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.

The budget process

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

From April 2024, a formal delegated authority budget letter detailing Resource and Capital budgets are issued by the Accountable Officer to the relevant Director and subsequent Directorate budget holders thereafter. Following the allocation of the budget, the budget holder has the authority to spend within previously agreed limits and under the authorities allowed by the Financial Scheme of Delegation. Functions should ensure that spend is controlled and monitored through regular budget reviews with their Management Accountant. Budget is to be spent on the agreed category and budget holders must align to the RoS Financial Management Guidance to support RoS in maintaining a balanced budget.

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.

Financial Authority

Authority levels are linked to seniority and the following levels apply (note that 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

As part of the budgeting process, any new spend not in the original plan must be approved by a business case regardless of the amount.

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

Indemnity/compensation payments are constantly monitored by the Policy and Practice Group (PPG) members through the compensation dashboards. Individual claims are highlighted to PPG on an ad hoc basis determined by value, novelty, and perceived reputational risk, or if serious issues relating to registration practice are observed.

Limits for indemnity /compensation payments are as per the first table above.

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 above. The only exceptions to this are minor expenditure through the use of government procurement cards (GPC) and RoS/Scottish Government call-off contracts.

A non-competitive action (NCA) is used when the procurement process is not followed. It is for exceptional circumstances only to meet the business needs and must be authorised by the Head of Procurement and the Accountable Officer before any commitment to spend is made. The Head of Procurement and the Head of Estates, Procurement & Sustainability can approve NCA up to the value of £10,000 inclusive of VAT and reported to the Accountable Officer.

Further information can be found in the Procurement Manual.

Losses, write offs

Losses / write offs if recognised and or required are reported to EMT on a monthly basis within the finance update paper. Write offs are managed and approved by the CFO, EMT approval for individual losses and write offs in excess of £1,000 is sought prior to recognition of the loss.

Payroll

The monthly payroll and associated third party payments are authorised at Director level.