These Financial Regulations were reviewed and adopted by the Council at its Meeting held on the 6th July 2016 and are based on the NALC 2015 template.

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 governing policy documents providing procedural guidance for members and officers. Financial regulations must be observed in conjunction with the council’s standing orders and any individual financial regulations relating to contracts.
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.
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.

These financial regulations demonstrate how the council meets these responsibilities and requirements.
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.
A breach of these Regulations by an employee is gross misconduct.
Members of Council are expected to follow the instructions within these Regulations and not to entice the clerk to breach them. Failure to follow instructions within these Regulations brings the office of councillor into disrepute.
The Responsible Financial Officer (RFO) holds a statutory office to be appointed by the council. [The Clerk has been appointed as RFO for this council and these regulations will apply accordingly.]
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.

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 record of receipts and payments and additional information, as the case may be, or management information prepared for the council from time to time comply with the Accounts and Audit Regulations.
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 or receipts and payments account relate;
a record of the assets and liabilities of the council; and

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;

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;
borrowing;
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.

In addition the council must:

determine and keep under regular review the bank mandate for all council bank accounts;
approve any grant or a single commitment in excess of [£5,000]; and
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.

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 Accountability for 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).

ACCOUNTING AND AUDIT (INTERNAL AND EXTERNAL)

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.
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.
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.
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.
The internal auditor shall:

be competent and independent of the financial operations of the council;
to demonstrate competence, objectivity and independence, be free from any actual or perceived conflicts of interest, and
have no involvement in the financial decision making, management or control of the council.

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.

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.
The RFO shall, without undue delay, bring to the attention of all councillors any correspondence or report from internal or external auditors.

ANNUAL ESTIMATES (BUDGET) AND FORWARD PLANNING

The RFO must each year, by no later than January, prepare detailed estimates of all receipts and payments including the use of reserves and all sources of funding for the following financial year in the form of a budget to be considered by the [relevant committee and the] council.
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.
The approved annual budget shall form the basis of financial control for the ensuing year.

BUDGETARY CONTROL AND AUTHORITY TO SPEND

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.

Such authority is to be evidenced by a minute.

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’).
The clerk’s salary budget is to be reviewed at least annually in January for the following financial year and such review shall be evidenced in the Council minutes.
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.
All capital works shall be administered in accordance with the council’s standing orders and financial regulations relating to contracts.
The RFO shall regularly provide the council with a statement of receipts and payments to date under each head of the budgets.

BANKING ARRANGEMENTS AND AUTHORISATION OF PAYMENTS

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 RFO shall prepare a schedule of payments requiring authorisation, forming part of the Agenda for the Meeting and, together with the relevant invoices, present the schedule to council. The council shall review the schedule for compliance and, having satisfied itself shall authorise payment by a resolution of the council. Personal payments (including salaries, wages, expenses and any payment made in relation to the termination of a contract of employment) may be summarised to remove public access to any personal information.
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.
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, and which are in order, at the next available council.
In respect of grants, council shall approve expenditure within any limits set by council and in accordance with any policy statement approved by council.
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 disc losable pecuniary or other interest, unless a dispensation has been granted.

INSTRUCTIONS FOR THE MAKING OF PAYMENTS

The council will make safe and efficient arrangements for the making of its payments.
Following authorisation under Financial Regulation 5 above, the council, shall give instruction that a payment shall be made.
All payments shall be effected by cheque or other instructions to the council’s bankers, or otherwise, in accordance with a resolution of council [or duly delegated committee].
Cheques or orders for payment drawn on the bank account in accordance with the schedule as presented to council shall be signed by two members of council in accordance with a resolution instructing that payment. If a member who is also a bank signatory has declared a disclosable pecuniary interest, or has any other interest, in the matter in respect of which the payment is being made, that councillor shall be required to consider Standing Orders, and thereby determine whether it is appropriate and / or permissible to be a signatory to the transaction in question.
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.
Cheques or orders for payment shall not normally be presented for signature other than at a council or committee meeting (including immediately before or after such a meeting). Any signatures obtained away from such meetings shall be reported to the council at the next convenient meeting. Photocopies of cheques, once signed should be taken.
If thought appropriate by the council, payment for certain items (principally salaries/pensions) 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 council at least every two years.
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.

PAYMENT OF SALARIES

As an employer, the council shall make arrangements to meet fully the statutory requirements placed on all employers by PAYE and National Insurance legislation. The payment of all salaries shall be made in accordance with payroll records and the rules of PAYE and National Insurance currently operating, and salary rates shall be as agreed by council, or duly delegated committee. The Employee shall be responsible to ensure the payment of any PAYE and National Insurance.
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.
No changes shall be made to any employee’s pay, emoluments, or terms and conditions of employment without the prior consent of the council.

INCOME

The collection of all sums due to the council shall be the responsibility of and under the supervision of the RFO.
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 and the RFO shall be responsible for the collection of all accounts due to the council.
The council will review all fees and charges at least annually, following a report by the clerk.
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.
The origin of each receipt shall be entered on the paying-in slip.
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.

ORDERS FOR WORK, GOODS AND SERVICES

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.
A member may not issue an official order or make any contract on behalf of the council.

CONTRACTS

Procedures as to contracts are laid down as follows:

Every contract shall comply with these financial regulations, and no exceptions shall be made otherwise than in an emergency provided that this regulation need not apply to contracts which relate to items (i) to (vi) below:
1. for specialist services such as are provided by solicitors, accountants, surveyors and planning consultants;
2. 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;
3. for work to be executed or goods or materials to be supplied which constitute an extension of an existing contract by the council;
4. for additional audit work of the external auditor up to an estimated value of £500 (in excess of this sum the Clerk and RFO shall act after consultation with the Chairman and Vice Chairman of council); and
5. for goods or materials proposed to be purchased which are proprietary articles and / or are only sold at a fixed price.

Such invitation to tender shall state the general nature of the intended contract and the Clerk shall obtain the necessary technical assistance to prepare a specification in appropriate cases. The invitation shall in addition state that tenders must be addressed to the Clerk in the ordinary course of post. Each tendering firm shall be supplied with a specifically marked envelope in which the tender is to be sealed and remain sealed until the prescribed date for opening tenders for that contract.
All sealed tenders shall be opened at the same time on the prescribed date by the Clerk in the presence of the council.
If less than three tenders are received 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.
Any invitation to tender issued under this regulation shall be subject to Standing Order 74 and shall refer to the terms of the Bribery Act 2010. [
The council shall not be obliged to accept the lowest or any tender, quote or estimate.

ASSETS, PROPERTIES AND ESTATES

The Clerk shall make appropriate arrangements for the custody of all title deeds, Land Registry Certificates and assets 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.

INSURANCE

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

RISK MANAGEMENT
1. The council is responsible for putting in place arrangements for the management of risk. Risk policy statements and consequential risk management arrangements shall be reviewed by the council at least annually.
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.

SUSPENSION AND REVISION OF FINANCIAL REGULATIONS

It shall be the duty of the council to review the Financial Regulations of the council from time to time. The Clerk shall make arrangements to monitor changes in legislation or proper practices and shall advise the council of any requirement for a consequential amendment to these financial regulations.

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.

These Financial Regulations shall be reviewed annually at the May meeting.

Approved…………David Hall…………………………………..

Parish Council Chair

Date………01-06-22 Min 34…………………………………………..