Finance induction training presentation

FINANCE INDUCTION Jan Powley Kim George "Although the primary responsibility of a school is to provide the best education possible for its pupils, control over a delegated budget brings with it a responsibility for financial stewardship" Audit Commission COURSE OUTLINE        Governors’ Responsibilities inc Budget Planning The Financial Framework Schools Financial Value Standard Value for Money Monitoring Budgets Financial Reports Funding Formula GOVERNORS’ RESPONSIBILITIES GOVERNORS’ RESPONSIBILITIES  Each governing body has a statutory responsibility for the financial management of the delegated budget in their school  As a whole, they are accountable for the standards of education provided and for balancing cost and effectiveness  Governors also need to ensure that they achieve the best possible outcomes for their pupils in the most efficient way KEY STANDARDS FOR GOVERNORS       The roles and responsibilities of governing body should be set out in writing A finance committee should be set up to consider strategic financial issues The governing body should establish the financial limits of delegated authority The governing body should agree with the headteacher the detail and format of financial information to be provided Minutes should be taken of all meetings of the governing body and its committees and include all decisions and by whom action is to be taken The governing body should establish a register of business interests KEY ACTIONS FOR GOVERNORS       Set financial limits of delegated authority Review last internal audit report Voluntary funds Local authority financial regulations and instructions Setting year budget plan – links to school improvement plan Setting timetable budget monitoring and review of financial plan POSSIBLE DELEGATIONS OF FUNCTIONS TO HEADTEACHER       Responsibility for notifying LBC of year budget plan Monitoring and reporting of actual/projected expenditure and income against budget plan The maximum value of virement or a single transaction without recourse to the full governing body Responsibility for awarding of contracts Responsibility for entering into lease or hire agreements Responsibility for setting letting scale charges and extent to which these can be varied/waived SUBMISSION OF BUDGET PLANS  Plan should show total estimated expenditure and income produced in conjunction with school improvement plan  Must be agreed by governing body  Submitted to LBC each financial year  Deadline notified to schools each year – 31 May and 31 July  No deficit without consent  If deficit budget likely then contact LMS team in first instance SCHOOL EXPENDITURE 10 BUDGET MONITORING SUMMARY     Central to effective financial management Finance Committee Members’ role should be more strategic, less transactional Bursar/Finance Officer and Head critical in providing relevant information to Finance Committee Identifies problems whilst you can still take action 33 FINANCIAL REPORTS 34 FINANCIAL REPORTS AVAILABLE Different reports are available: Local Finance System Reports: SIMS FMS6 Chart of Accounts Review - Ledger Codes/Cost Centres Income and Expenditure CFR Report Cumulative Expense Analysis Report Financials (LBC) Reports: Monthly Summary I&E Transaction and payroll transaction Electronic Reconciliation File Capital I&E and transactions 35 OTHER REPORTS AVAILABLE Section 251 Statement (Budgets and outturn) •Required of all LAs •Format prescribed by DFE School Profile (Parent/Governor report) •Schools financial position summarised in a format suitable for presentation to parents Comparative data - benchmarking •Local benchmarking data(LA) •CFR return •Schools Financial Benchmarking (DFE/Audit Commission/OFSTED) 36  FUNDING FORMULA 37 Where does the funding come from?     Formula Funding Pupil Premium Other allocations School generated income – facilities, bank interest etc 38 ISB 2011-12      Early Years Primary Secondary Special Total      £8.9m £85.2m £47.1m £6.3m £147.7m 39 INDIVIDUAL SCHOOLS BUDGETS Complex formulae, broadly summarised as follows Individual schools budgets = Age weighted pupil unit allocation + Lump sum allocation + Premises allocations + Other pupil-led allocations + Other special factor allocations 40 AWPU •By far the largest component of school budget shares •Irrespective of the type of school, pupils of the same age will receive exactly the same AWPU funding •Similar system in special/nursery schools - use planned places rather than pupil numbers •Current AWPU rates per key stage – primary and secondary schools Key Stage Age Group 2011-12 AWPU Pre KS1 KS1 KS2 KS3 KS4 4+ full time 5+ / 6+ 7+ / 8+ / 9+ / 10+ 11+ / 12+ / 13+ 14+ / 15+ £2,906 £2,466 £2,482 £3,033 £3,530 41 OTHER ALLOCATIONS Lump Sum allocation Each school in a specific sector receives an equal allocation, irrespective of size or type Premises allocations Based on physical areas for caretaking, cleaning, grounds maintenance, building maintenance, energy and swimming pools, rent and rates Other pupil-led allocations Includes sen factors and free school meals allocations Other special factors Includes small school allowances, KS1 ghost pupils 42 OTHER FUNDING YPLA (post 16)  Determined by YPLA on their own formula basis Only applies to secondary school  43 OTHER FUNDING Pupil Premium Service Children £200 LAC £488 Free School Meals £488 Maternity recompense  44 FUNDING FORMULA SUMMARY  Complex  Every school is unique Formula tries to reflect this  Subject to annual review 45 Further Training Setting and Monitoring the School Budget 12 January 2012 7-9pm at LLRC School Financial Value Standard Spring term 2012 46 LMS Finance Team Jan Powley Group Accountant Schools 548070 Liz Burden Senior School Financial Adviser 548071 Amina Begum Finance Assistant 548194 Kim George School Financial Adviser 548076 Lynne Knapton School Financial Adviser 548074 Keena Kunvarji School Financial Adviser 548075 Ruth Stryczko School Financial Adviser 548073 Lorraine Byrne School Funding Co-ordinator 548072 Barbara Wightman Finance Assistant 548077 47