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{{org_field_name}}

Registration Number: {{org_field_registration_no}}

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Financial Reports Policy

1. Purpose

The purpose of this policy is to set out how {{org_field_name}} maintains appropriate and up-to-date accounts and manages financial planning, monitoring and reporting in order to support the financial sustainability of the care home service and the achievement of the aims and objectives set out in its Statement of Purpose.

This policy supports compliance with the Regulation and Inspection of Social Care (Wales) Act 2016, the Regulated Services (Service Providers and Responsible Individuals) (Wales) Regulations 2017, as amended, including Regulation 11 relating to the financial sustainability of the service, and the Regulated Services (Annual Returns) (Wales) Regulations 2017, as amended.

The policy also reflects the annual return requirements of section 10 of the Regulation and Inspection of Social Care (Wales) Act 2016, as amended by the Health and Social Care (Wales) Act 2025, including the requirement for the service provider to submit an annual return to the Welsh Ministers and to publish the required annual return on the service provider’s website within the prescribed period.

{{org_field_name}} will maintain financial information and financial controls sufficient to demonstrate that reasonable steps are being taken to ensure the financial sustainability of the service and that the organisation has the financial resources required to continue to provide the services described in its Statement of Purpose.

2. Scope

This policy applies to the financial governance, accounting, monitoring and reporting arrangements operated by {{org_field_name}} in connection with the care home service.

It includes:

• the maintenance of appropriate and up-to-date accounts for the service;
• financial planning, budget monitoring and financial control;
• monitoring of the financial sustainability of the service;
• preparation of annual accounts in accordance with applicable legal and accounting requirements;
• arrangements for providing copies of the service’s accounts to the Welsh Ministers within the statutory timescale where these are requested;
• arrangements for obtaining certification of accounts by an accountant where this is required by the Welsh Ministers; and
• the governance arrangements relevant to the preparation, approval, submission and publication of the service provider’s statutory annual return.

This policy applies to the service provider, Responsible Individual, Registered Manager, company directors, finance personnel and any accountant, auditor or other financial professional engaged by {{org_field_name}}, according to their respective roles and responsibilities.

3. Related Policies

This policy should be read in conjunction with:
CHW05 – Statement of Purpose Policy
CHW18 – Risk Management and Assessment Policy
CHW26 – Recruitment, Selection and Retention Policy
CHW27 – Staff Supervision, Training and Development Policy
CHW30 – Equality, Diversity and Inclusion Policy
CHW41 – Managing Service User Finances Policy

4. Policy Statement and Implementation

4.1 Legal and Regulatory Requirements

{{org_field_name}}, as the service provider, will take reasonable steps to ensure that the care home service is financially sustainable for the purpose of achieving the aims and objectives set out in its Statement of Purpose.

In accordance with Regulation 11 of the Regulated Services (Service Providers and Responsible Individuals) (Wales) Regulations 2017, as amended, the service provider will:

• maintain appropriate and up-to-date accounts for the service;
• maintain effective arrangements for financial planning, budget monitoring and financial control;
• ensure, so far as reasonably practicable, that sufficient financial resources are available to provide and continue to provide the services described in the Statement of Purpose;
• provide copies of the service’s accounts to the Welsh Ministers within 28 days where requested to do so; and
• arrange for the accounts to be certified by an accountant where the Welsh Ministers require such certification.

The service provider will also comply with the annual return requirements under section 10 of the Regulation and Inspection of Social Care (Wales) Act 2016, as amended.

The statutory annual return is separate from the requirement under Regulation 11 to maintain appropriate and up-to-date financial accounts.

Information contained in the annual return must be complete and accurate and must be reviewed, approved, submitted and published in accordance with the applicable statutory requirements and current Care Inspectorate Wales requirements.

4.2 Internal Financial Monitoring and Reporting

{{org_field_name}} will maintain appropriate arrangements for monitoring the financial position of the service in order to support financial sustainability and the continued safe and effective operation of the care home.

Financial monitoring will be proportionate to the size, nature and complexity of the service and will enable the service provider to identify financial pressures or risks which could affect the service’s ability to meet the aims and objectives set out in its Statement of Purpose.

Internal financial monitoring may include:

• income and expenditure;
• cash flow;
• performance against agreed budgets;
• staffing and agency costs;
• operational and premises-related expenditure;
• occupancy and related income;
• outstanding debts and liabilities;
• significant financial commitments;
• forecast income and expenditure; and
• significant financial variances.

Financial information will be reviewed at appropriate intervals by persons with responsibility for the financial governance of the organisation.

Where monitoring identifies a financial risk which could affect the quality, safety, continuity or sustainability of the regulated service, appropriate action will be taken without unnecessary delay.

Material financial concerns will be escalated to the service provider and, where relevant to the effective management or regulatory compliance of the service, to the Responsible Individual.

4.3 Budgeting and Forecasting

A financial budget will be prepared for each financial year and approved in accordance with the organisation’s governance arrangements.

The budget will take account of anticipated income and expenditure associated with operating the regulated service, including, where applicable:

• commissioned placements;
• privately funded placements;
• staffing and agency expenditure;
• premises costs;
• equipment;
• insurance;
• staff training and development;
• repairs and maintenance;
• utilities;
• professional fees;
• administration costs; and
• other costs reasonably required to maintain the safe and effective operation of the service.

Budget assumptions will be based on information reasonably available to the organisation and will be reviewed where significant changes arise.

Performance against the approved budget will be monitored at appropriate intervals.

Significant or unexplained variances will be investigated and, where necessary, corrective action will be taken.

Financial forecasting will take account, where relevant, of reasonably foreseeable changes to income, expenditure, staffing, occupancy, contractual arrangements and other factors which could materially affect the financial sustainability of the service.

4.4 Annual Accounts, Regulatory Requests and Annual Return

{{org_field_name}} will prepare and maintain annual accounts in accordance with the legal and accounting requirements applicable to the organisation.

In accordance with Regulation 11 of the Regulated Services (Service Providers and Responsible Individuals) (Wales) Regulations 2017, as amended, appropriate and up-to-date accounts for the regulated service will be maintained.

Where the Welsh Ministers request copies of those accounts, the service provider will provide them within 28 days of the request.

Where the Welsh Ministers require the accounts to be certified by an accountant, the service provider will arrange for the required certification.

Where audited accounts are not available, the service provider will have regard to current statutory guidance concerning the preparation of annual accounts by a suitably qualified accountant for the purposes of regulation and inspection.

The accounts and supporting financial information will be sufficient to enable the service provider to monitor whether the regulated service is financially viable and is likely to have sufficient resources to continue delivering the services described in its Statement of Purpose.

The statutory annual return is separate from the service’s annual financial accounts.

Following the end of each financial year during which the service provider is registered, the service provider will complete and submit the statutory annual return in accordance with section 10 of the Regulation and Inspection of Social Care (Wales) Act 2016, as amended, the Regulated Services (Annual Returns) (Wales) Regulations 2017, as amended, and current Care Inspectorate Wales requirements.

The annual return will:

• contain all information required by the applicable legislation;
• contain accurate information about the service provider and regulated service for the relevant reporting period;
• contain the required information relating to each place at, from or in relation to which the regulated service is provided;
• include the required statement of compliance relating to the standards of care and support;
• be checked for completeness and accuracy before submission;
• contain the required declaration by or on behalf of the service provider; and
• be submitted within the statutory submission period.

Under the current annual return arrangements, the annual return is available through CIW Online from 1 April and must be submitted no later than 26 May.

The Responsible Individual will ensure that the information relating to each service for which they are designated is appropriately reviewed and will fulfil the duties applicable to the Responsible Individual in relation to the annual return.

The Responsible Individual will ensure that the statement of compliance relating to the standards of care and support is informed by appropriate oversight of the service and by the most recent quality of care review.

Following submission of the annual return, {{org_field_name}} will obtain the publication copy made available through CIW Online.

The publication copy will be published on the service provider’s own website no later than 30 June following the end of the relevant financial year.

A copy of the published annual return will also be made available on request in accordance with applicable statutory requirements.

The transaction copy generated following submission will be retained as part of the organisation’s regulatory records and will not be used as the version published on the service provider’s website.

An appropriate audit trail will be retained to demonstrate the preparation, checking, approval, submission and publication of the annual return.

4.5 Responsibilities and Financial Governance

The service provider has overall legal responsibility for compliance with Regulation 11 of the Regulated Services (Service Providers and Responsible Individuals) (Wales) Regulations 2017, as amended.

This includes responsibility for:

• taking reasonable steps to ensure that the service is financially sustainable;
• maintaining appropriate and up-to-date accounts;
• maintaining suitable arrangements for financial planning, budget monitoring and financial control;
• ensuring that sufficient financial resources are available to support the continued operation of the service;
• providing copies of accounts to the Welsh Ministers within 28 days where requested;
• obtaining certification of accounts where required by the Welsh Ministers; and
• ensuring that statutory annual return requirements are met.

The service provider is also legally responsible for ensuring that the statutory annual return is completed, approved, submitted and published within the applicable statutory timescales.

The Registered Manager is responsible for carrying out any day-to-day financial management functions formally delegated to them by the service provider.

These may include:

• monitoring expenditure against agreed budgets;
• checking and authorising expenditure within approved delegated limits;
• reviewing invoices and supporting records;
• monitoring staffing and agency expenditure;
• identifying significant financial variances;
• escalating financial risks which could affect the safe and effective operation of the service; and
• providing financial or operational information reasonably required by the service provider or Responsible Individual.

The Responsible Individual will maintain effective oversight of the regulated service in accordance with their statutory responsibilities.

Where financial information identifies a matter which may affect the quality, safety, effective management, regulatory compliance or continued operation of the service, the Responsible Individual will ensure that the matter is appropriately considered and escalated to the service provider.

The Responsible Individual will fulfil their statutory responsibilities in relation to the annual return and will contribute to ensuring that information relating to the service is accurate and consistent with their oversight of the service.

Finance staff, administrators and external financial professionals involved in preparing or maintaining financial information will ensure that records within their responsibility are:

• accurate;
• complete;
• appropriately authorised;
• securely maintained;
• retained in accordance with applicable legal and organisational requirements; and
• made available to authorised persons when required.

4.6 Data Protection and Confidentiality

Financial information will be handled in accordance with applicable data protection legislation, confidentiality requirements and the organisation’s Confidentiality and Data Protection Policy.

Financial records will be stored securely in either electronic or physical form, according to the organisation’s record management arrangements.

Access to confidential financial information will be restricted to persons who require access for an authorised purpose.

Electronic financial information will be protected by appropriate technical and organisational security measures.

Where appropriate, these measures will include:

• secure user access controls;
• password protection;
• appropriate access permissions;
• secure back-up arrangements;
• protection against unauthorised alteration or deletion; and
• appropriate cyber-security controls.

Staff who handle financial information will be made aware of their responsibilities relating to confidentiality, data protection, secure record keeping and information security.

Any actual or suspected loss, unauthorised disclosure, alteration or misuse of confidential financial information will be managed in accordance with the organisation’s data protection and information security procedures.

4.7 Risk Management and Financial Contingency

Financial risk will be considered as part of the organisation’s wider governance and risk management arrangements.

Financial risks which may affect the sustainability or safe operation of the regulated service will be identified, assessed, monitored and managed.

Relevant financial risks may include:

• cash flow pressures;
• significant debt or unpaid fees;
• changes in occupancy;
• dependence upon significant sources of income;
• increases in staffing or agency expenditure;
• unexpected premises or equipment costs;
• inflationary pressures;
• changes in commissioning or funding arrangements;
• significant increases in insurance, utilities or other operating costs;
• emergency expenditure; and
• other financial circumstances which could affect continuity of the service.

Where a material financial risk is identified, appropriate mitigation measures will be considered and implemented.

This may include:

• revised financial forecasts;
• expenditure controls;
• contingency arrangements;
• review of staffing expenditure;
• review of contractual arrangements;
• obtaining professional financial advice; or
• other proportionate measures necessary to protect the financial sustainability of the service.

Financial contingency arrangements will be proportionate to the size, nature and financial circumstances of the organisation.

Financial decisions must not compromise the service provider’s obligation to provide the service safely and effectively and in accordance with the Statement of Purpose and applicable regulatory requirements.

4.8 Transparency, Annual Return Publication and Stakeholder Communication

{{org_field_name}} will provide financial information to the Welsh Ministers, Care Inspectorate Wales, commissioners or other authorised bodies where there is a legal, regulatory or contractual requirement to do so.

Following submission of the statutory annual return, the service provider will download the publication copy made available through CIW Online and publish it on the service provider’s own website by 30 June following the end of the relevant financial year.

The publication copy will be made publicly accessible and a copy of the annual return will be made available on request in accordance with applicable statutory requirements.

The transaction copy of the annual return will be retained as a regulatory record and will not be published in place of the publication copy.

Before submission and publication, the service provider will ensure that the annual return has been checked for accuracy and completeness in accordance with current statutory and Care Inspectorate Wales requirements.

Financial information which is confidential, commercially sensitive or contains personal data will only be disclosed where there is a lawful basis, contractual requirement or other proper authority to do so.

Residents and their representatives will be provided with clear information about fees, charges and relevant funding arrangements in accordance with their service agreement and the organisation’s applicable policies.

Where changes to fees or charges are made, these will be communicated in accordance with the resident’s contractual terms, applicable consumer law and any other relevant legal requirements.

4.9 Continuous Improvement and Compliance

Financial governance arrangements will be monitored and reviewed as part of the organisation’s wider quality assurance and governance systems.

The service provider will use relevant information from:

• financial monitoring;
• budget reviews;
• audits;
• accountant or auditor recommendations;
• risk assessments;
• Responsible Individual oversight;
• quality of care reviews;
• Care Inspectorate Wales inspections;
• regulatory correspondence; and
• other relevant governance processes

to identify where improvements to financial systems, controls or reporting arrangements are required.

Where weaknesses, errors or failures in financial governance are identified, proportionate corrective action will be taken.

Where a financial issue creates, or could create, a risk to the quality, safety, continuity or financial sustainability of the regulated service, the matter will be escalated promptly to the service provider and, where appropriate, the Responsible Individual.

Any failure to meet a statutory financial reporting, account-production, annual return or publication requirement will be investigated and remedial action will be taken without unnecessary delay.

Lessons arising from financial incidents, regulatory findings, audits or reviews will be used to improve the organisation’s systems and reduce the likelihood of recurrence.

5. Policy Review

This policy will be reviewed at least annually and sooner where necessary following any relevant change to legislation, regulations, statutory guidance, Care Inspectorate Wales requirements, accounting requirements or the operation of the service.

The Responsible Individual will put suitable arrangements in place to ensure that this policy is kept up to date, having regard to the Statement of Purpose and the requirements applicable to the regulated service.

The service provider will ensure that any changes required to maintain legal and regulatory compliance are implemented without unnecessary delay. The Registered Manager will support the review and implementation of the policy in accordance with their delegated responsibilities.

Where changes to legislation, regulatory requirements or the Statement of Purpose affect the content or operation of this policy, the policy will be revised accordingly and relevant staff will be informed of the changes.

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Responsible Person: {{org_field_registered_manager_first_name}} {{org_field_registered_manager_last_name}}
Reviewed on: {{last_update_date}}
Next Review Date: {{next_review_date}}
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