financial management information as required by the council.

1.3 At least annually, prior to approving the annual return, the council shall conduct a review of the effectiveness of its system of internal control.

1.4 In these financial regulations;

- Accounts and Audit Regulations refers to Regulations issued under section 27 of the Audit Commission Act 1998;

- the term Ďproper practiceí or Ďproper practicesí shall refer to guidance issued in Governance and Accountability in local Councils in England and Wales Ė a Practitionersí Guide, published jointly by NALC and SLCC and updated from time to time.

1.5 The financial year ends 31 March annually.

2. ANNUAL FORECAST (BUDGET)

2.1 Committees (currently only the Village Hall) shall submit budget proposals to the Council not later than the end of October each year.

2.2 The Council shall review and approve the annual forecast (being all income, expenditure and reserves), and fix the Precept to be levied for the ensuing financial year, as discussed with and then submitted by the RFO, by the end of December annually. The Precept shall be submitted to the necessary billing authority as required by them.

2.3 These forecasts shall be the basis of financial control for the ensuing year.

2.4 Each year, the Council shall consider the need for a longer-term forecast (e.g. say three years): if deemed necessary these shall be submitted with the annual Budget.

3 BUDGETARY CONTROL

3.1 Expenditure on individual items may be incurred up to the amounts forecast without further referral to the Council, unless otherwise instructed at the time the budget is approved:

- while no expenditure on any item may exceed forecast, unspent amounts, after referral and approval by the council, may be re-apportioned for other purposes or placed in reserves as considered acceptable and appropriate.

3.2 At each Council meeting, and at least quarterly, the RFO shall provide the Council with a detailed statement of receipts and payments to date, comparing actual income and expenditure to that forecast.

3.3 Under advice to the Chairman, the RFO may incur expenditure up to a limit of £500 in relation to repair or replacement that is considered urgent, whether or not there is any budgetary provision, provided that details are then reported to the Council for ratification at the next Council meeting.

3.4 Excess funds may be placed in reserves by resolution of the Council.

3.5 No expenditure shall be incurred in relation to any capital project and no contract entered into, or tender accepted involving capital expenditure, without prior Council approval. No such expenditure or commitment will be entered into unless the Council is satisfied that the necessary funds exist, or the requisite borrowing approval has been obtained.

3.6 All capital works shall be administered in accordance with the Council's Standing Orders and Financial Regulations relating to contracts.

4. ACCOUNTING AND AUDIT

4.1 Accounting procedures and financial records shall comply with Accounts and Audit Regulations (see 1.4 above)

4.2 The RFO shall complete and submit Financial Statements as well as any other required reports in line with the Councilís Financial Timetable (see Appendix 1 below) which shall be reviewed from time to time but at least annually.

4.3 The RFO shall ensure that there is an adequate and effective system of internal audit of the Council's accounting, financial and other operations in accordance with proper practices. Any officer or member of the Council shall, if the RFO or Internal Auditor requires, make available such documents of the Council which appear to the RFO or Internal Auditor to be necessary for the purpose of the internal audit and shall supply the RFO or Internal Auditor with such information and explanation as the RFO or Internal Auditor considers necessary for that purpose.

4.4 An Internal Auditor shall be appointed, approved by the Council, to carry out the work required by the council in accordance with proper practices. The Internal Auditor, who shall be competent and independent of the operations of the Council, shall report to Council in writing in respect of each financial year. In order to demonstrate objectivity and independence, the internal auditor shall be free from any conflicts of interest and have no involvement in the financial decision making, management or control of the council.

4.5 The RFO shall make whatever arrangements are required for the Internal Auditor and/or External Auditor to have access to the accounts, books, and records as required by them and for the display or publication of any Notices and Statements of Account required by Audit Commission Act 1998 and Accounts and Audit Regulations.

4.6 The RFO shall, as soon as practicable, bring to the attention of all councillors any correspondence or report from the Internal or External Auditor, unless of a purely administrative matter.

5. BANKING ARRANGEMENTS AND CHEQUES

5.1 The Council's banking arrangements, including the Mandate, shall be the responsibility of and managed by the RFO as approved from time to time by the Council, which shall review the same on a regular basis, and at least annually.

5.2 Cheques drawn on the Councilís bank account shall be signed by two authorised signatories, in accordance with the bank mandate. The Clerk shall not be a signatory.

5.3 To confirm cheque details, the relevant counterfoil and supporting documentation will be initialled by the two signatories.

6 PAYMENTS OF ACCOUNTS

6.1 All payments shall be made by cheque, BACS or other order through the Councilís bank accounts.

6.2 If approved by the Council, any payment for utility supplies (energy, telephone and water) may be made by Direct Debit. Such payments must be highlighted in RFO Presentations and the situation reviewed annually by the Council.

7 PAYMENTS OF SALARIES

7.1 There are currently no such payments. In the event that this arises advice is to be taken from West Oxfordshire District Council. (There are statutory requirements which must be met, for example as related to PAYE, National Insurance and Pension related legislation.) Any salary agreed must be approved by the Council.

8 LOANS AND INVESTMENTS

8.1 There are currently no loans or investments (other than by way of Deposit/Savings accounts with the bank which may occur from time to time on a short-term basis. For the purposes of these Regulations these shall not be considered Investments unless maturities exceed three months.)

8.2 Should these ever occur, suitable policies shall be drawn up in line with appropriate legislation and best practice.

9 INCOME

9.1 The collection of all sums due to the Council shall be under the supervision of the RFO. Any sums found to be irrecoverable shall be reported to the Council and written off in the year.

9.2 Charges for work done, services rendered or goods supplied shall be agreed by the Council. The Council as a whole, or as individually delegated, will be responsible for the collection of accounts.

9.3 All sums received shall be banked by the RFO or as directed by him/her.

9.4 Paying in records (book and slips) shall be clear and reconcilable, with a system satisfactory to the Internal Auditor.

9.5 The RFO shall complete any required VAT Returns and report the same to the Council at least annually coinciding with the financial year end.

9.6 Where any significant sum of cash is due to be received by the Council, the RFO shall take such steps as are agreed by the Council to ensure that more than one person is present when the cash is received and counted, that the details are noted and clear, and that appropriate care is taken in the security and safety of individuals banking such cash.

10 ORDERS FOR WORK, GOODS AND SERVICES

10.1 If the nature of work ordered is considered to warrant a formal written Contract, the rules in (11) below will apply.

10.2 Copies of Orders will be maintained in an Order book kept by the RFO.

10.3 All members and Officers are responsible for obtaining value for money at all times.

11 CONTRACTS

11.1 (a) Every contract shall comply with the Regulations, unless in an Emergency (in which case two members of the Council must so direct, one being the Chairman or Vice Chairman (if existing)), or unless it is agreed by the Council that exceptional circumstances exist.

Any such action must be ratified by the Council as soon as possible thereafter.

Contracts are not required for:

(i) the supply of gas, electricity, water, sewerage and telephone services;

(ii) specialist services by solicitors, accountants, surveyors and planning consultants;

(iii) work, goods or materials not exceeding £500, which are repairs, to or parts for, existing machinery, equipment or plant;

(iv) work, goods or materials not exceeding £500 being an extension of an existing contract;

(v) additional external Auditor costs up to a value of £250.

(b) Any contract entered into will be governed by Section 4.7 of the Councilís Standing Orders.

(c) The Council shall not be obliged to accept the lowest of any tender, quote or estimate

. 12. PAYMENTS UNDER CONTRACTS FOR BUILDING OR OTHER CONSTRUCTION WORKS

Unless otherwise agreed by the Council to further tighten proceedings on any given contract, the general position will be as follows:

12.1 Payments on account shall be made by the RFO, within the time specified in the contract, on receipt of whatever certificates are called for in the contract.

12.2 Where contracts provide for payment by instalments the RFO shall maintain a record of all such payments. In any case where it is estimated that the total cost of work carried out under a contract, excluding agreed variations, will exceed the contract sum, a report shall be submitted to the Council.

12.3 Any variation to a contract or addition to or omission from a contract must be approved by the Council in writing, the Council being informed where the final cost is likely to exceed the financial provision.

If the RFO is in any doubt as to any situation arising this should be referred to the council for agreement and direction.

13 ASSETS, PROPERTIES AND ESTATES

13.1 The Clerk shall make appropriate arrangements for the custody of all title deeds of properties owned by the Council (this is currently arranged by the Chairman). A record (the Register of Title Deeds) is maintained which briefly explains the nature of the deed and the property to which it relates.

13.2 No property shall be sold, leased or otherwise disposed of without the authority of the Council, who will be required to ensure that all legal niceties are completed in order. (This excludes any item of tangible movable property with a value of less than £100.)

13.3 The RFO shall ensure that an appropriate and accurate Register of Assets and Investments is kept up to date. The continued existence of tangible assets shown in the Register shall be verified at least annually for final accounts purposes.

14 INSURANCE

14.1 Following the annual risk assessment (see (17) below), under advice to the Council, and as directed by them, the Clerk, in liaison with the Chairman, shall finalise all Council insurances deemed necessary.

14.2 The Village Hall Management Committee shall be directed by the Council to provide the Chairman with a schedule of their own insurance covering all relevant necessary insurance for the Village Hall.

14.3 The Clerk shall keep a record of all insurances effected and the property and risks covered.

14.4 The Clerk/Chairman shall be notified of any matter that might lead to a claim and these shall be reported to, and discussed in, Council at the next available meeting.

14.5 All appropriate employees of the Council shall be included in a suitable fidelity guarantee insurance which shall cover the maximum risk exposure as determined by the Council.

15 CHARITIES

15.1 Where the Council is a trustee of a Charitable body, the RFO shall ensure that separate accounts are maintained (bank and book-keeping) and that separate financial reports are made in such form as are required by Charity Law and/or regulation/best practice. He/she will ensure that the necessary audit procedures take place., and that the position is reported to the Council at least on an annual basis.

16 RISK MANAGEMENT

16.1 The council is responsible for putting in place arrangements for the management of risk. The RFO shall prepare, for approval by the council, a Risk Management Assessment in respect of all activities of the council. This shall be reviewed by the council at least annually.

16.2 When considering any new activity, the RFO shall prepare a draft risk assessment including risk management proposals for consideration and adoption by the council.

17 REVISION OF FINANCIAL REGULATIONS

17.1 The Council shall review these Regulations from time to time but at least on an annual basis.

Appendix 1

FINANCIAL TIMETABLE

Various requirements exist through the year and are outlined in a separate Swerford Parish Council (and related items) Timetable.

The process of dealing with the Internal Auditor (from 2018-19 the requirement to deal with an external auditor was removed), and the handling and submission of the Annual Governance and Accountability Return (AGAR), and publication on the village website, is the responsibility of the RFO, reporting to the Council. The Timetable referred to above lists these requirements.

At each Council meeting, and at least quarterly, the following will be presented by the RFO: Income and Expenditure statements comparing actual to forecast; a summary of balances held together with any loans and investments.

Signed: Date: Parish Council Chairman

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