January 2013

AcademyNews

For schools who converted to academy status in 2011, the accounting period ended 31 August 2012 will have been their first for which audited accounts are required. However, existing academies will also have been affected by changes to the reporting and disclosure requirements introduced by the Accounts Direction 2011/12.

An academy trust’s accounts have to comply with the Companies Act 2006, the Charities SORP and the Accounts Direction, so their preparation can be quite daunting and many academies look to the auditors for help especially in the early years. Academy business managers should however bear in mind that the responsibility for the accounts preparation rests with the academy and they need to plan to obtain support from their advisers at an early stage.

It is therefore important that you think about your audit and the preparation of your accounts as soon as possible, especially as the filing deadline with the DFE is relatively short, in fact by 31 December each year. Having had your first audit many of these issues will have been addressed but a useful summary of key points is attached below:• haveyouplannedtoinvolveGovernorsandtheHeadteacherindraftingtheGovernorsreport,especiallyto highlight your achievements and objectives

• doyounowhaveasensibleproformasetofaccounts,based on Coketown (the DFE pro forma) to use in the future. This will guide what disclosures and therefore what information you need to collate throughout the year

• requestdetailsrelatingtoLGPSpensiondisclosurebeforethe year end to give the actuaries sufficient time to provide the details needed in the accounts

• agreeyourtimetablewiththeauditors,especiallyassistance with drafting accounts, well before the end of the year and plan in the relevant meetings with the finance committeeandGovernors

• agreeaplantoaddressissuesarisingfromyourfirstaudit,talking to your auditors and other school contacts to develop best practice

A post audit debrief will help you improve your approach to the year end and now is a good time to review how things went and what could be done to make the process more efficient next year.

Your first audit – how was it for you and how do you prepare for next year?

Does independence mean operating aloneThe new found independence for many schools now operating as Academies can be an invigorating and inspiring status, a real driver for school improvement.

However it can also be daunting as there are suddenly many more new issues to contend with, statutory accounts need producing and auditing, you have to submit VAT returns and produce four year forecasts among many other things.

This has resulted in many Academies considering how they can get the very best from independence whilst sharing the burden of many back office functions and sometimes teaching resource. This is largely being driven by wanting to get the best value for money from the annual grants provided by the EFA.

Several structures have been implemented from the most simple buying groups, through to clusters of schools with no formal legal connection, umbrella trusts and multi academy trusts (MATs). There are also many shared service organisations offering back office support to academies.

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Seminar programme

Mastering Risk & FraudThis session will look at current developments in risk management and recent fraud trends in the not for profit sector, and how you should be responding.

LondonThursday 31 January 20133:30pm Registration 5:30pm Finish for drinks

Alternative FinancingAcross the sector, Trustees and management may want to take advantage of a range of new platforms and approaches ranging across crowd-sourcing and retail bond issuance to joint ventures with commercial and social enterprises. We will explore what new forms of finance are proving attractive and why.

LondonTuesday 23 April 20133:30pm Registration 5:30pm Finish for drinks

Tax/VAT/Employee Issues updateOur tax seminar will provide an update on developments in direct taxes, VAT and an update on employee issues as they affect the sector, as well as providing timely reminders on topical issues.

LondonWednesday 22 May 20133:30pm Registration 5:30pm Finish for drinks

Optimising OperationsOptimising operations is not only good for an organisation from a cost perspective, but creates a controlled environment from which a whole range of benefits can be delivered. Introducing a culture that continuously questions and challenges means that operations can be developed to drive out waste, spread best practice and introduce efficiencies which can be measured from both a financial and non-financial perspective.

LondonTuesday 12 November 20133:30pm Registration 5:30pm Finish for drinks

Tax/VAT/Employee Issues updateOur tax seminar will provide an update on developments in direct taxes, VAT and an update on employee issues as they affect the sector, as well as providing timely reminders on topical issues.

LondonThursday 5 December 20133:30pm Registration 5:30pm Finish for drinks

The difficult decision is whether or not to become part of a larger group and if so what are the key considerations? Once the governors (and parents) have decided that no longer being a stand alone academy is the best route forward the following should be considered:-Governance–whowillthegoverningbodybe?With

several academies in one academy trust (a MAT), the role of governors at an individual school is diminished, although it will typically focus on the educational aspects of the school. In Clusters, each governing body will still have the full range of powers and responsibilities. This is the most challenging issue and the governors will determine whether a MAT, a clusteroranumbrellatrustisthepreferredoption.Legaladvice should be sought in this area before proceeding to make a final decision.Financialsystem–ifallschoolsusethesameaccounting

system they can save on initial implementation costs, training and external audit costs. There is also cover for staff should there be absences.Buyingpower–thiscanonlyworkiftruegroup

procurement policies are developed and adhered to. In many ways these can be accessed through a range of existing

buying consortia but a group of schools could for example employ their own supply teachers reducing the cost per hour for this service.Opportunitiesforteachers–agroupethosmeansthat

teachers have the opportunity to develop their careers within an environment with which they are familiar. This can be a strong draw when you are looking to recruit new teachers.Linkswithbusiness–tohelpyourstudents,youmay

wish to explore this area further. It is more likely that you will be able to engage with business if they see that they are connecting with many schools at once, allowing them access to more pupils at the same time.

Overall the decision will be driven by what additional value can be provided to the pupils, teachers and parents from deciding to join or form a group of academies. You can retain your independence but you can also make savings in both monetary and time terms by sharing with others. Only time will tell which is the best option but every academy should at least consider what can be gained from working with other academies locally or nationally, which would demonstrate good governance regardless of the final decision.

Steve RobinsonPartner, Head of Schools and AcademiesT 01536 315966E steve.robinson@uk.gt.com