Welsh auditor's accounts warning to community councils

An accountant doing accounts Image copyright Thinkstock

Community councils have been urged to improve their financial management by the Auditor General for Wales.

Wales has 735 of the councils handling over £43m of public money but only an estimated 30% received qualified audit opinions on their last accounts.

The warning comes as community councils are being asked to take on more services by cash-strapped county councils.

The auditor has had to warn some councils for "serious weaknesses."

"The accountability and scrutiny that comes with the use of public money is growing ever tighter," said Huw Vaughan Thomas, the Auditor General for Wales.

"Community councils are responsible for over £43m worth of funds and are likely to be devolved more responsibilities."

'Undertake investigation'

Community councils represent the first tier of local government in Wales, and are equivalent to parish councils in England.

They can hold the purse strings for local community buildings, parks, cemeteries, allotments and toilets.

The auditor's report suggested councils should:

  • Improve the timeliness in the way they prepare accounts
  • Improve the quality of accounts
  • Develop and improve financial management and governance, especially in regards to the quality of financial reporting.

The auditor's fifth annual report tells councils they are to implement a financial code of conduct and sets out what councils must to be compliant with regulations.

"I would urge them to undertake an investigation into their current practice to ensure they are compliant with their legal requirements before the 2016-17 audit reviews," added Mr Thomas.

"It is worrying to see that a number of councils have qualified opinions which are easily avoidable."

Nick Ramsay, chairman of the assembly's public accounts committee, said: "It is essential that these councils have robust and effective arrangements in place for financial management and governance.

"While many councils have good arrangements in place, the Auditor General's report shows that there is still much work to do to raise standards of financial management and governance across the sector."