The Department for Education (DfE) has agreed new financial reporting arrangements for the academies sector with HM Treasury and Parliament.
DfE will prepare a new sector annual report and accounts (SARA) for the academic year from 1 September to 31 August each year. This aligns with the financial reporting period of individual academy trusts. This is different to the financial reporting period for government departments, which is from 1 April to 31 March each year.
The new reporting arrangements respond to the Comptroller and Auditor General’s ‘adverse’ opinion on DfE’s consolidated accounts for the years ending 31 March 2014 and 2015. This opinion is in part due to the complex methodology used to present results based on a 7-month difference in the reporting periods used by academy trusts and DfE.
DfE will prepare the first SARA for the reporting period from 1 September 2015 to 31 August 2016.
The new report will:
- provide a more holistic report of the academies sector by aligning reporting of financial results with educational performance
- separate academies spending from that of the DfE and clearly show for the first time the resources academies receive and how they use them
- make it easier for Parliament, parents and taxpayers to scrutinise and test information about academies funding and spending
At the same time, DfE expects new arrangements to speed up validation checks by up to 2 months and enable accounts production much earlier than in previous years.
To support new reporting arrangements, the Education Funding Agency (EFA) has developed a new online accounts return for 2015 to 2016. EFA will write to all academy trusts in November with information about how to submit the accounts return.
Academy trusts must submit their accounts return by 31 January 2017. EFA expects the submission date to be earlier in future years.
The accounts return is different to academies’ financial statements, which must be submitted to EFA by 31 December 2016.