Quarterly update for academies from the Education and Skills Funding Agency (ESFA) - September

Each week, ESFA publishes information for academies on the GOV.UK website which lays out the latest updates, things to be actioned and reminders on previous updates.

Below, our expert Academies team has provided a round-up of everything you need to know from a financial perspective from July to September 2024.

July 2024

• STRB and NFF allocations delayed – Due to the timing of the general election, information that would normally be released by the DfE/ESFA has been delayed.
• Budget Forecast Return – ESFA confirm that, due to the timing of the STRB process and the 29 August BFR deadline, they will not require a second or revised BFR in light of the delayed STRB outcome.
• Early Years supplementary grant (EYSG) allocations updated – Updated EYSG allocations issued.
• Updated Academy Trust Handbook 2024 (ATH) – Updated ATH 2024 issued. This came into effect on 1 September 2024. Changes are minimal but include:
  • finance leases – trusts no longer need ESFA approval to enter into these where the lease category appears on the DfE approved list
  • ESFA’s position on electric vehicle salary sacrifice (EVSS) schemes, as stated in the previous ATH (ATH 2023) has changed and trusts need to contact ESFA in the early stages of planning to offer a new scheme or before accepting any further employees onto an existing scheme
  • internal scrutiny options – trusts with an annual income over £50 million should consider moving towards using an in-house internal auditor or bought-in internal audit service during 2024 to 2025, as this will then become a requirement from 1 September 2025

• Core Schools Budget Grant (CSBG) – ESFA published the methodology for the new CSBG. This new grant is to support schools with increased costs.
• Financial Assurance monitoring post-16 funding – ESFA published updated guidance on how they monitor post-16 funding for 2024-2025.

August 2024

• Interactive post-16 census tool – ESFA published the post-16 interactive census tool to support accurate post-16 school census data.
• 16 to 19 exceptional in-year growth 2024–2025 – ESFA published the rules for 16 to 19 funding: in-year growth for 2024 to 2025.
• Related Party Transactions – Updated guidance for Related Party Transactions published. This included an updated checklist of things to consider when transacting with a related party, with a subsequent revision whereby approval/reporting is now to DfE via the RPT portal rather than to ESFA via IDAMS.

September 2024

• Transfer of ESFA functions into the Department for Education – ESFA will close as an executive agency on 31 March 2025, with some functions transferring to DfE earlier.
• Common themes arising from ESFA assurance work – ESFA published themes arising from ESFA assurance work. This covers their review of trust financial statements to 31 August 2023, funding audits financial management and governance reviews and school resource self-assessment checklists (SRMSAC). The main reasons for regularity issues being raised within trust financial statements were:
• • Management accounts issues (not produced, not shared, late, missing key sections)
  • Concerns over oversight of trust financial management
  • Missed deadlines
  • Accounting records not kept up to date
  • Related Party Transaction issues
  • Internal Scrutiny not taking place

• Updated academies planning calendar - 2024 to 2025 planning calendar published.
• Pupil premium allocations – From October, unsuppressed pupil premium allocations will be uploaded to the secure DfE portal document exchange.
• Land and Buildings Collection Tool (LBCT) updated - The LBCT workbook and guidance have been updated. Submission deadline is 12 November 2024.
• Post-16 schools budget grant – Guidance published for post-16 schools budget grant.

There have also been a couple of Notices to Improve issued recently that we wanted to particularly highlight around financial governance:

• Case 1 – The notice states that the trust was unable to approve a balanced budget for 2023/24 and required exceptional financial support from ESFA.
• Case 2 – The notice was issued because the trust failed to obtain adequate insurance cover in respect of its legal obligations to take out additional commercial insurance.
• Case 3 – The notice highlights concerns over budget forecasts (ATH 2.11), management accounts (ATH 2.18), board oversight of the trust’s financial position (ATH 2.19 and ATH 2.20) and failure to manage the trust’s cash position robustly (ATH 2.21 and ATH 5.53).

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.

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