School Funding & Accounting Circular
iPostDocumentTitle/Search Keyword(s): / 2ND REMINDER - Unofficial Funds 2016/17 Academic Year
Subject: / Unofficial Funds Return for 2016/17 Academic Year from ALL maintained schools
Circular No: / SFAT Circular 01.2018
iPostID-2-6194
Service Group: / School Funding & Accounting Team (SFAT)
Contact Details: / Tel: SFAT Helpline (01823) 359771
Email:
Date: / 10 January 2018
Whilst Somerset County Council makes every effort to ensure accuracy of content, it cannot accept liability for claim, loss or damage howsoever arising from the reliance on or use of this information.
Attention : Governors / Headteachers / Business Managers / Finance Staff
2nd REMINDER RE: Unofficial Funds Audit Return in respect of the academic year 2016/17 for ALL maintained schools
We refer to SFAT circular 12.2017 dated 8th September 2017 and SFAT circular 18.2017 dated 22nd November 2017
The following documents were required by Friday 1st December 2017 -
(NIL returns are required)
· Annual Audit Certificate
· Statement of Accounts
· Checklist
Under Section 2.8.3 of the Financial Management Scheme, every Unofficial Fund has to be audited at least once a year and an annual certificate, together with a completed and signed Unofficial School Funds Audit Checklist and statement of accounts, submitted to the Schools Funding & Accounting Team.
The annual certificate should cover all funds, created for the benefit of the school / educational establishment and its pupils / students, held at any time during the year, which, although not the direct responsibility of the Local Authority (LA), are held by the Head or Governors of schools purely on account of the office they hold. It is not intended that the annual certificate should apply to funds held by Governors as trustees, eg funds for the maintenance of the external fabric of a Voluntary Aided school or School Imprest accounts.
This circular includes:
1. Guidelines for Auditing Unofficial School Funds
2. Unofficial School Funds Audit Checklist
3. Unofficial School Funds Audit Certificate
The 3 documents above should all be given to your auditor, along with the documentation listed at the top of the checklist.
Please ensure that the Unofficial School Funds Audit Certificate (Form UF/2017) and the Unofficial School Funds Audit Checklist are completed by your auditor.
The Unofficial School Funds Certificate, accounts and Unofficial School Funds Audit checklist should be presented to Governors for review, discussion and approval in advance of their submission to the Local Authority.
After approval by governors, the following must be sent to the School Finance and Accounting Team (SFAT) - Now overdue:
· Signed audit certificate,
· Signed copy of your full year audited accounts, showingdetails of income and expenditure
· Signed checklist
IF YOU HAVE NOT ALREADY SUBMITTED THESE DOCUMENTS PLEASE EMAIL TO IMMEDIATELY.
Please note that this is a requirement of the Financial Management Scheme and any outstanding documents as at 31st January 2018 will be escalated for further action.
NB: If your school does NOT hold any unofficial funds a 'NIL'returnis required. (An audit certificate annotated “NIL” and signed by Chair of Govenors is sufficient)
Guidance on Unofficial Funds with further information can be accessed on iPost here.
Governors should note that an audit of such funds should also be undertaken whenever there is a change of Headteacher.
For any enquiries relating to this circular, please email
Schools Funding and Accounting Team
AUDITING UNOFFICIAL SCHOOL FUNDS - GUIDELINES
Definition
Auditing may be defined as the examination of certain statements covering transactions over a period. It would also include assessment of an organisation’s financial position on a certain date. The purpose of the Unofficial School Funds audit is to provide an independent review of the unofficial funds in order to assess if they are being managed in accordance with the fund objectives, and that the money in the funds is correctly accounted for. The audit is not primarily intended to detect irregularities and fraud, but to recognise the possibility of material irregularities or fraud. These could distort the results or state of affairs shown by the financial statements.
The Auditor
You should NOT audit the accounts of an unofficial fund if:
· You are involved in the management of the fund, even if you are only a signatory.
· You are closely related to someone who is involved in the management of the fund.
In the event of you being asked to perform an audit where the above apply, you should ask the fund administrator to find another auditor.
Documentation
The documentation listed in the Unofficial School Funds Audit Checklist should be provided to the auditor.
Auditor’s Findings
If any problems are found during the course of the audit then the following action should be taken:
1. An imbalance or lack of information should be referred back to the fund holder.
2. If advice is required on any aspect of auditing the fund, this can be sought from the Schools Funding and Accountancy Team, County Hall (Tel: 01823 359771).
3. If there is any suspicion of impropriety then the Schools Funding and Accountancy Team Service Manager, Ken Rushton, should be contacted immediately (Tel: 01823 356911). In the unlikely event that this problem is encountered, DO NOT return the records to the fund holder.
Audit Checks
There should be no gaps in the audit history of Unofficial School Fund accounts. The checklist is intended to assist the auditor by providing:
· a list of documents that the auditor must have
· an easy, step-by-step tick list of the checks that need to be carried out during this important annual check.
Annual Accounts Statement
An annual summary of the transactions should be produced by the school and audited and a copy sent to the clerk to the governors for presentation to the Governing Body.
The Audit Certificate
The Schools Funding and Accountancy Team, in Finance and Performance require the following to be submitted to them:
· Audit certificate completed after 31 August each year
· Unofficial School Funds Audit Checklist
· Annual Accounts Statement / Summary.
Any advice given to the Fund Holder, by the Auditor, to improve controls of the management and administration of the unofficial fund accounts, should be included in the comments section of the checklist, rather than given verbally.
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UNOFFICIAL SCHOOL FUNDS AUDIT - CHECKLIST
Documentation
The auditor of the Unofficial School Funds should have access to:
· Bank statements for the last Academic Year 01/09/2016 - 31/08/2017
· Cheque books and Paying in books for the last academic year 01/09/2016 - 31/08/2017
· Receipt books
· Accounting Records (eg cashbooks / spreadsheets) used to record all transactions during the year and, if relevant, the amounts held for each project.
· All bank reconciliations performed during the year
· Invoices / payment vouchers to evidence payments processed throughout the year
· Annual statement of accounts
· A copy of the School’s Finance Policy, or Unofficial School Funds Policy if this is separate from the Finance Policy
· Guidelines for Auditing Unofficial School Funds
Checks
The auditor should complete the checklist below.
* For these questions, checks should be made on a sample basis of a minimum of 10 transactions selected across the year.
In Part) / COMMENTS
If the answer is No or In Part, use the Comments column to summarise the position and to list Action Points and /or Recommendations
CASH AND CHEQUE RECEIPTS/PROCESSES
Have receipts been issued for all income received? *
Has all the income received been entered in the accounting records? *
Has the paying in book been completed fully? *
Have paying in slips been stamped/ initialled by the bank?
Do the paying in slips agree to the entries in the accounting records? *
PAYMENTS MADE FOR GOODS/SERVICES
Have the authorised signatories been recorded in the school’s Unofficial School Funds Policy or Finance Policy?
Have all invoices/payment vouchers been signed to demonstrate authorisation by the designated signatories? *
Are there invoices/payment vouchers which match all cheques processed? *
Are cheque counterfoils sequential and do they agree to the school’s record of the cheque books issued?
Have any spoiled/cancelled cheques been retained with the cheque book?
CHECK / ANSWER (Yes/No/
In Part) / COMMENTS
If the answer is No or In Part, use the Comments column to summarise the position and to list Action Points and /or Recommendations
Is all expenditure appropriate and in accordance with the purpose of the fund as recorded in the school’s Finance Policy or Unofficial School Funds Policy?
Are there corresponding payments related to income received for a specific purpose?
Have all the payments been entered in the accounting records? *
BANK RECONCILIATION
Are the bank statements for the full year present (sequential)?
Have all the income banked and payments made appeared on the bank statements? *
Have regular reconciliations, including a reconciliation at year-end, been carried out between the bank statements and accounting records, and do they show eg un-presented cheques/income not banked/bank errors?
Is there evidence that all reconciliations have been independently checked by the Headteacher or Bursar?
Do the brought forward and carried forward balances at the start and end of the year in the accounting records agree to the bank statement?
GENERAL
Have expenditure, income and balances been compared to the previous year for reasonableness to give assurance over completeness of processing?
Is the Annual Statement of Accounts correct for discussion and approval by Governors?
ANY OTHER COMMENTS OR RECOMMENDATIONS
Document any recommendations resulting from this audit which you consider would improve the quality of the record keeping and management of the Unofficial School Fund account.
Signed by Auditor: …………………………………………………..
Form UF/2017
UNOFFICIAL SCHOOL FUNDS AUDIT - CERTIFICATE
School name: ………………………………… School number: ………………
Unofficial School Funds – Certificate for Year Ended 31 August 2017
I CERTIFY
(1) That the following is a complete list of funds (other than Foundation Funds which are administered as a charity, by Trustees) which, although not the direct responsibility of the Local Authority, were being administered for the benefit of the school / establishment and its pupils / students by the Head teacher / Governing Body at any time during the year ended 31 August 2017.
Name of Fund/Account / Purpose of Fund/Account / Amount in Fund/Accountas at 31 August 2017
(2) That the checks on the Unofficial Funds Audit Checklist have been completed and that, in my opinion, all such funds have been verified as being correct for the academic year 2016 / 2017 ending 31 August 2017.
(3) That an independent person nominated by the governing body has audited these funds. An independent person is someone who is not involved in any way with the management of the Unofficial School Funds and is not related to anyone involved in the management of the funds.
Auditor Chair of Governors
Print Name: Print Name:
Signed: Signed:
Address:
NB: Please attach the following:
· a copy of the audited statement of accounts signed by auditor.
· a copy of the Unofficial School Funds Audit Checklist signed by auditor.
Please return to: Schools Funding and Accountancy Team, County Hall, Taunton TA1 4DY
by Friday 1st December 2017.
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