Local Authority: Roscommon County Council
Issue: Breach of grant claim procedures
The Local Government Auditor has repeatedly rebuked Roscommon County Council for breaching grant claim procedures.
In general terms, grant claims should only be made with respect to actual expenditure, rather than future expenditure.
Councils risk losing grant funding within the financial year unless they can show that they incurred expenditure before their request to draw down their funding.
To get around this problem, some local authorities submit invoices as part of their grant application, which gives the funding authority the impression they have incurred certain costs at that time, which they have not.
The invoices are then "parked" – meaning they are recorded on the system as relating to goods or services received, which is incorrect, and are then paid out later.
The trouble with this practice is that it breaks various rules and guidelines issued by government departments.
The Local Government Auditor has highlighted this practice at Roscommon County Council on several occasions, but its warnings have done nothing to alter the council's behaviour.
In the 2015 audit, for example, the auditor found that invoices valued at more than €600,000 had been recorded on the financial management system as having been "received" by the end of that year, which was not the case.
The invoices were submitted as part of a grant claim submitted to the Department of Transport, Tourism and Sport (DTTAS) in December 2015.
The auditor noted: "This is a breach of the DTTAS Memorandum on Grants for Regional and Local Roads…. [which] specifically forbids the claiming of unpaid bills."
The issue arose again in the 2016 audit – on this occasion, the auditor found that the invoices involved amounted to more than €1m. The auditor again stressed that "claiming unpaid bills breaches funding agreements."
It also warned the council that it was "circumventing basic controls inherent controls in the financial system."
In their 2017 report, the auditor said that the "matter remains on-going despite being highlighted in previous audits" and added that the practice "exposes the council to the risk of loss as a payment could be released without the receipt of goods/services".
In the following year’s audit, the auditor stressed that if the council continues with this practice, they should ask the funding bodies for their agreement to "such drawdowns".
Meanwhile, the practice was also referenced in the 2019 audit, with the auditor stating that the council should obtain the "written agreement" of funding authorities to "advance drawdowns".
In its responses to the audit findings, the council referred to "a conflict" between the accounting systems used by local authorities and those used by funding bodies.
The council told RTÉ Investigates: "The Council has a contractual obligation to discharge amounts as they fall due and grant allocations were drawn down as directed by funding departments."
"The issues outlined are not unique to Roscommon County Council, and they require a whole government approach/resolution."
The spokesperson would not say if the council sought written approval from the funding bodies when it had engaged in this practice, as recommended by the Local Government Auditor.
