Treasury and Cash Management Policy 13.07 - Welcome … and Cash... · Treasury and Cash Management Policy Version 2 Page 3 of 26 Contents Page 1. Executive Summary 4 2. Introduction

Treasury and Cash Management Policy Version 2 Page 1 of 26

TREASURY AND CASH MANAGEMENT POLICY

Document Author Authorised Written By: Assistant Director of Finance Date: 7 July 2014

Authorised By: Chief Executive Date: 7 July 2014

Lead Director: Executive Director of Finance

Effective Date: 6 July 2015

Review Date: 5 July 2018

Approval at: Trust Executive Committee

Date Approved: 6 July 2015


DOCUMENT HISTORY (Procedural document version numbering convention will follow the following format. Whole numbers for approved versions, e.g. 1.0, 2.0, 3.0 etc. With decimals being used to represent the current working draft version, e.g. 1.1, 1.2, 1.3, 1.4 etc. For example, when writing a procedural document for the first time – the initial draft will be version 0.1)

Date of Issue

Version No.

Date Approved

Director Responsible for

Change

Nature of Change

Ratification / Approval

16 Nov 12 0.1 Deputy Director of Finance

Draft Ratified at Finance,

Investment & Workforce

Committee

13 Feb 13 0.2 Deputy Director of Finance

Ratified at Audit Committee

06 Apr 13 0.3 Deputy Director of Finance

Amendments requested

Policy Management Committee

20 Jun 13 0.4 Assistant Director of Finance

Ratified at Policy Management Committee

05 Aug 13 0.4 05 Aug 13 Assistant Director of Finance

Approved at Trust Executive Committee

21 May 14 0.5 Director of Finance Revised Ratified at Finance, Investment & Workforce Committee

18 Jun 14 0.5 Director of Finance Ratified at Risk Management Committee

24 Jun 14 0.5 Director of Finance Ratified at Policy Management Committee

07 July 14 1.0 07 July 14 Director of Finance Approved at Trust Executive Committee

28 April 15 1.1 Executive Director of Finance

Revised Ratified at Finance, Investment, Information & Workforce Committee

26 May 15 1.1 Executive Director of Finance

Revised Ratified at Risk Management Committee

16 June 15 1.1 Executive Director of Finance

Ratified at Policy Management Group

06 July 15 2 Executive Director of Finance

Approved at Trust Executive Committee

NB This policy relates to the Isle of Wight NHS Trust hereafter referred to as the Trust.


Contents Page 1. Executive Summary 4 2. Introduction 5 3. Scope 5 4. Purpose 5 5. Roles and Responsibilities 7 6. Policy detail / course of action 8 7. Consultation 12 8. Training 12 9. Dissemination Process 12 10. Equality Analysis 13 11. Review and Revision arrangements 13 12. Monitoring Compliance and Effectiveness 13

13. Links to Other Organisation Policies / Documents 13 14. References 14

15. Disclaimer 14

Appendices:

A. Key definitions for documentation 15 B. Monitor Suggested Credit Ratings 16

C. Checklist for the development and approval of controlled 19 Documentation D. Impact assessment forms on policy implementation (including 21 checklist) E. Equality analysis and action plan 24


1. EXECUTIVE SUMMARY

The purpose of this policy is to ensure compliance with the treasury management requirements under the NHS Trust regime guidelines and that it complies with the Trust’s Standing Financial Instructions and Standing Orders. The objectives of the treasury management policy are to support the Trust’s strategic and business objectives and to safeguard and properly account for the use of public money. The aims and objectives of this policy are therefore to:

• identify, manage and reduce the financial risks arising from operational and treasury management activities including any foreign exchange transactions.

• minimise interest charges and maximise returns on any surplus funds whilst taking a risk adverse approach.

This policy will enable the Trust to manage its cash resources, to raise finance at acceptable cost and risk, and to reduce interest rate risk, as well as in the conduct of the Trust’s relationship with its financial stakeholders, mainly banks. It enables considered decisions to be made in ensuring that adequate cash resources are available to meet the needs of the Trust at any time. This policy focuses on investment of surplus operating cash likely to be needed within twelve months to support ongoing operations. These investments need to be safe and liquid, so that the risk to invested capital is minimised and the investments can be realised quickly. This document describes guidelines that are intended to ensure adequate safety (i.e. manageable risk profile) and liquidity (i.e. accessibility of funds at short notice), of such investments, while generating a competitive return.

As a Trust it cannot invest outside the GBS banking facility or the National Loans Fund. However the policy is designed to be “Foundation Trust” ready once authorisation is made with the minimum adjustment.


2. INTRODUCTION 2.1 Treasury management refers to the set of policies, strategies, and transactions that have

been adopted by the Trust and that the Trust implements to manage its cash resources, to raise finance at acceptable cost and risk, and to reduce interest rate risk, as well as in the conduct of the Trust’s relationship with its financial stakeholders, mainly banks. It enables considered decisions to be made in ensuring that adequate cash resources are available to meet the needs of the Trust at any time.

Treasury management is the process of managing:

• Cash

• Availability of short and long term funds;

• Foreign currency and interest rate risk; and

• Relationships with banks and other financial institutions.

3. SCOPE 3.1 This policy effects all the fiscal arrangements of the Trust relating to cash and treasury

management (see section 5 for roles and responsibilities). 3.2 This policy focuses on the investment of surplus operating cash likely to be needed within

twelve months to support ongoing operations. Investments need to be safe and liquid so that the risk to invested capital is minimised and the investments may be realised quickly.

3.3 This policy only relates to the funding due to the Isle of Wight NHS Trust. Charitable funds

are outside the scope of this policy.

4. PURPOSE 4.1 As an NHS Trust the principal role is one of providing healthcare services for the NHS. As

such the Board of the Trust must ensure that surplus operating cash is invested in accordance with the duty to safeguard and properly account for the use of public money. The Trust must avoid potential reputational risks associated with investments. The Chief Executive of the Trust is the Accounting Officer with direct accountability to Parliament for the operation of the Treasury and Cash Management Policy.

4.2 Treasury Management Function

The overall objective of the Treasury function is:

a) To make sure that any surplus funds are invested to provide a competitive return within an acceptable risk profile and subject to the statutory framework in which the Trust operates;

b) Manage the financial risk associated with operational activities; for instance, interest rate

and foreign currency risks;

c) To make sure that all creditors to the Trust receive settlement of their invoices in accordance with the Government’s Better Payment Practice Code;


d) Ensure the availability of competitively priced funding for working capital with an acceptable risk profile;

e) To make sure any investments promote fiscal responsibility that do not compromise

effective, efficient and economic delivery of services;

f) To minimise the level of funds owed to the Trust by effective credit control, and

g) Ensuring compliance with all banking covenants.

4.3 Risk and Control

The main liquidity priorities are that the Trust must be able to meet all liabilities as they fall due and avoid the need to borrow if at all possible to meet short-term cash requirements. To ensure that the Trust undertakes treasury activities in a controlled and properly reported manner a number of high level controls are in place including:

• The documentation of treasury management policies and processes within this document,

• Clearly defined roles and responsibilities for the Trust Board, the Executive Director of Finance, the treasury management function and the rest of the finance department,

• Regular reporting of treasury activities,

• Separation of duties between those who deal, those who initiate payment and those who account for treasury activities,

• Strict limits on the type of investment used and the circumstances in which they can be used, and

• Inclusion of treasury management activities within the scope of review by internal and external audit.

4.4 Attitude to risk

The Trust will take a conservative approach to risk and will not make any investments that represent a risk to the base capital of the Trust.

• Funding – the Trust will maintain adequate free funds, amounting to £5m, the equivalent to working ten days, to finance its day to day operations. The risk that the Trust fails to accurately identify a cash balance that is sufficient to pay creditors is managed by the use of cash flow forecasts and related monitoring systems;

• Investments - the Trust will not invest outside of safe harbour investments. Risk ratings will be in line with Monitor guidance and reviewed at least on a quarterly basis. The risk that too much money will be invested is managed by the use of authorised list of deposit takers together with limits on the amount that can be invested with each organisation. Long-term investments of more than three months will only be made with the approval of the Finance, Investment, Information and Workforce Committee. The risk that the Treasury Function incurs excessive costs in placing or withdrawing an investment will be mitigated by specifying minimum limits on investment levels to ensure the return is greater than the costs;

• Foreign exchange management – will not be undertaken by the Trust.


5. ROLES AND RESPONSIBILITIES 5.1 The Trust Board are responsible for:

• Approval of external funding requirements

• Approve the opening and closing of bank accounts

• Approval of overall treasury policy

• Delegates responsibility for approval of the treasury procedures, controls and detailed procedures to the Finance, Investment, Information and Workforce Committee

5.2 Finance, Investment, Information and Workforce Committee are responsible for:

• Ensuring that the Trust’s investment and borrowing strategy retains a minimal risk profile

• Approving and monitoring relevant benchmarks for performance

• Ensuring the proper safeguards are in place for the security of the Trust’s funds by o Agreeing a list of permitted institutions o Setting investment limits for each institution o Agreeing permitted investment types o Monitor compliance with treasury policy and procedures o Delegate responsibility for treasury operations to the Trust’s Executive

Director of Finance 5.3 Executive Director of Finance is responsible for:

• To set in place such procedures to enable strict control over the investment of surplus cash balances

• Approval of cash budgets, forecasts and cash management systems and procedures.

• Review and monitoring of investment and borrowing policy

• Ensuring proper safeguards are in place

• Delegating responsibility for treasury operations to the Head of Financial Services

• Approving all investment decisions 5.4 Deputy Director of Finance is responsible for:

• Ensuring that procedures are in place for the day to day running of the treasury function and are followed and has the delegated responsibility to authorise individual transactions up to three months.

5.5 Head of Financial Services is responsible for:

• Managing the treasury management function and ensuring that all procedures are followed, all transactions recorded and relevant cash flow and transactions reports prepared. Delegated responsibility to authorise individual transactions up to one month. Responsible for ensuring the policy is disseminated and communicated to all relevant parties

• Defining the approach to treasury for approval by the Board.

• Ensuring treasury activities are reported on regularly and accurately.

• Managing key banking relationships.

• Managing treasury activities within the agreed policies and procedures.


5.6 Senior Financial Accountant is responsible for:

• Carrying out deals with the approved institutions following receipt of the approval of the Head of Financial Services or, in their absence, the Deputy Director of Finance. They should ensure accurate and timely recording of all treasury transactions

• Accurate and timely recording in the accounting records all of the treasury transactions, undertaking bank account reconciliations and match and clear investment transaction documentation.

• Preparing cash flow projection and advising on the likely instances of surplus funds available for investment.

• Actioning investment and borrowing decisions

6. POLICY DETAIL / COURSE OF ACTION 6.1 Types of Investments

Safe Harbour Investments

Monitor’s guidance is that Foundation Trusts should only invest in “safe harbour” investments. A Safe Harbour investment is an investment deemed to be of sufficiently low risk and liquidity to meet the following criteria:

a) To meet a permitted Rating Requirement issued by a Recognised Rating Agency;

b) To be held at a Permitted Institution;

c) To have a defined maximum maturity date (other than for UK Government bonds);

d) To be denominated in sterling, with any payments or repayments for the investment

payable in sterling;

e) To pay interest at a fixed, floating, or discount rate; and

f) To be within the Preferred Concentration Limit aggregated for each institution and subsidiary of that institution.

The rating requirements set out in Appendix B meet the minimum standards set by Monitor and are indicative of a risk averse investment strategy.

These investments include (but are not limited to) money market deposits, money market funds, Government and local authority bonds and debt obligations, and cash deposits. Open-ended investments such as unit Trust or bond funds qualify as safe harbour only if all the individual investments of the unit Trust or bond fund meet the criteria as well. Safe harbour investments means that the Trust Board does not have to undertake an individual investment review nor will Monitor require a report on them as part of its risk assessment process as they are deemed to have sufficient low risk and high liquidity.

6.2 Investments outside of safe harbour

The Trust is not empowered to invest surplus operating cash outside of safe harbour investments.


6.3 Cash Investments 6.3.1 Cash Deposits – Principal Bankers.

The Trust uses the Government Banking Service for all its banking services 6.3.2 Short Term Deposits - Surplus Cash Funds

As a Trust deposits can only be made via its Principal Bankers or the National Loans Fund. The Trust will periodically review short term interest rates offered by its principal Bankers to ensure that rates being offered are competitive with the marketplace are of a similar and acceptable risk profile, and for similar short terms.

6.3.3 Long Term Deposits - Surplus Cash Funds

It is unlikely that the Trust will have long term funding surpluses but if so this should be invested with the same considerations as for short-term funds. When reviewing value for money in its banking arrangements the Trust must take into account the full cost to the Treasury of commercial banking arrangements.

6.4 Limits 6.4.1 Short Term Deposits

The majority of the day to day banking is performed through the GBS account and there is currently no limit on short term deposits of less than one month. In practice the GBS is the repository of NHS contract payments and this income is used over the course of the month to meet all the Trusts normal operational cash commitments.

6.4.2 Medium Term Deposits

These are for periods on deposit between one month and three months and must not exceed £500,000 thousand with any one Principal Banker. The Trust does not invest for periods in excess of three months.

6.4.3 Long Term Deposits

The Trust is not empowered to invest beyond three months without reference to a formal Board decision. All borrowing will be within the parameters of the Prudential Borrowing Limit set for the Trust by Monitor.

6.5 Credit Rating Agencies and Ratings

The Trust will use Moody’s Investors Services Ltd as its initial rating agency but will compare against Standard & Poor’s and Fitch Ratings if this is appropriate. Moody’s is one of the top three recognised credit agencies in the investment world. Cash deposits will only be placed with relationship banks in line with the limits agreed by the Finance, Investment, Information and Workforce Committee and based on Moody’s ratings. Under Monitor guidelines the short-term rating should be at least:

• P-1 Moodys

• A-1 Standard & Poor

• F1 Fitch


6.6 Brokers and Consultants

The Trust may utilise the expertise of external brokers if this is required and/or deemed appropriate. Consultants may be used where the Trust has no in-house expertise in a particular banking, investment or borrowing matter. The use of such brokers or consultants will be authorised by the Executive Director of Finance and reported to the Finance, Investment, Information and Workforce Committee.

6.7 Concentration Limits

These are set out in Appendix B but can be summarised as follows:

Up to £500,000 – maximum to be invested in a single institution Over £500,000 – to be invested over a number of permitted institutions to spread risk.

6.8 Banking

The Approval of the opening and closing of any bank or investment account is the responsibility of the Trust Board as set out in the Standing Financial Instructions. The Executive Director of Finance is responsible for managing the Trust’s banking arrangements and for advising the Trust on the provision of banking services and operation of accounts. GBS cash balances are reconciled by Shared Business Services and provided to the Trust on a daily basis. The Trust policy is to maintain a strong set of core relationships with Banks who may meet current and future banking and funding needs. Identifying those banks, which provide the better service for deposits, working capital, day-to-day accounting and cash management facilities. Ensuring that the cost paid for banking services is competitive, the cost of borrowing is minimised and the return on cash surpluses is maximised within acceptable risk and time parameters.

6.9 Organisation Responsibility

Day to day control of the Trust banking requirements rests with the Head of Financial Services as delegated by the Executive Director of Finance and the Board. The post holder is given limits and operational criteria within which to operate. Outside these limits and criteria the Trust Board will be consulted to approve investments and borrowing.

6.10 Reporting and Cash Flow

An annual cash flow forecast is prepared in summary form based on the Trust’s annual business plan.

The Senior Financial Accountant will prepare a weekly cash flow detailing actual transactions a detailed daily projection to the end of the period, a weekly projection to the end of the quarter and a monthly projection to the end of the financial year. Actual performance should then be monitored against anticipated performance. On a monthly basis the cash position will be reported to the Board in a form agreed by the Board, but will include compliance with the Prudential Borrowing Limit, the Better Payment Practice Code and the funding requirements of the Capital Programme and Working Capital limits.


6.11 Performance management

A rational and objective performance measurement structure will be used to monitor the effectiveness of the treasury and cash management policy. As a guide the National Loans Fund rate of interest will be used as a benchmark for investment returns. As stated above cash flow reporting is incorporated in finance reports provided to the Finance, Investment, Information and Workforce Committee.

6.12 Controls

In order for the treasury and cash management policy to ensure that treasury activities are undertaken in a controlled and properly reported manner the following control guidelines must be followed:

a) There will be clearly defined roles and responsibilities of individuals and committees

involved;

b) There will be regular reporting of treasury activities;

c) Segregation of duties between those who deal, those who initiate payment and those who account for treasury activities;

d) Controls on bank accounts in terms of mandates, signatories and sign-off limits.

6.13 Borrowing

The Trust will maintain a risk-averse approach to borrowing, recognising the on-going requirement to have committed funds in place to cover both existing business cash flows and reasonable headroom for seasonal debt fluctuations and capital expenditure programmes. When there are indications that the Trust may be required to borrow money the Executive Director of Finance must consider the implications of borrowing on the Trust’s Prudential Borrowing Limit, Working Capital Facility and income and expenditure account and risk rating where this is applicable.

Subject to Trust Board approval for sound reasons, borrowing is not permitted before it is required. The Trust is required to provide detail of its borrowings in its Annual Accounts. If the Trust should be unable to repay its borrowings on the due date the Executive Director of Finance must be informed to ensure remedial action is taken. The options for borrowing are:

• Working capital facility

• Loans

• Finance leases 6.14 Working Capital

It is accepted by Monitor that in order to provide the requisite opinion for authorisation by the trust board and the independent accountants, some Trusts may require working capital facilities. The working capital available to the Trust should be sufficient for its present requirements, that is, at least the twelve months.


It should be noted that Monitor will only include wholly committed lines of credit available for drawdown in the calculation of the liquidity metric in the continuity of services risk rating (as set out in the Risk assessment framework).

6.15 Loans

It is the responsibility of the Trust Board to approve external funding requirements. The limits for long term borrowing are determined by the Prudential Borrowing Code rules. Foundation Trusts will normally access the Foundation Trust Financing Facility when applying for loans. To ensure value for money the Trust will ensure that loan costs are market tested. Loans must be for capital expenditure either in the form of a single project or a basket of items within no more than the next two year’s capital expenditure programme.

6.16 Finance Leases

Finance leases to fund capital schemes are counted as borrowings. The effect on the Prudential Borrowing Limit should be calculated if such financing is being considered.

7. CONSULTATION 7.1 This document has been reviewed by the Audit Committee and the Finance, Investment,

Information and Workforce Committees, as described in the document history. Any feedback has been discussed and the document updated where appropriate.

8. TRAINING 8.1 This Treasury and Cash Management Policy does not have a mandatory training

requirement or any other training needs.

9. DISSEMINATION 9.1 When approved this document will be available on the Intranet and will be subject to

document control procedures. Approved documents will be placed on the Intranet within five working days of date of approval once received by the Risk Management Team.

9.2 When submitted to the Risk Management Team for inclusion on the Intranet this document

will have fully completed document details including version control. Keywords and description for the Intranet search engine will be supplied by the author at the time of submission.

9.3 Notification of new and revised documentation will be issued on the Front page of the

Intranet, through e-bulletin, and on staff notice boards where appropriate. Any controlled documents noted at the Trust Executive Committee will be notified through the e-bulletin.

9.4 Staff using the Trust’s intranet can access all procedural documents. It is the responsibility of

managers to ensure that all staff are aware of where, and how, documents can be accessed within their areas of work.


9.5 It is the responsibility of each individual who prints a hard copy of any document to ensure that the printed hardcopy is the current version. Current versions are maintained on the Intranet.

10. EQUALITY ANALYSIS 10.1 This procedure has undergone an equality analysis please refer to Appendix E.

11. REVIEW AND REVISION ARRANGEMENTS 11.1 This policy will be reviewed at least on an annual basis by the Finance Investment,

Information and Workforce Committee. Where legislation or revised guidance is issued the policy will be reviewed immediately in the light of that guidance.

Responsibility for updating the policy will be with the Deputy Director of Finance in conjunction with the Executive Director of Finance. Archival arrangements will be the responsibility of the Deputy Director of Finance.

11.2 Publicity

The policy will be available on the Policies section of the Intranet and on the finance department pages Hard copies made available to all relevant staff in the finance department Part of appraisal review and objective setting process.

11.3 Post Implementation Review Achievement of investment targets and monitoring through appraisal process Reporting of investments to Finance, Investment, Information and Workforce Committee Annual report on investment activities

12. MONITORING COMPLIANCE AND EFFECTIVENESS 12.1 The effectiveness of this Policy will be the subject of Audit scrutiny and investment will be

reported to the Finance, Investment, Information and Workforce Committee on a monthly basis.

The effectiveness will also be monitored and reviewed quarterly by the Head of Financial Services and performance indicators will be reported to the Finance, Investment, Information and Workforce Committee.

13. LINKS TO OTHER ORGANISATION POLICIES/DOCUMENTS

Equality and Human Rights Commission http://www.equalityhumanrights.com/advice-and-guidance/new-equality-act-guidance/equality-act-guidance-downloads/


Fraud and Corruption

If Fraud or Corruption is suspected confidentiality is vital to ensure the integrity of the information and any subsequent investigation. Please report any suspicions of Fraud and Corruption direct to the Local Counter Fraud Specialist Barry Eadle on 07779 031139 E mail [email protected] or Executive Director of Finance Chris Palmer on 01983 534462 E Mail [email protected] or ring the

National Fraud and Corruption reporting line on 0800 028 40 60 Please refer to the organisations Countering Fraud and Corruption Policy and Reporting Procedure for details, the policy is available on the Countering Fraud Intranet Page. Counter fraud Policy link Standing Orders http://intranet/uploads/clingov/Pdfs/Standing%20Orders%20-%20new%20trust%20march%202012%20-revised%20November%2012%20updated%2021.01.13.pdf

Standing Financial Instructions http://intranet/uploads/clingov/Pdfs/Standing%20Financial%20Instructions%20-with%20contents%20page%20January%202013%20ver%202%20final.pdf

14. REFERENCES

Data Protection Act (1998) Monitor’s Best Practice Treasury Management http://www.monitor-nhsft.gov.uk/

15. DISCLAIMER 15.1 It is the responsibility of all staff to check the Trust intranet to ensure that the most recent

version/issue of this document is being referenced.


Appendix A

KEY DEFINITIONS FOR DOCUMENTATION

None


Appendix B MONITOR SUGGESTED CREDIT RATINGS

Term

Advice

Recognised rating agency Only the following are recognised rating agencies1: ■ Standard & Poor’s; ■ Moody’s Investors Service Ltd; and ■ Fitch Ratings.

Permitted rating requirement The short-term rating should be at least: ■ A-1+ Standard & Poor’s rating; or ■ P-1 Moody’s rating; or ■ F1+ Fitch Ratings. The long-term rating should be at least: ■ Aa (Moody’s); or ■ AA (Standard & Poor’s/Fitch Ratings).

Permitted institutions Permitted institutions include: ■ institutions that have been granted permission, or any European institution that has been granted a passport, by the Financial Services Authority to do business with UK institutions provided it has an investment grade 2 credit rating of A1/A+ issued by a recognised rating agency; and ■ The UK Government, or an executive agency of the UK Government, that is legally and constitutionally part of any department of the UK Government, including the UK Debt Management Agency Deposit Facility.

Maximum maturity date ■ The maximum maturity date for all investments should be 3 months. ■ The maturity date for any investment should be before or on the date when the invested funds will be needed.

Preferred concentration limit (Long term deposits)

■ Surpluses below £500,000 may be invested with one institution. ■ Surpluses above £500,000 should be invested across a number of permitted institutions to spread the investment risk. ■ Investment limits should be set for permitted institutions based on their credit rating and net worth. These limits should be reviewed against latest ratings at the time of each investment decision transaction. If an institution is either downgraded or put on credit watch by a recognised rating agency, the decision to invest with them should be reviewed. ■ The investment limit must not be exceeded for any institution.


The following definitions elaborate on the criteria outlined in the table:

Moody’s Guide to Ratings – extract Long-Term Bank Deposit Ratings Moody's long-term bank deposit ratings employ the same alphanumeric rating system as that for long-term issuer ratings. Aaa Banks rated Aaa for deposits offer exceptional credit quality and have the smallest degree of risk. While the credit quality of these banks may change, such changes as can be visualized are most unlikely to materially impair the banks' strong positions. Aa Banks rated Aa for deposits offer excellent credit quality, but are rated lower than Aaa banks because their susceptibility to long-term risks appears somewhat greater. The margins of protection may not be as great as with Aaa-rated banks, or fluctuations of protective elements may be of greater amplitude. A Banks rated A for deposits offer good credit quality. However, elements may be present that suggest a susceptibility to impairment over the long term. Baa Banks rated Baa for deposits offer adequate credit quality. However, certain protective elements may be lacking or may be characteristically unreliable over any great length of time. Ba Banks rated Ba for deposits offer questionable credit quality. Often the ability of these banks to meet punctually deposit obligations may be uncertain and therefore not well safeguarded in the future. B Banks rated B for deposits offer generally poor credit quality. Assurance of punctual payment of deposit obligations over any long period of time is small. Caa Banks rated Caa for deposits offer extremely poor credit quality. Such banks may be in default, or there may be present elements of danger with regard to financial capacity. Ca Banks rated Ca for deposits are usually in default on their deposit obligations. C Banks rated C for deposits are usually in default on their deposit obligations, and potential recovery values are low. Note: Moody's appends the numerical modifiers 1, 2, and 3 to each generic rating category from Aa to Caa. The modifier 1 indicates that the bank is in the higher end of its letter-rating category; the modifier 2 indicates a mid-range ranking; and the modifier 3 indicates that the bank is in the lower end of its letter-rating category. Short-Term Bank Deposit Ratings Moody's employs the following designations to indicate the relative repayment ability for bank deposits:


P-1 Banks rated Prime-1 for deposits offer superior credit quality and a very strong capacity for timely payment of short-term deposit obligations. P-2 Banks rated Prime-2 for deposits offer strong credit quality and a strong capacity for timely payment of short-term deposit obligations. P-3 Banks rated Prime-3 for deposits offer acceptable credit quality and an adequate capacity for timely payment of short-term deposit obligations. NP Banks rated Not Prime for deposits offer questionable to poor credit quality and an uncertain capacity for timely payment of short-term deposit obligations. 1

1(source:http://www.moodys/cust/AboutMoodys/AboutMoodys.aspx?topic=rdef&subtopic=moodys%20credit

%20ratings&title=View+All+Rating+Definitions.htm)


Appendix C

CHECKLIST FOR THE DEVELOPMENT AND APPROVAL OF CONTROLLED DOCUMENTATION

To be completed and attached to any document when submitted to the appropriate committee for consideration and approval. Title of document being reviewed:

Y/N/ Unsure

Comments

1. Title/Cover

Is the title clear and unambiguous? Y

Does the title make it clear whether the controlled document is a guideline, policy, protocol or standard?

Y

2. Document Details and History

Have all sections of the document detail/history been completed? Y

3. Development Process

Is the development method described in brief? Y

Are people involved in the development identified? Y

Do you feel a reasonable attempt has been made to ensure relevant expertise has been used?

Y

4. Review and Revision Arrangements Including Version Control

Is the review date identified? Y

Is the frequency of review identified? If so, is it acceptable? Y

Are details of how the review will take place identified? Y

Does the document identify where it will be held and how version control will be addressed?

Y

5. Approval

Does the document identify which committee/group will approve it? Y

If appropriate have the joint Human Resources/staff side committee (or equivalent) approved the document?

N/A

6. Consultation

Do you have evidence of who has been consulted? Y

7. Table of Contents

Has the table of contents been completed and checked? Y

8. Summary Points

Have the summary points of the document been included? Y

9. Definition

Is it clear whether the controlled document is a guideline, policy, protocol or standard?

Y

10. Relevance

Has the audience been identified and clearly stated? Y

11. Purpose

Are the reasons for the development of the document stated? Y

12. Roles and Responsibilities

Are the roles and responsibilities clearly identified? Y

13. Content

Is the objective of the document clear? Y


Title of document being reviewed:

Y/N/ Unsure

Comments

Is the target population clear and unambiguous? Y

Are the intended outcomes described? Y

Are the statements clear and unambiguous? Y

14. Training

Have training needs been identified and documented? N/A

15. Dissemination and Implementation

Is there an outline/plan to identify how this will be done? N/A

Does the plan include the necessary training/support to ensure compliance?

N/A

16. Process to Monitor Compliance and Effectiveness

Are there measurable standards or Key Performance Indicators (KPIs) to support the monitoring of compliance with and effectiveness of the document?

Y

Is there a plan to review or audit compliance within the document? Y

Is it clear who will see the results of the audit and where the action plan will be monitored?

Y

17. Associated Documents

Have all associated documents to the document been listed? Y

18. References

Have all references that support the document been listed in full? Y

19. Glossary

Has the need for a glossary been identified and included within the document?

Y

20. Equality Analysis

Has an Equality Analysis been completed and included with the document?

Y

21. Archiving

Have archiving arrangements for superseded documents been addressed?

N

Has the process for retrieving archived versions of the document been identified and included within?

N

22. Format and Style

Does the document follow the correct style and format of the Document Control Procedure?

Y

23. Overall Responsibility for the Document

Is it clear who will be responsible for co-ordinating the dissemination, implementation and review of the documentation?

Y

Committee Approval

If the committee is happy to approve this document, please sign and date it and forward copies for inclusion on the Intranet.

Name of Committee

Date

Print Name Signature of Chair


Appendix D

IMPACT ASSESSMENT ON DOCUMENT IMPLEMENTATION Summary of Impact Assessment (see next page for details)

Document title

Treasury & Cash Management Policy

Totals WTE Recurring

£ Non Recurring £

Manpower Costs

0 0 0

Training Staff

0 0 0

Equipment & Provision of resources

0 0 0

Summary of Impact: No impact policy ensures compliance with Monitor cash management policies Risk Management Issues:

Cash management policy is a requirement of FT status. Ensures risk of cash flow shortages are mitigated and that the Trust maximises opportunities to invest surplus funds at any point. Benefits / Savings to the organisation: Compliance with best practice and maximising of investment returns Equality Impact Assessment � Has this been appropriately carried out? YES � Are there any reported equality issues? NO If “YES” please specify:

Use additional sheets if necessary.


IMPACT ASSESSMENT ON POLICY IMPLEMENTATION Please include all associated costs where an impact on implementing this policy has been considered. A checklist is included for guidance but is not comprehensive so please ensure you have thought through the impact on staffing, training and equipment carefully and that ALL aspects are covered.

Manpower WTE Recurring £ Non-Recurring £

Operational running costs

0 0 0

Additional staffing required - by affected areas / departments:

0 0 0

Totals:

Staff Training Impact Recurring £ Non-Recurring £ Affected areas / departments 0 0 e.g. 10 staff for 2 days

Totals: 0 0

Equipment and Provision of Resources Recurring £ * Non-Recurring £ *

Accommodation / facilities needed 0 0 Building alterations (extensions/new) 0 0 IT Hardware / software / licences 0 0 Medical equipment 0 0 Stationery / publicity 0 0 Travel costs 0 0 Utilities e.g. telephones 0 0 Process change 0 0 Rolling replacement of equipment 0 0 Equipment maintenance 0 0 Marketing – booklets/posters/handouts, etc 0 0

Totals: 0 0

• Capital implications £5,000 with life expectancy of more than one year.

Funding /costs checked & agreed by finance: Yes

Signature & date of financial accountant: Funding / costs have been agreed and are in place: Yes Signature of appropriate Executive or Associate Director:


IMPACT ASSESSMENT ON DOCUMENT IMPLEMENTATION - CHECKLIST

Points to consider

Have you considered the following areas / departments?

• Have you spoken to finance / accountant for costing?

• Where will the funding come from to implement the policy?

• Are all service areas included? o Ambulance o Acute o Mental Health o Community Services, e.g. allied health professionals o Public Health, Commissioning, Primary Care (general practice, dentistry, optometry),

other partner services, e.g. Council, PBC Forum, etc. Departments / Facilities / Staffing

• Transport

• Estates o Building costs, Water, Telephones, Gas, Electricity, Lighting, Heating, Drainage,

Building alterations e.g. disabled access, toilets etc

• Portering

• Health Records (clinical records)

• Caretakers

• Ward areas

• Pathology

• Pharmacy

• Infection Control

• Domestic Services

• Radiology

• A&E

• Risk Management Team / Information Officer– responsible to ensure the policy meets the organisation approved format

• Human Resources

• IT Support

• Finance

• Rolling programme of equipment

• Health & safety/fire

• Training materials costs

• Impact upon capacity/activity/performance


Appendix E Equality Analysis and Action Plan

(This template should be used when assessing services, functions, policies, procedures, practices, projects and strategic documents)

Step 1. Identify who is responsible for the equality analysis.

Name: Kevin Curnow

Role: Deputy Director of Finance

Other people or agencies who will be involved in undertaking the equality analysis:

Step 2. Establishing relevance to equality

Show how this document or service change meets the aims of the Equality Act 2010?

Equality Act – General Duty Relevance to Equality Act General Duties Eliminates unlawful discrimination, harassment, victimization and any other conduct prohibited by the Act.

n/a

Advance equality of opportunity between people who share a protected characteristic and people who do not share it

n/a

Foster good relations between people who share a protected characteristic and people who do not share it.

n/a

Step 3. Scope your equality analysis

Scope What is the purpose of this document or service change?

Compliance with financial management best practice

Who will benefits? Trust

What are the expected outcomes? Transparency in reporting cash management activities

within the Trust

Why do we need this document or do we

need to change the service?

Compliance with best practice and to support FT status

It is important that appropriate and relevant information is used about the different protected groups that will be affected by this document or service change. Information from your service users is in the majority of cases, the most valuable.

Relevance

Protected Groups Staff Service Users Wider Community

Age n/a n/a n/a Gender Reassignment n/a n/a n/a Race n/a n/a n/a Sex and Sexual Orientation n/a n/a n/a Religion or belief n/a n/a n/a Disability n/a n/a n/a Marriage and Civil Partnerships n/a n/a n/a Human Rights n/a n/a n/a Pregnancy and Maternity n/a n/a n/a


Information sources are likely to vary depending on the nature of the document or service change. Listed below are some suggested sources of information that could be helpful:

• Results from the most recent service user or staff surveys.

• Regional or national surveys

• Analysis of complaints or enquiries

• Recommendations from an audit or inspection

• Local census data

• Information from protected groups or agencies.

• Information from engagement events.

Step 4. Analyse your information. As yourself two simple questions:

• What will happen, or not happen, if we do things this way?

• What would happen in relation to equality and good relations? In identifying whether a proposed document or service changes discriminates unlawfully, consider the scope of discrimination set out in the Equality Act 2010, as well as direct and indirect discrimination, harassment, victimization and failure to make a reasonable adjustment.

Findings of your analysis

Description Justification of your analysis No major change Your analysis demonstrates

that the proposal is robust and the evidence shows no potential for discrimination.

This is a Finance technical policy designed to support reporting transparency and FT status. There are no equality impacts and no potential for discrimination

Adjust your document or service change proposals

This involves taking steps to remove barriers or to better advance equality outcomes. This might include introducing measures to mitigate the potential effect.

Continue to implement the document or service change

Despite any adverse effect or missed opportunity to advance equality, provided you can satisfy yourself it does not unlawfully discriminate.

Stop and review Adverse effects that cannot be justified or mitigated against, you should consider stopping the proposal. You must stop and review if unlawful discrimination is identified

5. Next steps. 5.1 Monitoring and Review.

Equality analysis is an ongoing process that does not end once the document has been published or the service change has been implemented. This does not mean repeating the equality analysis, but using the experience gained through implementation to check the findings and to make any necessary adjustments.


Consider: How will you measure the effectiveness of this change

Audit scrutiny and reporting to FIWC as sub-committee of Board

When will the document or service change be reviewed?

At least annually

Who will be responsible for monitoring and review? Head of Financial Services and Executive Director of Finance

What information will you need for monitoring? Performance indicators will be reported to FIWC

How will you engage with stakeholders, staff and service users

Not applicable for technical document.

5.2 Approval and publication

The Trust Executive Committee / Policy Management Group will be responsible for ensuring that all documents submitted for approval will have completed an equality analysis. Under the specific duties of the Act, equality information published by the organisation should include evidence that equality analyses are being undertaken. These will be published on the organisations “Equality, Diversity and Inclusion” website.

Useful links: Equality and Human Rights Commission http://www.equalityhumanrights.com/advice-and-guidance/new-equality-act-guidance/equality-act-guidance-downloads/