CIPFA poised to revise CFO role

The Chartered Institute of Public Finance and Accountancy (CIPFA) is set to revise its guidance on the role of chief financial officers in local government.
The move was revealed by Alison Scott, CIPFA’s assistant director for policy and technical, at the organisation’s annual conference in London yesterday.
She said that CIPFA would shortly launch a consultation into the revised document to clarify the role of the CFO due to the rise in joint venture partnerships with the private sector, along with standalone council-owned companies.
She told a workshop at the conference: “CFOs setting up third party organisations have often got involved without thinking about the consequences. It is very easy when setting up a new trust to get involved without thinking ‘do I have a conflict of interest?’
“If money is being spent with a third party then they cannot be expected to perform the same role.”
Scott said that some councils have split roles in order to keep the CFO role free from any conflict of interest, with a director or head of finance having greater involvement with any new third party body in which the council had some form of ownership.
But she admitted: “This works in a big organisation but doesn’t always in a smaller district council.”
She added that the role of the CFO now has a higher status than when the original guidance was produced due to the need of councils to deal with austerity.
According to Scott, a consultation will be launched shortly, seeking to identify key issues from local government finance professionals, with the aim of producing a revised document by the end of this year.
In 2003 CIPFA produced A Statement on the Role of the Finance Director in Local Government, which was replaced in June 2009 by a new Statement on the Role of the Chief Financial Officer in Public Service Organisations, which applied to all public service organisations.
In 2010, the organisation produced its Statement on the Role of the Chief Financial Officer in Local Government, which applied more specifically to councils.
The document describes the role and responsibilities of CFOs working in councils, and is aimed at codifying how they should fulfil their legal and professional duties.