Financial Procedures - Suffolk · Financial Procedures Financial Management ... C2. Format of the...

1 February 2016

Financial Procedures

2 February 2016

Financial Procedures Financial Management ....................................................................................... 4 A1. Financial Management Standards ................................................... 4 B1. Budget virements ..................................................................................... 5 C1. Treatment of year-end balances ............................................................. 7 D1. Accounting policies ............................................................................... 8 E1. Accounting records and returns (including the Statement of Accounts) ............................................................................................................ 9 Financial Planning A2. Strategic and Performance Planning .................................................. 12 B2. Preparing budgets and medium-term plans ........................................ 13 C2. Format of the budget book .................................................................... 15 D2. Revenue budget monitoring and control ............................................. 16 E2. Capital programmes ............................................................................... 19 F2. Maintenance of Reserves ..................................................................... 21 Risk Management and Control of Resources ................................................. 23 A3. Risk Management ................................................................................... 23 B3. Insurance ................................................................................................ 24 C3. Internal controls .................................................................................... 25 D3. Internal audit ........................................................................................... 26 E3. External audit ......................................................................................... 28 F3. Preventing fraud and corruption .......................................................... 30 G3. Control of Assets ................................................................................... 31 H3. Inventories .............................................................................................. 34 I3. Stocks and stores .................................................................................. 35 J3. Intellectual property ................................................................................ 36 K3. Treasury management ........................................................................... 37 L3. Investments and Borrowing ................................................................. 38 M3. Trust Funds and Funds Held for Third Parties .................................... 39 N3. Imprest Accounts ................................................................................... 40 O3. Cash Security ......................................................................................... 41 P3. Staffing .................................................................................................... 42 Q3. Payments to employees, pensioners and councillors ........................ 44 R3. Pension Scheme Administration .......................................................... 46 Financial Systems and Procedures ................................................................ 48 A4. General .................................................................................................... 48 B4. Income .................................................................................................... 51 C4. Ordering and paying for work, goods and services ............................. 55 D4. Taxation .................................................................................................. 59

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E4. Business Units ....................................................................................... 60 F4. Divestments ............................................................................................ 60 External Arrangements .................................................................................... 62 A5. Partnerships .......................................................................................... 62 B5. External funding ..................................................................................... 66 C5. Work for third parties ............................................................................. 67 D5. Provision of Grant to Other Organisations .......................................... 68 Glossary ............................................................................................................ 71 Bibliography ...................................................................................................... 71

4 February 2016

FINANCIAL MANAGEMENT

A1. Financial Management Standards

Why is this important?

1.1 All staff and councillors have a duty to abide by the highest standards when dealing with financial issues. This is helped by ensuring everyone is clear about the standards to which they are working and the controls that are in place to ensure that these standards are met.

1.2 These standards apply across the County Council and cover service offices, specialist support functions and delivery agencies (whether or not they operate as business units).

1.3 The County Council separates the role of commissioning a service from the delivery of that service. The arrangements to support this separation vary across the County Council. All such arrangements must follow principles of sound financial management as set out in this document and follow guidance issued by the Head of Finance.

Key controls

1.4 The key controls and control objectives for financial management standards are:

(a) the promotion of these standards throughout the County Council

(b) a monitoring system to review compliance with financial standards.

Responsibilities of the Head of Finance

1.5 To ensure the proper administration of the financial affairs of the County Council.

1.6 To set appropriate financial management standards and to monitor compliance with them.

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1.7 To ensure that arrangements are in place to maintain the standards, performance and development of finance staff for the County Council.

1.8 To ensure that financial information is available to enable accurate and timely monitoring and reporting of national and local financial performance indicators.

1.9 To provide information on non-compliance with financial standards.

Responsibilities of Directors

1.10 To promote the financial management standards set by the Head of Finance in their departments and to address issues of non-compliance.

B1. Budget virements


1.11 The policy on budget virement is intended to enable Cabinet, Directors and their staff to manage budgets flexibly while remaining within the overall policy framework determined by Council, and therefore to optimise the use of resources.

Key controls

1.12 Key controls for budget virements are:

(a) The policy for budget virements is agreed by Cabinet and administered by the Head of Finance. Any variation from this scheme requires the approval of Cabinet

(b) The overall budget is proposed by Cabinet and approved by Council. Directors and budget managers are therefore authorised to incur expenditure in accordance with the estimates that make up the budget. The rules below cover virement; that is, switching resources between approved estimates. For the purposes of this scheme, an approved estimate is considered to be a line in the budget book approved by Council.

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(c) Virement does not create additional overall budget liability. Directors are expected to exercise their discretion in managing their budgets responsibly and prudently. For example, they shall aim to avoid supporting recurring expenditure from one-off sources of savings or additional income, or creating future commitments, including full-year effects of decisions made part way through a year, for which they have not identified future resources. Directors must plan to fund such commitments from within their approved budgets.

(d) Budget Monitoring reports prepared for Cabinet will compare original budget with the latest budget at approved estimate level.


1.13 To prepare jointly with the Director a report to Cabinet where virements exceed either £500,000 or 10% of a budget affected.

1.14 To include information comparing original approved budget with the latest budget in regular budget monitoring reports to Cabinet.


1.15 A Director may exercise virement on budgets under his or her control during the year, however where a virement of any value reflects a change in policy then it is expected that Directors will consult the appropriate cabinet member/s. For virements that exceed £100,000 or 5% of a budget affected, Directors must consult with the appropriate cabinet member and notify the Head of Finance.

1.16 Amounts greater than either £500,000 or 10% of a budget affected must be reported to Cabinet. A joint report will be prepared by the Head of Finance and the Director and must specify the proposed expenditure, the source of funding, and explain the implications in the current and future financial years.

1.16 Virement that is likely to impact on the level of service activity of another Directorate shall be implemented only after agreement with the relevant Director.

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1.17 Where an approved budget is a lump-sum budget or contingency intended for allocation during the year, its allocation will not be treated as a virement, provided that:

(a) the amount is used in accordance with the purposes for which it has been established; and

(b) Cabinet has approved the basis and the terms, on which it will be allocated.

C1. Treatment of year-end balances


1.18 At the end of each year there will be variations between the budget and the actual spend for the services under each Director’s control. The ability to carry-forward unspent budget promotes sound financial management and value for money within the County Council.

Key controls

1.19 Any overspending or underspending in total on budgets under the control of each Director shall be carried forward to the following year, and will increase or reduce the level of service reserves.

1.20 All business units will prepare business plans that assess the level of reserves required to manage their business. As long as reserves do not exceed this level, surpluses shall be retained for the benefit of the business unit. Reserves that exceed this level will be returned to the county fund.

1.21 Appropriate accounting procedures are in operation to ensure that carried forward totals are correct.


1.22 To administer the policy for carry forward within the guidelines approved by Cabinet.

1.23 To report all overspendings and underspendings to Cabinet.

1.24 To ensure appropriate accounting procedures are in operation to ensure that carried forward totals are correct.

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1.25 To establish financial management arrangements in their directorate to ensure that all resources are used appropriately and that spending decisions are not distorted by carry forward arrangements at each year end.

D1. Accounting policies


1.26 The Head of Finance is responsible for the preparation of the County Council’s statement of accounts, in accordance with proper practices as set out in the format required by the CIPFA/LASAAC Code of Practice on Local Authority Accounting in the United Kingdom.

Key controls

1.27 The key controls for accounting policies are:

(a) systems of internal control are in place that ensure that financial transactions are lawful

(b) suitable accounting policies are selected and applied consistently

(c) proper accounting records are maintained

(d) financial statements are prepared which present fairly the financial position of the County Council and its expenditure and income.


1.28 To select suitable accounting policies and to ensure that they are applied consistently. The accounting policies are set out in the statement of accounts.


1.29 To adhere to the accounting policies and guidelines approved by the Head of Finance.

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E1. Accounting records and returns (including the Statement of Accounts)


1.30 Maintaining proper accounting records is vital for the County Council if it is to carry out its responsibility for stewardship of public resources and to report its financial position accurately.

1.31 The way in which the County Council carries out this responsibility is an important element of the government’s assessment of the County Council .

1.32 The County Council’s statement of accounts must be prepared in accordance with proper practices as set out in the Code of Practice on Local Authority Accounting in the United Kingdom.

Key controls

1.33 The key controls for accounting records and returns are:

(a) clearly documented instructions on financial processes and procedures are in place and widely understood

(b) all councillors and relevant staff operate within the required accounting standards and timetables

(c) all the County Council’s transactions, material commitments, contracts and other essential accounting information are recorded completely, accurately and on a timely basis

(d) procedures are in place to enable accounting records to be reconstituted in the event of systems failure

(e) reconciliation procedures are carried out to ensure transactions are correctly recorded

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(f) prime documents are retained in accordance with legislative requirements or for the periods specified in the Suffolk File plan and are available at http://colin.suffolkcc.gov.uk/NR/rdonlyres/CACFEE6A-DD61-4196-88E7-538B5B6BD80B/0/20070709EssentialGuidancetoManagingElectronicRecordsv12.pdf

http://colin.suffolkcc.gov.uk/NR/rdonlyres/88A1B252-3595-4577-A9DE-4B3C9D2C38E4/11347/20061221SuffolkFileplanv301.xls

http://colin.suffolkcc.gov.uk/NR/rdonlyres/4EB7432B-2894-4314-B65C-E162AA990E21/0/20051011FreedomofInformationPolicyv21.pdf


1.34 To agree the accounting processes and procedures for the County Council.

1.35 To ensure that information on the operation of these processes and procedures is available throughout the organisation.

1.36 To agree whether amendments to the processes and procedures requested by Directors shall be made.

1.37 To arrange for the compilation of all accounts and accounting records.

1.38 To issue guidance on the appropriate separation of financial duties to prevent or detect fraud and corruption.

1.39 To make proper arrangements for the audit of the County Council’s accounts in accordance with the Accounts and Audit Regulations 2011.

1.40 To ensure the accounts of the County Council for each financial year are prepared and published in accordance with the statutory timetable and with the requirement for the Audit Committee to approve the audited statement of accounts on or before 30 September. The Head of Finance must approve the draft accounts for audit by 30th June.

http://colin.suffolkcc.gov.uk/NR/rdonlyres/CACFEE6A-DD61-4196-88E7-538B5B6BD80B/0/20070709EssentialGuidancetoManagingElectronicRecordsv12.pdf











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1.41 To ensure the proper retention of financial documents in accordance with the requirements set out in the County Council’s document retention schedule.

1.42 To comply with the Code of Practice on Local Authority Accounting in the United Kingdom in preparing the accounts.

1.43 To sign and date the statement of accounts, stating that it presents fairly the financial position of the County Council at the accounting date.


1.44 To promote the operation of financial processes and procedures throughout their directorates and to address issues of non-compliance

1.45 To consult and obtain the approval of the Head of Finance before making any changes to accounting records and procedures.

1.46 To ensure that all claims for funds including grants are made by the due date.

1.47 To comply with accounting procedures in order to provide an adequate record from the source of income/expenditure through to the accounting statements.

1.48 To supply information required to enable the statement of accounts to be completed in accordance with guidelines approved by the Head of Finance.

1.49 To ensure that contractual terms include suitable and proportionate requirements for record keeping and access to records by the council and its auditors.

12 February 2016

FINANCIAL PLANNING

A2. Strategic and Performance Planning


2.1 A strong planning process expresses the ambition of the County Council in clear priorities over the medium term and promotes a wide understanding of these prioirities. This is a vital basis for financial planning as it enables limited resources to be used in a way that best delivers the corporate priorities of the County Council.

2.2 The County Council has an integrated approach to strategic planning, budget planning, performance improvement, and risk management. The budget and business planning cycles have been aligned to ensure that resources are targeted on priorities, and the strategic planning framework has been designed to ensure that it is straightforward to incorporate performance improvement and risk management into the cycle, enabling the County Council to make robust decisions about its priorities. Greater opportunity for public consultation to feed into the strategic planning framework has also been built into the cycle. A range of governance arrangements are in place to identify key risks, and ways to overcome or mitigate them.

Key controls

2.3 The key controls for strategic and performance planning are:

(a) to ensure that all relevant plans are produced and that they are consistent with each other

(b) to produce plans in accordance with statutory requirements

(c) to meet the timetables set

(d) to ensure that all performance information is accurate, complete and up to date

(e) to monitor performance against plans regularly and to take approriate action where this is indicated

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2.4 To lead the development of strategic and performance planning

2.5 To ensure that systems are in place to measure activity and collect accurate information for use as performance indicators.

2.6 To ensure that performance information is monitored sufficiently frequently to allow corrective action to be taken if targets are not likely to be met.

2.7 To contribute actively to the development of strategic and performance plans to ensure resources are targeted to delivering the Council’s priorities.

2.8 To advise and supply the financial information that needs to be included in strategic and performance plans.


2.9 To contribute actively to the development of strategic and performance plans.

2.10 To develop service targets and objectives.

2.11 To ensure that contractual arrangements include appropriate performance measures, monitoring processes and contractual remedies.

2.12 To ensure that performance information is monitored sufficiently frequently to allow corrective action to be taken if targets are not likely to be met.

B2. Preparing budgets and medium-term plans


2.13 The budget is the financial expression of the County Council’s plans and policies. The County Council is a complex organisation responsible for delivering a wide variety of services. It needs to plan effectively and to develop systems to enable scarce resources to be allocated in accordance with priorities.

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2.14 The County Council’s medium-term planning cycle covers three years. As each year passes, another future year will be added to the medium-term plan. This ensures that the County Council is always preparing for events in advance.

Key controls

2.15 The key controls for budgets and medium-term planning are:

(a) Directors are fully involved in the preparation of the budgets for which they will be held responsible and accept accountability

(b) Scrutiny committee reviews budget proposals

(c) a monitoring process is in place to review regularly the effectiveness and operation of budget preparation and to ensure that any corrective action is taken

(d) it is illegal for the County Council to budget for a deficit.


2.16 To work with the Corporate Management Team in order to prepare and submit to Cabinet reports on the medium-term budget prospects for the County Council, including the spending plans of directorates and resource constraints set by the Government.

2.17 To advise on the medium-term implications of spending decisions.

2.18 To encourage and advise on how to achieve the best use of resources and value for money.

2.19 To advise Council on Cabinet proposals in accordance with his or her responsibilities under section 151 of the Local Government Act 1972 and Local Government Act 2003.

2.20 To advise on the adequacy of the reserves held by the County Council.

2.21 To advise on the strategic financial risk of the County Council’s budget and the mitigation strategies in place to manage it.

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2.22 To prepare estimates of income and expenditure, in consultation with the Head of Finance, to be submitted to the Cabinet.

2.23 To integrate financial and budget plans into service planning, so that budget plans can be supported by financial and non-financial performance measures.

2.24 To prepare revenue and capital budgets in consultation with the Head of Finance and in accordance with guidance and timetables.

2.25 When drawing up draft budgets, to have regard to:

(a) delivering value for money

(b) spending patterns and pressures revealed through the budget monitoring process

(c) legal requirements

(d) policy requirements as defined by Council in the approved policy framework

(e) future cost pressures and

(f) initiatives already under way.

2.26 Directors must not enter into any commitment or series of commitments without ensuring there is identified budget provision.

C2. Format of the budget book


2.27 The format of the budget book determines the level of detail to which financial control and management will be exercised. It determines the level at which corporate monitoring will take place. The budget book format shapes how the rules around virement operate, and sets the level at which funds may be reallocated within budgets.

Key controls

2.28 The key controls for the budget format are:

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(a) the format complies with all legal requirements

(b) the format reflects management structures.


2.29 To advise Cabinet on the format of the budget to be approved by Council.

D2. Revenue budget monitoring and control


2.30 Budget management ensures that resources allocated are used for their intended purposes and are properly accounted for.

2.31 By continuously identifying and explaining variances against budgetary targets, the County Council can identify changes in trends and resource requirements at the earliest opportunity. To ensure that the County Council in total does not overspend, each service is required to manage its own expenditure within the resources allocated to it.

Key controls

2.32 The key controls for managing and controlling the revenue budget are:

(a) budget responsibility shall be allocated to the manager best able to control expenditure and income for a cost centre

(b) there is a nominated budget manager for each cost centre

(c) budget managers accept accountability for their budgets and the level of service to be delivered, and understand their financial responsibilities

(d) budget managers follow an approved certification process for all expenditure

(e) income and expenditure are properly recorded and accounted for

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(f) performance and levels of service are monitored in conjunction with the budget and necessary action is taken to align service outputs and budget.


2.33 To establish an appropriate framework of budgetary management and control that ensures that:

(a) each Director has available timely information on each budget which is sufficiently detailed to enable managers to fulfil their budgetary responsibilities

(b) all officers responsible for committing expenditure have access to appropriate training, the relevant guidance, and the financial regulations

(c) each cost centre has a single named manager, determined by the relevant Director

(d) significant variances from approved budgets are investigated and reported by budget managers regularly.

2.34 To administer the County Council’s policy on virements.

2.35 To submit reports to Cabinet, in consultation with the relevant Director, where a Director is unable to manage within approved budgets under his or her control.

2.36 To prepare and submit reports on the County Council’s projected income and expenditure compared with the budget on a regular basis.


2.37 To maintain budgetary control within their departments, and to ensure that all income and expenditure is properly recorded and accounted for.

2.38 To allocate budget responsibility for each and every cost centre in their Directorate to the manager best able to control the expenditure and income.

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2.39 To ensure that spending remains within their overall budget by monitoring the budget and taking appropriate corrective action where significant variations from the approved budget are forecast.

2.40 If expenditure for which no budget has been provided is required in response to an emergency then virement should take place after the event. If emergency expenditure cannot be met from within the Directorates budget the Head of Finance should be advised immediately.

2.41 To ensure that a monitoring process is in place to review service performance levels in conjunction with the budget and is operating effectively.

2.42 In consultation with the Head of Finance to prepare and submit to Cabinet reports on the service’s projected expenditure compared with its approved budget.

2.43 To ensure prior approval by Cabinet for new proposals, of whatever amount, that:

(a) create additional financial commitments in future years for which no identified source of funding exists

(b) change existing policies, initiate new policies or cease existing policies

(c) materially extend or reduce the County Council’s services.

2.44 To ensure compliance with the policy on virement.

2.45 To agree with the relevant Director where it appears that a proposal, including a virement proposal, may impact on another service area or directorates level of service activity.

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E2. Capital programmes


2.46 Capital expenditure involves acquiring or enhancing fixed assets with a long-term value to the County Council, such as land, buildings, highways infrastructure and major items of plant, equipment or vehicles. Capital assets shape the way services are delivered in the long term and create financial commitments that will continue for many years even decades.

2.47 Capital expenditure is a key part of the County Council’s investment strategy. It should therefore be linked to asset management plans and be carefully prioritised in order to maximise the benefit of scarce resources.

Key controls

2.48 The key controls for capital programmes are:

(a) specific approval by Council for the programme of capital expenditure. Subsequent variations to this programme are reported to Cabinet on a quarterly basis

(b) in year approval by Cabinet where schemes are to be added to the capital programme

(c) proposals for improvements and alterations to buildings must be approved by the Head of Finance

(d) the development and implementation of asset management plans

(e) accountability for each scheme is accepted by a named manager

(f) monitoring of progress in conjunction with expenditure and comparison with approved budget.


2.49 To prepare capital estimates jointly with Director(s) and to report them to Cabinet for approval.

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2.50 To prepare and submit reports to Cabinet on overall projected expenditure and resources compared with the approved capital programme.

2.51 To report to Cabinet on named schemes or programmes in the approved capital programme where the estimated or actual expenditure exceeds the provision by either 10% or £500,000.

2.52 To issue guidance concerning capital schemes and controls, for example, on project appraisal techniques.

2.53 To determine the definition of ‘capital’ having regard to government regulations and accounting requirements.


2.54 To comply with guidance concerning capital schemes and controls issued by the Head of Finance.

2.55 To prepare regular reports reviewing the capital programme for their services. To prepare a quarterly return of estimated final costs of schemes in the approved capital programme for submission to the Head of Finance.

2.56 To ensure that adequate records are maintained for all capital contracts.

2.57 To proceed with projects only when there is adequate provision in the approved capital programme.

2.58 To ensure that effective and proportionate arrangements are put in place for sound management of projects and programmes.

2.59 To ensure that within their directorate accountability for each scheme is accepted by a named manager.

2.60 To prepare and submit reports, jointly with the Head of Finance, to Cabinet, of any variation in the cost of a named scheme greater than either £500,000 or 10%.

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2.61 With regard to contracts for construction and alterations to buildings and for civil engineering works, to document and agree with the Head of Finance the systems and procedures for contracts for construction, including certification of interim and final payments, checking, recording and authorising payments, the system for monitoring and controlling capital schemes and the procedures for validation of subcontractors’ tax status.

2.62 To ensure that credit arrangements, such as leasing agreements, are not entered into without the prior approval of the Head of Finance. Where applicable these credit arrangements should be included as part of the County Council’s capital programme and follow the appropriate approval process.

F2. Maintenance of Reserves


2.63 The County Council must decide the level of reserves it wishes to maintain before it can decide the level of council tax. Reserves are maintained as a matter of prudence. They enable the County Council to provide for unexpected events and protect it from overspending, if such events occur. Earmarked reserves are also maintained for specific purposes such as the purchase or renewal of capital items.

Key controls

2.64 To maintain reserves in accordance with the CIPFA Code of Practice on Local Authority Accounting in the United Kingdom and agreed accounting policies.

2.65 The Head of Finance approves all new reserves and ensures that for each reserve established, the purpose, usage and basis of transactions is clearly identified.

2.66 Authorisation of expenditure from service reserves by the appropriate Director in consultation with the relevant cabinet member and for earmarked reserves with the Head of Finance.

2.67 Cabinet must approve any use of the county fund reserve in consultation with the Head of Finance.

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2.68 To advise Cabinet and Council on prudent levels of reserves for the County Council.

2.69 To prepare regular reports to Cabinet that provide information on the current level of general, service reserves and earmarked reserves to determine whether there is scope for these to be better used to deliver the County Council’s priorities.

2.70 To approve whether proposed new reserves are appropriate and to ensure that for each reserve there is a record of the purpose, usage and basis of transaction.


2.71 To ensure that reserves are used only for the purposes for which they were intended.

2.72 To ensure that adequate and appropriate reserves are in place to enable their directorate to manage its responsibilities.

2.73 To inform the Head of Finance where reserves exceed the requirements of the service.

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RISK MANAGEMENT AND CONTROL OF RESOURCES

A3. Risk Management


3.1 All organisations, whether private or public sector, face risks to people, property and continued operations. Risk is the chance or possibility of loss, damage, injury or failure to achieve objectives caused by an unwanted or uncertain action or event. Risk management is the planned and systematic approach to the identification, evaluation and control of risk. Its objectives are to secure the assets of the organisation and to ensure the continued financial and organisational well-being of the organisation.

3.2 It is the overall responsibility of Cabinet to approve the County Council’s risk management strategy, and to promote a culture of risk management awareness throughout the County Council.

Key controls

3.3 The key control for risk management is that procedures are in place to identify, assess, prevent or contain material known risks, and these procedures are operating effectively throughout the County Council. The Councils approach to Risk Management is available on COLIN

http://colin.suffolkcc.gov.uk/CouncilBusiness/CorporatePolicies/RiskManagement.htm

24 February 2016

B3. Insurance

Why is it important?

3.4 However well risk is managed by the County Council it is not possible to eliminate the posibility of an event that leads to significant financial loss. Insurance arrangements are designed to ensure that if such an event occurs, insurance cover exists so the loss will not impact on the ability of the County Council to deliver services.

Key controls

3.5 Provision is made for losses that might occur.

3.6 Procedures are in place to investigate claims within the required timescales

3.7 Acceptable levels of risk are determined and insured against where appropriate.

Responsibilities of Head of Finance

3.8 To ensure that arrangements are in place to provide effective insurance cover, through external insurance and internal funding.

3.9 To ensure arrangements are in place to investigate claims within the required timescales and to negotiate claims as required.


3.10 To notify the Head of Finance of all new risks, including equipment, properties and vehicles that require insurance and of any alterations affecting existing insurance.

3.11 To consult the Head of Finance and the Head of Legal Services on the terms of any indemnity that the authority is requested to give.

3.12 To ensure that any employees, or anyone covered by the authority’s insurances do not admit liability or make any offer to pay compensation that may prejudice the assessment of liability in respect of any insurance claim.

25 February 2016

C3. Internal controls


3.13 The County Council is a complex organisation and beyond the direct control of any single individual. It therefore requires internal controls to manage and monitor its progress towards objectives.

3.14 The system of internal controls is established in order to provide measurable achievement of:

(a) efficient and effective operations

(b) reliable financial information and reporting

(c) compliance with laws and regulations

(d) risk management.

Key controls

3.15 The key controls and control objectives for internal control systems are:

(a) key controls shall be reviewed on a regular basis

(b) An annual governance statement is produced stating whether the County Council is satisfied that the system of internal control is operating effectively. This statement is reviewed by the Audit Committee

(c) strong managerial control systems which promote ownership of the control environment by defining roles and responsibilities

(d) financial and operational control systems and procedures that include physical safeguards for assets, segregation of duties, authorisation and approval procedures and information systems

(e) an effective internal audit function that is properly resourced and operates in accordance with the principles contained in the Public Sector Internal Audit Standards and with any other statutory obligations and regulations.

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3.16 To assist the County Council to put in place an appropriate control environment and effective internal controls.

3.17 To issue guidance on the operation of these controls.


3.18 To review existing controls in the light of changes affecting the County Council and in line with guidance from the Head of Finance.

3.19 To ensure staff have a clear understanding of the importance and operation of controls in place.

3.20 To manage processes to ensure that internal controls are in place and being adhered to.

D3. Internal audit


3.21 The Accounts and Audit Regulations 2011 require that the County Council shall maintain an adequate and effective system of internal audit for its accounting records and its system of internal control. This will be in accordance with proper practices in relation to internal control, and the Council shall at least once a year conduct a review of the effectiveness of its sytem of internal audit.

3.22 Audit Services is an assurance function that provides an independent and objective opinion to Council on the control environment, by evaluating its effectiveness in achieving the County Council’s objectives. It objectively examines, evaluates and reports on the adequacy of the control environment as a contribution to the proper, economic, efficient and effective use of resources.

Key controls

3.23 The key controls for internal audit are that:

(a) it is independent in its planning and operation

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(b) the Head of Audit Services has direct access to the Head of Paid service, all levels of management and directly to elected councillors

(c) the internal auditors comply with the Auditing Practices Board’s guidance, as interpreted by the Public Sector Internal Audit Standards and with any other statutory obligations and regulations.

(d) the Head of Audit Services reports regularly to the Audit Committee

(e) the Head of Audit Services is required to deliver an annual audit opinion to the Audit Committee (those charged with governance).


3.24 To ensure that internal auditors have the authority to:

(a) access County Council premises at reasonable times

(b) access all assets, records, documents, correspondence and control systems

(c) receive any information and explanation necessary concerning any matter under consideration

(d) require any employee of the County Council to account for cash, stores or any other County Council asset under his or her control

(e) access records belonging to third parties, such as contractors and partner organisations, when required

(f) directly access the Chief Executive, Cabinet and the Audit Committee.

3.25 To approve the audit strategy and Annual Audit Plan prepared by the Head of Audit Services, which take account of the characteristics and relative risks of the activities involved.

3.26 To ensure that effective procedures are in place to investigate promptly any fraud or irregularity.

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3.27 To ensure that internal auditors are given access at all reasonable times to premises, personnel, documents and assets that the auditors consider necessary for the purposes of their work.

3.28 To ensure that auditors are provided with any information and explanations that they seek in the course of their work.

3.29 To consider and respond promptly to recommendations in audit reports.

3.30 To ensure that any agreed actions arising from audit recommendations are carried out in a timely and efficient fashion.

3.31 To notify the Head of Audit Services immediately of any suspected fraud, theft, irregularity, improper use or misappropriation of the County Council’s property or resources. Pending investigation and reporting, the Director shall take all necessary steps to prevent further loss and to secure records and documentation against removal or alteration.

3.32 To ensure that new systems for maintaining financial records, or records of assets, or changes to such systems, are discussed with and agreed by the Head of Audit Services prior to implementation.

E3. External audit


3.33 The Local Government Finance Act 1982 set up the Audit Commission, which is responsible for appointing external auditors to each local Council in England and Wales. The external auditor has rights of access to all documents and information necessary for audit purposes.

3.34 The basic duties of the external auditor are defined in the Audit Commission Act 1998 and the Local Government Act 1999. In particular, section 4 of the 1998 Act requires the Audit Commission to prepare a code of audit practice, which external auditors follow when carrying out their duties. The code of audit practice (2010) sets out the auditor’s objectives to review and report on:

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(a) the audited body’s financial statements and its annual governance statement

(b) whether the audited body has made proper arrangements for securing economy, efficiency and effectiveness in its use of resources.

3.35 The County Council’s accounts are scrutinised by external auditors, who must be satisfied that the statement of accounts give a true and fair view of the financial position of the County Council and its income and expenditure for the year in question and complies with the legal requirements.

Key controls

3.36 External auditors are appointed by the Audit Commission normally for a minimum period of five years. The Audit Commission prepares a code of audit practice, which external auditors follow when carrying out their audits.


3.37 To ensure that external auditors are given access at all reasonable times to premises, personnel, documents and assets that the external auditors consider necessary for the purposes of their work.

3.38 To ensure there is effective liaison between external and internal audit.

3.39 To work with the external auditor and advise Audit Committee, Council, Cabinet and Directors of their responsibilities in relation to external audit.


3.40 To ensure that external auditors are given access at all reasonable times to premises, personnel, documents and assets which the external auditors consider necessary for the purposes of their work.

3.41 To ensure that all records and systems are up to date and available for inspection.

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F3. Preventing fraud and corruption

Why is it this important?

3.42 The County Council will not tolerate fraud and corruption in the administration of its responsibilities.

3.43 The County Council’s expectation of propriety and accountability is that councillors and staff at all levels will lead by example in ensuring adherence to legal requirements, rules, procedures and practices.

3.44 The County Council also expects that individuals and organisations (eg suppliers, contractors, partners and service providers) with whom it comes into contact will act towards the County Council with integrity and without thought or actions involving fraud and corruption.

Key controls

3.45 The key controls regarding the prevention of financial irregularities are that:

(a) the County Council has an effective anti-fraud and anti-corruption policy and maintains a culture that will not tolerate fraud or corruption

(b) all councillors and staff act with integrity and lead by example

(c) senior managers are required to deal swiftly and firmly with those who defraud or attempt to defraud the County Council or who are corrupt

(d) a code of conduct is in place to ensure that high standards of conduct are promoted amongst councillors and monitored by the Audit Committee

(e) a register of interests is maintained for both staff and councillors to record any relationship that may compromise them in carrying out their duties, any hospitality or gifts offered must be recorded by staff and councillors

(f) a whistle blowing policy is in place and operates effectively

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(g) legislation including the Public Interest Disclosure Act 1998 is adhered to.


3.46 To develop and maintain an anti-fraud and anti-corruption policy.

3.47 To maintain adequate and effective internal control arrangements.

3.48 To ensure that all suspected irregularities are reported immediately to the Head of Audit Services.


3.49 To ensure that appropriate processes, training and separation of duties are in place to minimise the risk of fraud and corruption in accordance with guidance issued by the Head of Finance.

3.50 To ensure that all suspected irregularities are reported to the Head of Audit Services.

3.51 To instigate the County Council’s disciplinary procedures where the outcome of an audit investigation indicates improper behaviour.

3.52 Where sufficient evidence exists that a criminal offence may have been committed to consult with the Head of Legal Services and the Head of Audit Services to decide whether the police are called in.

3.53 To maintain departmental registers of interests, gifts and hospitality.

G3. Control of Assets


3.54 The County Council holds assets in the form of property, highways infrastructure, vehicles, equipment, furniture and other items worth many millions of pounds. It also holds intangible assets such as intellectual property. It is important that assets are safeguarded and used efficiently in service delivery, and that there are arrangements for the security of both assets and information required for service operations.

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Key controls

3.55 The key controls for the security of assets are:

(a) resources are used only for purposes approved by the County Council and are properly accounted for

(b) resources are available for use when required

(c) resources no longer required are disposed of in accordance with the law and the regulations of the County Council so as to maximise benefits

(d) an asset register is maintained for the County Council, assets are recorded when they are acquired by the County Council and this record is updated as changes occur with respect to the location and condition of the asset

(e) all staff are aware of their responsibilities with regard to safeguarding the County Council’s assets and information, including the requirements of the Data Protection Act and software copyright legislation.

3.56 Contractual arrangements are in place to ensure that ownership and risk in tangible and intangible assets are clear and the County Council’s interests protected.

3.57 Procedures protect staff involved in the disposal of assets from acusation of personal gain.


3.58 To ensure that an asset register is maintained in accordance with good practice for all non-current assets with a value in excess of £20,000 for property and £6,000 (when purchased) for all other assets. To ensure this register is reconciled each year to information held on the operational asset registers. This process relies on the completion of asset confirmation requests by directorates.

3.59 To issue guidance that ensures that assets are valued in accordance with the CIPFA Code of Practice on Local Authority Accounting in the United Kingdom

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3.60 To issue guidance representing best practice for the disposal of assets.

3.61 To approve the format of asset databases maintained by Directors.

3.62 To issue guidance on the proper security of assets.

3.63 To provide advice and guidance on leases and other forms of legal agreement for the use of council land or properties.

3.64 Where property is surplus to requirements, a recommendation for sale shall be the subject of a joint report by the Director and the Head of Finance

3.65 The Head of Finance is responsible for custody of all title deeds


3.66 Directors shall maintain asset databases in a form approved by the Head of Finance for all fixed assets with a value in excess of £20,000 for property and £6,000 (when purchased) for all other assets. Any use of assets by a department or establishment other than for direct service delivery shall be supported by documentation identifying terms, responsibilities and duration of use.

3.67 To ensure that assets are identified, their location recorded and that they are appropriately marked and insured.

3.68 To ensure the proper security of all assets under their control, following guidance issued by the Head of Finance and that no County Council asset is subject to personal use by an employee without prior approval.

3.69 To consult the Head of Audit Services in any case where security is thought to be defective or where it is considered that special security arrangements may be needed.

3.70 To arrange for the valuation of assets for accounting purposes to meet requirements specified by the Head of Finance.

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3.71 To ensure that all employees are aware that they have a personal responsibility with regard to the protection and confidentiality of asset information, whether held in manual or computerised records.

3.72 To ensure that lessees and other prospective occupiers of County Council land are not allowed to take possession or enter the land until a lease or agreement, in a form approved by the Head of Finance, has been established as appropriate.

3.73 To seek advice from purchasing advisors on the disposal of surplus assets.

3.74 Where a property is surplus to requirements, a recommendation for sale shall be the subject of a joint report by the Director and the Head of Finance.

3.75 To ensure that income received for the disposal of an asset is properly banked and accounted for.

3.76 To record the disposal or part exchange of assets that are recorded on the operational asset register.

H3. Inventories


3.77 To maintain inventories and record an adequate description of furniture, fittings, equipment, plant and machinery which is either above £100 in value or attractive and portable.

3.78 An Inventory should include:

(a) Details of all ‘attractive’ and portable items (e.g. electrical equipment) these should be individually recorded. Other equipment can be generalised (e.g. 28 standard beds and 4 orthopaedic beds)

(b) An adequate description of the items held

(c) Serial numbers. If no serial number is available then this should be indicated on the inventory with reference to other forms of identification.

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(d) Replacement or estimated value where this is known

(e) The date the item was first held

(f) The quantity held

(g) Evidence of an annual check including certification and date

(h) Record of items not purchased by the Council such as leased items

(i) Consumable items i.e. those with a short life, need not be entered but there must be adequate control exercised over such items.

3.79 To carry out an annual check of all items on the inventory in order to verify location, review condition and to take action in relation to surpluses or deficiencies, updating the inventory accordingly. Attractive and portable items such as computers and other electronic equipment shall be identified with security markings as belonging to the Council.

3.80 To make sure that Council property is only used in the course of the County Council’s business, unless the Director concerned has given permission otherwise.

3.81 The inventory must be kept secure, in a fireproof receptacle such as a safe, to provide a record in the event of a fire or burglary. This applies to both hand written inventories and to back up disks for inventories maintained on a stand alone PC. As a matter of good practice, a copy of the inventory should be held on other premises.

I3. Stocks and stores


3.82 To make arrangements for the care and custody of stocks and stores in their directorate.

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3.83 To ensure stocks are maintained at reasonable levels and are subject to a regular physical check. All discrepancies shall be investigated and pursued to a satisfactory conclusion.

3.84 To investigate and remove from the County Council’s records (ie write off) discrepancies as necessary, or to obtain cabinet approval if they are in excess of the Directors approved level of write off.

3.85 To authorise or write off disposal of redundant stocks. Procedures for disposal of such stocks and equipment shall be by competitive quotations or auction, unless, following consultation with the Head of Finance, the Director decides otherwise in a particular case.

J3. Intellectual property


3.86 Intellectual property is a generic term that includes inventions and writing. If these are created by the employee during the course of employment, then, as a general rule, they belong to the employer, not the employee. Various acts of Parliament cover different types of intellectual property.

3.87 Certain activities undertaken within the County Council may give rise to items that may be patentable, for example, software development. These items are collectively known as intellectual property.

3.88 Partnerships, joint ventures and contractors may create valuable intellectual property or may make use of or build upon the County Council’s pre-existing intellectual property. The County Council’s interests in its pre-existing intellectual property must be protected and ownership of new intellectual property must be pre-determined by contract and subsequently asserted and protected.

3.89 The County Council may make use of intellectual property (such as software and copyright materials) owned by others and must ensure that it does not breach the owners’ rights in the intellectual property.

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Key controls

3.90 In the event that the County Council decides to become involved in the commercial exploitation of inventions, the matter shall proceed in accordance with the County Council’s approved intellectual property procedures.

3.91 Staff members must be aware of intellectual property issues, including the consequences of breach of copyright or other intellectual property rights by the County Council and the need to protect the County Council’s intellectual property through appropriate contractual arrangements.


3.92 To develop and disseminate good practice through the County Council’s intellectual property procedures.

3.93 To ensure that controls are in place to ensure that staff do not breach the intellectual property rights of others.

3.94 To ensure that the County Council’s intellectual property rights are protected in any partnership, joint venture or contractual relationship.


3.95 To ensure that controls are in place to ensure that staff do not carry out private work in work time and that staff are aware of an employer’s rights with regard to intellectual property.

K3. Treasury management


3.96 Many millions of pounds pass through the County Council’s books each year. It is therefore vital to provide assurances that this money is properly managed in a way that balances risk with return, but with the overriding consideration being given to the security of the County Council’s money.

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Key controls

3.97 That the County Council’s borrowings and investments comply with the CIPFA Code of Practice on Treasury Management and with the County Council’s treasury policy statement.


3.98 To arrange the borrowing and investments of the County Council in such a manner as to comply with the CIPFA Code of Practice on Treasury Management and the Council’s Treasury Management policy statement and strategy.

3.99 To report at least twice a year on treasury management activities to Cabinet.

3.100 To operate bank accounts as are considered necessary – opening or closing any bank account shall require the approval of the Head of Finance.


3.101 To follow the instructions on banking issued by the Head of Finance.

L3. Investments and Borrowing


3.102 To ensure that all investments of money are made in the name of the County Council or in the name of nominees approved by the County Council.

3.103 To ensure that all securities that are the property of the County Council or its nominees and the title deeds of all property in the County Council’s ownership are held in the custody of the Head of Legal Services.

3.104 To effect all borrowings in the name of the County Council.

3.105 To maintain records of all borrowing of money by the County Council.

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3.106 To make arrangements for the appointment of a custodian for the County Council’s holdings of stocks, bonds and other financial investments.


3.107 To ensure that loans are not made to third parties and that interests are not acquired in companies, joint ventures or other enterprises without the approval of the Head of Finance for those below £500,000, or for those greater that £500,000 without the approval of Cabinet following consultation with the Head of Finance.

M3. Trust Funds and Funds Held for Third Parties


3.108 To arrange for all trust funds to be held, wherever possible, in the name of the County Council. All officers acting as trustees by virtue of their official position shall deposit securities, etc relating to the trust with the Head of Finance, unless the deed otherwise provides.

3.109 To ensure that, where an officer of the council, by virtue of their official position, deals with or is responsible for the assets of an unofficial or ancillary trust or other fund connected in any way with a council establishment or service, they shall maintain:

• proper records of such assets (including an inventory as

appropriate) and keep them separate from those belonging to the council;

• a separate account for the transactions of the Fund.

A suitably qualified person shall be appointed to audit the Fund accounts, which shall be presented annually to the trustees or their equivalent, and to the appropriate director.

3.110 To ensure that trust funds are operated within any relevant legislation and the specific requirements for each trust.

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N3. Imprest Accounts


3.111 Imprest accounts are maintained to provide employees of the County Council with cash or bank accounts to meet minor expenditure on behalf of the County Council.


3.112 To issue guidance on the operation of imprest accounts.

3.113 To maintain a record of all transactions and petty cash advances made, and periodically to review the arrangements for the safe custody and control of these advances.

3.114 To reimburse imprest holders as often as necessary to restore the imprests, but normally not more than monthly.


3.115 To ensure that employees operating an imprest account:

(a) obtain and retain vouchers to support each payment from the imprest account and where appropriate, an official receipted VAT invoice must be obtained

(b) make adequate arrangements for the safe custody of the account

(c) produce upon demand by the Head of Finance cash and all vouchers to the total value of the imprest amount

(d) record transactions promptly

(e) reconcile and balance the account at least monthly; reconciliation sheets to be signed and retained by the imprest holder

(f) provide the Head of Finance with a certificate of the value of the account held at 31 March each year

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(g) ensure that the float is never used to cash personal cheques or to make personal loans and that the only payments into the account are the reimbursement of the float and change relating to purchases where an advance has been made

(h) on leaving the County Council’s employment or otherwise ceasing to be entitled to hold an imprest advance, an employee shall account to the Head of Finance for the amount advanced to him or her.

O3. Cash Security

3.116 All officers involved in cash handling have a duty to ensure that practice and procedures properly safeguard cash holdings in their possession, BUT NOT AT ANY RISK TO THEIR OWN PERSON.

Responsibilities of Directors:

3.117 Procedures should be operating to ensure that:

(a) All monies received are receipted or otherwise adequately recorded at the time of receipt

(b) All monies received are brought into account promptly, correctly, accurately and completely

(c) Adequate arrangements are made to safeguard monies pending banking

(d) Banking arrangements are such that they minimise the amount of money, and ensure it does not exceed insurance levels

(e) Banking arrangements are such that they minimise the risk to staff undertaking the banking

(f) There is regard for the suggested maximum limit set under the insurance policy for each directorate for monies held during working hours and overnight.

3.118 Arrangements for safeguarding monies pending banking include:

(a) Use of locked cash boxes held in a safe, or locked drawer or cabinet for short periods

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(b) Restricted access to the keys for the above

(c) Locking cash away when unattended

(d) Not counting cash or accessing the safe in view of visitors and members of the public

(e) Where large amounts of cash are collected, considering the physical security of the cashiers office (e.g. access arrangements to the cashiers area; screens; alarm systems etc.).

P3. Staffing


3.119 In order to provide the highest level of service, it is crucial that the County Council recruits and retains high calibre, knowledgeable staff, qualified to an appropriate level.

Key controls

3.120 The key controls for staffing are:

(a) an up to date People Strategy including a workforce plan and clear HR policies is in place and regularly updated

(b) procedures are in place for forecasting staffing requirements and cost and ensuring this is affordable within agreed budget provision

(c) controls are implemented that ensure that staff time is used efficiently and to the benefit of the County Council

(d) checks are undertaken prior to employing new staff to ensure that they are appropriately qualified, experienced and trustworthy.


3.121 To ensure that the County Council utilises its workforce to achieve the maximum benefit.

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3.122 To establish processes to manage the County Council’s workforce imaginatively and efficiently so that service levels can be maintained and improved.

3.123 To provide strategic workforce planning inputs for the annual budget setting exercise.

3.124 To ensure policies and procedures are compliant with legislation and fit for purpose particularly in regard to vacancy management, recruitment and organisational change.

3.125 To act as an advisor to Directors on pay costs including salaries, National Insurance and pension contributions, as appropriate.

3.126 To oversee the County Council’s organisational change programmes, including authorising related termination, redundancy or retirement payments as appropriate.


3.127 To produce annually an accurate forecast staffing budget.

3.128 To monitor staff activity to ensure adequate control over such costs as sickness, overtime, training and temporary staff.

3.129 To ensure that the staffing budget is not exceeded and that it is managed to enable the agreed level of service to be provided.

3.130 To ensure that the Head of HR and the Head of Finance are immediately informed if the staffing budget is likely to be materially over or underspent.

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Q3. Payments to employees, pensioners and councillors


3.131 Staff costs are the largest item of expenditure for most County Council services. It is therefore important that payments are accurate, timely, made only where they are due for services to the County Council and that payments accord with individuals’ conditions of employment. It is also important that all payments are accurately and completely recorded and accounted for and that councillors’ allowances are authorised in accordance with the scheme adopted by the full council; and that all pensioners are paid in accordance with the relevant legislation

Key controls

3.132 The key controls for payments to employees, pensioners and councillors are:

(a) proper authorisation procedures are in place and that there is adherence to corporate timetables in relation to:

(i) starters

(ii) leavers

(iii) variations

(iv) enhancements

and that payments are made on the basis of individual’s contracts or claims

(b) frequent reconciliation of payroll expenditure against approved budget and bank account

(c) all appropriate payroll documents are retained and stored for the defined period in accordance with the document retention schedule

(d) that HM Revenue and Customs regulations are complied with

(e) that pensions schemes regulations are complied with

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3.133 To arrange and control secure and reliable payment of salaries, wages, compensation or other emoluments to existing and former employees, in accordance with procedures prescribed by him or her, on the due date.

3.134 To record and make arrangements for the accurate and timely payment of tax, pension and other deductions.

3.135 To make arrangements for payment of all travel and subsistence claims or financial loss allowance.

3.136 To make arrangements for paying councillors travel or other allowances upon receiving the prescribed form, duly completed and authorised.

3.137 To make arrangements for paying pensioners in accordance with the relevant legislation and direction from pension scheme employers.

3.138 To secure payment of salaries and wages by the most economical means.


3.139 To ensure appointments are made in accordance with the regulations of the County Council and approved establishments, grades and scale of pay and that adequate budget provision is available.

3.140 To notify HR of all appointments, terminations or variations which may affect the pay or pension of an employee or former employee, in the form and to the timescale required by the Head of Finance.

3.141 To ensure that adequate and effective systems and procedures are operated, so that:

(a) payments are only authorised to bona fide employees

(b) payments are only made where there is a valid entitlement

(c) conditions and contracts of employment are correctly applied

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(d) employees’ names listed on the payroll are checked at regular intervals to verify accuracy and completeness.

3.142 To send an up-to-date list of the names of officers authorised to sign records to HR, together with specimen signatures. HR shall have signatures of officers authorised to sign timesheets and claims.

3.143 To ensure that payroll transactions are processed only through the payroll system. Directors shall give careful consideration to the employment status of individuals employed on a self-employed consultant or subcontract basis. The HM Revenue and Customs applies a tight definition for employee status, and in cases of doubt, advice shall be sought from the Head of Finance.

3.144 To certify travel and subsistence claims and other allowances. Certification is taken to mean that journeys were authorised and expenses properly and necessarily incurred, and that allowances are properly payable by the County Council, ensuring that cost-effective use of travel arrangements is achieved. Due consideration shall be given to tax implications and that HR is informed where appropriate.

3.145 To ensure that HR is notified of the details of any employee benefits in kind, to enable full and complete reporting within the income tax self-assessment system.

3.146 To ensure that all appropriate payroll documents are retained and stored for the defined period in accordance with the document retention schedule.

Responsibilities of councillors

3.147 To submit claims for councillors’ travel and subsistence allowances on a monthly basis and, in any event, within one month of the year end.

R3. Pension Scheme Administration


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3.148 The County Council is the administering authority for the local government pension scheme on behalf of the employers affiliated to the Suffolk Pension Fund, and also administers the Firefighters Pension Scheme. Occupational pension schemes are an important part of the pay and benefit package for many employees. It is therefore important that the administration is accurate and timely and that payments are made only where they are due under the legislation and that these payments are accurately and completely recorded and accounted for within the Pension Fund Accounts.

Key Controls

3.149 The key controls for payments for pensions administration are:

(a) proper authorisation procedures are in place

(b) there is adherence to legislation and regulatory timescales

(c) all appropriate pension documents are retained and stored for the defined period in accordance with the document retention schedule

(d) that HM Revenue and Customs regulations are complied with.


3.150 To arrange and control secure and reliable pensions administration to existing and former pension scheme members, in accordance with procedures prescribed, on the due date.

3.151 To record and make arrangements for the accurate and timely payment of death benefits, lump sum benefits, refunds of contributions and transfer values.

3.152 To ensure all administering authority and employing authority

policies and discretions are correctly operated. 3.153 To provide advice on pension scheme matters to the employing

authorities of the pension funds.

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3.154 To ensure that there are adequate arrangements for administering pension scheme matters on a day-to-day basis.

3.155 The County Council’s Head of Finance is responsible for all

arrangements concerning pension funds within the scope of the pension fund investment policies that are approved by the Pension Fund Committee.


3.156 To supply information to the Payroll team, for onward transmission to the Pensions team, on all contractual changes.

3.157 To ensure all retirements, redundancies, interests of efficiency

leavers and ill health leavers are notified to the Pensions team at least one month in advance of the termination date.

3.158 To follow County Council procedures and thereby ensure the full

costs and benefits of early terminations are considered.

FINANCIAL SYSTEMS AND PROCEDURES

A4. General


4.1 Departments have many systems and procedures relating to the management of the County Council’s finances and assets. The information must be accurate and the systems and procedures sound and well administered. They shall contain controls to ensure that transactions are properly processed and errors detected promptly.

4.2 The Head of Finance has a professional responsibility to ensure that the County Council’s financial systems are sound.

Key controls

4.3 The key controls for systems and procedures are:

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(a) basic data exists to enable the County Council’s objectives, targets, budgets and plans to be formulated and monitored

(b) performance is communicated to the appropriate managers on an accurate, complete and timely basis

(c) financial systems and associated information are kept secure

(d) procedures are in place to ensure the information is only made accessible to authorised parties.


4.4 To make arrangements for the proper administration of the County Council’s financial affairs, including to:

(a) issue advice, guidance and procedures to officers and others acting on the County Council’s behalf

(b) determine the accounting systems, form of accounts and supporting financial records

(c) approve any new financial systems to be introduced

(d) commission and approve changes to be made to existing financial systems.

4.5 To ensure that staff using or developing financial and feeder systems understand:

(a) how they are used

(b) their responsibilities in relation to the management of the information in these systems

(c) training and guidance material.

4.6 To ensure that effective contingency arrangements, including back- up procedures, exist for computer systems. If possible, back-up information shall be securely retained in a fireproof location, preferably off site or at an alternative location within the building.

4.7 To ensure that, where appropriate, computer systems are registered in accordance with data protection legislation.

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4.8 To ensure that relevant standards and guidelines for computer systems are issued.

4.9 To ensure there is a documented and tested disaster recovery plan to allow information system processing to resume quickly in the event of an interruption.

4.10 To ensure there are effective arrangements for the:

(a) back-up and security of information. These arrangements should include contingencies for returning services where systems become unavailable or inaccessible through expected or unexpected events

(b) protection of computer equipment and software from loss and damage through theft, vandalism etc.

4.11 To comply with the copyright, designs and patents legislation and, in particular, to ensure that:

(a) only software legally acquired and installed by the County Council is used on its computers

(b) staff are aware of legislative provisions

(c) in developing systems, due regard is given to the issue of intellectual property rights.


4.12 To ensure that accounting records are properly maintained and held securely.

4.13 To ensure that documents in any media with financial implications are not destroyed, except in accordance with arrangements approved by the Head of Finance.

4.14 To incorporate appropriate controls in automatic or manual processes to ensure that, where relevant:

(a) all input is genuine, complete and accurate,

(b) all processing is carried out in an accurate, complete and timely manner.

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4.15 To consult with the Head of Finance before making changes to systems, or introducing new systems that impact on financial systems, processes and data.

4.16 To ensure that relevant standards and guidelines for computer systems are observed.

4.17 To ensure that procedures and policies in relation to data protection, freedom of information, information security and computer use are understood and complied with.

B4. Income


4.18 Effective income collection systems are necessary to ensure that all income due is identified, collected, receipted and banked properly. It is preferable to obtain income in advance of supplying goods or services as this improves the County Council’s cashflow and also avoids the time and cost of administering debts.

4.19 The County Council relies on income it collects to fund the services it provides. Loss of potential income or inability to predict income levels will impact on these vital services.

Key controls

4.20 The key controls for income are:

(a) all income due to the County Council is identified and charged correctly, in accordance with an approved charging policy, which is regularly reviewed

(b) all income is collected from the correct person, at the right time, using the correct procedures

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(c) all money received by an employee on behalf of the County Council is paid without delay to the Head of Finance or, as he or she directs, to the County Council’s bank and properly recorded. The responsibility for cash collection shall be separated from that:

(i) for identifying the amount due

(ii) for reconciling the amount due to the amount received

(d) effective action is taken to pursue non-payment within defined timescales

(e) formal approval for debt write-off is obtained

(f) appropriate write-off action is taken within defined timescales

(g) appropriate accounting adjustments are made following write-off action

(h) all appropriate income documents are retained and stored for the defined period in accordance with the document retention schedule

(i) money collected and deposited is reconciled to the bank account by a person who is not involved in the collection or banking process

(j) the county council keeps under review the services for which it makes charges and the level of those charges.


4.21 To agree arrangements for the collection of all income due to the Council and to approve the procedures, systems and documentation for its collection.

4.22 To recommend to cabinet arrangements for writing off bad debts including authorised limits.

4.23 To supply to departments appropriate documentation (electronic or paper) and processes to record income received by the Council.

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4.24 To approve all debts to be written off in consultation with the relevant Director and to keep a record of all sums written off up to the approved limit.

4.25 To obtain the approval of the cabinet in consultation with the relevant Director for writing off debts in excess of the approved limit.

4.26 To ensure that appropriate accounting adjustments are made following write-off action.

4.27 To put in place a robust payment card data security process to ensure compliance with the Payment Card Industry Data Security Standard (PCI DSS).


4.28 To establish a charging policy in consultation with the Head of Finance for the supply of goods or services, including the appropriate charging of VAT, and to review it regularly, in line with corporate policies.

4.29 To separate the responsibility for identifying amounts due and the responsibility for collection, as far as is practicable.

4.30 To establish and initiate appropriate recovery procedures, including legal action where necessary, for debts that are not paid promptly.

4.31 To issue official receipts or to maintain other documentation for cash income collection.

4.32 To ensure, in establishments where significant income is regularly received by post, that at least two employees are present when post is opened so that money received by post is properly identified and recorded.

4.33 To hold securely any records of income for the appropriate period.

4.34 To lock away all income to safeguard against loss or theft, and to ensure the security of cash handling.

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4.35 To ensure that income is paid fully and promptly into the appropriate bank account in the form in which it is received. Appropriate details shall be recorded to provide an audit trail. Money collected and deposited must be reconciled to the bank account on a regular basis.

4.36 To ensure income is not used to cash personal cheques or other payments.

4.37 To supply the Head of Finance with details relating to work done, goods supplied, services rendered or other amounts due, to enable the Head of Finance to record correctly the sums due to the County Council and to ensure accounts are sent out promptly. Directors have a responsibility to assist the Head of Finance in collecting debts that they have originated, by providing any further information requested by the debtor, and in pursuing the matter on the County Council’s behalf.

4.38 To keep a record of every transfer of income between individuals prior to banking. There should be an evidenced audit trail indicating who has been responsible for holding monies at any particular time.

4.39 To recommend to the Head of Finance all debts to be written off and to keep a record of all sums written off up to the approved limit. Once raised, no bona fide debt may be cancelled, except by full payment or by its formal writing off. A credit note to replace a debt can only be issued to correct a factual inaccuracy or administrative error in the calculation and/or billing of the original debt.

4.40 To obtain the approval of the Head of Finance or Cabinet where required when writing off debts in excess of the approved limit.

4.41 To notify the Head of Finance of outstanding income relating to the previous financial year as soon as possible after 31 March in line with the timetable approved by the Head of Finance.

4.42 To comply with the card data security process as put in place by the Head of Finance.

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C4. Ordering and paying for work, goods and services


4.43 Public money must be spent with demonstrable probity and in accordance with the County Council’s policies. Public procurement is highly regulated via European and English law and procedures are required to avoid breaches of the law and minimise risk.

4.44 The County Council’s procedures are designed to ensure that services obtain value for money from their purchasing arrangements. These financial procedures should be read in conjunction with the County Council’s Procurement Strategy and Procurement Regulations.

General

4.45 Every officer and member of the County Council engaged in contractual, commercial or purchasing decisions on behalf of the authority must declare any links or personal interests that they may have with tenderers, suppliers and/or contractors.

4.46 Apart from imprest accounts (the use of which shall be minimised) and schools’ own bank accounts, the normal method of payment from the County Council shall be by electronic funds transfer or payment card. Cheques or other instruments drawn on the authority’s bank account by the Head of Finance may also be used The use of direct debit is encouraged in appropriate cases but shall require the prior agreement of the Head of Finance.

4.47 Official orders may not be raised for any personal or private purchases, nor may personal or private use be made of authority contracts, other than those specifically established to provide staff benefits.

Key controls

4.48 The key controls for ordering and paying for work, goods and services are:

(a) all goods and services are ordered only by appropriate persons and are correctly recorded

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(b) all goods and services shall be ordered in accordance with the County Council’s Procurement Regulations

(c) where the Head of Finance so requires, goods and services received are checked to ensure they are in accordance with the order

(d) payments are not made unless goods have been received by the authority to the correct price, quantity and quality standards

(e) all payments are made to the correct person, for the correct amount and are properly recorded, regardless of the payment method

(f) all appropriate evidence of the transaction and payment documents are retained (as originals or microfiches or microfilms or in an electronic records management system approved by the Head of Audit Services) for the defined period, in accordance with the document retention schedule

(g) all expenditure, including VAT, is accurately recorded against the right budget and any exceptions corrected

(h) processes are in place to maintain the confidentiality, integrity and availability of data used in transacting business electronically.


4.49 To approve the County Council’s ordering, receipting and payment processes.

4.50 To make payments from the County Council’s funds on the Director’s authorisation that the expenditure has been duly incurred in accordance with financial and procurement regulations.

4.51 To make payments, whether or not provision exists within the estimates, where the payment is specifically required by statute or is made under a court order.

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4.52 To make payments to works contractors on the certificate of the appropriate Director, which must include details of the value of work, retention money, amounts previously certified and amounts now certified.

4.53 To provide guidance on making payments by the most economical means.

4.54 To ensure that a budgetary control system is established that enables material commitments incurred by placing orders to be shown against the appropriate budget allocation so that they can be taken into account in budget monitoring reports.

4.55 Maintain an end to end requisition to payment process that ensures :

(a) receipt of goods or services (except in categories of spend where the Head of Finance agrees that receipting is not appropriate)

(b) that no invoice is paid more than once

(c) that expenditure has been properly incurred

(d) that sums invoiced for are correct and accord with quotations, tenders, contracts or catalogue prices

(e) correct accounting treatment of tax

(f) that the invoice is correctly coded

(g) that discounts have been taken where available

(h) that appropriate entries are made in accounting records.

4.56 To maintain a corporate contracts register listing all contracts with a value of more than £10,000.


4.57 To comply with the Procurement Strategy and Regulations and with ordering, receipting and payments processes laid down by the Head of Finance.

4.58 To update the corporate contracts register in accordance with procedures specified by the Head of Finance.

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4.59 To ensure that orders are only used for goods and services provided to the directorate. Individuals must not use official orders to obtain goods or services for their private use.

4.60 To ensure that only those staff authorised by him or her place orders and to maintain an up-to-date list of such authorised staff and the limits of their authority. The authoriser of the order must be satisfied that the goods and services ordered are appropriate and needed, that there is adequate budgetary provision and that quotations or tenders have been obtained where the Procurement Regulations so require.

4.61 To ensure that payment is not made unless a proper VAT invoice (self-billed electronic or paper) has been received, checked, coded and certified for payment (either manually or electronically).

4.62 To ensure that payments are not made on a photocopied or faxed invoice, statement or document other than the formal invoice unless in exceptional circumstance after consultation with the Head of Finance.

4.63 To encourage suppliers of goods and services to receive payment by the most economical means for the County Council and to mandate the acceptance of electronic funds transfer in respect of all contracts with a value of more than £10,000. It is essential, however, that payments made by direct debit have the prior approval of the Head of Finance.

4.64 To ensure that employees are aware of the national code of conduct for local government employees and local arrangements as set out in the local code of conduct which can be found on COLIN. http://colin.suffolkcc.gov.uk/NR/rdonlyres/59082662-070C-4857-A53C-2673E3BF30B8/0/OfficersInterestsGuidanceNotesOct2012.pdf

4.65 To notify the Head of Finance of outstanding expenditure relating to the previous financial year as soon as possible after 31 March in line with the timetable approved by the Head of Finance.

4.66 To notify the Head of Finance immediately of any expenditure to be incurred as a result of statute/court order where there is no budgetary provision.

http://colin.suffolkcc.gov.uk/NR/rdonlyres/59082662-070C-4857-A53C-2673E3BF30B8/0/OfficersInterestsGuidanceNotesOct2012.pdf



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4.67 To ensure that all appropriate payment records are retained and stored for the defined period, in accordance with the document retention schedule.

D4. Taxation


4.68 Like all organisations, the County Council is responsible for ensuring its tax affairs are in order. Tax issues are often very complex and the penalties for incorrectly accounting for tax are severe. It is therefore very important for all officers to be aware of their role.

Key controls

4.69 The key controls for taxation are:

(a) budget managers are provided with relevant information and kept up to date on tax issues

(b) budget managers are instructed on required record keeping

(c) all taxable transactions are identified, properly carried out and accounted for within stipulated timescales

(d) records are maintained in accordance with instructions

(e) returns are made to the appropriate authorities within the stipulated timescale.


4.70 To complete all HM Revenue and Customs returns regarding PAYE.

4.71 To complete a monthly return of VAT inputs and outputs to HM Revenue and Customs.

4.72 To provide details to HM Revenue and Customs and relevant contractors regarding the construction industry tax deduction scheme.

4.73 To maintain up-to-date guidance for County Council employees on taxation issues.

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4.74 To follow the guidance on taxation issued by the Head of Finance.

4.75 In particular to ensure that all VAT on purchases is recorded in compliance with guidance issued by the Head of Finance.

4.76 To ensure that, where construction and maintenance works are undertaken, the contractor fulfils the necessary construction industry tax deduction requirements.

4.77 To ensure that all persons employed by the County Council are added to the payroll and tax deducted from any payments, except where the individuals are bona fide self-employed or are employed by a recognised staff agency.

E4. Business Units


4.78 The County Council is required to keep separate records for all support services provided on a basis other than straightforward recharge of cost. These services are termed business units.

Key controls

4.79 All business units will produce a medium term (3 year) business plan on an annual basis in accordance with guidance issued by the Head of Finance.

4.80 Business units will use the corporate financial system and adopt standard financial processes unless an exception is agreed with the Head of Finance.

4.81 Business units will maintain adequate reserves to manage their business and ensure that they can replace assets used in the delivery of their services. Reserves accumulated above this required level may be transferred to the county fund.


4.82 To advise and issue guidance on the establishment and operation of business units.

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4.83 To approve the creation of new business units.

4.84 To issue guidance on the required content of business plans for business units to include issues such as charging, overheads, cost of risk and management of assets.

4.85 To agree any exceptional arrangements for financial systems and processes for business units.


4.86 To review their operations and ensure that relevant services are correctly classified as business units under guidance issued by the Head of Finance.

4.87 To consult with the Head of Finance where a business unit wishes to enter into a contract with a third party where the contract expiry date exceeds the remaining life of their main contract with the County Council. In general, such contracts shall not be entered into unless they can be terminated within the main contract period without penalty.

4.88 To follow all guidance on the operation of business units.

4.89 To ensure that the same accounting principles are applied in relation to business units as for other services.

4.90 To ensure that each business unit prepares an annual 3 year business plan in accordance with guidance issued by the Head of Finance.

F4. Divestments


4.91 The County Council has made a commitment to be a smaller and more effective council, with a much greater emphasis on commissioning and much lower levels of direct service provision. Through the divestment programme the Council has supported the establishment of a range of organisations, including a wholly owned company, a mutual, and two industrial provident societies.

Key Controls

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4.92 The Head of Finance retains responsibility for wholly owned companies. The degree of involvement required to discharge the Section 151 Officer duty needs to be proportionate to the perceived risk. Assurance will be taken from:

(a) the companies external audit of the statement of accounts

(b) oversight of the budget planning process

(c) an assessment of the knowledge of the skills and experience of board members especially Council respresentatives

(d) regular meetings with the Directors of the Company and Chairman of the Board

(e) Sight of all board papers to ensure financial matters are being properly addressed.

EXTERNAL ARRANGEMENTS

A5. Partnerships

General

5.1 The term partnerships can be used to describe two very different ways of working with other organisations - contractual relationships and joint working arrangements . This section uses the term partnerships as a description of joint working arrangements. The governance arrangements for contractual relationships (i.e. the purchase of services, goods and works) are governed by procurement law and must be established in accordance with the council’s procurement regulations.

5.2 Partnerships are defined within the County Council as: “An agreement between two or more independent bodies who work collectively to achieve an objective”. A distinction is drawn between “planning partnerships” and “delivery partnerships”.

5.3 Cabinet is responsible for approving delegations, including frameworks for partnerships. Cabinet is the focus for forming partnerships with other local public, private, voluntary and community sector organisations to address local needs.

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5.4 Cabinet can delegate functions – including those relating to partnerships – to officers. Where functions are delegated, Cabinet remains accountable for them to Council.

5.5 The Chief Executive represents the County Council on partnership and external bodies, in accordance with the scheme of delegation.

5.6 The Assistant Director Scrutiny and Monitoring is responsible for promoting and maintaining the same high standards of conduct in partnerships that apply throughout the Council.

5.7 The Head of Finance must ensure that the accounting arrangements to be adopted relating to partnerships and joint ventures are satisfactory, and that audit arrangements are appropriate.

5.8 Good governance of partnerships requires the following to be taken into account:

(a) the identified need for a partnership – how will entering into a partnership help the Council meet its objectives and aims

(b) financial arrangements underpinning the partnership

(c) the significance of that partnership

(d) the risk associated with that partnership

(e) the value for money attained through that partnership

(f) performance management arrangements to monitor that partnership.

5.9 Directors are responsible for ensuring that appropriate approvals are obtained before any negotiations are concluded in relation to work with external bodies.


5.10 Partnerships play a key role in delivering the community strategy and in helping to promote and improve the well-being of the area. The County Council work in partnership with others – public agencies, private companies, community groups and voluntary organisations.

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5.11 The County Council mobilises investment, bids for funds, champions the needs of Suffolk and harnesses the energies of local people and community organisations. We will be measured by what we achieve in partnership with others.

5.12 Partnerships may result in the establishment of contractual relations and any such relations must be entered into in accordance with the Procurement Regulations. There is no general exemption from procurement law for public-public contracting.

5.14 The main reasons for entering into a partnership are:

(a) the desire to find new ways to share risk

(b) the ability to access new resources

(c) to provide new and better ways of delivering services

(d) to forge new relationships.

Key controls

5.15 The key controls for County Council partners are:

(a) to be aware of their responsibilities under the County Council’s financial regulations and to verify that any proposed partnership does not fall within the ambit of the Procurement Regulations

(b) to ensure that risk management processes are in place to identify and assess all known risks

(c) to ensure that project appraisal processes are in place to assess the viability of the project in terms of resources, staffing and expertise

(d) to agree and accept formally the roles and responsibilities of each of the partners involved in the project before the project commences

(e) to communicate regularly with other partners throughout the project so that problems can be identified and shared to achieve their successful resolution

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(f) to meet the required standard of corporate governance.


5.16 To advise on effective controls that will ensure that resources are not wasted.

5.17 To advise on the key elements of funding a project. They include:

(a) a scheme appraisal for financial viability in both the current and future years, including exit strategies

(b) risk assessment and management

(c) resourcing, including taxation issues

(d) audit, security and control requirements.

5.18 To ensure that the accounting arrangements are appropriate.


5.19 To ensure that, before entering into agreements with external bodies, a risk management appraisal has been prepared for the Head of Finance.

5.20 To ensure that such agreements and arrangements do not impact adversely upon the services provided by the County Council.

5.21 To comply with Procurement Regulations.

5.22 To discuss proposals with the Head of Legal Services to ensure that all agreements and arrangements are properly documented.

5.23 To provide appropriate information to the Head of Finance to enable a note to be entered into the County Council’s statement of accounts concerning material items.

5.24 To ensure that the County Council’s internal auditors have appropriate access to financial records in order to carry out their statutory duties.

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B5. External funding


5.25 External funding is potentially a very important source of income, but funding conditions need to be carefully considered to ensure that they are compatible with the aims and objectives of the County Council. Local authorities are increasingly encouraged to provide seamless service delivery through working closely with other agencies and private service providers. Funds from external agencies such as the National Lottery provide additional resources to enable the County Council to deliver services to the local community. However, in some instances, although the scope for external funding has increased, such funding is linked to tight specifications and may not be flexible enough to link to the County Council’s overall plan.

Key controls

5.26 The key controls for external funding are:

(a) to ensure that key conditions of funding and any statutory requirements are complied with and that the responsibilities of the accountable body are clearly understood

(b) to ensure that funds are acquired only to meet the approved priorities of the County Council

(c) to ensure that any match-funding requirements are given due consideration prior to entering into long-term agreements and that future revenue budgets can accommodate and reflect these requirements or a managed exit strategy is in place.


5.27 To ensure that all funding notified by external bodies is received and properly recorded in the County Council’s accounts.

5.28 To ensure that the match-funding requirements are considered prior to entering into the agreements and that future revenue budgets reflect these requirements.

5.29 To ensure that audit requirements are met.

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5.30 To ensure that all claims for funds are made by the due date.

5.31 To ensure that the project progresses in accordance with the agreed timetable and that all expenditure is properly incurred and recorded.

5.32 To ensure that risk associated with grant funding (such as unexpected withdrawal of funding) are mitigated and managed.

C5. Work for third parties


5.33 Current legislation enables the County Council to provide a range of services to other bodies. Such work may enable a unit to maintain economies of scale and existing expertise. Arrangements must be in place to ensure that any risks associated with this work is minimised and that such work is intra vires.

Key controls

5.34 The key controls for working with third parties are:

(a) to ensure that proposals are costed properly in accordance with guidance provided by the Head of Finance

(b) to ensure that contracts are drawn up using guidance provided by the Head of Legal Services and that the formal approvals process is adhered to

(c) to issue guidance with regard to the financial aspects and control of third party contracts and the maintenance of the contract register.


5.35 To issue guidance with regard to the financial aspects of third party contracts and the maintenance of the contract register.

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5.36 To ensure that the approval is obtained before any negotiations are concluded to work for third parties in accordance with guidance issued by the Head of Finance.

5.37 To maintain a register of all contracts entered into with third parties in accordance with procedures specified by the Head of Finance.

5.38 To ensure that appropriate insurance arrangements are made.

5.39 To ensure that the County Council is not put at risk from any bad debts.

5.40 To ensure that no contract is subsidised by the County Council.

5.41 To ensure that, wherever possible, payment is received in advance of the delivery of the service.

5.42 To ensure that the department/unit has the appropriate expertise to undertake the contract.

5.43 To ensure that such contracts do not impact adversely upon the services provided for the County Council.

5.44 To ensure that all contracts are properly documented.

5.45 To provide appropriate information to the Head of Finance to enable a note to be entered into the statement of accounts.

D5. Provision of Grant to Other Organisations

5.46 The County Council can support voluntary and other organisations through the payment of grants. It is important that these grant payments are made within a controlled and structured programme, and that the objectives of the organisation supported are consistent with those of the County Council.

Key Controls

5.47 The key controls for grant payments are:

(a) to ensure that terms and conditions set out by the County Council are complied with

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(b) that the grant monies are used solely for the purpose provided

(c) that the recipient body reports back to the County Council on achievement of outcomes.


5.48 To ensure that payments are only made to organisations meeting appropriate criteria.


5.49 To ensure that grant recipients complete the appropriate application form, which should be signed by an officer or trustee of the organisation.

5.50 To ensure that the organisation agrees to

(a) Use the money within a set period and for the reasons given in the application form

(b) have a constitution or set of rules to work to, together with a statement of their activities

(c) involve those benefiting from their service in planning and delivering those services

(d) have an equal opportunities policy or statement or be working towards this

(e) meet all legal requirements on issues such as staff employment and health and safety

(f) report back to the County Council on how the money has been spent

(g) allow access to auditors as necessary to carry out their statutory duties.

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GLOSSARY Accounting Policies: The underlying rules that explain how financial records should be maintained. Approved estimate: A line in the budget book that is approved by the Council each year. Budget book: The resources budget and medium term financial plan approved by Council for each financial year. Business Units: A delivery unit that seeks to work commercially and has therefore introduced financial arrangements other than delegation or devolvement of budgets. These are likely to involve a transfer of risk to the delivery unit and charging for services either on a unit or lump-sum basis. Capital expenditure: Spending on assets with a long term value such as land, buildings, vehicles or computer equipment. This may involve purchase or improvement of these assets. Capital Programme: Planned spending to enable the council to purchase, build or improve assets with a long term value such as land, buildings, computers and vehicles. Contingency: A budget approved each year to provide for costs that arise during the year but cannot be specifically planned for. Contingencies are likely to be called upon in most years; they allow the council some flexibility to manage without calling on reserves. County fund reserve: The county fund reserve is a general reserve set aside to cover unexpected future demands or spending pressures. This helps to ensure that the council is always in a secure financial position. Directorates: The financial regulations use the term Directorate as a term to cover the entirety of the service responsibilities of a Director. Earmarked Reserve: Funds set aside for specific purposes in the future. They include money set aside for future capital investment and services improvements. External Funding: Income granted to the County Council through programmes other than mainstream central government funding (such as the National Lottery or European Union funding streams).

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Governance: Governance arrangements are put in place to develop and manage consistent, cohesive policies, processes and decision-rights for a given area of responsibility. Head of Finance: The Head of Finance is the section 151 Officer, the responsible financial officer for the County Council. Imprest accounts: These are bank accounts or cash advances provided to allow employees of the county council to pay for minor items in a cost effective and convenient way. Inventory: List of equipment or other items held that do not meet the definition of long term assets. Lump sum budget: A budget approved as a single sum for later distribution to a number of separate projects or service areas. Medium term planning: The County Council prepares 3 year forward plans known as medium term plans. Partnerships: Joint working arrangements between two or more independent bodies who work collectively to achieve an objective.

Payment Card Industry Data Security Standard (PCI DSS): A framework which offers a comprehensive approach to safeguarding sensitive payment card data. Procurement Regulations: The County Council's approved rules for managing purchasing decisions and processes across the county council. Projected expenditure: The latest forecast level of spending at the end of the financial year. Reserve: Accumulated funds held by the county council. Risk management: The planned and systematic approach to the control of risk. Service reserves: Reserves held by directorates to allow them to normally manage unexpected events and protect it from overspending without calling on the county fund reserve. Treasury management: Management of the County Council's money to ensure that best use is made of available funds while ensuring the money is secure.

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Virement: Transfer of agreed budgets between headings. Virement does not increase the overall budget but simply moves it. Year end balance: The difference between the actual spending of a service at the end of the year and the budget provided for that service. Bibliography Service Reporting Code of Practice for Local Authorities 2012-13 CIPFA Code of Practice on Local Authority Accounting in the United Kingdom 2012/13 Accounts Practitioners' Guide to Capital Finance in Local Government (2012 Edition) Treasury Management in Public Services: Guidance Notes for Local Authorities including Police and Fire Authorities (2011 Edition) Group Accounts in Local Authorities: Practitioners' Workbook (Fully Revised Second Edition 2011)

http://www.cipfa.org/Policy-and-Guidance/Publications/P/Practitioners-Guide-to-Capital-Finance-in-Local-Government-2012-Edition-Hard-Copy

http://www.cipfa.org/Policy-and-Guidance/Publications/P/Practitioners-Guide-to-Capital-Finance-in-Local-Government-2012-Edition-Hard-Copy

http://www.cipfa.org/Policy-and-Guidance/Publications/G/Group-Accounts-in-Local-Authorities-Practitioners-Workbook-Fully-Revised-Second-Edition-2011-CDROM

http://www.cipfa.org/Policy-and-Guidance/Publications/G/Group-Accounts-in-Local-Authorities-Practitioners-Workbook-Fully-Revised-Second-Edition-2011-CDROM

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