Role of KeyAcademy Officers

  • Accounting Officer
  • Principal Finance Officer
  • Responsible Officer

Responsibilities

Scheme Of Delegation

The roles of the governing body, its committees, the Responsible Officer, the Headteacher (who is also the Accounting Officer), and other staff should be defined in writing. This should include statements of the respective responsibilities of the governing body and staff, limits of delegated authority and channels for reporting.

Each academy should refer to its Funding Agreement, which sets out the roles and responsibilities of governors in broad terms. Academies should expand on this document by defining:

  • a schedule of decisions reserved for the governing body;
  • terms of reference for all committees; and
  • an explicit statement of the financial powers delegated to individual school personnel.

Accounting Officer

The Funding Agreement requires each academy to appoint an Accounting Officer. Generally this is the Principal. This post confers responsibility for financial and administrative matters and is a vital role, as the Accounting Officer is personally responsible to the governing body for:

Regularity

  • this means dealing with all items of income and expenditure in accordance with legislation and any applicable delegated authority;

(ie spending public money only for the purposes intended);

Propriety

  • operating appropriate standards of conduct, behaviour and corporate governance includingfairness, integrity, avoidance of personal profit from public business (avoidance of conflict of interest), even-handedness and open competition;

(ie honest handling of public money);

Value for Money

  • efficient and effective use of available resources;
  • avoidance of waste and extravagance;
  • prudent and economical administration of the financial affairs of the academy including the day to day organisation, staffing and management of the academy.

(ie spending wisely)

These responsibilities imply the need for:

  • clearly laid out processes for making decisions. That is to say, a scheme of delegation and a Finance Committee;
  • some means of monitoring whether the rules are being met. Whilst the DFE will carry out periodic financial management reviews of academies (FMRs) these are a snapshot and reliance must therefore also be placed on the Responsible Officer for ongoing assurance (see below);
  • procedures to follow if the rules aren’t being met. This would include regular reports by the Responsible Officer and a whistleblowing policy accessible to all staff.

The Accounting Officer also has a duty to take appropriate action if the governing body, or the Chairman, is contemplating a course of action which he or she considers would infringe the requirements of propriety or regularity (including the provisions of the Funding Agreement, the academy’s Development Plan, or other documents setting out the financial duties of the governing body or of any other rules governing the conduct of the body), or would not represent prudent or economical administration, or the efficient or effective discharge of the governing body's functions.

In such circumstances, the Accounting Officer would be required to put his or her objections in writing, without delay, to the governing body and to advise them of the requirement to inform the DFE Accounting Officer (the Permanent Secretary), the academy’s external auditors, and the Comptroller and Auditor General (NAO).

The Accounting Officer may delegate authority, or appoint others to assist in their responsibilities, for example to a Finance Director. However there are certain financial duties which it is recommended the Accounting Officer performs personally. This would generally include:

  • regular review of the academy’s budget (for example a monthly budget meeting with the FD, and at least termly meetings with the governors);
  • authorisation of orders for goods and services beyond certain limits;
  • authorising the addition of new staff to the payroll, within the agreed establishment numbers;
  • scrutiny of the monthly payroll before payment.

Finance Director

The Finance Director would be the member of the senior management teamresponsible for:

  • the maintenance of effective systems of internal financial controlincluding:
  • the development of appropriate financial regulations to control, disburse and monitor academy funds, and liaison with budget holders to ensure compliance;
  • the establishment, operation and security of a suitable computerised accounting system;
  • the day to day management of financial processesincludingthe buying and ordering of academy supplies and services to ensure value for money is achieved;
  • the management of the academy’s financial positionat a strategic and operational level, including:
  • development of an annual budget and forecasts for future years as part of the academy’s three year plan;
  • preparation of appropriate management information, including monthly accounts of budgeted and actual expenditure and briefingsfor governors and the senior team;
  • the submission of budget returns and other financial documents to the DFE in line with the Department’s timetable;
  • planning and monitoring of the academy’s cash flow including policies for monitoring creditors and debtors;
  • business planning to identify and maximise potential sources of income from local and national government initiatives andfrom the academy’s own activities etc;
  • management of the academy’s capital assets including rolling replacement programmes as part of the budget setting process;
  • ensuring that annual accounts are properly presented and adequately supported by the underlying books and records of the academy, including planning of statutory auditsand progression of any audit recommendations;
  • ensuring an effective payroll system is operated in compliance with relevant legislation and that all external returns are submitted on time;
  • ensuring adequate insurance cover is maintained;
  • overseeing and/or collaborating with other non-teaching areas including HR, admin, facilities management, ICT and catering.

The Finance Director may also be delegated responsibility for:

  • authorising orders up to a level set by the governing body, in conjunction with budget holders;
  • signing cheques in conjunction with the Principal or other authorised signatory.

The Finance Director is a key appointment and requires someone with sufficient knowledge and experience to guide the governing body on financial and administrative systems, audit and charity accounting matters. The DFE strongly recommends that the person appointed as Finance Director, or equivalent, should be a qualified CCAB accountant, or equivalent, with some experience in a senior position; charity experience would be valuable. An acceptable alternative, subject to the governing body themselves having significant financial experience and ability, would be a member of the Association of Accounting Technicians who has significant relevant experience in either a charity or educational institution.

Responsible Officer

The governing body will need to consider how it monitors and checks the operation of the financial management arrangements that have been established and are operated by officers of the academy. To assist in this they should appoint a person who will have specific responsibility for overseeing the financial arrangements on their behalf. The appointment of this Responsible Officer (RO) must be notified to the DFE.

The RO post is intended to provide an independent oversight of the academy’s financial affairs. The main duties of the RO are to provide the governing body with on-going independent assurance that:

  • the financial responsibilities of the governing body are being properly discharged;
  • resources are being managed in an efficient, economical and effective manner;
  • sound systems of internal financial control are being maintained; and
  • financial considerations are fully taken into account in reaching decisions.

The programme of checks to be performed should be agreed with the governing body or Finance & General Purposes Committee (as appropriate). After each checking session the RO should provide the governing body or the Finance & General Purposes Committee with a written report. The RO should not be a member of the Finance & General Purposes Committee, as he or she may find it necessary to criticise the workings of that Committee. Instead, the RO should report to the Finance & General Purposes Committee in an advisory capacity.

The RO should be a governor (but not the chairman), or an appropriately qualified and experienced individual not on the academy staff, with the necessary financial interest and skills to be able to perform the role competently. A recognised professional qualification is not necessary. However, the person selected must be able to show that the responsibilities being undertaken are fully understood and the importance of the role is fully recognised. The RO should have sufficient understanding to recognise any irregularities which may arise and sufficient authority to ensure they are addressed. The governing body should consider carefully who would make the most appropriate RO and if they are unable to appoint an RO who complies with the above guidelines they should discuss the appointment with the Department. Alternatively, the governing body can engage a firm of auditors to aid the RO in this function.

The RO function could be carried out by an individual or body associated with a governor – for example a business governor may arrange for his/her company’s internal auditors to carry out the reviews and provide him/her (on behalf of the governors) with reports.

The RO will need to be sufficiently familiar with the finances of the academy to be able to provide the governing body, and hence indirectly the DFE, with the required assurance. The RO is not expected to do any detailed accountancy work, but will be required to check some transactions to ensure that the correct procedures have been followed. Suggested guidance for issue to ROs, together with details of the expected checks are shown in annex 2b of the Academies Financial Handbook, but the general areas for review should cover the following:

  • Review that bank reconciliations have been carried out each month, including a review of validity of reconciling items;
  • Review of the monthly payroll to ensure that any changes have been appropriately authorised;
  • Check of a sample of orders to delivery notes and invoices to ensure that the documentation is complete and has been appropriately checked and authorised;
  • Check of a sample of payments back to invoices, orders and delivery notes to confirm they are bona fide purchases;
  • Review of a sample of expense claims to ensure there is appropriate documentation to support the claim and that the claim is appropriately authorised;
  • Review the returns to the DFE to ensure the information supplied is consistent with the underlying accounting records and internal management reports;
  • Carry out spot checks of petty cash balances and supporting vouchers and
  • Review all major contracts and ensure formal tendering procedures exist and are being adhered to.

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