Bristol City Council lost track of £1.8m in cash transactions

Bristol City Council lost track of £1.8m of staff cash transactions last year, a damning report has found.

Social workers issued payments of up to £500 without anyone checking what they were for, investigators concluded.

An internal audit revealed a number of “key deficiencies”, including the lack of a central record and no back-checking of emergency payments.

A council spokesman said: “We are now taking immediate action by reviewing all sources of petty cash with a view to significantly reducing the number of non-essential accounts.”

An inquiry into the authority’s cash holdings – called imprest accounts – returned the lowest possible audit finding of “no insurance”.

The authority held a number of cash accounts for various purposes, including as part of statutory and emergency payments to those in need.

But an internal audit revealed a lack of control or awareness of bosses and staff bypassing council systems.

Individual social workers also requested, authorized and issued cash payments of up to £500 without supervision, unsafe cash storage arrangements and no subsequent verification of the validity of emergency payments.

There were also inconsistent balance sheets and no central record of what was happening.

While internal auditors found no evidence of fraudulent payments, the team concluded that the risk of fraud and error remained high.

The report, to be discussed later, says the children and education directorate was responsible for the vast majority of spending – £1.7m – with most of the rest being done by the adults and communities team.

“A common theme was a lack of resources to administer cash payments and that council systems were being bypassed,” the report said.

The report said council chiefs accepted the findings and agreed to a number of actions.

A Bristol City Council spokesman said: “Following an internal audit of the council’s petty cash accounts, it was determined that the level of guidance, oversight, processes and controls on these accounts was not acceptable.”

Council chiefs plan to “eliminate all cash purchases” where appropriate.

“Our finance team is also in the process of producing a revised policy with clear instructions for those operating and relying on small house accounts, as well as adding robust standardization on opening and closing such accounts.

“We hope to have this newly revised policy framework in place by the end of August and continue to work with all services that rely on petty cash to ensure they become fully compliant,” the spokesperson added.