Hot off the press from Lord Agnew....
Following a meeting with various audit firms Lord Agnew, the Under-Secretary of State for the School System, has identified a number of areas where Academy Trusts and their advisors can look to improve best practice from both a financial and governance perspective. Paraphrasing the content of an open letter sent to auditors across the country, the three key messages we have identified are as follows:
- GAG pooling. This is one of the greatest freedoms a MAT has. The opportunity to pool GAG is particularly valuable, in particular to simplify the provision of support to weaker schools in a MAT until they can grow their pupil numbers. It is worth remembering that a MAT is a single financial entity.
- Three year forecasting. This is now a mandatory requirement in the latest version of the Academies Financial Handbook (AFH). Trusts should note that the Department is keen that the integrity of the process is not slewed by an overly optimistic approach to pupil number projections.
- Governance. Areas picked out for particular consideration include:
- Use of a standard employment contract for all teaching staff so that they can be cross deployed to different schools.
- Use of the same exam boards in all schools to enable cross school marking.
- Use of a central bank account that simplifies bank reconciliations and ensures that there is constant, easy visibility of the cash position.
- Use of the Department’s procurement arrangements if they provide better value than what the trust can achieve on its own.
Reading between the lines of the letter, the overriding message from the Department is that trust boards and CEOs need to be presented with accessible and relevant information in a timely manner.