Supporting and informing our local communities

Financial regulations

These Financial Regulations were adopted by resolution of the Council at its Meeting on 10th May 2004.
Amended 13 March 2006.
Revised 27th June 2007 (version 2).
V4 revised as agreed in F&GP meeting 9F05 28 September 2009

Contents

1. GENERAL

1.1 These financial regulations govern the conduct of the financial transactions of the Council and may only be amended or varied by resolution of the Council

1.2 The Clerk as Proper Officer under the policy direction of the Council, shall be responsible for the proper administration of the Council’s financial affairs and will report on a regular basis to the Finance and General Purposes Committee (F&GP) who will monitor all financial matters.

1.3 The Clerk shall be responsible for the production of up to date monthly financial management information with clear, understandable and accurate reports to be made available to the F&GP for their monthly Committee meetings.

1.4 The Chairman of the F&GP will submit the financial reports and the Committee meeting minutes including any related resolutions for the Council’s consideration and approval.

2. ANNUAL ESTIMATES

2.1 Each Committee shall formulate and submit proposals to the F&GP in respect of revenue and capital costs for the following financial year not later than the end of November each year.

2.2 Detailed estimates of all receipts and payments for the year shall be prepared each year by the Clerk.

2.3The F&GP should also consider the estimated expenditure for the current year and the need to include additional provision in the budget for projects not completed in the year.

2.4 It is the responsibility of the F&GP to satisfy themselves that the Council is carrying adequate reserves by means of suitable credit balances to meet all future outgoings.

2.5The F&GP shall review the estimates not later than the end of December each year and shall set an annual budget not later than the end of January each year forming the basis of financial control for the ensuing year, to be approved by individual resolution at the next Council Meeting

2.6 The F&GP shall recommend the Precept to be levied for the ensuing financial year by the end of January to be fixed and approved by individual resolution at the next Council Meeting.

2.7 The Clerk shall supply each Member with a copy of the estimates for setting the precept and the budget at the appropriate Council Meeting.

 

3 BUDGETARY CONTROL

3.1 Expenditure on revenue items may be incurred up to the amounts included in the approved budget.

3.2 No expenditure may be incurred which will exceed the amount provided in the revenue budget, except with the approval of the Council.

3.3 The budget may be amended or exceeded during the year only upon receipt of a special resolution from the F&GP Committee and subsequent approval by Council.

3.4 The Clerk shall regularly provide the F&GP with a statement of receipts and payments produced monthly under each heading of the budgets, comparing actual expenditure against that planned.

3.5 The Clerk may incur expenditure on behalf of the Council, which is necessary to carry out any repair, replacement or other work, which is of such extreme urgency that it must be done at once, whether or not there is any budgetary provision for the expenditure, subject to a limit of £1,500 per item.  The Clerk shall report the action to the F&GP as soon as practicable thereafter.

3.6 Unspent provisions in the revenue budget shall not be carried forward to a subsequent year, unless allocated to a specific heading by resolution of the Parish Council.

3.7 No expenditure shall be incurred in relation to any capital project and no contract entered into or tender accepted involving capital expenditure unless the Council is satisfied that the necessary funds are available, or the requisite borrowing approval has been obtained.

3.8 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 All accounting procedures and financial records of the Council shall be determined by the Clerk as required by the Accounts and Audit Regulations 1996 as amended.

4.2 The Clerk shall be responsible for completing the annual financial statements of the Council as soon as practicable after the end of the financial year and shall submit them and report thereon to the Council.

4.3 The Clerk shall be responsible for completing the Accounts of the Council contained in the Annual Return (as supplied by the Auditor appointed from time to time by the Audit Commission) and for submitting the Annual Return for approval and authorisation by the Council within the timescales set in the Accounts and Audit Regulations 1996 as amended, or set by the Auditor.

4.4 The Clerk shall be responsible for ensuring that there is adequate and effective system of internal audit of the Council’s accounting, financial and other operations in accordance with Regulation 5 of the Accounts and Audit Regulations 1996 as amended.  Any officer or member of the Council shall, if the Clerk or Internal Auditor requires, make available such documents of the Council which appear to the Clerk or Internal Auditor to be necessary for the purpose of the internal audit and shall supply the Clerk or Internal Auditor with such information and explanation as the Clerk or Internal Auditor considers necessary for that purpose.

4.5 The Internal Auditor shall carry out the work required by the Clerk, or by the Council, with a view to satisfactory completion of the Internal Auditor’s Report section of the Annual Return as compiled annually by the Audit Commission.  The Internal Auditor, who shall be competent and independent of the operations of the Council, shall report to Council in writing on a regular basis with a minimum of one annual report in respect of each financial year.

4.6 The Clerk shall make arrangements (for the opportunity) for inspection of the accounts, books, and vouchers required by the Audit Commission Act 1998 section 15 and the Accounts and Audit Regulations 1996 as amended.

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

5 BANKING ARRANGEMENTS AND CHEQUES

5.1 The Council’s banking arrangements shall be made by the Clerk and approved by the F&GP.  They shall be regularly reviewed for efficiency

5.2 A schedule of the payments required, forming part of the agenda of the meeting shall be prepared by the Clerk and, together with the relevant invoices, be presented to the Finance and General Purposes Committee. If the schedule is in order it shall be authorised by resolution and the detail recorded in the minutes of the meeting. The Schedule of Payments will be included in a separate statement to the Committee.

5.3 A list of BACS payments for regular expenditure shall be prepared and authorised by the Clerk and two members of the Council alternatively cheques drawn on the bank account in accordance with the schedule referred to in para 5.2, or in accordance with para 6.4, shall be signed by two members of Council and the Clerk.

6 PAYMENT OF ACCOUNTS

6.1 All payments shall be effected by BACS using the most suitable online internet banking system available with the necessary security arrangements in place requiring authority for payments by the Clerk or Assistant Clerk and two members of the Council or alternatively by cheque drawn on the Council’s bankers signed by two members of Council and the Clerk or Assistant Clerk. The cheque signatories will also initial the Payment Transaction Statement for each payment.

6.2 All invoices for payment shall be examined, verified and certified by the Clerk.  The Clerk shall satisfy him/herself that the work, goods or services, to which the invoice relates, shall have been received, carried out, examined and approved.

6.3 The Clerk shall examine invoices in relation to arithmetic accuracy and shall allocate them to the appropriate expenditure heading.  The Clerk shall take all steps to settle all invoices submitted, and which are in order, at the next available F&GP Meeting.

6.4 If a payment is necessary to avoid a charge to interest under the Late Payment of Commercial Debts (Interest) Act 1998, and the due date for payment is before the next scheduled Meeting of the F&GP, where the Clerk certifies that there is no dispute or other reason to delay payment, the Clerk may (notwithstanding para 6.3) take all steps necessary to settle such invoices provided that a list of such payments shall be submitted to the next appropriate meeting of the F&GP.

6.5 The Council will maintain a cash float not in excess of fifty pounds to cover postage and minor stationery items.  All cash received must be banked intact and not used to maintain the cash float.

7 PAYMENT OF SALARIES

7.1 The Payment of all salaries to Officers shall be made in accordance with payroll records and the rules of PAYE and National Insurance currently operating, using salaries as agreed by Council.

7.2 Payment of salaries and payment of deductions from salaries such as may be made for tax, national insurance and pension contributions, may be made in accordance with the payroll records and on the appropriate dates, provided that each payment is reported to and ratified by the next F&GP Meeting.

8 LOANS AND INVESTMENTS

8.1 All loans and investments shall be negotiated in the name of the Council and shall be for a set period in accordance with Council policy.

8.2 The Council’s Investment Policy, shall be in accordance with the Trustee Act 2000, and shall be reviewed on a regular basis (at least annually).

8.3 All investments of money under the control of the Council shall be in the name of the Council.

8.4 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.

8.5 All investment certificates and other documents relating thereto shall be retained in the Parish Council’s Office.

9 INCOME

9.1 All sums received on behalf of the Council shall be banked intact as directed by the Clerk.  In all cases, all receipts shall be deposited with the Council’s bankers with such frequency, as the Clerk considers necessary.

9.2 The origin of each receipt shall be entered on the paying-in slip.

9.3 Personal cheques shall not be cashed out of money held on behalf of the Council.

9.4 The Clerk 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 An official order or letter shall be issued for all work, goods and services unless a formal contract is to be prepared or an official order would be inappropriate.  Copies of orders shall be retained.

10.2 Order books shall be controlled by the Clerk.

10.3 All members and Officers are responsible for obtaining value for money at all times.  An officer issuing an official order is to ensure as far as reasonable and practicable that the best available terms are obtained in respect of each transaction, usually by obtaining three or more quotations or estimates from appropriate suppliers, subject to any de minimis provisions in Regulation 11 (1) below.

10.4 The Clerk shall verify the lawful nature of any proposed purchase before the issue of any order, and in the case of new or infrequent purchases or payments, the Clerk shall ensure that the statutory authority shall be reported to the meeting at which the order is approved so that the Minutes can record the power being issued.

11 CONTRACTS

Procedures as to contracts are laid down as follows: –

11.1 Every contract shall comply with these financial regulations, and no exception shall be made otherwise than in an emergency provided that these regulations shall not apply to contracts which relate to (i) to (vi) below:

(i) for the supply of gas, electricity, water, sewerage, telephone, Internet Service Providers, litter and waste clearance disposal services;

(ii) for specialist services such as are provided by solicitors, accountants, surveyors and planning consultants;

(iii) for work to be executed or goods or materials to be supplied which consist of repairs to or parts for existing machinery, equipment , plant or office equipment;

(iv) for work to be executed or goods or materials to be supplied which constitute an extension of an existing contract by the Council;

(v) for additional audit work of the external Auditor up to an estimated value of £750 (in excess of this sum the Clerk shall act after consultation with the Chairman and Vice Chairman of Council);

(vi) for goods or materials proposed to be purchased which are proprietary articles and/or are only sold at a fixed price.

11.2 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 appropriate approved list. In such instances when a contract is budgeted then a procedure will be written for it by the F&GP, to be approved by Council and appended to the Financial Regulations

11.3 When applications are made to waive financial regulations relating to contacts to enable a price to be negotiated without competition the reason shall be embodied in a recommendation to the Council.

11.4 When it is to enter into a contract 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 shall obtain 3 quotations (priced descriptions of the proposed supply); where the value is below £1,000 and above £100 the Clerk shall strive to obtain 3 estimates.  Otherwise, Regulation 10 (3) above shall apply.

11.5 The Council shall not be obliged to accept the lowest or any tender, quote or estimate.

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 Clerk 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 Clerk 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 F&GP.

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

13 INSURANCE

13.1 Following an annual risk assessment, the Clerk shall effect all necessary insurances at a proper and up to date level and negotiate all claims on the Council’s insurers in consultation with the F&GP.

13.2 The Clerk shall give prompt notification to the F&GP of all new risks or properties that require to be insured and any alterations affecting existing insurances.

13.3 The Clerk shall keep a record of all insurances effected by the Council and the property and risks covered thereby and annually review it.

13.4 The Clerk shall be notified of any loss liability or damage or of any event likely to lead to a claim, and shall report these to the F&GP at the next available meeting.

14 PROPERTIES AND ESTATES

14.1 The Clerk shall make appropriate arrangements for the safe custody of all title deeds of land and properties owned by the Council or under the Council’s care.  The Clerk shall ensure a record is maintained of all properties owned by the Council or under the Council’s care, recording the location, extent, plan, reference, purchase details, nature of the interest, tenancies granted, rents payable and purpose for which held in accordance with Regulation 4 (3) (b) of the Accounts and Audit Regulations 1996 as amended.
14.2 No property shall be sold, leased or otherwise disposed of without the authority of the Council, together with any other consents required by law, save where the estimated value of any one item of tangible movable property does not exceed £50.

15 RISK MANAGEMENT

15.1 The Clerk shall report on risk management policy statements in respect of all activities of the Council.

15.2 When considering any new activity the Clerk shall report on Management policy for the activity and shall report on the legal and financial liabilities and Risk Management issues that arise to Council for consideration and, if thought appropriate, adoption.

16 REVISION OF FINANCIAL REGULATION

16.1 It shall be the duty of the F&GP to review the Financial Regulations of the Council at the first F&GP Committee meeting of each new financial year.

16.2 In the absence of the Clerk, the Assistant Clerk is authorised to and shall carry out the duties of the Clerk as stipulated in the preceding paragraphs.

 

10th May 2004
Amended April 2006
Revise 27 June 2007 (version 2)