FINANCIAL REPORT 2014/15
Last year, I was asked, on the basis of my professional experience, to help with the financial records of the Parish Council. The Parish Council then decided officially to separate the roles of Parish Clerk and Responsible Financial Officer. This is a normal practice in larger parishes, having the effect both of sharing the administrative burden and giving an extra level of risk prevention.
The Clerk reduced his own salary by the amount of the new Responsible Financial Officer’s salary, so there was no extra cost to the Parish for the new arrangement.
In September, a new Clerk was appointed, with the role of the RFO included in the contract and assuming the full clerical salary. I was, however, asked to stay on to assist in the handover period.
I resigned as RFO in January 2015 and the duties were taken over by Clerk as per his contract. The budgeted cost of employing an RFO as well as a Clerk was thus eliminated.
I was asked in April to assist the Locum Clerk with preparing the financial reports, so that she could concentrate on the secretarial duties for the year end. I presented the March and Annual Accounts to Council and prepared the books and Annual Return for Audit. I attended the Internal Audit with the Chairman, and am pleased to report that this passed successfully.
When I took over as RFO I expanded the categories in the accounts to try to make them more understandable for readers. All the monthly summaries for 2014/15 and the year’s spreadsheet have used these expanded categories. In order to present a fair comparison with the Annual Accounts presented to the Annual Parish Meeting in 2014, I have printed for you as Item One a re-statement of the 2014 annual accounts, so that the new, expanded categories can be easily checked against the old lists. I have also appended notes to those accounts for easy reference.
Item Two is the accounts for 2014/15, comparing with last year’s figures, and setting out the Budget for 2015/16, upon which the Precept was demanded after resolution from the council. Budgets always have an element of guess-work, but must be prepared on a prudent basis so that income is not over-estimated.
The notes attached should explain the items, but I am happy to try to answer any questions on the accounts. I would like to highlight the following points, which were stated in my last report to the Council in December, in relation to the Precept.
- a) Maintenance of churchyard. After consultation with the church wardens, it was suggested that a figure of £5,000 be added to the Budget for the purposes of paths, tree and hedge work required immediately, and for the ongoing maintenance of the churchyard.
- b) Cost of elections. Various estimates of cost to the parish were received from TVBC, depending on whether there would be a triple, double or single election, and based on the number on the electoral register. There would also be variations depending on the number of postal voters, polling station hiring costs, etc. Based on all the information available, it was decided that, bearing in mind the uncertainties, it was sensible to set aside a provision of £4,500 as a contribution to potential costs.
- c) The Green will need fencing, mowing, new gates etc, and it was agreed that a provision of £2,500 would be sensible.
- d) Dyno-Rod is now on a quarterly maintenance contract to clear the drains by the WMH, and £800 was included as a provision. The frequency of clearance may be re-considered by the council during the year. An amount was also budgeted for prospective tree works.
- e) New storage facilities may be required for machinery and £1,500 for purchase of a container, plus £500 transport costs, has been allowed in the Budget.
- f) A provision for training new councillors and officers has been included. It is required that all councillors are abreast of current legislation and good practice, and £500 has been set aside for training. The Clerk will be able to provide a list of courses provided by the Local Councils’ professional bodies, which councillors will be required to attend.
These special provisions would have left a potential bank reserve of just under £8,000 by the end of 2015/16. It is generally accepted in parish council professional guidance that reserves should not exceed 3 to 9 months of gross expenditure. The council has held a strong balance of cash funds up to now and it was my view that they could manage for this year without increasing the Precept, provided they ran a tight ship. However, councillors took the Clerk’s advice that a year-end balance potential of £8,000 was insufficient, and voted that the Precept should be increased for this year by £5,000. This represents an extra £2.50 per elector in Council Tax and a percentage increase of just under 23%. As a former financial adviser I feel it is better to have a credit balance than to risk succumbing to the unnecessary costs of overdraft, but for this year in particular it has been difficult to calculate a balance between safety and over-funding. Next year should not have so many imponderables.
I would add finally that the work I have carried out for the Council since my resignation as RFO in January has been voluntary to aid the Locum Clerk with year-end accounting and is of no cost to the Council. My involvement with the Council ends from this evening.
R.A. Griffiths, B.A. Hons, A.C.I.S
14/05/15
