Inadequacies in governance and financial management at two community councils

Inadequacies in governance and financial management at two community councils
30 January 2019

Reports in the public interest issued today (30 January 2019) by the Auditor General for Wales highlight long-standing shortfalls at two community councils

The Auditor General for Wales has today (30 January 2019) published reports in the public interest highlighting inadequacies in governance, financial management and internal control at two community councils – Bodorgan, and Llangristiolus and Cerrigceinwen.

Similar issues were identified at both councils. Typically, these were:

  • Failure to maintain adequate internal controls to safeguard assets and finances
  • Efficacy of internal audit diminished by reluctance to report concerns about poor governance directly to the Council
  • Governance arrangements inconsistent with the positive disclosures made in the Annual Return
  • Failure to submit annual accounts for audit in accordance with the statutory timetable
  • Insufficient evidence to confirm whether or not proper arrangements have been made for the exercise of electors’ rights

Despite clear calls from the Auditor General, the current standard of financial management and government remains disappointing at too many Town and Community Councils. In 2018 alone it has been necessary for reports in the public interest to be issued to 8 other community councils.

Earlier this month, the Auditor General called for urgent action in Financial Management and Governance – Town and Community Councils 2017-18. This report concluded that a significant number of councils fail to comply with their statutory responsibilities for preparing their accounts, a shortfall which is highlighted in today’s reports issued to Bodorgan and to Llangristiolus and Cerrigceinwen. Crucially, both councils accept that more could have been done to ensure that legal obligations were met for the timely preparation and approval of accounts.

Speaking about today’s public interest reports, Auditor General, Adrian Crompton said:

“With rising incomes and increased responsibility, it is crucial that town and community councils get a grip on financial management, now more than ever.

“I am encouraged that both Councils have since put in place changes to address the weaknesses highlighted in my reports. I call on all Town and Community councils in Wales to take heed and learn from the important lessons within these reports, and others that I have produced, so that communities in Wales get the services and the assurance they rightly deserve.”


Notes to Editors

  • The Auditor General has issued a report in the public interest under Section 22 of the Public Audit (Wales) Act 2004.
  • The Auditor General is required to consider whether to issue a report in the public interest on any significant matter coming to his or her notice in the course of an audit, and to bring it to the attention of the audited body and the public.
  • It gives the Council an opportunity to explain the important steps it has taken to improve arrangements and to ensure that the risk of such failures recurring is reduced to a minimum.
  • After a report in the public interest is issued, the Council is required to consider the report at a full meeting of the Council within one month of the date of issue. At the meeting, the Council must decide whether the report requires it to take any action; whether the recommendations in the report are to be accepted; and what action (if any) to take in response to the report and recommendations.
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