External report finds 'weakness' in Oakham Town Council financial procedure
By Evie Payne
17th Feb 2023 | Local News
In December 2022, it was revealed that Oakham Town Council would be employing an accountant to look into the "transparency" of their finances following an online leak about missing petty cash.
This decision was made after local writer and former Oakham Town Councillor, Martin Brookes, received an anonymous email that petty cash was missing from the Oakham Town Council funds.
Chair, Cllr Sally-Anne Wadsworth confirmed that funds were "unaccounted for, whether it is theft or accounting mistakes hopefully this will be sorted by an outside accountant checking over the books".
Now, the report has been returned, and it suggests that there are 'weaknesses' in the financial procedures being undertaken by Oakham Town Council.
DCK Accounting Solutions Limited were engaged by the Council to report on financial operations and whether these were in accordance with proper practices and whether the Council's financial regulations and standing orders were being adhered to.
This report was made following the request to attend the Council offices by Oakham Mayor and Chairman, Cllr Sally-Anne Wadsworth, on 4 January 2023. Cllr Wadsworth requested that a review of the financial systems in use at the Council were scrutinised and that a report was prepared with particular attention to any risks and weaknesses in procedures.
The report states that the Council must "determine and keep under regular review the bank mandate for all Council bank accounts.
"It would appear that any review carried out by the Council has not complied with financial regulation 6.3."
Annually, a member other than the Chairman or a cheque signatory should be appointed to verify bank reconciliations, which the report suggests has not been happening.
DCK Accounting said that they "were unable to verify that this is being carried out."
Rules of the council say 'the Responsible Financial Officer (RFO), in this instance the Clerk, shall provide the Council with a statement of receipts and payments under each head of budgets.'
The report found that: "On examining the software set up, we would suggest that this isn't possible as income is not allocated under a budget head. We would suggest that either the Financial Regulations are updated or the budget set up is changed to enable such reporting."
In accordance with stipulations, the Council's banking arrangements, including the bank mandate, shall be made by the RFO and approved by the Council. They shall be reviewed for safety and efficiency.
The findings reported that: "In as much as we have not seen a copy of the bank mandate, we are unable to confirm whether this in accordance with the above extract.
"In any event, regulation 6.4 makes it clear that authorisation of payments is by two members. Our examination of the records during our visit indicate that such authorisation has been by the clerk/RFO and thus is in direct contravention to the financial regulations."
The Clerk is also the RFO and carries out all the financial work and makes the data entries on the Omega software.
DCK Accounting Solutions Ltd. stated that one member of the Council taking on this role is a 'weakness': "We would perceive this as a weakness and believe the Council should review the risks of only one person being able to use the software.
"The Council receives very little income of any kind and the only cash used is an occasional withdrawal for petty cash use. We noted that it is possible that there may be unclaimed VAT on part of the £80.00 worth of Petty Cash payments already incurred and we have advised the clerk to check that all VAT is included in the next VAT claim.
"Reimbursement is made by the Council on an ad hoc round sum basis. We suggest that the exact amount of petty cash expenditure only is re-imbursed on production of receipts and vouchers for inspection."
The report has not clarified that any public money is missing.
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