What you need to know about the difference between accounting requirements pre and post Academy conversion Chris Beaumont Partner – Clive Owen & Co LLP.

What you need to know about the difference between accounting

requirements pre and post Academy conversion

Chris BeaumontPartner – Clive Owen & Co LLP

Agenda

What is an Academy Is an Academy free Matters to consider Pre/Post conversion The various returns Format of Year End Financial Statements Interim Internal Reviews Top Tips Further information Questions

What is an Academy?

Company limited by Guarantee Members Directors/Trustees Governors Exempt charity – Registered with EFA

Is an Academy ‘free’

Of Local Authority control – YES

Of Whitehall – NO- EFA/DFE/Treasury/NAO

Matters to consider (Pre Conversion)

Articles and memorandum Land transfer – 125 year lease LGPS Valuation Insurance Transfer of agreements e.g. photocopier

leases Service level agreement (SLA’s)

Matters to consider (Pre Conversion)

Committees- Members- Directors/Trustees- Governors- Finance- Audit

* Governors skills Audit

Financial Procedures Manual Scheme of delegation/limits Register of interests (including family members) Appointment of auditors Appointment of Responsible Officer (RO)/Internal

Assurance Appointment of Bankers Appointment of Lawyers Policies - Fixed assets/Anti Fraud/Risk

Assessment/Whistle Blowing etc

Matters to consider (Pre Conversion)

Matters to consider (Pre Conversion)

Accounting system- PS Financials

- Corero- Sage- Agresso-Capita Sims- Hoge 100

* Nominal Leger structure

Matters to consider (Pre/Post Conversion)

* Management accounts- Income and expenditure account- Balance sheet- Cashflow forecast- Restricted v unrestricted funds

* VAT (Section 33B)- S126- Register for VAT

Matters to consider (Post Conversion)

PayrollCalculation of various deductions including

- PAYE/NI deductions- Calculation of various deductions including

- Teachers Pension Scheme- LGPS Pension Scheme- Union subscriptions- Dispensations / PIID’s- Payment of the above and net pay

The various returns

EFA Returns- Budget forecast (By 31st July for following financial year)- Academy Accounts Return (AAR)- March return (1st year for some)- Financial Management and Governance self assessment (FMGS)

Audited financial statements to 31st August End of Year Certificate (EOYC) Companies House

- Directors appointments and resignations

- Annual return

Format of Year End Financial Statements

Model financial statements include:- *Trustees’ Report (C or T)- *Governance statement (C and AO)- Statement of regularity, propriety and compliance (AO)- Statement of trustees’ responsibilities (C)- Independent auditor’s report of the financial statements- Independent auditor’s report on regularity- Set of financial statements

- Statement of financial activities (SOFA)- Balance sheet (C or T)- Cashflow statement- Notes

Trustees’ Report

Method of recruitment of trustees Organisational structure Risk management Connected organisations Objects and Aims Achievement and Performance Reserves Policy Plans for future periods Amongst others

Governance Statement

Trustees – meeting attendance during the year FGPC – if appointed, meeting attendance

during the year Audit committee – if appointed, attendance

during the year Risks Description of interim internal checks Detail any material control issues

Income > £10m or Assets > £30m MUST have an audit committee

All MAT’s below this should CONSIDER having an audit committee

All others MAY have an audit committee Up to the Academy to identify risks and

agree a programme of work to address

Interim Internal Reviews Requirements

Can be undertaken by one or combination of the following

Internal Audit (In house or brought in) Supplementary programme of work for the external

auditor Responsible officer Peer Review

Interim Internal Reviews

Undertake a Governor skills Audit Consider Governance structure Consider internal resource Research and plan the implementation of an

appropriate accounting package Review MIS requirements Take advice – VAT, Gift Aid and potentially

Corporation Tax Prepare an outline 3 and 5 year financial forecast Set appropriate level of reserves Have costed ideas for capital projects

Top Tips

Further information

Academies Accounts Direction 2013 Academies Financial Handbook EFA website EFA Bulletins Charity Commission website Your Advisers

Any Questions?

Tel: 01325 349 700

Email – [email protected]

www.cliveowen.com

Contact details