The business of effectively running a multi academy trust (MAT) in today’s educational landscape is complex. This week, the ESFA have released a number of good practice guides to publish information in connection with academy trust financial management and assurance. There are so many angles and factors to be considered in terms of business operations and compliance, and it is not uncommon to find that some more challenging topics of checking financial governance practices can be lower on the priority list than perhaps they should. The health checks you undertake with your trust should ensure best practice with this guidance, as the health checks we undertake do.
In today’s environment, financial accountability is high. Budgets are tight, capacity can be stretched and the security of external financial moderation can be a welcome reassurance for trustees and executive directors alike, that the appropriate systems are in place to ensure that matters are in hand. This can be to validate where processes are working well and also to identify where there may be gaps to improve day-to-day practice to another level.
Trustees have significant responsibility in holding executive leaders to account for financial performance and ensuring money is well spent. Together with their executive leader (Accounting Officer) they are charged with adhering to the academies financial handbook (AFH), which is of course a complex document, with a great number of non-negotiable rules, the “musts”, to strictly comply with. Ultimate accountability for financial matters lies with the AO, with duties of the trustees, to hold that named individual to account. The AO is responsible for ensuring regularity, propriety, value for money, keeping proper financial records and accounts, risk management and compliance with the AFH.
We have worked with our clients to develop a suite of health checks that are designed to address specific areas of concern and that afford an external expert perspective on appropriate handling of challenging areas of compliance, such as; effective risk management, MAT board effectiveness, handling of related party transactions, regularity, management information and more.
The health checks that we undertake, involve working with the trust on site for a day to assess and review the particular topic and talk with the personnel involved with covering the trusts responsibility for that area. This is followed with a summary report for the trust board with key findings, that the trustees can then use to assist in holding their leaders to account, financially.
The ESFA, via the AFH, demand a high level of financial governance, appropriate to the significant levels of public money that are handled by todays MATs and academies. The demands on the trust board to challenge their executive leaders in their financial practices are strong and the back-up reassurance of external validation could be a solution to reassure, and signpost improvement to both the paid executives and the non-paid volunteer army of trustees.
In our advisory team, we have a unique collection of expertise to consider the financial governance, compliance and strategic issues facing MAT’s and academies today, and with the benefit of significant experience within our work as the leading supplier of audit services to the sector.
If you would like to explore external expertise to assist with a health check of your MAT or academy, please contact our advisory team.