Part 7: Definitions

Help with terms used in this handbook.

Accounting officer	The academy trust’s senior executive leader, accountable for value for money, regularity and propriety.
Accounts Direction	ESFA’s guide for academies on preparing their annual accounts.
Accounts return	A return based on academy trusts' annual accounts, required for the sector annual report and accounts, and for collecting benchmarking data.
Articles of association	The articles describe the trust's charitable object(s) and governance arrangements.
Chief executive	The senior executive leader and head of the management team of a trust with multiple academies. Trusts may use alternative descriptions such as executive principal.
Chief financial officer	The individual leading the finance department: e.g. finance director, business manager or equivalent.
De facto trustee	A person not validly appointed as a trustee but exercising the functions that could only be properly discharged by a trustee. See also shadow directors.
Economy	Obtaining an outcome for the least possible input of resources.
Effectiveness	Obtaining the desired outcome.
Efficiency	Obtaining the best possible outcome for the resources input.
Financial Management and Governance Self-assessment (FMGS)	A return to ESFA by new academies and trusts, where they self-assess their financial management arrangements.
Funding agreement	The agreement between the academy trust and the Secretary of State, including funding arrangements, obligations and termination provisions.
General annual grant	Academy trusts' main revenue funding.
Propriety	Dealing with expenditure and receipts in accordance with Parliament’s intentions and the principles of parliamentary control. This covers standards of conduct, behaviour and corporate governance.
Regularity	Dealing with income and expenditure in accordance with legislation, the funding agreement, the handbook, and the trust's internal procedures. This includes spending public money for the purposes intended by Parliament.
Related party	Related parties include persons and entities with control or significant influence over the academy trust, and members of the same group (for example parent and subsidiary companies). This description is not comprehensive. A full definition is in section 33 of Financial Reporting Standard 102 and section 9.15 and appendix 1 of the Charities SORP. The related parties section of ESFA’s Accounts Direction provides further information.
Risk protection arrangement	An alternative to insurance for academy trusts where losses are covered by government funds.
Shadow director	A person in accordance with whose directions or instructions the directors of a company are accustomed to act. See also de facto trustee.
Special payments	Payments outside the normal range of activities approved by Parliament and therefore requiring greater control, including ex gratia payments, staff severance payments, compensation payments and other extra-statutory or extra-contractual payments.
Value for money	Achieving the best possible educational and wider societal outcomes through the economic, efficient and effective use of resources, the avoidance of waste and extravagance, and prudent and economical administration.