| Importance of this area |
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| It is essential that robust, integrated systems are developed and maintained for identifying and evaluating all significant operational risks to the Authority. Equally, regulations are needed to ensure arrangements are in place to protect the assets and resources of the Council. |
C1 Risk Management
C1.1 The Executive is responsible for approving the authority’s risk management strategy and for reviewing the overall effectiveness of the strategy.
C1.2 The Director of Finance, IT & Trading, in conjunction with Service Directors, is responsible for preparing the authority's risk management policy statement and for promoting it throughout the Authority and updating it.
C1.3 The general controls for risk management are :-
C1.3.1 Procedures are in place to identify, assess, prevent or contain material known risks and these procedures are operating effectively throughout the authority. C1.3.2 A monitoring process is in place to review the effectiveness of risk reduction strategies and the operation of these controls C1.3.3 Managers know which risks they are responsible for managing and are provided with the relevant information C1.3.4 Provision is made for any losses that might result from the risks that remain. C1.3.5 Claims are investigated within a given time scale C1.3.6 Acceptable levels of risk are determined and insured against where appropriate C1.3.7 The Authority has identified business continuity plans in the event of a disaster that results in significant loss or damage to its resources. |
C2 Internal Control
Internal control refers to the systems of control devised by management to help ensure the Council’s objectives are achieved in a manner that promotes economical, efficient and effective use of resources and that the Council’s assets and interests are safeguarded.
Systems of internal control
C2.1 The Director of Finance, IT & Trading is responsible for advising on effective systems of internal control. These arrangements need to ensure compliance with all applicable statutes and regulations, and other relevant statements of best practice.
C2.2 It is the responsibility of Service Directors to establish sound arrangements for planning, appraising, authorising and controlling their operations to achieve continuous improvement, economy, efficiency and effectiveness and for achieving their financial performance targets.
C2.3 The Director of Finance, IT & Trading will prepare an annual statement on the effectiveness of the County Council's system of internal control. THis statement will be published as part of the Annual Statement of Accounts and will be approved by the Audit Committee.
C3 Separation of duties
Financial procedures must be undertaken whenever possible using separate persons to undertake different parts of a sequence of operations so that no one person authorises the whole of any one transaction. An example would be ordering, receiving and authorising payment for a transaction, where at least two, if not three, people should be involved in the separate parts of the process.
C4 Retention of records
Accounting and other records must be retained for periods that comply with relevant legal requirements and the detailed standards below.
C4.1 Records must be retained for periods specified by Internal Audit, which will ensure the Council’s compliance with VAT and other law. The following periods provide a broad indication only:
(a) Expenditure records (e.g. order books, invoices) should generally be retained for three years plus the current year.
(b) Income records (e.g. receipt books, debtor invoices) should generally be retained for six years plus the current year.
(c) All records associated with grant funding must be retained for longer periods if required by the funding body.
C5 Investments and Treasury Management
C5.1 All investments of money under its control shall be made in the name of the Council or in the name of nominees approved by the Executive.
C5.2 All securities that are the property of or in the name of the Council or its nominees, and the title deeds of all property in its ownership, shall be held by the Director of Finance and IT or appointed custodians/other nominees or the Council 's bankers as appropriate.
C5.3 All borrowings will be in the name of the Council.
C5.4 The Director of Finance, IT & Trading will be the Council's registrar of stocks, bonds and mortgages and will maintain records of all borrowing of money by the Council.
C5.5 Funds held in trust will wherever possible be in the name of the Council.
C5.6 All officers acting as trustees or controlling funds by virtue of their official position have a duty to exercise due care over the custody of valuables and documents and the administration of funds.
C5.7 The Council adopts the key recommendations of CIPFA’s Treasury Management in Public Services: Code of Practice (the Code).
C5.8 Accordingly, the Council will create and maintain, as the cornerstone for effective treasury management : a treasury management policy statement, stating the policies and objectives of its treasury management activities;
| suitable treasury management practices (TMP), setting out the manner in which the organisation will seek to achieve those policies and objectives, and prescribing how it will manage and control those activities. |
C5.9 The Council (the Executive) will receive reports on its treasury management policies, practices and activities, including, as a minimum, an annual strategy and plan in advance of the year and an annual report after its close.
C5.10 The Council delegates responsibility for the implementation and monitoring of its treasury management policies and practices to the Executive, and for the execution and administration of treasury management decisions to the Director of Finance, IT & Trading who will act in accordance with the organisation’s policy statement and TMP’s and, if a CIPFA Member (as currently), with CIPFA’s Standard of Professional Practice on Treasury Management.
C5.11 The Full Council is required to approve certain maximum borrowing levels before the start of each financial year based on the recommendations of the Director of Finance a.
C5.12 The Director of Finance, IT & Trading is empowered to make decisions regarding the premature repayment of debt and the acquisition of new debt (debt rescheduling) within the borrowing limits set by the Executive. All such decisions will be in line with the County Council’s Treasury Management Policy Statement. A full analysis of the budgetary implications of the debt rescheduling will be undertaken before any decision is reached. This analysis will include an assessment of all risk factors affecting the current and future cost implications of the debt rescheduling.
C6 Security of Council Property
C6.1 The Director of Finance, IT & Trading will maintain a register of land and buildings owned by the Council and have custody of all title deeds under secure arrangements.
C6.2 Service Directors are responsible for maintaining proper security of Council property and cash holdings in accordance with the detailed standards below:
C6.2.1 Other than where approved by the Service Director the Council’s property must not be removed other than in the ordinary course of the Council’s business or used other than for the Council’s purposes. C6.2.2 Where Council property is held in the homes of Officers or Members, those individuals must make reasonable arrangements for its safe custody and return the property when required by the Council. C6.2.3 Maximum limits for cash holdings must be agreed with the Director of Finance, IT & Trading and must not be exceeded without express permission. C6.2.4 All reasonable steps should be taken for the secure storage of cash. The Council's Insurance policy for cash storage carries a £50 excess, which would be borne by the establishment suffering the loss. C6.2.5 Keys to safes and similar receptacles must be subject to adequate security and the loss of keys must be reported to the Director of Finance, IT & Trading immediately. Safes and similar receptacles must be subject to an annual contents review, listing and certification by an appropriate manager. |
C6.3 The Director of Finance, IT & Trading is responsible for maintaining proper security and privacy of information held in the main computer installation.
C6.4 Service Directors are responsible for controlling access to main computer installation data and access to all computer data within their own directorates in accordance with the Council’s Data Protection and Security Policy and Guidelines.
C7 Sale of Assets
C7.1 Service Directors may make arrangements for disposal of surplus items (excluding land and buildings and leased items) with an estimated value of up to £100. For surplus items with an estimated value in excess of £100 the sale must be arranged by the Chief Purchasing Officer.
C7.2 All asset disposals must be undertaken so as to maximise income to the Council and no favour should be shown to staff or other third parties.
C8 Stocks and Stores
C8.1 Service Directors are responsible for the custody and control of stocks and stores in their directorates in accordance with the detailed standards below.
Detailed Standards C8.1.1 Unless otherwise agreed in writing by the Director of Finance, IT & Trading, a complete record of all stores received on behalf of the Council, whether from suppliers, surplus stores, as gifts, or material returned from works sites, together with a record of all issues made and balances in hand at any time must be kept in a form agreed by the Director of Finance, IT & Trading C8.1.2 In addition to the periodical testing of stocks in hand, unless agreed otherwise in writing by the Director of Finance, IT & Trading, Service Directors must undertake a complete stocktaking of all stores at least once during each financial year. C8.1.3 Where required by the Director of Finance, IT & Trading, stock sheets must be prepared and passed to him/her showing at 31st March (as nearly as may be), the actual stocks in hand and their value. This will be as revealed by the stocktaking (see C 8.1.4 below). The stocks in hand and their value must be shown in the stores accounts, together with any surpluses or deficiencies. C8.1.4 The stocktaking must be supervised by a responsible person (other than the person responsible for the stores) nominated for the purpose by the Service Director, and both the person taking the stock and the person supervising must certify the stock sheets. C8.1.5 Any deficiency, theft or other loss in value including obsolete stock exceeding 2.5% or £1,000 whichever is the greater, on any one item revealed on the occasion of the annual stocktaking or otherwise, must be reported at the earliest opportunity to the Director of Finance, IT & Trading and to the Executive for the necessary authority to write off each deficiency or to obtain a decision as to other action to be taken. The report must state the quantities and values in question, together with any other relevant information. The Director of Finance, IT & Trading is empowered to write off deficiencies not requiring an Executive decision. C8.1.6 Wherever a storekeeper or person in charge of stores hands over, leaves or ceases to have custody of stores, the Service Director must ensure that a prior check is made of the stores concerned and that a handing over certificate is signed by the out-going and incoming officers. C8.1.7 Stocks and stores must not be carried by any directorate in excess of reasonable requirements as ascertained by experience. |
C9 Inventories
C9.1 Service Directors are responsible for the maintenance of inventories of plant and equipment for establishments in their control in accordance with the detailed standards below.
Detailed Standards C9.1.1 Inventories of plant, equipment, and other moveable articles including those donated or held under leasing agreements or on trust, must be maintained in accordance with the instructions of the Director of Finance, IT & Trading in respect of each establishment, depot or other appropriate unit. Such inventories must include items held at the homes of Officers or Members. Service Directors must ensure that:- (a) such inventories are kept up-to-date; (b) items held under leasing agreements are appropriately identified; (c) any deficiency, theft or other loss is reported at the earliest opportunity to the Director of Finance, IT & Trading, who may advise the Executive; (d) the deletion of items from inventories is authorised by the countersignature of an appropriate Officer; (e) details of the disposal of the items are stated on the inventory; (f) an adequate record is maintained of transfer of control and any temporary borrowing or other removal from the establishment of any item which is (or should be) listed in the inventory, including items held at the homes of Officers or Members; (g) whenever an Officer who is responsible for the custody of the items recorded in an inventory hands over that responsibility to another, the inventory is checked and the incoming Officer must sign as accepting responsibility for the custody of the items recorded in the inventory; a complete inventory check is carried out at least annually, and the result certified by the Head of Establishment. C9.1.2 All property owned by the Council must, as far as practicable, be effectively marked as Council property. |
C10 Insurance
The council faces many risks of different kinds in carrying out its functions e.g. risk of damage to assets, loss of resources etc. Regulations here are designed to protect the interests of the Council, its staff and the people it serves.
C10.1 The Executive will decide the Council's policy on insurance. Service Directors must notify the County Solicitor promptly of all new risks or properties which may need to be insured and of any alterations affecting existing risks or insurances indicating the amount of cover required.
C10.2 All insurances and related claims are to be arranged in accordance with the detailed standards below.
Detailed Standards C10.2.1 The County Solicitor is responsible for advising the Executive of any insurance required by the Council and of market changes. C10.2.2 Any event that gives rise to a claim under any policy of insurance must be notified immediately by the Service Director concerned to the County Solicitor who will deal with all claims. C10.2.3 Any officer in respect of whom the Council is required by Section 114 of the Local Government Act 1972 to take security, and any other person handling public money or money's worth in respect of whom the Executive consider it desirable, must be covered by insurance in such form as the Committee approves. C10.2.4 Any officer who uses his own motor vehicle on Council business is required to insure against third party risks in such form as to indemnify the Council against claims arising, and the policy, including any necessary endorsements and renewal receipts, must be produced for inspection by the Director of Finance and IT if so required other than in those cases where they are deemed to be covered by implied endorsements under the arrangements made between the Local Government Association and various insurers. The head of each directorate is responsible for acquainting officers under his control of the foregoing requirement. C10.2.5 Before any contract is made the County Solicitor must approve the insurance cover to be furnished by the contractor in respect of any act or default. |
C11.3 On the recommendation of the Service Director, the County Solicitor may, after consultation with the Director of Finance, IT & Trading, exercise delegated power to make any ex gratia payment in a sum not exceeding £1,000 for damage to or loss of property where such payment is calculated to facilitate or is conducive or incidental to the discharge of any of the functions of the Council. If you believe you may be entitled to claim such a payment please fill in the ex gratia payment form (PDF, 20KB) 
(20KB - pdf help).
C12 Gifts and Hospitality
The Council and the Public expect the highest standards of integrity from public servants. Formal standards are in place to guide staff and Members on these matters and to ensure consistency of judgement.
C12.1 All employees must observe the provisions of the Council's policy on Gifts and Hospitality which is reproduced in the detailed standards below.
Detailed Standards C12.1.1 A particular source of conflict between the private and the public interest is the offer of gifts, hospitality or other benefits in kind to Councillors and Officers in connection with their official duties. A difficult exercise of judgement may sometimes be necessary to decide how the public interest, and the Authority's good name, may best be served. A reasonable amount of entertainment is a normal part of the courtesies of public life and extreme inflexibility can give unnecessary offence to people and organisations with whom the Authority's relationships should be cordial. But an appearance of improper influence is easily created, and with it encouragement of cynicism about the motives of those who serve in Local Government. C12.1.2 With the exceptions listed below, an Officer should refuse any personal gift offered to him or to a member of his family by any person or body who has or seeks dealings with the Authority. The offer should be reported immediately to the Service Director concerned. These paragraphs are particularly directed to individuals or organisations or persons who already do or who seek to provide work, goods or services to the Council, e.g. building contractors, suppliers of goods or equipment and firms able to provide professional or commercial services to the Council. In addition, there may be occasions where because of the special relationship between the donor and donee, e.g. social worker and client, similar rules should apply. In these cases, legacies, fees or presents of any description should not be accepted and any employee in doubt should first seek the advice of the Service Director. C12.1.3 Exceptions :- (i) A modest gift of a promotional character given to a wide range of people. These gifts are usually given at Christmas-time and include calendars, diaries, desk sets, tape measures, scales and other articles of use in the office. (ii) Gifts on the conclusion of any courtesy visit to a factory or firm of a sort normally given by that firm. (iii) A modest gift where refusal would cause needless offence and the giver is not seeking a decision of business but merely wishes to express thanks for advice, help or co-operation received, e.g. a modest gift from a client for personal care. (iv) An unsolicited legacy from a client for personal care, which must be reported to Executive. It is wise to err on the side of caution and an obviously expensive gift should raise a question even if it otherwise falls within one of the above categories. If in doubt, seek the advice of the Service Director. C12.1.4 When a gift has to be refused, this should be with tact, because the offer of gifts is common practice in the commercial world. In some cases a gift is simply delivered and there may be a problem over returning it. It is sometimes acceptable to the giver for the gift to be the subject of a raffle and the proceeds placed to a charitable fund, e.g. Unison Welfare Fund. An arrangement of this sort should only be made with the Service Director approval and recorded by letter. C12.1.5 Hospitality is sometimes offered to representatives of the authority and is accepted at official level because it is reasonable in all the circumstances. Where it is offered to individual employees, special caution is needed where the host is seeking to do business with the Council or to obtain a decision from it. It is important to avoid any suggestion of improper influence. The question is one of judgement and the following examples are intended to give general guidance :- Acceptable * A working lunch of modest standard provision to allow the parties to continue to discuss business. Senior Officers should consider reciprocation on a subsequent occasion if there is need for further meetings. * Invitation to a Society or Institute dinner or a function, for example, private architect inviting Devon Property Practice staff to RIBA dinner. * Invitation to take part in a sporting event. * Invitation to take part in Company jubilee or other anniversary celebration. Unacceptable * Holiday abroad or weekend in a holiday centre. * Offer of hotel and tickets for theatre. * Use of Company flat or hotel suite. * Invitation to attend sporting events at the courtesy of a private individual or company In general terms, it will often be more acceptable to join in hospitality offered to a group than to accept something unique to oneself. When a particular matter is currently in issue with the County Council, e.g. an arbitration, then clearly common sense dictates that offers of hospitality be refused even if in normal times they would be on the acceptable list. |
C13 Voluntary Unofficial Funds
For reasons of probity and accountability, the good practice applied to Council funds should also be applied to unofficial funds. This section therefore requires that administrative arrangements for unofficial funds meet the standards expected by the Council.
C13.1 Officers controlling, wholly or in part, any voluntary unofficial fund must ensure that audit and accounting arrangements are in place which comply with the detailed standards below and other guidance issued by the Director of Finance, IT & Trading.
C13.2 Service Directors must ensure that they are aware of all voluntary unofficial funds in their directorates, maintain a record of them and ensure that the accounts are audited and put before the management bodies annually.
Detailed Standards C13.1.1 Officers must ensure that arrangements are in place to: (a) ensure that a suitably experienced person (not necessarily professionally qualified) audits the fund in accordance with procedures recommended by the Director of Finance, IT & Trading; (b) arrange for audited statements of accounts to be submitted to and received by the appropriate management body at least annually. Such statements must include a signed certificate in a form prescribed by the Director of Finance, IT & Trading. (c) ensure that other guidance issued by the Director of Finance, IT & Trading in the manual “Management of Voluntary Unofficial funds” is complied with. |
C14 Safeguarding clients’ private property
C14.1 Service Directors and heads of establishments responsible for the private property of a person (other than a member of staff) under their or their directorate's guardianship or supervision must adhere to the detailed standards below.
C14.2 Heads of any establishments responsible for the receipt or disbursement of clients' cash must ensure that such transactions are conducted within arrangements agreed by the Service Director and the Head of Internal Audit.
Detailed Standards C14.1.1 Service Directors must ensure that all steps are taken to: (a) prevent or mitigate loss or damage or diminution in value of the private property of any vulnerable client immediately on assumption of responsibility for the care of that client, and; (b) inform without delay the Head of Internal Audit of any such case of loss, damage or diminution in value. C14.1.2 Heads of establishments must :- (a) take all steps to prevent or mitigate loss or damage to that property immediately on assumption of responsibility for that person. Such steps must include :- (i) preparing (with a Council employee as witness) and then maintaining a detailed inventory of the property; (ii) ensuring immediate safe custody of all the property to the satisfaction of the Service Director and the Director of Finance, IT & Trading. (b) in any case of loss or damage or diminution in value, notify without delay the Service Director and the Head of Internal Audit. |
C15 Fraud and Corruption
C15.1 All Officers and Members are responsible for giving immediate notification to the Head of Internal Audit where there are grounds to suggest any financial impropriety or irregularity concerning cash, stores or other property of the Council or held by the Council.
C15.2 Any financial irregularity will be dealt with in accordance with the Policy Document titled “Strategy for Dealing with Financial Irregularities”. Where there are grounds to suggest any irregularity, after preliminary investigation the Director of Finance, IT & Trading will consult with the Service Director and the County Solicitor before involving the Police if it is considered that a criminal offence may have been committed. A report may be made of any irregularity to the Executive after consultation with the appropriate officers.
C16 Audit Requirements
The Council has a statutory responsibility to maintain an effective and adequate system of internal audit. Regulations in this area are therefore important to provide a formal framework for the activities of the Internal Audit team. There are also statutory requirements in respect of external audit and other inspection agencies.
C16.1 As required by law the Director of Finance, IT & Trading will maintain an internal audit of the Council's financial dealings.
C16.2 Internal Audit will follow professional standards and guidelines issued by the Chartered Institute of Public Finance and Accountancy and the Auditing Practices Board.
C16.3 The Director of Finance, IT & Trading or authorised representatives may, for the purposes of audit, have the following access to premises and records:
(a) enter on any Council premises or land and have access to all Council property;
(b) have access at all times to all records, documents and correspondence relating to all financial and other transactions of the Council or non-official funds operated by Council staff or private property belonging to vulnerable clients;
(c) require and must receive any explanations as are necessary;
(d) require any employee of the Council to produce cash, stores or any other Council property or that of an unofficial fund under his control:
(e) remove records, documents or assets required for further investigation as necessary.
C16.4 The Audit Commission is responsible for appointing external auditors to each local authority. The basic duties of the external auditor are governed by section 15 of the Local Government Finance Act 1982, as amended by section 5 of the Audit Commission Act 1998.
C16.5 The Council may, from time to time, be subject to audit, inspection or investigation by external bodies such as HM Customs and Excise and the Inland Revenue, who have statutory rights of access.
C17 Staffing
C17.1 Service Directors are responsible for the operation of the following controls over staffing:
(a) A staffing strategy is in place that matches staffing requirements and budget allocations
(b) Appropriate methods are used to forecast staffing requirements and related costs.
(c) Staffing establishments specified as full time equivalents are approved alongside the annual budget.
(d) Any subsequent increases in establishment levels will require the approval of the appropriate Executive Member.
(e) Procedures are in place to ensure that only properly authorised vacancies are advertised.
(f) Monitoring of full time equivalents against budget is undertaken on a quarterly basis.
(g) Corporate minimum standards on recruitment and selection are followed at all stages of the recruitment process.
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