At its last meeting the Audit & Governance Committee received a presentation which provided an overview of the first six months operation of the shared service arrangement between Hampshire and Oxfordshire County Council, from July to the end of December 2015. Following the presentation the Committee requested to receive a presentation on Aged Debt and duplicate payments .The Assistant Chief Finance Officer (Assurance) will give a presentation on these issues.
Minutes:
At its last meeting the Audit & Governance Committee had received a presentation which provided an overview of the first six months operation of the shared service arrangement between Hampshire and Oxfordshire County Council, from July to the end of December 2015. Following the presentation the Committee had requested to receive a presentation on Aged Debt and duplicate payments.
The Assistant Chief Finance Officer (Assurance) gave a presentation (a copy of which is attached to the signed copy of the minutes) which updated the Committee in relation to these areas.
Mr Dyson reported on the current Controls in place. The Vendor Invoice Management (VIM) system currently sweept for duplicate VIM documents and identified an invoice where the date, amount and reference matched. It would not pick up where an invoice scaned differently. Equally if an invoice went through a Non-VIM route, e.g. the Bulk Data Upload (BDU) process it would not connect it. Payments were made through SAP on instruction via: Standard Purchase Orders - match Price and Quantity before releasing for payment upon confirmation of goods receipt. Without this match, an invoice would be blocked for payment and required budget holder approval to un-block.
Service Orders – These were manager approved value based orders. Payments will only be released upon instruction from purchaser. Invoices would block once the value of the purchase order had been exceeded.
In relation to Interfaces and BDU Uploads, he reported that SAP could receive standard instructions to pay through agreed interfaces and uploads. The controls over managing the uploads was undertaken locally.
– Any material duplicates should be identified through retrospective budget monitoring controls. Production of SAP standard Direct Payment reports received periodically from the IBC - these would be available through self service in 16/17. There were reviewed and actioned within the Corporate Procurement Team.
Additional controls for duplicates in 16/17 - The Hampshire organisations had taken the decision to establish an internal control group, to investigate potential duplicate payments. OCC would have the opportunity to contribute to the cost of this team.
He further reported that a VIM software upgrade was taking place in July / August 2016, which would introduce additional automated duplicate checking before a payment was released. Increasing the chance that suspected duplicates would be identified by matches to value, date and reference numbers and will block before release.
There had been 5 Duplicate payments Reports received since July 2015.
This represented a significant decline in the number of potential duplicates for investigation following stabilisation period.
In relation to Aged dept, Mr Dyson reported that the Banking and Income Team was responsible for corporate monitoring of income collection, including performance of Debt Management.As reported previously, visibility and reporting of debt had been an issue, resolved during the stabilisation period.
The Corporate Debt tool was now available. OCC Corporate Finance had been invited for training in April 2016. This would enable OCC to run regular aged debt reports through the Portal split by departments or suppliers.
The budget manager dashboard had now been live within HCC for 4 weeks and it was working as it should. There now needed to be a collective deployment decision for OCC, but anticipated for 16/17.
Mr Dyson went on to explain that the process for collection of Debt had changed with the transfer to IBC. There were now three dunning instances, with direct customer contact later in the process. Once the IBC had completed their process, uncollected debt was referred to Corporate Finance to liaise with the Manager, and advise on decision to pursue through Legal or Write Off.Performance Management was under development.
In response to concern raised by members regarding the high level of Aged Debt within the Council, The Chief Finance Officer explained that although the figure seemed very large, that the figure was not higher than average and that Oxfordshire came out in the upper quartile for debt recovery.
Members pointed out that the Council should not be working with people who still owed money and queried whether anything was in place to stop this happening. In response Mr Dyson confirmed that the corporate team looking at the issue would be asking that question.