Radwinter Parish Council
Financial Regulations

These Financial Regulations were adopted by the Council at its meeting held on

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1.GENERAL

1.1 These financial regulations govern the financial management of 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 Council’s functions, including arrangements for the management of risk and for the prevention and detection of fraud and corruption.

1.2 The Responsible Financial Officer (RFO) is a statutory officer and shall be appointed by the Council. [The Clerk has been appointed as RFO for this Council and these regulations will apply accordingly.] The RFO, acting under the policy direction of the Council, shall administer the Council's financial affairs in accordance with proper practices. The RFO shall determine on behalf of the Council its accounting records and control systems. The RFO shall ensure that the accounting systems are observed and that the accounting records of the council are maintained and kept up to date in accordance with proper practices.

1.3 The RFO shall produce financial management information as required by the council.

1.4 A Finance and Audit Committee shall be formed to generally administer the financial operations of the Council and the work of the RFO and ensure compliance with Council policy. It will include an external Financial Adviser to guide on such matters. At least once a year, prior to approving the annual return, the Council through the Finance and Audit Committee shall conduct a review of the effectiveness of its system of internal control which shall be in accordance with proper practices.

1.5 In these financial regulations, references to the Accounts and Audit Regulations shall mean the Regulations issued under the provisions of section 27 of the Audit Commission Act 1998 and then in force.

1.6 In these financial regulations the term ‘proper practice’ or ‘proper practices’ shall refer to guidance issued in ‘Governance and Accountability in Local Councils in England and Wales’ – a guide which is published jointly by NALC and SLCC and updated from time to time.

2.ANNUAL BUDGET

2.1 Each Committee/Sub-Committee (if any) shall formulate and submit proposals to the Council in respect of revenue and capital including the use of reserves and sources of funding for the following financial year not later than the end of November each year.

2.2 Detailed estimates of all receipts and payments including the use of reserves and all sources of funding for the year shall be prepared each year by the RFO in the form of a budget to be considered by the council after approval by the Finance Committee

2.3 The Council shall review the budget not later than the end of January each year and shall approve the Precept to be levied for the ensuing financial year. The RFO shall issue the precept to Uttlesford District Council and shall supply each member with a copy of the approved budget.

2.4 The annual budgets shall form the basis of financial control for the ensuing year.

3. BUDGETARY CONTROL

3.1 Expenditure on revenue items may be incurred up to the amounts included for that class of expenditure in the approved budget.

3.2 No expenditure may be incurred that will exceed the amount provided in the revenue budget for that class of expenditure without consent of the Council. During the budget year, unspent amounts may be moved to other budget headings or to an earmarked reserve as appropriate.

3.3 The RFO shall regularly provide the Council with a statement of receipts and payments to date under each head of the budgets, comparing actual expenditure to the appropriate date against that planned as shown in the budget. These statements are to be prepared at least at the end of each financial quarter.

3.4 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 £250. The Clerk shall report the action to the Council as soon as practicable thereafter.

3.5 Unspent provisions in the revenue budget shall not be carried forward to a subsequent year unless placed in an earmarked reserve by resolution of the council.

3.6 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.

3.7 All capital works shall be administered in accordance with the Council's standing orders and financial regulations relating to contracts. All projects shall have an agreed budget and those over £250 shall require the acceptance by the Finance Committee of the best of three quotations.

4.ACCOUNTING AND AUDIT

4.1 All accounting procedures and financial records of the Council shall be determined by the RFO in accordance with the Accounts and Audit Regulations. His work will be supervised by the Finance and Audit Committee which shall meet at least twice per annum.

4.2 The RFO shall complete the annual financial statements of the Council, including the council’s annual return, as soon as practicable after the end of the financial year and shall submit them and report thereon to the Council.

4.3 The RFO shall complete 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 shall submit the Annual Return for approval and authorisation by the Council within the timescales set by the Accounts and Audit Regulations.

4.4 An Internal Auditor shall be appointed and shall carry out the work required by the Council in accordance with proper practices. The Internal Auditor will be independent of the Council and shall attend the Finance and Audit Committee at least twice per annum to carry out an audit in conjunction with members of the committee. He will countersign the council’s annual return as required.

4.5 The remuneration of the Internal Auditor shall be agreed at the commencement of the appointment, and revised at the request of either party.

4.6 The RFO and Internal Auditor shall ensure that there is adequate and effective system of internal audit of the Council's accounting, financial and other operations in accordance with proper practices. Any document of the Council which appears to the RFO or Internal Auditor to be necessary for the purpose of the internal audit shall be supplied with such information and explanation as the RFO or Internal Auditor require.

4.7 The RFO shall make arrangements for the opportunity for inspection of the accounts, books, and vouchers and for the display or publication of any Notices and statements of account required by Audit Commission Act 1998 and the Accounts and Audit Regulations.

4.8 The RFO shall, as soon as practicable, bring to the attention of the Council 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, including the bank mandate, shall be made by the RFO and approved by the Council. They shall be regularly reviewed for efficiency.

5.2 A schedule of the payments required shall be prepared by the RFO and, together with the relevant invoices, be presented to Council at each Meeting. If the schedule is in order it shall be authorized by a resolution of the Council.

5.3 Cheques drawn on the bank account in accordance with the schedule referred to in paragraph 5.2 or in accordance with paragraph 6.4 shall be signed by two members of Council. The RFO will not be a signatory.

5.4 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.PAYMENT OF ACCOUNTS

6.1 All payments shall be effected by cheque or other order drawn on the Council's bankers.

6.2 All invoices for payment shall be examined, verified and certified by the RFO, who shall satisfy him/herself that the work, goods or services to which the invoice relates shall have been received, carried out, examined and approved. All invoices shall be made out to ‘Radwinter Parish Council’ in order to effect recovery of VAT.

6.3 The RFO shall examine invoices in relation to arithmetic accuracy and shall analyze them to the appropriate expenditure heading. The RFO shall take all steps to settle all invoices submitted, and which are in order, at the next available Council 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, or when it is considered mutually beneficial to settle such invoices, this may be done in the correct form provided that a list of such payments shall be submitted to the next meeting of Council.

6.5 The Council will not maintain any form of cash float. All cash received must be banked intact. Any payments made in cash by Councillors or the Clerk (for example when attending external meetings or postage) shall be refunded on a regular basis against receipts.

6.6 If thought appropriate by the Council, payment for utility supplies (energy, telephone and water) and regular organisation subscriptions 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 every year.

7.PAYMENT OF SALARIES & REMUNERATION

7.1 The Council shall make arrangements to meet fully the statutory requirements for 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 salaries shall be as agreed by Council.

7.2 The services of self-employed contractors may be used for specific purposes as required.

8.LOANS AND INVESTMENTS

8.1 The council shall consider the need for an Investment Policy which, if drawn up, shall be in accordance with relevant regulations, proper practices and guidance.

8.2 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, after obtaining any necessary borrowing approval as to terms and purpose. The terms and conditions of borrowings shall be reviewed at least annually.

8.3 All investment certificates and other documents relating thereto shall be retained in the custody of the RFO.

9.INCOME

9.1 The collection of all sums due to the Council shall be the responsibility of and under the supervision of the RFO.

9.2 Particulars of all charges to be made for work done, services rendered or goods supplied shall be agreed annually by the Council and notified to the RFO.

9.3 The Council will review all fees and charges annually, following a report of the RFO through the Finance Committee.

9.4 Any sums found to be irrecoverable and any bad debts shall be reported to the Council and shall be written off in the year.

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

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

9.7 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 directly after the financial year end.

9.8 When any significant sums of cash are 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 counted in the first instance, that there is a reconciliation to some form of control such as ticket issues, 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 An official order or letter shall be issued by the Clerk 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. The Clerk shall verify the lawful nature of any proposed purchase before the issue of any order.

10.2 All Councillors and Officers are responsible for obtaining value for money at all times, and that the best available terms are obtained in respect of each transaction. Three or more quotations or estimates should be obtained from appropriate suppliers.

11.CONTRACTS

11.1 Procedures as to contracts are laid down as follows:

(A) Where it is intended to enter into a contract exceeding £2,000 in value for the execution of works or specialist services the Clerk shall invite tenders from at least three firms to be taken from the appropriate approved list, provided that these regulations shall not apply to contracts which relate to items (i) to (v) below:

(i) for the supply of gas, electricity, water, sewerage and telephone 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 property or parts for equipment or plant;

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

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

(C) 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.

(D) 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.

(E) If less than three tenders are received for contracts above £2,000 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.

(F) 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 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 installments 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.

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

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. The Clerk shall ensure a record is maintained of all properties owned by the Council, recording the location, extent, plan, reference, purchase details, nature of the interest, tenancies granted, rents payable and purpose for which held in accordance with Accounts and Audit Regulations.

13.2 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 £250.

13.3 The Clerk 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 annually, possibly in conjunction with a health and safety inspection of assets.

14. INSURANCE

14.1 Following the annual risk assessment (per Financial Regulation 16), the RFO shall effect all insurances and negotiate terms for all claims on the Council's insurers

14.2 The RFO shall be notified of all new risks and assets which require to be insured and of any alterations affecting existing insurances.

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

14.4 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.

14.5 All claims shall be made by the RFO with expedition, taking care to obtain all relevant information, statements and assessments.

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 sole trustee of a Charitable body the RFO shall ensure that separate accounts are kept of the funds held on charitable trusts and separate financial reports made in such form as shall be appropriate, in accordance with Charity Law and legislation, or as determined by the Charity Commission. The RFO shall arrange for any Audit or Independent Examination as may be required by Charity Law or any Governing Document.

16. RISK MANAGEMENT

16.1 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 annually.

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

17. REVISION OF FINANCIAL REGULATIONS.

17.1.1 It shall be the duty of the Council to review the Financial Regulations of the Council from time to time. The RFO 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.

RAJ

28.09.09