From laggard to leader

11 Feb 13
Steven Mair

Oldham has transformed itself from one of the slowest councils in England to publish its accounts to the fastest. So what’s the secret of its success?

Christmas came early for Oldham Metropolitan Borough Council when the Audit Commission published its review of local government accounting on December 13. The authority received high praise for having closed its 2011/12 accounts on June 25, a month ahead of any other council in England.

Controller of audit Marcine Waterman commended the council for being ‘top of the league’. The Audit Commission report, Auditing the accounts, pointed out that Oldham was the first council to publish its accounts in June since the commission began producing this analysis in 2009.

It’s a long way from where we were three years ago. For the 2008/09 financial year, Oldham submitted its statement of accounts on June 30, 2009. But it didn’t publish them until September 30 and then with several material errors. Our performance put us in the lower quartile of councils.

Since then, as part of a transformation programme across the council, we have radically altered our operations and timings. Oldham made it into the top six for closing the 2009/10 accounts, was joint first for 2010/11 and now leads the pack. So how did we do it?

One of the vital elements was winning the support of finance staff. We had some enablers, others who weren’t sure and a few blockers. Our goal was to turn the unsure into enablers and the blockers into believers.

The starting point was reviewing the timetable – challenging deadlines and examining dependencies. We treated this as a project, introducing a ‘core team’ with a sponsor, manager and work-stream leaders. Team members now meet monthly to update and publish the timetable; identify and manage risks; and review progress.

We then began to work more closely with our external auditors – originally the Audit Commission and then Grant Thornton. There are regular audit liaison meetings between the borough treasurer’s management team, the district auditor and the audit manager.

These are information-sharing sessions, but also allow us to discuss our aspirations. It makes planning closure of the accounts easier for everyone. Our internal audit teams supports the assurance process and works very closely with external audit throughout the year.

The major challenges, however, are technical. We rely on our talented technical accountants and support them with finance staff undergoing professional studies. Together, we introduced monthly closedowns, an early annual closedown at the end of January and full quality assurance. This enables preparation of large sections of the accounts before March 31. It means the year-end is mainly routine with no unexpected problems.

Early publication allows finance to focus on the new financial year, including savings. It helps members and managers to identify and address issues quickly. It also helps to motivate finance staff, who feel greater pride in their performance and in the improved reputation of the council.

Fundamentally, the quality and pace of changes brought about with the accounts now feed into everything we do.

We aim for continuous improvement – so look out for a new record this year and maybe the year after also.

Steven Mair is the treasurer of Oldham Metropolitan Borough Council

This article first appeared in the January/ February edition of Public Finance magazine

Did you enjoy this article?