Examination of credit card use and management: The Coorong District Council

This report communicates my findings on the examination of credit card use and management by The Coorong District Council.

I concluded that The Coorong District Council did not always use and manage its credit cards efficiently and economically during the period I examined (1 July 2016 to 30 April 2018).

We recommended that the Council should: 

• perform a formal and regular analysis of its credit card and accounts payable expenditure to: 
  • identify areas for further improvement in the use of credit cards  
  • confirm individual cardholder limits are reasonable and enable cardholders to perform their roles and responsibilities efficiently 
  • confirm that the reason for issuing a credit card and its subsequent use remains 
  • appropriate and supports efficiency 
  • inform its procurement strategy 
• consider updating its credit card policy for the improvements we identified  
• ensure all delegations and sub‐delegations are made in line with the LG Act 
• clarify the effect of the conditions or limitations contained in its instrument of delegations  
• ensure its instrument of delegations clearly and accurately reflects the powers and functions delegated. The information contained in the Instrument of Delegations is consistent within itself and other relevant documents 
• have the CEO maintain a signed formal instrument of sub‐delegations separate from the instrument of delegation by the Council    
• update its new credit card policy to require an independent review of credit card expenditure and document the procedures for this. Reinforce to staff the importance of the independent reviewer’s responsibility 
• review a sample of credit card transactions to ensure the independent review is operating effectively and in line with the new/revised policies  
• periodically report the CEO’s and Mayor’s credit card transactions to its audit committee for review to ensure the expenditure is reasonable and for business purposes 
• update its policies for: 
  • the expenditure principles staff need to apply and clearly demonstrate at the time expenditure is incurred  
  • the nature and extent of information needed to adequately justify the business purpose of the expenditure 
• maintain adequate records to explain its expenses and demonstrate transparency in the decision‐making process and the proper use of public money 
• evidence approvals that support the business purpose prior to incurring expenditure that is outside of an approved policy and/or perceived to be unusual or uncommon  
• identify its key business expenses and develop and implement policies and procedures for them, such as policies for travel, entertainment and hospitality   
• in revising its expenditure policies, consider consulting with its community, and other key people or groups, to better understand the public’s expectations of acceptable expenditure behaviours
• consider revising its credit card policy to limit the amount spent on individual gifts to ensure the expenditure is a proper use of public money 
• review its policy on funding social functions such as the annual elected member and staff Christmas function 
• better explain the business purpose and business benefit to the Council before incurring sensitive expenditure. The Council should also maintain adequate records to support this explanation  
• review its policy and procedure on employee recognition of service and achievements, with specific focus on staff performance and the expenditure principles 
• have its staff organise the Mayor’s travel arrangements in line with policy and existing practices and reassess the need for the Mayor to have a council credit card
• clarify and, where necessary, update its elected members allowance, benefits and support policy for requirements to ensure all expenditure incurred by or for elected members is necessary and appropriate in performing their official duties.