Model Financial Procedures Manual

Contents

**please note that the policies below have been taken from the DfE Statutory policy document dated September 2014 – please feel free to add any other policy documents that your Governing Body or SLT may require**

Introduction

  1. Financial Procedures
  2. Financial systems
  3. Financial planning
  4. Financial reporting
  5. Financial controls
  6. Accounts receivable / income
  7. Accounts payable / expenditure
  8. Procurement
  9. Governance
  10. School assets / inventory
  11. Payroll
  12. Unofficial fund
  13. VAT/ Tax
  14. Banking arrangements
  15. Insurance / risk management
  16. Contracts / leasing
  17. SFVS / Audit
  1. Financial Policies (statutory)
  2. Charging and remissions policy
  3. Teachers pay policy
  4. Data protection policy
  5. Governors allowances policy
  6. Instrument of Government
  7. Committee minutes and papers policy
  8. School Information on website policy
  9. Register of business interests policy
  10. Complaints procedure statement
  11. Whistleblowing Policy
  1. Key financial documents
  2. Finance committee Terms of Reference
  3. Scheme of delegation
  4. LA financial regulations / scheme for financing schools
  5. Declarations of business interests
  6. Statement of internal control
  7. 3-year budget / monitoring reports
  8. Asset register
  9. Contract / lease register
  10. Business continuity plan / risk register
  11. SFVS
  1. Finance forms
  2. Expense claim form
  3. Purchase order form
  4. Equipment loan form

Introduction

These financial procedures have been written after formally approving the Local Authorities Financial Regulations and considering the Local Authorities Scheme for financing schools.

  1. Financial Procedures
  2. Financial systems

Include an overview of the schools accounting system. Does this link to any other software packages? Include descriptions of any online payment systems, budget planning software or online payroll systems.

1.2Financial planning

How does the school set its budget? How does this link to the School Development Plan? Does the school set a 3-year budget forecast? How does it manage its cash flow?

1.3Financial reporting

How does the school report its finances to Governors during the financial year? Does the school produce regular budget monitoring reports? How is the year-end CFR report produced? What financial reports is the school required to submit to the Local Authority, e.g. Fin 1, cumulative expense analysis, trail balance, budget monitoring.

1.4Financial controls

Include an overview of key finance controls. Are there clear job descriptions setting out the responsibilities of staff with financial responsibility? Have clear desk instructions giving step-by-step guidanceon key individual tasks, e.g. collection of dinner money. Include step-by-step instructions on the operation of the financial systems, e.g. FMS,payroll.Explain how the school separates finance duties. Explain key controls for ordering and receiving goods. Include an overview of authority to sign cheques and receive cash.

1.5Accounts receivable / income

Include an overview of all sources of income. How does the school collect money after an invoice is sent out? Does the school operate lettings or after school clubs? How does the school manage its debtors?

1.6Accounts payable / expenditure

How does the school raise purchase orders for goods and services? Include details of cheques, bacs payments, standing orders and direct debits.

1.7Procurement

Does the school have effective procurement processes? Does the school get 3-qoutes before ordering goods and services? Does the school get value for money when purchasing goods and services? Does the school get any bulk purchasing deals with other schools?

1.8Governance

Give an overview of the schools Governing Body and its responsibilities for ensuring that high standards are achieved. Include an overview of the schools other committees.

1.9School assets / inventory

Include details of how the school manages its assets and how these are recorded into an asset register. How does the school manage its inventory?

1.10Payroll

Include details of the school payroll provider. How is payroll processed each month and how are starters and leavers updated.

1.11Unofficial fund

Include details of the schools unofficial fund. Who are the account holders.

1.12VAT/ Tax

Include details of how the school processes its VAT return each month / term. Explain how the school processes it PAYE tax for HMRC. Are there adequate controls in place to ensure the school is complying with the current HMRC VAT regulations.

1.13Banking arrangements

Include details of the schools bank mandate including cheque signatories and account holders.How does the school reconcile the bank statements? How often and how does the school bank cash or cheques?

1.14Insurance / risk management

Include details of all the schools insurance policies e.g. long term sickness, public liability, buildings insurance etc. Include details of the schools risk register.

1.15Contracts / leasing

Include details of all contracts including both rental and lease agreements. Include the start date, the length of the contract and the value of the contract.

1.16SFVS / Audit

Give an overview of how the school prepares for the Schools Financial Value Standard each year and how this then feeds into the 3-year LA Audit programme. Have all the previous Audit recommendations been implemented effectively.

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