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Date Change Made
New Version No.
Changes Made By (initial)
Approved at MTC 21 05 15 Agenda Item 11.1
Considered at Full Council 20/03/17
Considered at Full Council 27/11/17
Considered at Full Council 08/10/18
Adopted at Full Council 16/03/20
Adopted at Full Council 29/03/21
Adopted at Full Council 29/03/22
Adopted at Full Council 03/10/22
Updated to include Pre-paid Debit and Credit Card policy
Updated to reflect changes to Pre-paid Debit and Credit Card Policy
|Document Version Control|
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. Financial regulations are one of the council’s three principal governing policy documents providing procedural guidance for members and officers. Financial regulations must be observed in conjunction with the council’s standing orders and standing orders relating to contracts.
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. These financial regulations demonstrate how the council meets these responsibilities and requirements.
1.5. At least once a year, prior to approving the Annual Governance Statement, the council must review the effectiveness of its system of internal control which shall be in accordance with proper practices.
1.6. Deliberate or wilful breach of these Regulations by an employee may give rise to disciplinary proceedings.
1.7. Members of council are expected to follow the instructions within these Regulations and not to entice employees to breach them. Failure to follow instructions within these Regulations brings the office of councillor into disrepute.
1.8. The Responsible Financial Officer (RFO) holds a statutory office to be appointed by the council. The Clerkhas been appointed as RFO for this council and these regulations will apply accordingly.
1.9. The RFO;
- acts under the policy direction of the council;
- administers the council’s financial affairs in accordance with all Acts, Regulations and proper practices;
- determines on behalf of the council its accounting records and accounting control systems;
- ensures the accounting control systems are observed;
- maintains the accounting records of the council up to date in accordance with proper practices;
- assists the council to secure economy, efficiency and effectiveness in the use of its resources; and
- produces financial management information as required by the council.
1.10. The accounting records determined by the RFO shall be sufficient to show and explain the council’s transactions and to enable the RFO to ensure that any income and expenditure account and statement of balances, or management information prepared for the council from time to time, comply with the Accounts and Audit Regulations.
1.11. The accounting records determined by the RFO shall in particular contain:
- entries from day to day of all sums of money received and expended by the council and the matters to which the income and expenditure accounts relate;
- a record of the assets and liabilities of the council; and
- wherever relevant, a record of the council’s income and expenditure in relation to claims made, or to be made, for any contribution, grant or subsidy.
1.12. The accounting control systems determined by the RFO shall include:
- procedures to ensure that the financial transactions of the council are recorded as soon as reasonably practicable and as accurately and reasonably as possible;
- procedures to enable the prevention and detection of inaccuracies and fraud and the ability to reconstruct any lost records;
- identification of the duties of officers dealing with financial transactions and division of responsibilities of those officers in relation to significant transactions;
- procedures to ensure that uncollectable amounts, including any bad debts are not submitted to the council for approval to be written off except with the approval of the RFO and that the approvals are shown in the accounting records; and
- measures to ensure that risk is properly managed.
1.13. The council is not empowered by these Regulations or otherwise to delegate certain specified decisions. In particular any decision regarding:
- setting the final budget or the precept (council tax requirement);
- approving accounting statements;
- approving an annual governance statement;
- writing off bad debts;
- declaring eligibility for the General Power of Competence; and
- addressing recommendations in any report from the internal or external auditors,shall be a matter for the full council only.
1.14. In addition, the council must:
- determine and keep under regular review the bank mandate for all council bank accounts;
- All Committees can approve any grant up to £10,000 any grants over £10,000 must be approved by Full Council.
- in respect of the annual salary for any employee have regard to recommendations about annual salaries of employees made by the relevant committee in accordance with its terms of reference. For the purpose of clarity, Personnel Committee make recommendations on re-grading and new positions and may determine annual increments within existing grades, in accordance to Personnel Policies.
1.15. In these financial regulations, references to the Accounts and Audit Regulations or ‘the regulations’ shall mean the regulations issued under the provisions of section 27 of the Audit Commission Act 1998, or any superseding legislation, and then in force unless otherwise specified. In these financial regulations the term ‘proper practice’ or ‘proper practices’ shall refer to guidance issued in Governance and Accountabilityfor Local Councils – a Practitioners’ Guide (England) issued by the Joint Practitioners Advisory Group (JPAG), available from the websites of NALC and the Society for Local Council Clerks (SLCC).
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 Chair shall be appointed to verify bank reconciliations (for all accounts) 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 Finance Committee.
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.
2.6.The internal auditor shall:
- be competent and independent of the financial operations of the council;
- report to council in writing, or in person, on a regular basis with a minimum of one annual written report and one interim report during each financial year;
- demonstrate competence, objectivity and independence, be free from any actual or perceived conflicts of interest, including those arising from family relationships; and
- have no involvement in the financial decision making, management or control of the council
2.7. Internal or external auditors may not under any circumstances:
- perform any operational duties for the council;
- initiate or approve accounting transactions; or
- direct the activities of any council employee, except to the extent that such employees have been appropriately assigned to assist the internal auditor.
2.8. For the avoidance of doubt, in relation to internal audit the terms ‘independent’ and ‘independence’ shall have the same meaning as is described in proper practices.
2.9. The RFO shall make arrangements for the exercise of electors’ rights in relation to the accounts including the opportunity to inspect the accounts, books, and vouchers and display or publish any notices and statements of account required by Audit Commission Act 1998, or any superseding legislation, and the Accounts and Audit Regulations.
2.10. The RFO shall, without undue delay, bring to the attention of all councillors any correspondence or report from internal or external auditors, unless the correspondence is of a purely administrative matter.
3. Annual estimates (budget) and forward planning
3.1. The RFO must each year, by no later than November, prepare detailed estimates of all income and expenditure 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 each relevant committee. The Finance Committee shall, no later than December, consider a draft budget for the Council (taking in to account recommendations from relevant committees) and make recommendations to Council no later than January.
3.2. The council shall consider annual budget proposals in relation to the council’s three-year forecast of revenue and capital receipts and payments including recommendations for the use of reserves and sources of funding and update the forecast accordingly.
3.3.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.
3.4. The approved annual budget shall form the basis of financial control for the ensuing year.
3.5. The Finance Committee shall consider a rolling Medium-Term Financial Plan prepared by the RFO and recommend it to Council by March each year. The Council shall adopt such a plan no later than April.
4. Budgetary control and authority to spend
4.1. Expenditure on revenue items may be authorised up to the amounts included for that class of expenditure in the approved budget. This authority is to be determined by:
- the council for all items over £10,000.
- a duly delegated committee of the council for items over £3000 up to £10,000
- the Town Clerk for any items up to £3000.
- Staff with authorised access to Council pre-paid debit cards can spend up to £500 per item.
4.2. Such authority is to be evidenced by a minute or by an authorisation slip duly signed by the Clerk, and where necessary also by the appropriate Chair. Contracts may not be disaggregated to avoid controls imposed by these regulations.
4.3. No expenditure may be authorised that will exceed the amount provided in the revenue budget for that class of expenditure other than by resolution of the council, or duly delegated committee. 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 (‘virement’).
4.4. Unspent provisions in the revenue or capital budgets for completed projects shall not be carried forward to a subsequent year.
4.5. The salary budgets are to be reviewed at least annually for the following financial year and such review shall be evidenced by a hard copy schedule signed by the Clerk and the Chair of Council or relevant committee. The RFO will inform committees of any changes impacting on their budget requirement for the coming year in good time.
4.6. In cases of extreme risk to the delivery of council services, or other cases of utmost urgency, the Town Clerk in consultation with the Mayor and Chair of Finance may authorise revenue expenditure on behalf of the council which in the clerk’s judgement is necessary to continue their delivery. Such expenditure includes repair, replacement or other work, whether or not there is any budgetary provision for the expenditure, subject to a limit of £10,000. The Town Clerk shall report such action to the next meeting of Finance or to the Council as soon as practicable thereafter.
4.7. No expenditure shall be authorised 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 and the requisite borrowing approval has been obtained.
4.8. All capital works shall be administered in accordance with the council’s standing orders, financial regulations and standing orders for contracts.
4.9. The RFO shall regularly provide the Finance Committee with a statement of income and expenditure 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 every second month and shall show explanations of material variances. For this purpose, “material” shall be in excess of £100 or 15% of the budget.
4.10. Changes in earmarked reserves shall be approved by council as part of the budgetary control process.
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. The Council may seek credit references in respect of members or employees who act as signatories.
5.2 The RFO shall prepare a schedule of payments requiring authorisation by two of the Council’s Authorised Signatories. The two Authorised Signatories shall review the schedule for compliance and, having satisfied themselves shall authorise payment by signing the schedule. This shall be deemed as authorisation by any two of the RFO, Proper Officer or other authorised Manager to activate electronic payments using the Council’s Electronic Banking System. At every meeting of the Finance Committee, the RFO shall present a full list of payments which have been authorised by members for information.
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. The RFO shall take all steps to pay all invoices submitted, unless there is a valid reason to with-hold payment or part payment until the issue is resolved.
5.5. The Town Clerk and RFO shall have delegated authority to authorise the payment of items only in the following circumstances (with the exception of 4.5 above):
- 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 Council or Finance and Governance Committee, where the Clerk and RFO certify that there is no dispute or other reason to delay payment, provided that a list of such payments shall be submitted to the next appropriate meeting of Council or Finance and Governance committee;
- An expenditure item authorised under 5.7 below (continuing contracts and obligations) provided that a list of such payments shall be submitted to the next appropriate meeting of Council or Finance and Governance committee.
5.6. Transfers between any accounts (except on any account on which the officers are signatories) and the current account may be affected by the RFO and Proper Officer. A transfer into any account on which officers are signatories shall be treated like a cheque on the current account and shall require the authorisation of two Members who are authorised signatories.
5.7. For each financial year the Clerk and RFO shall draw up a list of due payments which arise on a regular basis as the result of a continuing contract, statutory duty, or obligation (such as but not exclusively) Salaries, PAYE and NI, Superannuation Fund and regular maintenance contracts and the like for which Council, or Finance committee, may authorise payment for the year, provided that the requirements of regulation 4.1 (Budgetary Controls) are adhered to, provided also that a list of such payments shall be submitted to the next appropriate meeting of Council or Finance Committee.
5.8. A record of regular payments made under 5.7 above shall be drawn up and be signed by two members on each and every occasion when payment is authorised – thus controlling the risk of duplicated payments being authorised and / or made.
5.9. In respect of payments made by staff who are authorised to have a pre payment debit card,a receipt must be obtained and provided, together with an expense sheet, to the Town Clerk.
5.10. In respect of grants a duly authorised committee shall approve expenditure within any limits set by council and in accordance with any policy statement approved by council. Any Revenue or Capital Grant in excess of £10,000 shall before payment, be subject to ratification by resolution of the council.
5.11. Members are subject to the Code of Conduct that has been adopted by the council and shall comply with the Code and Standing Orders when a decision to authorise or instruct payment is made in respect of a matter in which they have a disclosable pecuniary or other interest, unless a dispensation has been granted.
5.12. The council will aim to rotate the duties of members in these Regulations so that onerous duties are shared out as evenly as possible over time.
5.13. Any changes in the recorded details of suppliers, such as bank account records, shall be approved in writing by the Town Clerk or RFO. The Council shall retain a file with details of all suppliers whose invoices are paid electronically. Members of Audit Committee shall take a random sample of invoices to ensure that the details match those held in the Council’s accounting software.
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. Following authorisation under Financial Regulation 5 above, the Council, a duly delegated committee or, if so delegated, the Clerk or RFO shall give instruction that a payment shall be made.
6.3. All payments shall be affected by cheque, online banking or by using a pre-paid debit card (See pre-paid Debit and Credit Card Policy) in accordance with a resolution of council or duly delegated committee.
6.4. A member who is a bank signatory, having a connection by virtueof family or business relationships with the beneficiary of a payment, should not, under normal circumstances, be a signatory to the payment in question. Unless otherwise decided by Council resolution, signatories will be Finance Committee Chair, Vice Chair, the Mayor and Deputy Mayor and Town Clerk.
6.5. In the event that payment is required by cheque those shall be signed by two signatories. 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.
6.6. In the event of payment being made by staff members using the pre-paid debit card then the Pre-Paid Debit and Credit Card policy must be followed, otherwise disciplinary action will be taken. The card can only be used by the authorised signatory.
6.7. 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 Finance Committee at least every two years.
6.8. If thought appropriate by the council, payment for certain items (principally salaries) may be made by banker’s standing order provided that the instructions are signed, or otherwise evidenced by two members are retained and any payments are reported to council as made. The approval of the use of a banker’s standing order shall be renewed by resolution of the Finance Committee at least every two years.
6.9. If thought appropriate by the council, payment for certain items may be made by BACS or CHAPS methods provided that the instructions for each payment are signed, or otherwise evidenced, by two authorised bank signatories, are retained and any payments are reported to council as made. The approval of the use of BACS or CHAPS shall be renewed by resolution of the Finance Committee at least every two years.
6.10. If thought appropriate by the council payment for certain items may be made by internet banking transfer provided evidence is retained showing which 2 members approved the payment.
6.11. The staff pre-paid debit card pin number must be kept securely by the staff and not written down or shared with anyone else.
6.12. Where a computer requires use of a personal identification number (PIN) or other password(s), 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 Mayor in a sealed dated envelope. This envelope may not be opened other than in the presence of two other councillors. After the envelope has been opened, in any circumstances, the PIN and / or passwords shall be changed as soon as practicable. The fact that the sealed envelope has been opened, in whatever circumstances, shall be reported to all members immediately and formally to the next available meeting of the council. This will not be required for a member’s personal computer used only for remote authorisation of bank payments.
6.13. No employee or councillor shall disclose any PIN or password, relevant to the working of the council or its bank accounts, to any person not authorised in writing by the Council or Finance Committee.
6.14. Regular back-up copies of the records on any computer shall be made and shall be stored securely away from the computer in question, and preferably off site.
6.15. The council, and any members using computers for the council’s financial business, shall ensure that anti-virus, anti-spyware and firewall software with automatic updates, together with a high level of security, is used.
6.16. Where internet banking arrangements are made with any bank, the Town Clerk or RFO shall be appointed as the Service Administrator. The bank mandate approved by the council shall identify a number of councillors who will be authorised to approve transactions on those accounts. The bank mandate will state clearly the amounts of payments that can be instructed by the use of the Service Administrator alone, or by the Service Administrator with a stated number of approvals.
6.17. Access to any internet banking accounts will be directly to the access page (which may be saved under “favourites”), and not through a search engine or e-mail link. Remembered or saved passwords facilities must not be used on any computer used for council banking work. Breach of this Regulation will be treated as a very serious matter under these regulations.
6.18. Changes to account details for suppliers, which are used for internet banking may only be changed on written hard copy notification by the supplier and supported by hard copy authority for change signed by the Town Clerk or the RFO and an authorised member. A programme of regular checks of standing data with suppliers will be followed.
6.19. Any Debit Card issued for use will be specifically restricted to the Clerk and the RFO and will also be restricted to a single transaction maximum value of £1000 unless authorised by Council or Finance and Governance committee in writing before any order is placed.
6.20. A pre-paid debit card that is issued to employees will have a set limit. These limits will be set by the Council or Finance Committee and are currently: a maximum value of a single payment shall not exceed £500, and the balance held on the card shall not exceed £2000. Transactions and purchases made will be reported to the Finance Committee and authority for topping-up shall be by authorisation of 2 Councillors who will be provided with the transactions and purchases made.
6.21. Any corporate credit card or trade card account opened by the council will be specifically restricted to use by the Clerk and RFO and shall be subject to automatic payment in full at each month-end.
6.22. 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.
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 Personnel Committee according to approved delegation.
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 or Personnel Committee according to approved delegation.
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 (confidential cash book). 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.
7.6. An effective system of personal performance management should be maintained for all staff.
7.7. Any termination payments shall be supported by a clear business case and reported to the council.
7.8. Termination payments shall only be authorised by council.
7.9. Before employing interim staff, the Council or Personnel Committee must consider a full business case.
8. Loans and investments
8.1. All borrowings shall be affected 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.
8.2. Any financial arrangement which does not require formal borrowing approval from the Secretary of State (such as Hire Purchase or Leasing of tangible assets) shall be subject to approval by the full council. In each case a report in writing shall be provided to council in respect of value for money for the proposed transaction.
8.3. The council will arrange with the council’s banks and investment providers for the sending of a copy of each statement of account to the Town Clerk or RFO.
8.4. 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.
8.5. The council shall maintain an Investment Policy which shall be in accordance with relevant regulations, proper practices and guidance. The Policy shall be reviewed by the council at least annually.
8.6. All investments of money under the control of the council shall be in the name of the council.
8.7. All investment certificates and other documents relating thereto shall be retained in the custody of the RFO.
8.8. Payments in respect of short term or long-term investments, including transfers between bank accounts held in the same bank, or branch, shall be made in accordance with Regulation 5 (Authorisation of payments) and Regulation 6 (Instructions for payments).
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, notified to the RFO who shall be responsible for the collection of all accounts due to the council.
9.3. The council will review all fees and charges at least annually, following a report of the Town Clerk.
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 as directed 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. Personal cheques shall not be cashed out of money held on behalf of the council.
9.8. 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.
9.9. Where any significant sums of cash are regularly 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.
9.10. Any income arising which is the property of a charitable trust shall be paid into a charitable bank account. Instructions for the payment of funds due from the charitable trust to the council (to meet expenditure already incurred by the authority) will be given by the Managing Trustees of the charity meeting separately from any council meeting (see also Regulation 16 below).
9.11. The Council will not maintain any form of cash float.
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 RFO.
10.3. 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, 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. A member may not issue an official order or make any contract on behalf of the council.
10.5. The RFO 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 RFO 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 used.
11.1. Procedures as to contracts are laid down as follows:
a. 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 (i) to (vii) below:
i. for the supply of gas, electricity, water, sewerage and telephone services;
ii. for specialist services such as are provided by legal professionals; accountants, surveyors and planning and other specialist consultants subject to a resolution of Council which embodies the reason for the exemption;
iii. 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;
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 £500 (in excess of this sum the Town Clerk or RFO shall act after consultation with the Chair and Vice Chair of council); and
vi. for goods or materials proposed to be purchased which are proprietary articles and / or are only sold at a fixed price.
vii. In cases where genuine competition is not available because of the specialist nature of the work or goods, subject to a resolution of Council which embodies the reason for the exemption.
b. Where the council intends to procure or award a public supply contract, public service contract or public works contract as defined by The Public Contracts Regulations 2015 (“the Regulations”) which is valued at£25,000 or more, the council shall comply with the relevant requirements of the Regulations. For contracts at or above this value, the Town Clerk or RFO shall invite tenders from at least 3 firms, in accordance with Standing Orders and Standing Orders for Contracts.
c. The Public Services (Social Value) Act 2012 requires public bodies to consider how what is to be procured may improve social, environmental and economic well-being of the relevant area, how they might secure any such improvement and to consider the need to consult.
d. 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.
e. The full requirements of The Regulations, as applicable, shall be followed in respect of the tendering and award of a public supply contract, public service contract or public works contract which exceed thresholds in The Regulations set by the Public Contracts Directive 2014/24/EU (which may change from time to time).
f. Any invitation to tender shall state the general nature of the intended contract and the Town 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 Town Clerk in the ordinary course of post. Each tender shall state that no tender will be considered unless contained in an unmarked, plain, sealed envelope and endorsed “Tender” followed by the subject to which it relates and remain sealed until the prescribed date for opening tenders for that contract.
g. All sealed tenders shall be opened at the same time on the prescribed date by the Clerk in the presence of at least 2 members of council.
h. Any invitation to tender issued under this regulation shall be subject to Standing Orders 18 and 33c, Standing Orders for Contracts and shall refer to the terms of the Bribery Act 2010.
i. When it is to enter into a contract of less than £25,000 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 Town Clerk or RFO shall obtain 3 quotations (priced descriptions of the proposed supply); where the value is below £3,000and above £500 the Clerk or RFO shall strive to obtain 3 estimates. Otherwise, Regulation 10.3 above shall apply.
j. Any invitation to tender issued under this regulation shall be subject to Standing Orders 18 and 33c, Standing Orders for Contracts and shall refer to the terms of the Bribery Act 2010.
k. When it is to enter into a contract of less than £25,000 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 Town Clerk or RFO shall obtain 3 quotations (priced descriptions of the proposed supply); where the value is below £3,000and above £500 the Clerk or RFO shall strive to obtain 3 estimates. Otherwise, Regulation 10.3 above shall apply.
l. The council shall not be obliged to accept the lowest or any tender, quote or estimate.
m. 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.
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.
12.3. Any variation to a contract or addition to or omission from a contract must be approved by the council and Town Clerk to the contractor in writing, the council being informed where the final cost is likely to exceed the financial provision.
12.4. Thresholds currently applicable are:
- For public supply and public service contracts £213,477
- For public works contracts £5,336,937
13. Stores and equipment
13.1. The officer in charge of each section of the Council’s organisation, shall be responsible for the care and custody of stores and equipment in that section.
13.2. Delivery notes shall be obtained in respect of all goods received into store or otherwise delivered and goods must be checked as to order and quality at the time delivery is made.
13.3. Stocks shall be kept at the minimum levels consistent with operational requirements.
13.4. The RFO shall be responsible for periodic checks of stocks and stores at least annually.
14. Assets, properties and estates
14.1. The Town Clerk shall make appropriate arrangements for the custody of all title deeds and Land Registry Certificates of properties held by the council. The RFO shall ensure a record is maintained of all properties held 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.
14.2. No tangible moveable property shall be purchased or otherwise acquired, 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 £1000. Such a disposal must be authorised by the Town Clerk and reported to the appropriate committee or to Council.
14.3. No real property (interests in land) shall be sold, leased or otherwise disposed of without the authority of the council, together with any other consents required by law. In each case a report in writing shall be provided to council in respect of valuation and surveyed condition of the property (including matters such as planning permissions and covenants) together with a proper business case (including an adequate level of consultation with the electorate).
14.4. No real property (interests in land) shall be purchased or acquired without the authority of the full council. In each case a report in writing shall be provided to council in respect of valuation and surveyed condition of the property (including matters such as planning permissions and covenants) together with a proper business case (including an adequate level of consultation with the electorate).
14.5. Subject only to the limit set in Regulation 14.2 above, no tangible moveable property shall be purchased or acquired without the authority of the full council. In each case a report in writing shall be provided to council with a full business case.
14.6. 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.
15.1. Following the annual risk assessment (per Regulation 17), the RFO shall effect all insurances and negotiate all claims on the council’s insurers, in consultation with the Town Clerk (if a different officer).
15.2. The Town Clerk shall, where it is a separate officer, give prompt notification to the RFO of all new risks, properties or vehicles which require to be insured and of any alterations affecting existing insurances.
15.3. The RFO shall keep a record of all insurances effected by the council and the property and risks covered thereby and annually review it.
15.4. 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.
15.5. 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.
16.1. Where the council is sole managing trustee of a charitable body, the Clerk and 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 Clerk and RFO shall arrange for any audit or independent examination as may be required by Charity Law or any Governing Document.
17. Risk management
17.1. The council is responsible for putting in place arrangements for the management of risk. The Clerk with the RFO 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.
17.2. When considering any new activity, the Clerk with the RFO shall prepare a draft risk assessment including risk management proposals for consideration and adoption by the council.
18. Suspension and revision of Financial Regulations
18.1. It shall be the duty of the council to review the Financial Regulations of the council in each financial year. 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.
18.2. 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.
19. Capital Expenditure
19.1. For the purpose of these procedure rules “capital expenditure” means the acquisition of land or buildings, the erection of buildings, the erection of permanent works, the purchase or vehicles, plant, machinery, equipment and furniture and any related fees, which are not financed from the Revenue budget. Items or groups of items under the value of £1,000 would not normally be classified as capital expenditure.
19.2. A Capital Programme will be prepared by the Town Clerk, in the annual budget cycle, showing the projects for the next three years.
20. Grants Income
20.1. Officers should ensure that all grants and external funding income is promptly claimed and proper records and working papers are retained to justify claims.
20.2. The RFO must inform the Finance Committee of any new bids for grant funding.
21.1. A partner is defined as a private or public organisation, undertaking part funding or participating as a beneficiary in a project.
21.2. The RFO will as appropriate, advise on the key elements of partnership, including:
- Effective controls that ensure that resources are not wasted.
- A scheme appraisal for financial viability in both the current and future years.
- Financial risk appraisal and management.
- Resourcing, including taxation issues.
- Audit, security and control requirements.
- Carry-forward arrangements.
- Satisfactory accounting arrangements.
21.3.The RFO will ensure that:
- All funding notified by external bodies is received and properly recorded in the authority’s accounts.
- The match-funding requirements are considered prior to entering into the agreements and that future revenue budgets reflect these requirements.
- Audit requirements are met.
- Ensuring that all agreements and arrangements are properly documented.
- Ensuring that all claims for funds are made by the due date.
- Ensuring that the project progresses in accordance with the agreed plan and that all expenditure is properly incurred and recorded.