Community and Town councils in Wales show improvement in delivering timely accounts
But despite this the number of qualified audit opinions and failures in financial governance remains too high
The timeliness of delivering end of year accounts from community and town councils in Wales has improved since 2011-12. However, there remains scope for the sector as a whole to improve its financial management and governance, according to a report released today by the Auditor General for Wales.
The report ‘Financial Management and Governance in Community and Town Councils 2013-14’ identifies a significant improvement since 2011-12 in the timeliness of production of audited accounts with the number of completed audits having increased to 696 (94 per cent) by 30 September 2014. The improvement continues the steady progress made by the sector, increasing from 91 per cent for the 2012-13 accounts and 87 per cent for the 2011-12 accounts and is in line with moves from the Welsh Government to encourage greater transparency by public bodies to explain how they use public money. Wales, however, is still lagging some way behind England where 98 per cent of parish councils received their audit opinion and certificate by 30 September 2014.
15 Councils in Wales had not received an audit opinion at 31 December 2014, three months after the statutory deadline because of delays due to such things as councils not providing sufficient evidence to support the audit opinion, failing to send approved annual returns to the auditor or because of unresolved queries from the auditor. A further 5 councils had failed to produce an annual return or provide sufficient evidence to support the annual return for 2013-14 and up to four of the previous financial years. Whilst four of these councils have now been certified as complete, Machynlleth Community Council still has five years of overdue accounts outstanding.
On a positive note the report highlights that the number of councils with qualified audit opinions has reduced. However, it remains a matter of concern that 45 Councils have received qualified audit opinions for two or more of the last three years, with 19 councils being qualified in every one of the last three years. In many cases, the audit opinions are qualified for the same reasons each year indicating that councils are not improving their financial management and governance.
The report also details changes set out the audit arrangements for town and community councils for the 2015-16 audit. The new arrangements will help councils to improve their financial management and governance and will include examining the councils’ arrangements for setting and monitoring budgets and for engaging the services of internal audit.
Auditor General for Wales, Huw Vaughan Thomas said today:
“It is pleasing to see that progress is being made by community and town councils in submitting timely accounts. The responsibility to account for their stewardship of the public money they have been entrusted with is an important role as citizens have a right to see where public money is being spent. Some councils, however, are still failing to properly discharge their legal duties, and I have brought my concerns to the attention of the Minister.
I would encourage councils to continue to build on this progress by addressing the common issues and weaknesses highlighted in today’s report and working closely with auditors to prepare future accounts.”