1.1. These Financial regulations shall govern the conduct of the financial transactions of the Council and may only be amended or varied by resolution of the council. Financial regulations are one of the council’s governing policy documents providing procedural guidance for members and officers. Financial regulations must be observed in conjunction with the council’s standing orders.
1.2. 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 internal control which facilitates the effective exercise of the council’s functions, including arrangements for the management of risk.
1.3. The council’s accounting control systems must include measures:
- for the timely production of accounts;
- that provide for the safe and efficient safeguarding of public money;
- to prevent and detect inaccuracy and fraud; and
- identifying the duties of officers.
1.4. The Responsible Financial Officer (RFO) holds a statutory office to be appointed by the council. The Clerk has been appointed as RFO for this council and these regulations will apply accordingly.
1.5. The RFO;
1.5.1. acts under the policy direction of the council;
1.5.2. administers the council's financial affairs in accordance with all Acts, regulations and proper practices;
1.5.3. determines on behalf of the council its accounting records and accounting control systems;
1.5.4. ensures the accounting control systems are observed;
1.5.5. acts under the policy direction of the council;
1.5.6. administers the council's financial affairs in accordance with all Acts, Regulations and proper practices;
1.5.7. determines on behalf of the council its accounting records and accounting control systems;
1.5.8. ensures the accounting control systems are observed;
1.5.9. maintains the accounting records of the council up to date in accordance with proper practices;
1.5.10. assists the council to secure economy, efficiency and effectiveness in the use of its resources; and
1.5.11. produces financial management information as required by the council.
2. ACCOUNTING AND AUDIT (INTERNAL AND EXTERNAL)
2.1. All accounting procedures and financial records of the council shall be determined by the RFO in accordance with the Accounts and Audit Regulations, appropriate Guidance and proper practices.
2.2. On a regular basis, at least once in each quarter, and at each financial year end, a member other than the Chairman shall be appointed to verify bank reconciliations produced by the RFO. The member shall sign the reconciliations and the original bank statements or similar document as evidence of verification. This activity shall on conclusion be reported, including any exceptions, to and noted by the council.
2.3. The RFO shall complete the annual statement of accounts, annual report, and any related documents of the council contained in the Annual Return (as specified in proper practices) as soon as practicable after the end of the financial year and having certified the accounts shall submit them and report thereon to the council within the timescales set by the Accounts and Audit Regulations.
2.4. The council shall ensure that there is an adequate and effective system of internal audit of its accounting records, and of its system of internal control in accordance with proper practices. Any officer or member of the council shall make available such documents and records as appear to the council to be necessary for the purpose of the audit and shall, as directed by the council, supply the RFO, internal auditor, or external auditor with such information and explanation as the council considers necessary for that purpose.
2.5. The internal auditor shall be appointed by and shall carry out the work in relation to internal controls required by the council in accordance with proper practices.
3. ANNUAL ESTIMATES (BUDGET) AND FORWARD PLANNING
3.1. The RFO must each year, by no later than December, prepare detailed estimates of all receipts and payments including the use of reserves and all sources of funding for the following financial year in the form of a budget to be considered by the council.
3.2. The council shall fix the precept (council tax requirement), and relevant basic amount of council tax to be levied for the ensuing financial year not later than by the end of January each year. The RFO shall issue the precept to the billing authority and shall supply each member with a copy of the approved annual budget.
3.3. The approved annual budget shall form the basis of financial control for the ensuing year.
4. BUDGETARY CONTROL AND AUTHORITY TO SPEND
4.1. In cases of extreme risk to the delivery of council services, the clerk may authorise revenue expenditure on behalf of the council which in the clerk’s judgement it is necessary to carry out. Such expenditure includes repair, replacement or other work, whether or not there is any budgetary provision for the expenditure, subject to a limit of £500. The Clerk shall report such action to the chairman as soon as possible and to the council as soon as practicable thereafter.
4.2. All capital works shall be administered in accordance with the council's standing orders and financial regulations relating to contracts.
5. BANKING ARRANGEMENTS AND AUTHORISATION OF PAYMENTS
5.1. The council's banking arrangements, including the bank mandate, shall be made by the RFO and approved by the council; banking arrangements may not be delegated to a committee. They shall be regularly reviewed for safety and efficiency.
5.2. The RFO shall prepare a schedule of payments, forming part of the Agenda for the Meeting and present the schedule to council. The approved schedule shall be disclosed within the minutes of the meeting at which payment was authorised.
5.3. All invoices for payment shall be examined, verified and certified by the RFO to confirm that the work, goods or services to which each invoice relates has been received, carried out, examined and represents expenditure previously approved by the council.
5.4. The RFO shall examine invoices for arithmetical accuracy and analyse them to the appropriate expenditure heading.
5.5. The Clerk and RFO shall have no delegated authority to authorise any payment.
5.6. A record of regular payments shall be drawn up and be signed by two members on each and every occasion when payment is authorised.
6. INSTRUCTIONS FOR THE MAKING OF PAYMENTS
6.1. The council will make safe and efficient arrangements for the making of its payments.
6.2. All payments shall be effected by cheque or other instructions to the council's bankers, or otherwise, in accordance with a resolution of Council.
6.3. Cheques or orders for payment drawn on the bank account in accordance with the schedule as presented to council or committee shall be signed by two members of council in accordance with a resolution instructing that payment.
6.4. To indicate agreement of the details shown on the cheque or order for payment with the counterfoil and the invoice or similar documentation, the signatories shall each also initial the cheque counterfoil.
6.5. If thought appropriate by the council, payment for utility supplies (energy, telephone and water) and any National Non-Domestic Rates may be made by variable Direct Debit provided that the instructions are signed by two members and any payments are reported to council as made. The approval of the use of a variable Direct Debit shall be renewed by resolution of the council at least every two years.
6.6. If thought appropriate by the council payment for certain items may be made by internet banking transfer provided evidence is retained showing which members approved the payment.
6.7. Where a computer requires use of a personal identification number (PIN) or other passwords, for access to the council’s records on that computer, a note shall be made of the PIN and Passwords and shall be handed to and retained by the Chairman of Council in a sealed dated envelope. No councillor shall disclose any PIN or password, relevant to the 4 | Page working of the council or its bank accounts, to any person not authorised in writing by the council or a duly delegated committee.
6.8. Any Debit Card issued for use will be specifically restricted to the Clerk.
6.9. The council will not maintain any form of cash float. All cash received must be banked intact. Any payments made in cash by the Clerk shall be refunded on a regular basis, at least quarterly.
7. PAYMENT OF SALARIES
7.1. As an employer, the council shall make arrangements to meet fully the statutory requirements placed on all employers by PAYE and National Insurance legislation. The payment of all salaries shall be made in accordance with payroll records and the rules of PAYE and National Insurance currently operating, and salary rates shall be as agreed by council, or duly delegated committee.
7.2. Payment of salaries and payment of deductions from salary such as may be required to be made for tax, national insurance and pension contributions, or similar statutory or discretionary deductions must be made in accordance with the payroll records and on the appropriate dates stipulated in employment contracts, provided that each payment is reported to the next available council meeting, as set out in these regulations above.
7.3. No changes shall be made to any employee’s pay, emoluments, or terms and conditions of employment without the prior consent of the council.
7.4. Each and every payment to employees of net salary and to the appropriate creditor of the statutory and discretionary deductions shall be recorded in a separate confidential record. This confidential record is not open to inspection or review (under the Freedom of Information Act 2000 or otherwise) other than:
- by any councillor who can demonstrate a need to know;
- by the internal auditor;
- by the external auditor; or
- by any person authorised under Audit Commission Act 1998, or any superseding legislation.
7.5. The total of such payments in each calendar month shall be reported with all other payments as made as may be required under these Financial Regulations, to ensure that only payments due for the period have actually been paid.
8. LOANS AND INVESTMENTS
8.1. All borrowings shall be effected in the name of the council, after obtaining any necessary borrowing approval. Any application for borrowing approval shall be approved by Council as to terms and purpose. The application for Borrowing Approval, and subsequent arrangements for the Loan shall only be approved by full council.
9.1. The collection of all sums due to the council shall be the responsibility of the RFO.
9.2. The origin of each receipt shall be entered on the paying-in slip.
9.3. The RFO shall promptly complete any VAT Return that is required. Any repayment claim due in accordance with VAT Act 1994 section 33 shall be made at least annually coinciding with the financial year end.
10. ORDERS FOR WORK, GOODS AND SERVICES
10.1. All members and Officers are responsible for obtaining value for money at all times. An officer issuing an official order shall ensure as far as reasonable and practicable that the best
available terms are obtained in respect of each transaction.
10.2. A member may not issue an official order or make any contract on behalf of the council.
11.1. Procedures as to contracts are laid down as follows:
- Every contract shall comply with these financial regulations, and no exceptions shall be made otherwise than in an emergency provided that this regulation need not apply to contracts which relate to items below:
- for the supply of gas, electricity, water, sewerage and telephone services;
- for specialist services such as are provided by solicitors, accountants, surveyors and planning consultants;
- for work to be executed or goods or materials to be supplied which consist of repairs to or parts for existing machinery or equipment or plant;
- Where it is intended to enter into a contract exceeding [£30,000] in value for the supply of goods or materials or for the execution of works or specialist services other than such goods, materials, works or specialist services as are excepted as set out in paragraph (a) the Clerk shall invite tenders from at least three firms to be taken from the appropriate approved list.
- Such invitation to tender shall state the general nature of the intended contract and the Clerk shall obtain the necessary technical assistance to prepare a specification in appropriate cases. The invitation shall in addition state that tenders must be addressed to the Clerk in the ordinary course of post. Each tendering firm shall be supplied with a specifically marked envelope in which the tender is to be sealed and remain sealed until the prescribed date for opening tenders for that contract.
- All sealed tenders shall be opened at the same time on the prescribed date by the Clerk in the presence of at least one member of council.
- If less than three tenders are received for contracts above £30,000 or if all the tenders are identical the council may make such arrangements as it thinks fit for procuring the goods or materials or executing the works.
- When it is to enter into a contract of less than £30,000 in value for the supply of goods or materials or for the execution of works or specialist services other than such goods, materials, works or specialist services as are excepted as set out in paragraph (a) the Clerk or RFO shall 6 | Page obtain 3 quotations (priced descriptions of the proposed supply); where the value is below £5,000 and above £500 the Clerk or RFO shall strive to obtain 3 estimates.
- The council shall not be obliged to accept the lowest or any tender, quote or estimate.
- Should it occur that the council, or duly delegated committee, does not accept any tender, quote or estimate, the work is not allocated and the council requires further pricing, provided that the specification does not change, no person shall be permitted to submit a later tender, estimate or quote who was present when the original decision making process was being undertaken.
- The European Union Procurement Directive shall apply and the terms of the Public Contracts Regulations 2006 and the Utilities Contracts Regulations 2006 including thresholds shall be followed.
12. PAYMENTS UNDER CONTRACTS FOR BUILDING OR OTHER CONSTRUCTION WORKS
12.1. Payments on account of the contract sum shall be made within the time specified in the contract by the RFO upon authorised certificates of the architect or other consultants engaged to supervise the contract (subject to any percentage withholding as may be agreed in the particular 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 of 5% or more a report shall be submitted to the council.
13. ASSETS, PROPERTIES AND ESTATES
13.1. The RFO shall ensure a record is maintained of all properties held by the council, recording the location, extent, plan, reference and purpose for which held in accordance with Accounts and Audit Regulations.
13.2. 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, possibly in conjunction with a health and safety inspection of assets.
14.1. Following the annual risk assessment, the RFO shall effect all insurances and negotiate all claims on the council's insurers.
14.2. The RFO shall keep a record of all insurances effected by the council and the property and risks covered thereby and annually review it.
14.3. The RFO shall be notified of any loss liability or damage or of any event likely to lead to a claim and shall report these to council at the next available meeting.
14.4. All appropriate members and employees of the council shall be included in a suitable form of security or fidelity guarantee insurance which shall cover the maximum risk exposure as determined [annually] by the council, or duly delegated committee.
15. RISK MANAGEMENT
15.1. The council is responsible for putting in place arrangements for the management of risk. The Clerk shall prepare, for approval by the council, risk management policy statements in respect of all activities of the council. Risk policy statements and consequential risk management arrangements shall be reviewed by the council at least annually. 7 | Page
15.2. When considering any new activity, the Clerk shall prepare a draft risk assessment including risk management proposals for consideration and adoption by the council.
16. SUSPENSION AND REVISION OF FINANCIAL REGULATIONS
16.1. It shall be the duty of the council to review the Financial Regulations of the council from time to time. The Clerk shall make arrangements to monitor changes in legislation or proper practices and shall advise the council of any requirement for a consequential amendment to these financial regulations.
16.2. The council may, by resolution of the council duly notified prior to the relevant meeting of council, suspend any part of these Financial Regulations provided that reasons for the suspension are recorded and that an assessment of the risks arising has been drawn up and presented in advance to all members of council.
Reviewed updated & Adopted at the Parish Council Meeting held on November 11th 2020