When problems arise at a town or parish council they may find that they have insufficient financial reserves to adequately deal with the problem.

This objective of this guide is to outline best practice regarding reserves and assist in determining how the adequacy of reserves should be judged.

  • This Best Practice Guide is for town and parish councillors who as part of their duties need to ensure that the council has adequate financial reserves
  • The guide may also be of assistance to residents who wish to understand what reserves their council should reasonably have and clerks who may need to advise the elected councillors in making their decision

This Best Practice Guide builds on and provides more detail than the published 60 second guide the “CPALC 60 Second Guide (21) to Parish Council Reserves, Bank Accounts and Reconciliations”


Article Contents - Click on a link below

What are reserves

Must a parish council have reserves

Should a parish council have reserves

What should be the minimum general reserve

What types of reserves can a parish council have

Best practice what reserves a parish council should have

Minuting transfers between accounting reserves

Must every reserve have a bank account

The role of the internal auditor

Best Practice Summary


This guide is indicative and is not definitive as the scale of operations and risk assessments may and will vary from council to council.

This guide is not an internal audit manual or accounting guide.


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