New Statutory Requirements for Large Trusts
The Internal Scrutiny process is set to tighten up for a lot of Trusts later this year following the publication of new statutory requirements in the Academies Handbook.
The updated Handbook contains new requirements which will affect Trusts with an annual revenue of more than £50 million.
From 1 September 2025 these Trusts must use either a professional in-house internal auditor or a bought-in professional internal audit service for their Internal Scrutiny processes.
That emphasis on professionalism is a welcome development which will continue to drive up the quality and rigour of Internal Scrutiny across the sector, and not just in larger Trusts.
Trusts should already be working towards the 1 September deadline but it is worth stepping back and reviewing your scrutiny processes to see what needs to change ready for September. And if your Trust doesn’t have to conform with those requirements, they are still worth considering.
Qualifications and Professional Standards
As previously emphasised in the Handbook, those performing Internal Scrutiny or auditing should always have relevant professional qualifications or experience.
For example, auditors carrying out Internal Scrutiny work should be a member of a relevant professional body including the Institute of Internal Auditors (IIA), and the Institute of Chartered Accountants in England and Wales (ICAEW).
Impact of Professional Scrutiny
As a member of the Institute of Internal Auditors I feel that increased emphasis on professionalism and appropriate qualifications and skill of those undertaking scrutiny of Academy Trusts should lead to more effective scrutiny with a broadened financial and non-financial scope.
This will, in turn, lead to more rigorous oversight, more consistent quality of internal scrutiny of larger Trusts, and foster an environment of greater accountability, transparency and risk management.
The Evolving Role of Internal Scrutiny
This fresh emphasis on a professional approach to auditing processes with a focus on risk management isn’t limited to the larger Trusts. As each version of the Academies Handbook has evolved, so has Internal Scrutiny, with the focus now very much on robust Internal Scrutiny.
The Value of an Independent Perspective
All Academy Trusts are required to have some form of Internal Scrutiny during the year – that’s roughly three reviews a year. Originally this could be done by someone designated as the responsible officer. Qualifications didn’t matter as much as they were expected to carry out routine, repetitive checking tasks.
That has shifted the Internal Scrutiny responsibility away from internal appointees towards the use of external expertise.
That external view can be hugely helpful, providing an objective, informed view that trusts of any size are less likely to be able to accommodate. That objective view can assess what the Trust’s strategic aims are and provide a thorough audit of the risks that might stop them from achieving those aims, based on the Trust’s risk register.
The risks faced by Trusts large and small are complex and seem to grow each year. SEND funding is obviously a key pressure point, together with recruitment and retention, forecasting and budget management, and pupil attendance.
Internal Scrutiny is a tool that can identify potential issues before they escalate, protect the trust's reputation, and ultimately, improve outcomes for students.
Whether your Trust is of a scale that it must comply with those new Internal Scrutiny requirements from September or not, following the route of professional external scrutiny will only strengthen your Trust.
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Authored by Amelia Clark
Head of Internal Scrutiny
Amelia is a Chartered Internal Auditor and Head of Internal Scrutiny at SBS, combining expertise in accountancy and a passion for education. With a background in external and internal audits at Baker Tilly, she has supported public sector bodies in ensuring financial efficiency and value for money.
Connect with Amelia Clark
Amelia Clarke is Head of Internal Scrutiny at School Business Services, which provides financial planning and forecasting software for more than 2,200 UK schools and academies.
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