Guidance

16 to 19 education: financial management and assurance

Information about financial assurance and financial management of 16 to 19 institutions funded by Education Funding Agency (EFA).

Colleges and providers financial assurance

This guide helps local authorities, colleges and 16 to 19 providers understand the responsibilities and good practice they should follow with their financial assurance and financial management.

Part of the remit of Education Funding Agency (EFA) is to obtain financial assurance and aid good financial management of those institutions it funds.

The information that you give allows EFA to assess providers’ financial health and understand the degree of risk it faces in contracting with those organisations. This also allows EFA to establish the recommended value of contracts appropriate to the financial resources of those organisations.

Annual requirements for providers

The EFA business cycle 2014 sets out important information to help institutions and local authorities plan ahead.

Requirement for local authorities to submit grant returns to EFA

For learners over 16, local authority chief financial officers are required to make a 2-stage grant return and use of funds statement on funds received from EFA, and a use of funds statement on funds received from the Skills Funding Agency (SFA). For the 2013 to 2014 financial year, the stage 1 grant returns are due by 30 April 2014, and the more detailed stage 2 returns are due by 31 October 2014.

Financial assurance on local authority maintained schools with sixth-form funding

The document ‘assurance guidance to local authorities’ provides information for local authorities about the assurance of maintained schools with sixth form funding.

This information specifically refers to assurance for funding in the 2012 to 2013 academic year. However, paragraph 1 of the introductory section, which states that the use of this assurance approach, is not a requirement on local authorities. It is wholly the responsibility of chief financial officers to determine the extent of the work, if any, which is necessary to enable them to make their grant returns to EFA.

Assurance for funding relating to the 16 to 19 Bursary Fund

The 16 to 19 Bursary Fund audit guidance and working papers 2013 to 2014 document was produced to help local authorities gain assurance that institutions are administering the 16 to 19 Bursary Fund correctly. It is not mandatory.

It is addressed to all local authorities receiving EFA funding, and will be of interest to local authority chief financial officers, directors of children’s services, heads of children’s services finance and heads of internal audit.

Joint audit code of practice

Part 1 of the Joint Audit Code of Practice (JACOP) provides an overview of the lead assurance arrangements for education providers in the 16 to 24 sector.

A revised version of JACOP part 1 came into effect on 1 August 2013. This takes changes to audit and assurance arrangements and changes in funding arrangements for high needs students into account.

Part 2 of the JACOP also came into effect from the 1 August 2013 and is relevant to further education colleges and sixth-form colleges.

It has been developed in conjunction with the Skills Funding Agency with consultation taking place through the Association of Colleges and Sixth-Form College Association. It’s relevant to colleges and provides more in-depth details of the governance and audit and assurance responsibilities for college corporations, funding bodies and financial statement auditors.

Assurance framework for high needs funding 2013 to 2014

The assurance framework for high needs funding 2013 to 2014 sets out the agreement that EFA will take the lead for financial health assessments for non maintained special schools (NMSS) and independent specialist providers (ISPs), and that it will share the results with local authorities.

The results of the first round of assessments for NMSS and ISPs are available to local authorities via the EFA Portal. Please note the portal will shut on 20 March 2014 and you should download any documents you wish to keep before this date. If you have any questions about this framework, please contact EFA.

Financial assurance information from previous years

You can access downloads from previous years in the National Archives.

Colleges and providers financial management

Financial planning handbook 2014 and template

Published jointly with the Association of Colleges (AoC) and the Skills Funding Agency, this guidance for colleges set out the requirement to prepare a financial plan using the template provided.

The financial planning handbook and template for 2014 to 2015 is now available. Colleges are required to complete the template and submit it to the EFA by 31 July 2014.

Financial health assessment of 16 to 19 non-college providers

EFA assesses a provider’s financial health to understand the degree of risk in contracting with those organisations, and to establish the recommended value of contracts appropriate to the financial resources of those organisations.

The document ‘financial health assessment of 16 to 19 non college providers’ sets out EFA’s approach to this assessment of 16 to 19 non college providers.

College accounts 2012 to 2013

The first release of college accounts data for the 2012 to 2013 financial year is taken from the combined Skills Funding Agency and EFA database of college finance records for the year ending 31 July 2013.

Information supplied by further education and sixth-form colleges has been subject to basic credibility and reasonableness checks, either by the Skills Funding Agency or EFA.

However, whilst every effort has been made to cleanse the data, colleges may identify inaccuracies in their information supplied to EFA. In these circumstances, colleges should contact pfm@skillsfundingagency.bis.gov.uk or externalassurance.EFA@education.gsi.gov.uk.

This current version of the accounts file may be subject to further release(s).

Benchmarking 2011 to 2012

The data used in the benchmarking package is taken from the finance record returns submitted by further education and sixth-form colleges for the financial year ended 31 July 2012.

The benchmarking package has been commissioned in partnership with the Association of Colleges (AoC), EFA and College Finance Directors Group (CFDG) as an integral element of the College Financial Reporting Project.

The 2011 to 2012 (academic year) further education benchmarking tool can be used in Microsoft 2007 Excel or later versions of Excel. Due to the amount of content contained in the benchmarking tool it will not run in pre-2007 versions of Excel.

For any queries concerning the benchmarking package, please contact externalassurance.EFA@education.gsi.gov.uk

Accounts direction guidance

Every year EFA provides documents that are of interest to principals and chief executives of sixth-form colleges (SFCs), finance directors at SFC colleges, and financial statements and regularity auditors.

The purpose of these guidance documents is to provide direction to colleges and auditors on the preparation of colleges’ annual financial statements.

EFA works with the AoC, the College Financial Directors Group and Skills Funding Agency, and consulted with the Sixth-Form Colleges Association and auditors on these documents, which supplements that in the 2007 Statement of Recommended Practice (SORP) and consolidates all previous accounting policies guidance issued by EFA.

The documents for 2013 to 2014 will be available in April 2014. For reference purposes you can still view the guidance provided for last year’s return, which includes:

Financial management information from previous years

You can access information on financial management from previous years on the National Archives website.

EFA Risk Analysis Division

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