In the week that One Direction played Wembley Stadium, we got the first chance to look at the Department for Education’s Accounts Direction for 2014.
Whilst it is recommended that the 150 page document is circulated amongst Academy Accounting Officers, Business & Finance Managers and Trustees & Governors, in this week’s blog we will summarise some of the changes and points to watch.
For the full document visit: https://www.gov.uk/government/publications/academies-accounts-direction
The Academies Accounts Direction is a reference pack for academy trusts to use when preparing their annual reports and financial statements for accounting periods ending on 31 August 2014. New academy trusts, including free schools, studio schools and university technical colleges, that have been incorporated by 31 August 2014 should review carefully the guidance as they may also be required to prepare audited accounts.
The requirements for Academy Trusts are:
- Prepare an annual report and financial statements to 31 August 2014, unless the trust is extending its first accounting period to 31 August 2015.
- Have these accounts audited by an independent auditor.
- Submit the audited accounts to EFA by 31 December 2014.
- File the accounts with the Companies Registrar as required under the Companies Act 2006.
- Arrange an independent review of regularity and include a reporting accountant’s report on regularity as part of the accounts.
Academy Trusts will also need to complete the Annual Accounts Return – and we await DfE guidance on this.
Pages 5 to 8 of the Guidance summarises the changes introduced. Given some of the recent press coverage you will not be surprised to see that the areas covered by the changes include:
- Greater clarity on the members of Trusts.
- Updates to the Accounting Officer’s statement on regularity, propriety and compliance.
- The introduction of a ‘Strategic Report’, which provides context to the financial statements, an analysis of past performance and insight in to future objectives, strategies and principal risks. This requirement is as a result to changes in the regulations relating to the Companies Act 2006.
- Changes to the disclosure requirements relating to ex gratia payments, severance payments, disposal of assets etc. There are also changes to disclosures on related party transactions.
- New disclosure notes relating to Multi Academy Trust and the constituent Academies.
- Updates to Audit, including information on the content of the Auditor’s management letter and new guidance to support the independent review of regularity.
Emphasis has been placed on the timeliness of submitting the accounts, which also have to be published on the Trusts website by the end of January, not May as this year. Action against Trust’s that do not comply may be considered, which could include a Financial Notice to Improve.
Whilst discussing regularity, propriety and compliance; the Charity Commission has published further guidance on conflicts of interest. Trusts should review there existing policy or adopt a policy based upon the guidance. For further details visit: http://www.charitycommission.gov.uk/detailed-guidance/trustees-staff-and-volunteers/conflicts-of-interest-in-charities/
Ready for the puns!
One thing is certain, the freedom that Trusts have means that public scrutiny is going in one direction. You and I want good financial management to ensure regularity, propriety and compliance in the use of public funds, to ensure those freedoms remain.
One way or another Trusts should start to plan now to enable accounts to be prepared, audited, approved and submitted by the deadline. Moments to plan right now will ensure there are no midnight memories in December and you are not up all night at the last minute.
Need help? I recommend one direction – SBS. If you don’t know about us I would visit our website. http://www.schoolbusinessservices.co.uk/
OK – so how many One Direction songs did I squeeze in? I know, little things! Let us know the songs you spotted and we’ll sort out a prize for one randomly selected correct answer.