What was the issue?

Weaknesses in governance allowed a Clerk to defraud two community councils of in excess of £33,000.

What happened?

The clerk stole this money by falsifying documents. This highlighted the council’s general lack of financial control. Specific problems included:

• the Council did not review the bank reconciliations prepared by the clerk; and
• the Council did not receive or review budget reports on a regular basis.

What was/could be the impact?

The Council incurred losses of over £33,000 over five years.

What improvements should be made?

To ensure the proper administration of public funds, the members should:

• be clear about their legal responsibilities for the stewardship of Council funds and the maintenance of Council documents;
• be clear about the clerk’s responsibilities;
• ensure there is a sound financial control environment, including authorisation of payments;
• insist on the proper reporting of the council’s financial position and performance at each council meeting; and
• ensure that bank reconciliations are reviewed and counter-signed at each Council meeting.