| Importance of this area |
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| Financial Management covers all financial accountabilities in relation to the running of the Authority, including the Policy Framework and budget. Below are set out the main areas of responsibility of financial management. |
A 1 The Full Council
The Full Council is responsible for adopting the Authority’s constitution and Members code of conduct and for approving the policy framework, budget and borrowing within which the Executive operates. It is also responsible for approving and monitoring compliance with the Authority’s overall framework of accountability as set out in its constitution and is responsible for monitoring compliance with agreed policy and reporting decisions taken.
A 2 The Executive
The Executive is responsible for proposing the policy framework and budget to the Full Council. Within the approved policy and budget frameworks the Executive is responsible for day to day direction of the Council’s affairs. The Constitution provides for the necessary decision-making at three levels:
(a) Key Decisions – decisions which by reason of their financial, strategic or corporate importance are taken by the whole Executive;
(b) Executive Member Decisions – each member of the Executive is assigned a particular area of service responsibility (an Executive Remit) and can take decisions within that Remit after the proposal has been notified to all members of the Council;
(c) Chief Officer Decisions – decisions taken within a chief officer’s professional or management role or in accordance with specific delegated powers.
A 3 Committees
A 3.1 Overview and Scrutiny Committees are responsible for scrutinising Executive decisions and for holding the Executive to account.
A 3.2 The Audit Committee is an advisory body that reports to the Full Council. It has the right of access to all of the information it considers necessary and can consult directly with internal or external auditors. The Committee is responsible for reviewing the external auditor’s reports, the annual audit letter and the internal audit’s annual plan and report.
A 3.3 The Standards Committee is responsible for advising the council on the adoption and revision of the Members code of conduct and for monitoring the operation of the code.
A 4 Statutory Officers
A 4.1 The Head of Paid Service is responsible for the corporate and overall strategic management of the Authority as a whole. He/she must report to and provide information for the Executive, the Full Council, the Overview and Scrutiny Committees and other Committees. He/she is responsible for establishing a framework for management direction, style and standards and for monitoring the performance of the organisation.
A 4.2 The Monitoring Officer is responsible for promoting and maintaining high standards of financial conduct and for reporting any actual or potential breaches of the law or maladministration and for ensuring that the procedures for recording and reporting key decisions are operating effectively. The Monitoring Officer is responsible for advising all members and officers about who has the authority to take a particular decision and whether a decision is likely to be considered contrary to the policy framework. The Monitoring Officer and the Director of Finance, IT & Trading are also responsible for advising the Executive or Full Council if a decision could be considered contrary to the budget. An example of such a decision would be promoting a new policy without thought as to the budget implications.
A 4.3 The Director of Finance, IT & Trading (The Chief Finance Officer)
Lawfulness and Financial Prudence of Decision Making
After consulting with the Head of the Paid Service and the Monitoring Officer, the Chief Finance Officer will report to the Full Council or to the Executive in relation to an Executive function and the Council’s external auditor if he/she considers that any proposal, decision or course of action will involve incurring unlawful expenditure or is unlawful and is likely to cause a loss or deficiency or if the Council is about to enter an item of account unlawfully.
The Director of Finance, IT & Trading, if necessary in conjunction with the Chief Executive and after consultation with the leader of the Council, shall have the powers to take any action necessary to safeguard the interests of the Council.
Administration
The Director of Finance, IT & Trading has responsibility for the proper administration of the Authority’s financial affairs. This includes setting and monitoring compliance with financial management standards, advising on the corporate financial position and on key financial controls, providing financial advice, advising on preparation of revenue and capital budgets, and treasury management.
These responsibilities are set out in statute such as section 151 of the Local Government Act 1972. They refer to the totality of the financial affairs of the Authority in all its dealings. The rights and responsibilities of the Director of Finance, IT & Trading in relation to school delegated budgets are constrained, in part, by the provisions of the Education Reform Act 1988 and the School Standards and Framework Act 1998. Details are provided in the Devon Scheme for the Financing of schools.
Advice
The Director of Finance, IT & Trading is responsible for advising committees on all financial matters. He/she must be consulted on all financial matters and given adequate opportunity to provide written comments in any report with financial implications. All reports to the Executive or Committees with a significant financial implication are to be made under the joint names of the Service Director concerned and the Director of Finance and IT.
Where the urgency procedures set out in the Council’s Constitution are to be invoked, the Director of Finance, IT & Trading must first be consulted on financial and other resource implications.
A 4.4 Money Laundering Reporting Officer
The Head of Finance Services is appointed as the Money Laundering Reporting Officer and the Head of Audit Services is appointed as the Deputy Money Laundering Reporting Officer.
They will be responsible for notifying the National Criminal Intelligence Service (NCIS) of any suspected cases of money laundering committed within the accounts of Devon County Council as soon as possible and fulfil other duties as defined by legislation or regulation related to the post. Simultaneeously, the Executive Member for Policy and Resources will be kept informed of any notifications to NCIS and of any issues arising from them.
A 5 Service Directors must operate efficient systems of financial control and are responsible for
(a) ensuring that executive members are advised of the financial implications of all proposals and that the financial implications have been agreed by the Director of Finance, IT & Trading
(b) ensuring that executive members are advised of legal implications of all proposals and that the legal implications have been agreed with the Monitoring Officer.
(c) the Signing of contracts on behalf of the Authority (except where the seal of the council is applied). Service Directors may delegate authority to sign contracts below £100,000 to a Deputy or an Officer to whom they have specifically delegated authority to sign contracts. The Director of Adult & Community Services may delegate authority for signing contracts. relating to the Supporting People Programme below a value of £750,000 and Social Care Contracts below a value of £250,000 to his/her Deputy.
(d) Consulting with the Director of Finance, IT & Trading and seeking his/her approval on any matter that could materially affect the authority’s financial position before any commitments are incurred.
Other Financial Accountabilities
A 6 Accounting Arrangements
A 6.1 The Director of Finance, IT & Trading is responsible for keeping the accounts and financial records of the Council. He/she must also approve accounting and other systems with a financial function and accounting records of directorates.
A 6.2 Accounting procedures will reflect recommended professional practices, and follow accounting principles as determined by the Director of Finance, IT & Trading. Accounting procedures will be reviewed as necessary by the Director of Finance, IT & Trading in consultation with Service Directors to ensure that they provide the information required by both without duplication of records.
A 6.3 No change to existing accounting procedures must be made without prior consultation with the Director of Finance, IT & Trading.
A 6.4 The Director of Finance, IT & Trading must examine and certify where required any submission, estimate or claim for payment of grant by a Government Department or funding from any other body. Officers responsible for the administration of such grants, funds and spending associated with them must ensure compliance with the conditions of the grant/funding and where appropriate adhere to the Council’s Minimum Standards for External Funding.
A 6.5 The Director of Finance, IT & Trading must examine and certify where required any financial return to a Government Department or other body.
A 7 Year end accounting
A 7.1 The Director of Finance, IT & Trading is responsible for ensuring that the annual statement of accounts is prepared in accordance with the “Code of Practice on Local Authority Accounting in the United Kingdom: A Statement of Recommended Practice” (CIPFA/LASAAC). The Executive is responsible for approving the annual Revenue and Capital Outturn and for agreeing procedures for carrying forward under and over-spending on budget headings. The County Council's final financial position as presented in the Annual Statement of Accounts will be approved by the Audit Committee on behalf of the Council.
A 8 Financial training
A 8.1 Service Directors are responsible for ensuring staff receive appropriate training to undertake their financial responsibilities, in accordance with any standards set by the Director of Finance, IT & Trading
A 9 Grants and subscriptions
A 9.1 Service Executive Members (advised by the relevant Service Director) will approve all grants or subscriptions exceeding £20,000. Grants or subscriptions below this level will be approved by the relevant Service Director (where this payment exceeds £10,000 the Executive Member should be kept informed).
A 9.2 Officers must satisfy themselves that organisations to be grant-aided are financially viable for the duration of the appropriate project or activity. They must also give local members adequate notice of any grant they propose to make or withdraw.
A 10 Use of Capital Receipts
A 10.1 All capital receipts will be treated as corporate capital receipts unless specific approval is obtained from the Executive for an alternative treatment.
A 11 Use of Consultants
A 11.1 If any professional person is to be engaged as a lead consultant for a major organisational review or to lead a major project on behalf of the County Council the approval of the Executive Member must first be obtained .
A 11.2 For projects and activities under their control, Directors may appoint specialist sub-consultants up to the value of £100,000 per consultant
A 12 Commercial units
A 12.1 The management and control of the Commercial Units is the direct responsibility of the relevant Director who must ensure they operate within the requirements and constraints of public accountability required by law and embodied in Financial Regulations.
A 12.2 Commercial Units will be required to adopt the appropriate accounting practices advised by the Director of Finance, IT & Trading and are required to comply with Financial Regulations except where exceptional arrangements are made by the Director of Finance, IT & Trading and approved by Executive.
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