New guidance for academy trusts is essential reading for Accounting Officers.
Eileen Milner, Chief Executive of the Education and Skills Funding Agency (ESFA), has written to all Accounting Officers with new guidance, copied to the chair of trustees.
The letter highlights key updates to the Academies Financial Handbook and Academies Accounts Direction. It also covers new and existing good practice guides available to trusts.
Academies Financial Handbook
There is a new requirement in the Handbook to submit an annual summary of the internal scrutiny work undertaken in the year. This will first need to be submitted by the 31 December 2020.
In the interim, pending the annual report, the ESFA will be asking for the most recent internal scrutiny report to be submitted alongside the annual accounts by 31 December 2019.
Risk management has always been a key feature of good governance, and there is now a MUST in the Handbook to maintain a risk register. This is a key document and should be the starting point for any internal scrutiny programme of work.
Academies Accounts Direction
The letter highlights that accounts can be used not just to explain how money has been spent but also to describe wider educational objectives and what has been achieved against them.
Good practice guides
Various good practice guides are highlighted in the letter which should be reviewed. A number of these are also linked in the Academies Financial Handbook.
School resource management self-assessment tool (SRMSAT)
This tool was released in September 2018 as a voluntary measure to help trusts maintain financial health and resource management. It comprises a checklist, and then a subsequent dashboard.
Its use will be mandatory for trusts to complete this year, with the deadline being 14 November 2019.
Only the questionnaire will need to be submitted, and not the accompanying dashboard, which is for own internal purposes only.
Additionally, there is no requirement for this return to be audited or reviewed prior to submission.
Both the executive team and non executives should use this as a tool to highlight potential efficiencies or to provide confidence that operations are being run well and efficiently.
Financial management and governance self-assessment (FMGS)
New trusts will still need to complete these forms. For trusts that take on a new school, they will no longer have to complete a supplementary FMGS alternative return, as the assurances will now be gained through the SRMSAT.
School resource management advisors (SRMAs)
These continue to be championed by the ESFA, and are a free resource available to trusts to look at efficiencies and practices - to ensure resources can be used most efficiently to deliver the greatest educational outcomes.
SRMAs are involved in the sector for their day jobs, for example as a school business manager, and will look to work collaboratively with trusts.
On completion of their work, they will provide a written report with any observations and recommendations, but the decision to implement any of these remains with the trust.
These visits have no cost to the trust, other than time, and may well help to identify potential efficiencies to improve educational outcomes.