Best Practice arising from audits for the school year y /14

Transcription

1 Best Practice arising from audits for the school year y /14 Governance and Leadership Finance Policy An up-to-date Finance Policy is held which is: Reviewed annually Approved by the GB Circulated to all staff involved in financial administration at the school, including budget holders. The Finance Policy includes: Authority levels for: Virements The appointment of staff. It is best practice that governors are involved in the recruitment to posts in the Senior Leadership Team. Senior officers, for example, budget holders Capital expenditure The disposal of assets The write off of debt. This is aligned with the limits set in the Fair Funding Scheme. Only debts up to 100 may be written off by the school (see Fair Funding Scheme for Schools). Purchasing limits that reflect the correct EU thresholds. Please note: the thresholds are amended every two years, on the 1 January. It currently stands at 172,514 for supplies and services. The next review date is 1 January Pecuniary Interest forms Governors, senior staff and officers involved in the financial administration of the school complete a pecuniary interest form annually. Conflicts of interest Declarations (on pecuniary interest forms) are reviewed to identify any potential conflicts of interest. Any conflicts should be managed by ensuring there is adequate segregation of duties. For example, getting other officers from the senior leadership team to authorise documentation. Sample testing should be carried out to ensure that this is happening. Meetings are Quorate Relevant governors attend Finance Committee meetings, to enable the Head teacher to progress and manage the school effectively. 1

2 Purchasing Building works are planned in advance so that value for money can be demonstrated. The school follows the Finance Policy and obtains quotes/tenders, as specified. All quotes/tender documentation is retained for the appropriate periods under the statutory rules and the council s document retention policies. Quotes For simple procurement, where the cheapest quote is not accepted, the school documents the reason why the chosen supplier was selected. Tenders and Contracts Constructionline is used to invite quotes and tenders from suitable contractors. Evidence of this check is maintained, such as the Constructionline registration number of contractors. Where a Constructionline contractor is not used, all the necessary documentation is obtained, such as health and safety documents, insurance certificates, registration with regulating authorities and financial accounts. This is to allow a fair evaluation and to assess the suitability of the potential contractors. The evidence is retained. Tenders are evaluated against criteria that are agreed at the specification stage. Tenderers should be informed about the criteria during the tendering stage, in order to make the selection process fair and transparent. The reason(s) for choosing the preferred supplier must be documented, preferably by an evaluation panel, and approved by the appropriate authority, in line with the Finance Policy. European Union procurement rules must be complied with. There is a signed contract for all major procurement. Contract specifications should define the service or works to be provided in terms of its nature, quality standards, information and monitoring requirements. Where work will affect the structure of the building or its services or the work will disturb, or take place in the vicinity of asbestos, written authorisation should be sought from the council. The council s Procurement Unit should be contacted for procurement advice when undertaking material or complex procurements. Eprocurement@newham.gov.uk See Audit s Procurement Essential Practice. This can be found on Fronter, together with other procurement guidance. Suitability of school purchasess Money meant for educating students is not spent on items that do not comply with the dedicated schools grant (DSG) policy. Purchase orders Purchase orders are committed against the appropriate budget code before or at the same time the order is placed with the supplier. This will aid budget monitoring and reduce the risk of overspends. Purchase orders are signed, as approved for purchase, by an authorised officer. 2

3 Invoices Payments are made on valid invoices (i.e. including the VAT number, amount of VAT chargeable and the rate) as VAT is only recoverable on invoices that conform to HM Revenue and Customs legislation. Invoices are approved prior to payment, by a member of staff with sufficient seniority (e.g. the Head teacher, Head of school, Assistant Head teacher) or by the budget holder, who is not otherwise involved in invoice processing. Purchasing Cards Purchasing and store cards are appropriately monitored through the review of the transactions and authorisation of the monthly reconciliation. The card statements are signed and dated by the Head teacher to evidence review and that the spend has been approved. Budget The annual budget is ratified by the Governing Body and minuted as such. In order to adequately monitor the school's budget and have the ability to easily identify changes within the budget, it is essential that the budget, as agreed by the Governing Body, is promptly "fixed" on FMS. This is carried out as soon as possible (i.e. within six weeks of the start of the financial year) ). Subsequent changes to the original budget are then reflected in the current budget. Regular (monthly) budget monitoring reports (BMRs) are obtained from the Financial Management System (FMS) and monitoring is carried out. The BMRs are reviewed by the Head teacher and signed/dated to show this review. Alternatively, the review is confirmed via . Budget reports are prepared for the Finance Committee/Governing Body, explaining the school s financial position. There is evidence that the budget position has been discussed and these discussions are detailed in the minutes. Detailed financial reports and minutes of the Finance Committee meetings are retained, to demonstrate accountability and transparency for all spend. Virements are approved by the appropriate authority, prior to being carried out. School development plan A three year school development plan is produced that provides strategic vision and direction and is linked to a multi-year budget. Ear marked funds Pupil Premium funds are reported accurately and the breakdown of the spend is drawn from FMS reports. 3

4 Banking Arrangements Un-reconciled items are investigated and cleared promptly. There is adequate monitoring and management of finances, so that the school s bank account is never overdrawn. Transactions appearing on the bank statement are promptly input into FMS, so that the transactions are reflected in the school s expenditure in a timely fashion. A copy of the bank mandates, detailing the authorised signatories, is always retained at the school. All sequentially numbered cheques that are input on FMS is readily identifiable as being paid to suppliers or, if appropriate, shown as spoilt /cancelled on the FMS bank history. FMS clearly reflects what has happened with each cheque. All spoilt checks are recorded on FMS, together with the reason, to ensure complete records of cheques are held. All journals, that have the effect of crediting the bank statement, are appropriately authorised prior to input on FMS (i.e. direct debit transactions). Personnel The Single Central Record - including details of Disclosure and Barring Service (formerly known as CRB) checks - is kept up to date. Schools should continue to liaise with Newham Partnership Working in order to remove the names of the individuals that no longer work at the school, from the Trent Payroll system. The staff structure is reviewed to reduce the use of temporary agency workers. The structure is approved by the Governing Body. There is appropriate segregation of duties when appointing staff, to ensure that there is no conflict of interest. Payments to individuals All payments to employees must be made through the council's payroll system, so that the proper deductions (Income Tax and National Insurance) are made. The guidelines issued by Schools Traded Services (now Newham Partnership Working) should be followed in respect of recompensing external individuals, such as self-employed workers, for work carried out at the school. Evidence of these checks carried out is held on file. Use of personal credit cards Making purchases via personal credit cards is strongly discouraged. A corporate purchase card can be obtained via the council s Finance Service, if required. 4

5 Overtime The Scheme of Delegation, as part of the Finance Policy, should list all officers authorised to approve overtime claim forms; it should ensure that there is no conflict of interest and appropriate segregation of duties. All overtime is planned in advance and approved by an officer with the delegated authority. Overtime claim forms are completed and signed by the claimant. Correcting fluid is not used on any financial documents and any corrections are initialled. Pre-signed forms must not be used. A detailed description of the overtime is provided on the claim form. Staff hours/duties and overtime claimed should be regularly reviewed to ensure that unnecessary overtime is not claimed. Site Supervisors Overtime Site supervisors take breaks where more than six hours are worked. Where Site Supervisors are used on overtime for handy person projects, value for money is demonstrated in line with the site supervisor manual, section 4.8: Specify clearly in writing the work to be undertaken, with the same level of detail as if it were for a contractor. After consultation with the Site Supervisor: determine the amount of time required to complete the work; decide if the work should be carried out in basic time, or overtime, or a combination of the two. If any of the tasks are to be done on overtime, work out its cost, remembering that overtime hours are paid time and a half (double time on Sundays). Include the cost of any materials and hire equipment. If the total cost is less than 2,000 - you may proceed with the job provided that you are satisfied that the school is getting value for money. If the cost is more than 2,000, obtain a quote from your selected building works contractor for the specified job. Decide whether to accept the lower estimate, i.e. the contractor s quote or Site Supervisor s costs. If you wish to accept the estimate that is not the lowest, you must obtain the approval of the Governing Body, through the submission of a written report, which sets out the reasons for the proposed action. Temporary Agency Workers Agency workers timesheets are checked that they are complete and signed by the employee and reviewed by the supervisor/head teacher before payment to ensure that the correct number of hours are paid. Timesheets are matched with the invoices to confirm that the correct charges are made. Timesheets are retained in case queries arise in the future. 5

6 Income Provisions for income are made in the annual budget, so that effectivee budget monitoring can be carried out. Receipts are issued for all income received. A cash book is maintained to ensure that all income, whether cash or cheques, is recorded. The handover of responsibility for cash is signed by both parties. Entries are made on FMS before banking. There is appropriate segregation of duties. A senior officer carries out independent checks of all income documents on a regular basis. A costing exercise is undertaken to ensure that letting charges cover costs. A lettings policy exists which includes a process for authorising and recording lettings. The policy is approved by the Governing Body and reviewed annually. Income is raised through the Accounts Receivable section of FMS. This automatically creates a debt that can be tracked and will also generate an invoice that contains the relevant information, for example, the VAT element. There is timely chasing and regular monitoring of outstanding balances. A specific due date is stated on the invoice for clarity and formal letters are used as soon as the debts become overdue. The procedures are documented and used as a reference point. Debt recovery procedures are invoked for debts that have not been recovered after 90 days. Leases All leases, with a total value of 50,000 or more, are countersigned by the Director of Finance. Separate insurance cover is obtained for leased equipment, where the contract dictates. Corporate Accountancy is informed about any proposed leases beforee they are entered into, so that Corporate Accountancy can assess the nature of the lease i.e. whether it is a finance lease or an operating lease. Governing Body approval is sought for leases. ICT & Application Access Controls Policies/procedures are in place to protect the school s ICT hardware, software and data against loss, damage or misuse. These are provided to all staff. Supervisor access rights are restricted to two or three individuals. All users with access to the system are set up on FMS based on their individual names, so that transactions performed by them are readily identified. We can be contacted via School.Audits@newham.gov.uk 6