Council accidentally breaches its lending limit by £2 million
Flintshire County Council has admitted that human error caused it to accidentally breach its investment limit with other local authorities by £2 million.
The council exceeded the amount for a period of ten days when it invested £5m with the London Borough of Bexley during the last financial year.
The authority said the oversight was caused by human error after a spreadsheet which it uses to track the total figure was not checked properly.
However, it decided not to call back the money as it would have incurred extra costs.
Officers said steps have now been taken to make sure no further mistakes are made.
Paul Vaughan, interim finance manager for technical accounting, said: “The failure was in terms of the fact that we have a fairly unsophisticated spreadsheet system, which tells you how much we’ve invested in any particular place.
“While this investment was inputted, it did not flag up that we’d gone over the limit and the total amount wasn’t checked by the person who typed it in.
“We did some work on that control and we’ve now developed a system where there’s a new function on the sheet which means if you try to create a loan outside the limit then it will tell you what you’re doing.”
The council currently has a total £22.3m invested with 12 other local authorities and third parties.
The largest amounts are two separate £3m investments with the Amundi Money Market Fund and BNP Paribas Securities Services.
The second highest sum of £2.3m was invested with Standard Life Investments’ liquidity funds
The council’s chief executive admitted that it was fortunate that the error had no further consequences.
Chief executive Colin Everett said:
“It’s the only time in recent years that it has happened, but it shouldn’t have happened. It’s just fortunate that it was only a short term loan with no risk.”
By Liam Randall – Local Democracy Reporter. Spotted something? Got a story? Send a Facebook Message | A direct message on Twitter | Email: News@Deeside.com