1. CIPFA PROFESSIONAL UPDATE CIPFA Europe Seminar 7th November Don Peebles Head of CIPFA Policy & Technical UK

2. Copyright © CIPFA 2018 protected under UK and international law.
Session Agenda
Professional Ethics – CIPFA ‘Raises the Bar’
Setting Financial Management Standards
UK Insight: Public Sector Commercial Activity – The tensions
The Accounting World
Copyright © CIPFA 2018 protected under UK and international law.

3. But first back to June 2016 ……

14. Setting Financial Management Standards – Why Necessary?

15. CIPFA’s Professional Code Hierarchy & Index
Professional Proper Practice
Primary/Secondary Legislation
Good Practice
CODE OF FINANCIAL
MANAGEMENT

16. The CIPFA Principles of Good Financial Management - Expanded

17. Statements of Standard Practice
The Code Hierarchy
Principles
Financial Management
Standards
Statements of Standard Practice

21. The CIPFA FM Code Structure

22. Statements of Standard Practice
Principles FM
Standards
Statements of Standard Practice

23. The Code: the Debating points so far…..
Testing the principles -sufficiently robust so far
Challenging Areas to Codify: The planning horizon, finance talent management ratio, ‘guidance’ on reserve levels
Do the standards/practice statements provide the basis to proceed?

24. The Code: An Outline Timeline
Stake holder group agreed content and terms of reference
July 2018
Research, recommendations on chapters content initial draft
October 2018
Stake holder ‘road’ test
December 2018
Consultation on Draft Code
Early 2019
Code ‘Franked’ by CIPFA
July 2019
Code Release
September 2019

25. UK Insight: Public Sector Commercial Activity

26. Borrowing & Treasury Management:The Code(s) Changes
Capital strategy – clarifies the links between the two Codes
Minor changes to TM indicators
investments includes non- treasury management investments:
Development of a capital strategy
High level context setting and strategy with key indicators
Delegation of detail but responsibility remains with council
Coverage of group and combined authorities etc.
Encouragement of local indicators
Removal of duplication

27. Borrowing for Commercial Investments

28. Statutory Guidance on Local Government Investments - Extracts

29. CIPFA Intervenes
October 2018

30. Linking to The Capital Strategy
Extract from The Prudential Code:
‘high level overview’
‘how ..risk managed’
‘Implications for future sustainability’

31. The Capital Strategy – Building Blocks
Capital Expenditure
Governance
Long term plans
Asset management planning
Restrictions around funds
Investments and liabilities (risks)
Approach, due diligence, risk appetite
Governance process for approval and monitoring
Summary of material investments, guarantees and liabilities
Treasury Management
Long term planning inc. MRP
Risk appetite, key risks and sensitivities
Skills and knowledge
Copyright © CIPFA 2018 protected under UK and international law.

32. Promoting IPSAS adoption & implementation Currently 25% of governments report on accrual……
Source: IFAC / CIPFA International Public Sector Financial Accountability Index Data from 150 countries

33. …...within 5 years 65% will report on accrual
Source: IFAC / CIPFA International Public Sector Financial Accountability Index
Data from 150 countries

34. Summary Evidence of ethical pressures on members
The current climate (and wider factors) increases responsibilities on professionals
Uncertainty continues ….. Opportunity for professionals?