The Committee considered a report of the Corporate Director of Resources (Interim) which provided information about the Chartered Institute of Public Finance and Accountancy (CIPFA) Financial Management Code (FM Code) designed to support good practice in financial management and to assist local authorities in demonstrating their financial sustainability. The FM Code also sets for the first time, the standards of financial management for local authorities (for copy see file of Minutes).
The Finance Manager - Revenues, Pensions and Technical Accounting highlighted the underlying principles, the seventeen FM Code standards and the three improvement opportunities identified.
In relation to the Peer Review improvement proposals, Mr Robinson asked how this would be judged, what criteria would it be measured against and whether there would be a negative or positive outcome. The Finance Manager explained that there would be no positive or negative answer / rating given. A member of staff from the other authorities Finance Team would look at the best practice requirements and highlight any issues based on the evidence supplied to them and their own experiences of the approach taken elsewhere. It would be then up to the authority to take on board those observations. The Corporate Director of Resources (Interim) elaborated further in that the recommended best practice elements of the CIPFA Code were to have a peer review of arrangements in place. Internal Audit provided a level of independence on current practices and their review this year had been useful in giving some assurance over our arrangements but the third party external peer review, although not compulsory, was good practice and an opportunity to share ideas and learn better ways of working. The seven local authority areas of LA7 had an agreement to review each other’s arrangements, providing a sector led improvement approach.
That the report be noted.