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INTERNAL AUDIT REPORT
2024/2025 - ANNUAL RETURN
KELLOE PARISH COUNCIL
1. Background
1.1. Following the abolition of the Audit Commission a new organisation has been established which is
responsible for issuing proper practices in relation to the accounts of smaller authorities. It is called
the Smaller Authorities Proper Practices Board (SAPPB), and is made up of members of the SLCC,
NALC, CIPFA, the Ministry of Housing, Communities and Local Government (MHCLG), the Department
of Environment, Food and Rural Affairs (DEFRA), the National Audit Office and a representative of the
external audit firms appointed to smaller authorities
1.2. Every smaller authority in England that either received gross income or incurred gross expenditure
exceeding £25,000 must complete Part 3 of the Annual Governance and Accountability Return (AGAR)
at the end of each financial year. Where the higher of gross income or gross expenditure is £25,000
or less, a council can certify themselves as exempt from a limited assurance review, and complete
part 2 of the AGAR. This Council for 2024/25 does qualify to complete part 2 of the AGAR, and will
complete the exemption form which will be approved at the AGM.
1.3. CDALC have provided Councils with a checklist to be used, this annual audit uses this list as the
minimum of the tests to be carried out.
2. Objectives of the Audit
2.1. To examine the system of internal controls in place and to ensure that the Parish Council may obtain
an adequate level of assurance for its activities.
3. Scope of the Work and the areas of Audit Work examined.
3.1 The Scope of Work covers the ten key control tests identified in the AGAR, only nine of these were
examined, as the Parish Council does not have any petty cash.
3.2. To properly complete the audit the following areas of activity have been examined and tested by the
Internal Auditor:
• Payroll
• Creditors
• Risk Management
• Income collection and Banking arrangements
• Accounting records,
• Assets
• Debtors
• Budgetary Control (including year end procedures)
• Exercise of Public Rights 2023/24
3.3. The audit findings of this report have been discussed with the Clerk of the Council and any audit
recommendations have been agreed with him.
4.
4.1.. Payroll
4.1.1. The Council employs 2 officers a Clerk and a Cemetery Grounds Maintenance Officer.
4.2.1 The Parish Clerk works on average 25 to 30 hours per month, however no contract of employment.
Has yet been completed for him.. It is recognized that there would be overtime needed to help get the
Council back on course after previous events. The payroll amounts are approved with the accounts
payments
4.2.2. The Cemetery Ground Maintenance Officer does have a contract but has now resigned and the Council
is to consider options to fill this post.
4.2.3. During 2024/25 the Council has employed an independent payroll administrator to deal with all
payroll matters, this is a a good internal control for the Council
4.3. Creditors
4.3.1. The Clerk produces an accounts update where Members of the Council approve all payments being
made, where 2 from 3 signatories are required.
4.3.2. On examining the spreadsheet of payments these appear correct
4.4. Governance Arrangements
4.4.1. The minimum internal audit testing required by CDALC state that Financial Regulations and standing
orders should be reviewed within the current financial year. I understand that this review is carried
out at the AGM.

4.4.2. The Accounts and Audit Regulations 2015 require smaller authorities, each financial year, to conduct
a review of the effectiveness of the system of internal control and prepare an annual statement in
accordance with proper practices in relation to the accounts. This will be approved at the next Council
meeting after the AGM.
4.4.3. The announcement of the public rights for 2023/24 was announced at the AGM on 8th May 2024 for
inspection between 18th June to 28th July 2024
4.4.4. Bank account statements are signed as correct at each meeting.
4.4.5. At the AGM on 8th June 2024 the Governance arrangements can be seen where it was resolved:
- The end of year 2023/24 Accounts and AGAR were approved.
- It was agreed that Gordon Fletcher would be the Internal Auditor for 2024/25
- The Internal Audit Report 2023/24 was approved
-The Internal Audit Plan for 2024/25 was approved.
- The statement of Internal Control was approved. A Risk Register would be set
up for approval by the September meeting.
-Also the Assets register would be updated.
-The dates agreed for the Exercise of Public Rights from 18th June to the 28th
July 2024
- To discuss and approve meetings for 2024/25 and that meetings would be
held on the second Wednesday of July, September, November, January 2025
and March 2025.
4.4.6 I have agreed the accounting statements for 2024/25 as recorded on Section 2 of the AGAR.
4.5. Income collection and Banking arrangements
4.5.1. Income is from the precept, cemetery, allotments and vat claim.
4.5.2. There is no record of vat being claimed by the Council since 2020/21. The Clerk is aware of this and
is to complete this and will record the vat against the paid invoices on the expenditure spreadsheet.
4.5.3. The Council has 2 bank accounts, current and deposit, which reconciled as at 31st March 2025
4.6. Accounting Records
4.6.1. Payments and receipts are properly recorded in the accounts for 2024/25 and appear to be correct.
4.7. Security/Assets
4.7.1. I understand that the Council has assets and the Clerk has completed an asset register for 2024/25
and is to be approved with the statement of accounts
4.8. Debtors
4.8.1. There are no accounts raised for debts as Debtors either pay by cash or a cheque is received for any
work/service carried out.
4.9. Budgetary Control
4.9.1. The Precept appears to be higher than I would expect for this Councils expenditure although it will
need to include the payment back of the loan.
4.9.2. At 9th January 2025 Council meeting the budget and precept for 2025/26 was discussed and
agreed.
5. Conclusions
5.1. Following the concerns of the previous years the Council has realized what was required and the
appointment of an experienced Clerk and the introduction of good procedures will ensure that good
Governance is followed. It can be seen that during that the Governance arrangements have
improved, and I understand that some monies have been recovered.

6. Recommendations
6.1. A contract for the Clerk should be agreed and completed.

Gordon Fletcher (C.M.I.I.A.),
Internal Auditor

 

March 2025 We have donated £100 to the Friends of Kelloe Primary & Community Group towards there new playground project.

 

March 2025 Quick Survey done by one of our County Councillors if you could fill it in take you 30 seconds Thankyou.    https://www.surveymonkey.com/r/YYBHSCL

March 2025 Next Meeting 7pm 12/03/2025 Pheonix Centre 

Dec 24 Xmas Tree UP our xmas tree has been put up and lit up on the entrance to the village the Parish would like to thank Gary Hutchinson and Andrew Shutt for putting the lights on .

 

Dec 24 Planning application has came in for new houses in Kelloe behind Woodland Crecent please check out our Planning application Page to View and comment.

 

OCT 24 Special meeting of Kelloe Parish Council to be held on Thursday 17 th October at 7.00 pm at Phoenix Centre

 

Ongoing Fraud Investigation

Due to a ongoing police investigation as a parish council we were advised not to mention anything regarding ex clerk Stephen Round the ex parish clerk helped himself to £98,000 of the funds from parish funds , putting services at risk after his five-year tenure in the part-time role.The current committee reported this to the police once bank statements were given from the bank and investigations  took place .

The only service that was really cut was flower tubs which were not re potted as the money stolen was been saved for a new cemetery piece of land .

Stephen Round has been charged ,the current comittee are looking at there next course of action and we will try to keep you informed as soon as we can .