The new Academy Trust Handbook 2024 (ATH) has been released by ESFA, following a short delay as a result of the general election. The new Handbook will come into effect from 1 September 2024. Compared with previous years, the changes are minimal and include some rearrangement to make the Handbook more cohesive and a move to stricter internal scrutiny options for larger entities.
ESFA have also updated the 2024 Schedule of musts alongside the ATH. Use of this tool is entirely optional, but trusts may find it helpful to see a summary of the musts within the Handbook. Inclusion of an annual review of the Schedule of musts within board minutes can be used to demonstrate trustee awareness of the current regulatory framework.
So, what else is new?
There has been no change to the content, but this section has been moved to within roles and responsibilities from elsewhere in the Handbook. The board must still ensure that the register is kept up-to-date and contains the details as set out in the ATH.
DfE issued the latest update to the Digital and Technology Standard in May 2024. The update covered changes to the format of the cyber security standards, which has implications for senior leadership (SLT) and trusts IT support. We can support Academy Trusts with this through our IT services solution, Datcom who can undertake a cyber security audit should the trust require an external review of their IT provision.
The trusts’ reserves policy, as disclosed in the trustees report of the annual financial statements, should include a clear plan for managing reserves. ESFA issued updated guidance on Academy Trust Reserves during 2023/24 and the ATH. Whilst ESFA do not set a required level of reserves, it is important to ensure that the trust maintains sufficient reserves to ensure financial viability but does not hold excessive reserves without a clear purpose – as trusts with reserves in excess of 20% of income may attract further scrutiny from ESFA.
Trusts must approach ESFA to seek approval for new EV schemes or when accepting further employees onto an existing EV scheme. This is a change to ATH 2023, which had introduced a permissive position on EV schemes.
Internal scrutiny options – Trusts with annual revenue income in excess of £50m must deliver internal scrutiny using any combination of:
Trusts will be able to enter into finance leases where the lease category appears on the DfE-approved list. Other finance leases will still require prior approval from ESFA. This change reflects the new International Financial Reporting Standard (IFRS 16 leases) and the recognition of operating and finance leases under the Financial Reporting Standard 102 (FRS102).
Academy Trusts are already aware of the requirement to be alert to the risk of cybercrime. But they should now take appropriate action to meet DfE’s cyber security standards. This reinforces the importance of the digital and technology standards as set out in the change to Roles and Responsibilities.
The list of examples which may trigger a Notice to Improve (NtI) has been extended to include management of the school estate. As set out in our quarterly update for academies, trusts should be aware of the situations that can give rise to a NtI. This change further highlights the disclosure updates brought in under the Academies Accounts Directions 2023 (AAD), whereby the annual report needs to state the approach to ensuring the trust’s estate is safe, well-managed and complies with relevant regulations.
If you work for an academy trust and are looking for support - whether it’s external audit, internal scrutiny, VAT, cyber-security, budget forecast, charitable objects or pensions - our expert team can help.
Visit our sector page or get in touch to find out more.
