The Academy Trust Handbook 2022 was eventually released in August and applies from 1 September 2022 to 31 August 2023.
Whilst there were limited changes it is important that all members, trustees and key management consider the handbook, as compliance is a key condition of the academy trust’s funding agreement. You may wish to forward them a link or table it at a forthcoming meeting.
The main changes, as highlighted on page 8 of the Handbook, are as follows:
Financial Reporting: Confirming withdrawal of the Budget Forecast Return Outturn [paragraph 2.15].
This is just an update, however, the section still includes important guidance on how academies should set and monitor their budget, together with ensuring that it is appropriately approved by the trustees.
Special Payments: Clarifying in paragraph 5.12 that prior approval of staff severance payments in accordance with HM Treasury’s Guidance on Public Sector Exit Payments applies only to ‘special’ (non-statutory/non-contractual) payments.
For most academies, severance payments are not a regular occurrence. Therefore, it is recommended that this section is reviewed prior to any settlement being agreed to ensure compliance with the handbook. There may also be additional disclosure requirements in the year end accounts, as set out in the Accounts Direction.
Indemnities: Confirming that trusts will be able to enter into indemnities which are in the normal course of business without seeking approval [paragraph 5.19].
Again indemnities may not be a regular occurrence and this section also includes other areas which trusts may not be aware that they require ESFA approval. Therefore the section is well worth a read to ensure compliance.
Religious Character: Extending the scope of paragraph 5.57 from dioceses to all religious authorities, confirming when the ‘at cost’ requirement is met.
The ‘at cost’ requirement is an important tool to demonstrate that people connected to the academy are not profiting from their role. There are some agreed exceptions were the ‘at cost’ rules are not applied. This appears to be a natural extension to all religious authorities.
The Academy Trust Handbook is a key document where non compliance may not just affect the funding agreement but also the overall reputation of the trust. A good working knowledge is required by trusts and should form part of the ongoing training of key individuals. Sometimes certain situations are not black and white and judgement is required. As auditors we are always here to provide our advice, so please do not hesitate to get in touch.
