Leicestershire Parish Councils

KIBWORTH BEAUCHAMP PARISH COUNCIL

FINANCIAL REGULATIONS

These Financial Regulations were adopted by the Council at its Meeting held on 22nd September 2009.

1. GENERAL

1.1 These financial regulations govern the conduct of financial transactions of the Council and shall only be amended by resolution of the Council.
1.2 The Responsible Financial Officer (RFO), acting under the policy direction of the Council, shall be responsible for the proper administration of the Council’s financial affairs.
1.3 The RFO shall determine on behalf of the council its accounting records, and accounting control systems. The RFO shall ensure that the accounting control systems are observed and that the accounting records of the council are maintained and kept up to date in accordance with proper practices.
1.4 The RFO shall be responsible for the production of financial management information.
1.5 At least once a year, prior to approving the annual return, the council shall conduct a review of the effectiveness of its system of internal control which shall be in accordance with proper practices.
1.6 Where a statute, regulation or order confers a function or duty on the ‘Responsible Financial Officer’, that person shall be the Clerk to the Council.

2. ANNUAL ESTIMATES (BUDGET)

2.1 Each Committee 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 September each year.
2.2 A draft budget shall be prepared by the RFO and discussed by the Finance & General Committee, in the first instance, and a recommendation will be made to the Council for consideration not later than the end of November in each year.
2.3 During each year the Council shall set the precept to be levied for the ensuing financial year.
2.4 The annual budgets shall form the basis of financial control for the ensuing financial 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. During the budget year and with the approval of council having considered fully the implications for public services, unspent and available amounts may be moved to other budget headings or to an earmarked reserve as appropriate.
3.3 The RFO shall provide the Council with a statement of receipts and payments to date. 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 £200, reviewed annually. 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 unless the Council is satisfied that the necessary funds are available, or the requisite borrowing approval can be obtained.

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.
4.2 The RFO shall be responsible for completing the annual accounts of the Council as soon as practicable after the end of the financial year and shall submit them and report thereon to the Finance & General Committee for recommendation to the Council by the statutory date of 30th June.
4.3 The RFO shall supply each member as soon as practicable after 31st March each year, a statement of the receipts and payments of the Council and a Statement of Accounts. A Financial Statement for the financial year shall be presented to each member before the end of May.
4.4 The RFO shall be responsible for maintaining an 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 2003.
4.5 The Internal Auditor shall be appointed by the Finance & General Committee and shall 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, or in person, on a regular basis with a minimum of one annual written report 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.
4.6 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.
4.7 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 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 Finance & General Committee.
5.2 Cheques drawn on the bank account shall be signed by three members of the Council or two members of the Council and countersigned by the Clerk. To indicate agreement of the details shown on the cheque and invoice, the signatories shall each also initial the cheque counterfoil and invoice.

6 PAYMENT OF ACCOUNTS

6.1 All payments shall be effected by cheque or by direct debit drawn on the Council's bankers.
6.2 All invoices for payment shall be examined, verified and certified by the RFO as evidenced by the presentation to the Finance & General Committee or Council for payment. Before such certification the RFO shall be satisfied that the work, goods or services to which the invoice relates shall have been received, carried out, examined and approved as appropriate.
6.3 Invoices shall be presented to the Finance & General Committee or Council and if in order shall be authorised for payment by a Committee or Council resolution.
6.4 If the due date for payment is before the next scheduled Meeting of Council/Finance and General Committee, where the RFO certifies that there is no dispute or other reason to delay payment, the RFO may take all steps necessary to settle such invoices provided that a list of such payments shall be submitted to the next appropriate meeting of Finance & General Committee or 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 the Clerk or RFO (for example for postage or minor stationery items) shall be refunded on a regular basis, at least quarterly.
6.6 If thought appropriate by the council, payment for utility supplies (energy, telephone and water) 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.

7 PAYMENT OF SALARIES

7.1 It shall be the responsibility of the RFO to calculate payment of salaries and wages in accordance with the rates in force and arrange for such payment to be made on the appropriate dates stipulated in employment contracts and reported to and ratified by the next meeting of the Council or Finance & General Committee as appropriate.
7.2 All time sheets shall be examined by the RFO to ensure that they have been signed and duly certified that such time as been worked.

8 LOANS AND INVESTMENTS

8.1 All loans and investments shall be negotiated by the RFO in the name of the Council, after approval by the Council, and shall be for a set period in accordance with Council policy.
8.2 All investments of money under the control of the Council shall be in the name of the Council.
8.3 All borrowings shall be in the name of the Council.
8.4 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 The Finance and General Committee will review all fees and charges annually or tri-annually as appropriate, following a report from the Clerk and will make recommendation to the Council
9.3 Any sums found to be irrecoverable and any bad debts shall be reported to the Council.
9.4 All sums received on behalf of the Council shall be banked as soon as practicable.
9.5 The RFO shall promptly complete any VAT Return 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 PROCUREMENT OF WORKS, GOODS AND SERVICES

10.1 The following provisions shall apply:

a. Up to £1000 - obtain prices informally to demonstrate value for money

b. £1001 - £50000 – obtain at least three written quotations based on a detailed specification.

c. £50001 and above – the tender procedure rules set out below shall apply

10.2 In respect of a, b and c, an official order or letter shall be issued and a copy retained on file
10.3 Where it is intended to enter into a contract exceeding £50,000 in value for the supply of goods, works or services the Clerk shall invite tenders from at least three suppliers in accordance with the following procedure:

a. The invitation to tender shall state the general nature of the intended contract and the Clerk shall prepare (with whatever technical assistance he/she may require) a detailed specification on which the tenders are to be based.

b. Tenders shall be invited after giving at least 21 days public notice in at least one local newspaper and in such trade journals as the Clerk considers appropriate (where a tender falls under the scope of EC Procurement Rules, their timescales and advertising requirements shall apply).

c. Tenders are to be sent to the Clerk to the Council in a sealed, marked envelope by a specific date and time after which they will be opened by the Clerk in the presence of at least one Member of the Council.

d. Tenders are then to be assessed by the Finance & General Committee and reported to the Council for consideration.

e. Any invitation to tender shall contain a statement that the Council is not obliged to accept the lowest or any tender.

f. If less than three tenders are received for contracts above £50,000 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.

10.4 Every contract shall comply with these financial regulations except in an emergency or for the following:

a. For the supply of gas, electricity, water, sewerage and telephone services.

b. For specialist services such as are provided by solicitors, accountants, and surveyors.

c. 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.

d. For work to be executed or goods or materials to be supplied which constitute an extension of an existing contract by the Council.

e. For additional audit work of the external Auditor up to an estimated value of £250 (in excess of this sum the RFO shall act after consultation with the Chairman and Vice Chairman ]of Council).

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

11. PAYMENTS UNDER CONTRACTS FOR BUILDING OR OTHER CONSTRUCTION WORKS

11.1 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).
11.2 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 Council being informed where the final cost is likely to exceed the financial provision.

12 ASSETS, PROPERTIES AND ESTATES

12.1 The Clerk shall make appropriate arrangements for the custody of all title deeds of properties owned by the Council. The RFO 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.
12.2 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.
12.3 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, possibly in conjunction with a health and safety inspection of assets.

13 INSURANCE

13.1 The RFO shall be responsible for effecting all insurance and negotiating all claims against the Council’s insurers.
13.2 The RFO shall give prompt notification to the Council of all new risks and of any amendments affecting existing cover.
13.3 All appropriate employees of the Council shall be included in a suitable fidelity guarantee cover.

14 RISK MANAGEMENT

14.1 The council is responsible for putting in place arrangements for the management of risk. The Clerk shall prepare the risk management policy statements in respect of all activities for consideration by the Finance & General Committee for their recommendation to Council for approval. Risk policy statements and consequential risk management arrangements shall be reviewed by the council at least annually.
14.2 When considering any new activity, the Clerk shall prepare a draft risk assessment including risk management proposals to the Finance & General Committee for their recommendation to the council for adoption.

15 REVISION OF FINANCIAL REGULATIONS

15.1 It shall be the duty of the Finance & General Committee to review these financial regulations annually.