Internal Audit - 8th June 2020
***Update 9th June 2020*** – The Internal Audit has now been completed, the Auditor’s report can be found here: GBPC Internal Audit Report 2020-06-08.
This page contains files and commentary for the Glynde & Beddingham Parish Council Internal Audit, scheduled for Monday 8th June 2020, in addition to the files that will be sent to the External Auditor PKF Littlejohn.
During the 2019-2020 municipal year, the Council saw a change in Chairman and a number of Councillors. The previous Clerk left the Council in August 2019 and an Interim Clerk joined in September 2019.
In the absence of key governance documents, the Interim Clerk created a new Working Cashbook from scratch. Payments and receipts made from 1st April 2019 were traced through reviewing the bank statements, cheque stubs, invoices, minutes and agendas. Missing copies of bank statements and invoices were obtained and anomolies were investigated and resolved. The Council only had 1 bank account signatory on the Council; the bank mandate has now been updated and all currently serving Councillors are now signatories. The Interim Clerk created a new website and all key documents have been updated and uploaded to ensure compliance with the Transparency Code. All Councillors now have .gov.uk email addresses for Council business. The Interim Clerk is in the process of creating other documents to be reviewed by the Council including a Business Plan outlining the Council’s objectives to the end of the current term in May 2023.
Recruitment for a permanent Clerk was due to be approved in the Parish Council Meeting which took place on 18th March 2020, however due to the coronavirus outbreak, this item was deferred and will be added to an agenda as soon as the current restrictions are eased. The Council’s next meeting will be a virtual meeting on 24th June 2020.
The Parish Council’s Working Cashbook can be found here and contains the following worksheets:
- Cashbook – a list of all receipts and payments received into all bank accounts with net values allocated to budget categories from column R onwards.
- Account Reconciliation – A reconciliation of the working cashbook and bank accounts that the Clerk updates, and presents to Councillors, quarterly. The numbers 1-7 in column A correspond to the boxes in the Annual Return Accounting Statements Section (see AGAR Part 2 under ‘Files for the External Auditor’ below).
- Bank Rec Q4 – Reconciliation of the Bank Account and Working Cashbook to be presented to, and signed by, Councillors at the next meeting on 24th June 2020.
- Budget + Forecast – Used to track spend against forecast and to set the precept.
- Precept Comparison – Calculations showing the financial impact on electors of various increases in Council Tax.
As a smaller authority with gross income and expenditure below £25,000, and in meeting the exemption qualification criteria, Glynde and Beddingham Parish Council has opted to certify itself as exempt from a limited assurance review. The below documentation will be presented to Councillors at the next virtual meeting on 24th June 2020. The Clerk will seek approval of the documents from Councillors during the virtual meeting and will hand-deliver them to the Chairman the following day to obtain wet signatures which are still a requirement under the new coronavirus legislation. Once signed, the exemption certificate will be sent to the external auditor and will then be placed on the Parish Council website with the below documentation which fulfils the Publication Requirements of the Annual Governance and Accountability Return 2019/2020 Part 2.
- AGAR Part 2 2019-2020 (updated copy signed by Internal Auditor on 8th June 2020, any unticked boxes to be completed by Council during next meeting):
- Page 3 = Exemption Certificate (to be sent to External Auditor PKF Littlejohn)
- Page 4 = Internal Audit Report (to be completed by Internal Auditor)
- Page 5 = Section 1: Annual Governance Statement 2019/20 (to be completed during meeting on 24th June 2020)
- Page 6 = Section 2: Accounting Statements for 2019/20 (pre-populated by Clerk, awaiting verification from internal auditor)
- Analysis of variances 2019-2020
- Bank Reconciliation 2019-2020 (external auditor format)
- Notice of the period for the exercise of public rights 2019-2020
The Parish Council has 2 bank accounts with Lloyds; 1 current account and 1 deposit account. Bank statements for the 2019-2020 financial year are below showing opening and closing balances for the year.
- Current (Treasurer) Account 16
- Current (Treasurer) Account 17
- Current (Treasurer) Account 18
- Current (Treasurer) Account 19
- Current (Treasurer) Account 20
- Current (Treasurer) Account 21
- Current (Treasurer) Account 22
- Current (Treasurer) Account 23
- Current (Treasurer) Account 24
- Current (Treasurer) Account 25
- Current (Treasurer) Account 26
- Current (Treasurer) Account 27
When the Interim Clerk joined in September 2019, the Council had not made any PAYE submissions for the financial year and had outstanding PAYE invoices for underpayments dating back to December 2018. The Interim Clerk did not have the Council’s Government Gateway ID details and it took many weeks of phone calls and letters to HMRC to gain access to the PAYE Tools to be able to complete submissions. The Interim Clerk gained full access in February 2020 and all historic PAYE submissions and payments for the financial year were made. The Chairman now has a copy of the Government Gateway ID details to mitigate a recurrence of this issue.
The Interim Clerk prepared a Risk Assessment in conjunction with the Chairman. This was presented to Members and approved at a meeting of the Council on 18th March 2020. A copy is displayed on the Parish Council website under the ‘Documents’ page. For convenience, a copy has also been made available here:
The Council has an insurance policy, incorporating employer’s and public liability insurance, with Zurich. The policy runs from 1st June to 31st May. During the Interim Clerk’s review of the finances of the Council, a premium for the insurance amount for 2019-2020 could not be identified. The Interim Clerk spoke with Zurich who confirmed that the premium had been paid and further investigation indicated that it may have been accidentally paid by a neighbouring Parish Council that the last Clerk also works for. The Interim Clerk telephoned the Chairman of the neighbouring Parish Council who said he would look into the issue and, if the anomalous payment was confirmed, he would arrange for their Clerk to submit an invoice to GBPC for the premium.
The Standing Orders, Financial Regulations and Code of Conduct were fully revised and adopted at a meeting of the Council on 18th March 2020. A FOI Publication Schedule was adopted in November 2019. Following government advice after the covid-19 outbreak, the Council adopted a Business Continuity Plan at the last face-to-face meeting on 18th March 2020 to enable the business of the council to be conducted in the unprecedented circumstances.
The above documents can be found on the Parish Council website under ‘Policies and Procedures’. The Interim Clerk has prepared a list of all other documents that the Council should hold, to ensure a best-practice approach to it’s organisation, and is preparing the full documents for Councillors to review and adopt at upcoming meetings.
Payments and Receipts are completed by cheque and are reported to the Council, and cheques signed, at each meeting.
Since joining the Council in September 2019, the Clerk has implemented a quarterly review of the Council’s Bank Reconciliation, during which 2 Councillors sign the reconciliation, bank statements and cheque stubs. Councillors also receive a copy of the working cashbook to verify payments and receipts each quarter. Members reviewed the budget and forecast in November 2019. Moving forwards, the Council wish to move towards internet banking which will be added to an upcoming agenda.
The Clerk had prepared a VAT claim to be approved at the last meeting on 18th March 2020 however this item had to be deferred. The Clerk will present this for Councillor’s approval at the next meeting on 24th June 2020.