Seán Fleming (Laois-Offaly, Fianna Fail)
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227. To ask the Minister for Social Protection the policy in relation to the audit procedure to be carried out by community employment schemes on an annual basis; the separate audit procedures for the companies that operate these schemes which have a financial year ending that does not coincide with the renewal dates of the schemes; if her Department indicated the amount they should be paying for the audit; if any guidelines or benchmarks have been set for these figures; and if she will make a statement on the matter. [21945/15]

Kevin Humphreys (Dublin South East, Labour)
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Community Employment (CE) schemes work on annual contracts. As part of the contract, the CE Sponsoring organisation is given an advance payment at the project commencement (called the Initial Grant) equivalent to 8 weeks estimated wages to cover the initial wages for the Supervisor and participants (who are paid on a current week basis) and other set-up costs (insurance costs, start-up materials, training etc.).

The CE project year is divided into 13 four-week pay cycles. The Sponsor can claim the actual wages paid out in each 4-week cycle at the end of that cycle. The advance payment/Initial Grant is clawed back in tranches over the last 4 cycles (15% in Cycle 10, 15% in Cycle 11, 35% in Cycle 12 and 35% in Cycle 13). The Cycle 13 payment is withheld pending the audit/final reconciliation being carried out on the project finances at the end of the 12th cycle. On completion and sign-off of the audit, a final payment is issued by the Department to cover Cycle 13, taking account of any net over/under payment up to Cycle 12.

At the end of each project, the Sponsor must have a record of all financial transactions of the project presented in a coherent manner. These records must be supported by the submission of an independent, professionally certified, audited Statement of Income and Expenditure.

The requirement under the CE Procedures for an annual audit of projects reflects the fact that funding for CE comes from the Exchequer and the Department is answerable to the Government, the Comptroller & Auditor General and the Public Accounts Committee for the administration of this funding.

There is a separate legal requirement under the Companies Acts for an annual audit of the registered company, as the organisation running a CE project may have other business interests or activities outside of the CE funding. In the majority of cases the work carried out for the CE audit can be used to assist with the Companies Registration Office (CRO) audit.

There is a guideline maximum audit fee of €1,000 on CE, but this can be exceeded for larger CE schemes, where justified. This figure was arrived at as part of the Financial Review of Community Employment, carried out in 2012. Prior to that there were substantial variations in audit fees (ranging from €20 to €9,500).

Overall, the Department seeks to maximise the value for money to be achieved from the CE programme, while maintaining control of the finances in its charge.