Finance manual - budgeting

The delegated budgeting system

RoS income and expenditure budget is agreed by the Scottish Parliament as part of the Scottish Consolidated Budget. RoS is responsible for preparing and managing its budget for each financial year. RoS must comply with the rules under the Scottish Consolidated Fund and the Scottish Government's’ in year budget monitoring and management procedures.

RoS operates a system of delegated budgeting which means that each department is responsible for its own budget. The keeper is authorised to make payments that are legally required in the exercise of her functions. The accountable officer has personal responsibility for safeguarding public funds and ensuring RoS complies with the Scottish Public Finance Manual.  The keeper and the accountable officer delegate this authority to the executive management team members who, in turn, delegate financial authority to appropriate members of their teams.

Further information can be found on the Scottish Government Scottish Public Finance Manual (SPFM) and within the extract of the Public Finance and Accountability (Scotland) Act 2000 (the 2000 Act) statutory basis.

Authority levels

Directors are able to delegate financial authority to appropriate members of their teams. The details of these delegations are held by the Financial accounting team.

Authority levels are linked to seniority and the following levels apply (note that the values include VAT):

The financial authority limits for business case approval for each body are:

Note that these authority levels apply to the total value of linked individual expenditure so that if an activity requires multiple payments to be complete then authority for the total payment is required before commencing the activity.

Business cases >£1m require approval of both the Keeper and the Accountable Officer.  Business cases <£1m can be approved at Executive Management Team investment board if quorate, which could be either the Keeper or the Accountable Officer.

Indemnity/compensation payments in excess of £10,000 are reported on a monthly basis to the policy and practice group. The keeper’s authorisation is obtained prior to making any offers or payments in excess of £30,000, or smaller amounts in cases which give rise to potential legal or reputational risks.

The following limits apply for indemnity/compensation payments:

The monthly payroll is authorised at Director level.

Forming contracts with suppliers

Procurement staff are authorised to commit funds and form contracts with suppliers and adhere to the limits in the first table below. The only exceptions to this are minor expenditure through the use of government procurement cards (GPC) and RoS/Scottish Government call-off contracts.

Further information can be found in the Procurement Manual.

The budget process

The Corporate Plan is completed in January and reviewed quarterly with the Accountable Officer & Director.

Budgets are then compiled by a team from Finance. The draft budget is presented to the Executive Management Team (EMT) for approval. In the event that a budget cannot be agreed that meets these criteria, the issue would revert to the Board for a view on priorities.

The budget is monitored on a monthly basis, with reports issued to budget holders including invoices received and outstanding purchase orders. The budget holders investigate any variances, and provide relevant commentary on variances above 10%. The Head of Finance presents the monthly report to the EMT.

Occasionally in-quarter adjustments are made for additional expenditure, where the proposed expenditure would exceed £1,000,000 or impact on our ability to meet our financial targets. These require board approval.

Business cases

As part of the budgeting process, directors should identify possible expenditure which would require a business case.