Statutory
Non-Statutory
Financial Management Policy
& Scheme of Delegation
Date: May 2009
Reviewed: November 2010
Reviewed: May 2012
Reviewed: August 2014
Reviewed: March 2015
Reviewed: September 2015
Northgate School Arts College (Academy Trust)
Financial Management Policy and
Scheme of Delegation
1. AIMS
The Governors of Northgate School Arts College (Academy Trust) believe that sound financial management policies are essential to the fulfilling of their statutory duties under government legislation. Sound financial management is achieved by:
· Defining the financial roles and responsibilities of staff and Governors under the EFA’s (Education Funding Agency) Academies Financial Management and Governance Evaluation.
· Providing a framework to ensure that a consistently high standard of education is maintained for their pupils within the available resources.
· Preparing the annual financial plan whilst taking a 3-5 year view on anticipated changes to the funds available, demand pressures and lead time to effect change
· Acting in accordance with the guidelines outlined in the ‘Academies Financial Handbook 2015 (effective from 1st September 2015).
· ‘Contract Award’
o During the course of the financial year the Governing Body will take whatever steps possible to ensure that expenditure, particularly in respect of large service contracts, will reflect the four principles of Best Value; Challenge; Compare, Consult and Compete.
2. RESPONSIBILITY AND ACCOUNTABILITY
A. INTERNAL FINANCIAL CONTROL
DELEGATED BUDGET
By virtue of Section 50(7) of the School Standards and Framework Act 1998 (SSFA), governors do not incur any personal liability in respect of anything done in good faith in exercising their power to spend a school’s budget share, or in delegating that power to the *Executive Head Teacher (*here after referred to as the Head Teacher). An example of an act not done in good faith is fraud.
The Governors and Head Teacher are responsible for the proper financial management and probity of their school.
The Governors have delegated day to day spending authority within the approved annual budget for the Academy to the Head Teacher. In the absence of the Head, delegated authority will transfer to the additional members of the ATLT (Academy Trust Leadership Team) ie Head of School (Northgate) and the Executive Deputy Head (Bee Hive). The Head Teacher allocates to budget holders an annual budget to support teaching and learning within that particular area. Budget holders/teaching staff placing orders will ensure that there is sufficient money within their budget and ‘Order Requisitions’ are submitted for approval to the Head (ATLT) in accordance with the school procedures (Appendix A). Deviation from school procedures must be agreed by the Northgate School Arts College Academy Trust governing body and reflected as such in the published minutes.
The governing body will hold a register which lists for each member of the governing body and the Head Teacher and ATLT, any business interests or affiliations they or any member of their immediate family may have. This register will be kept up to date through notification of changes and through annual (beginning of Autumn Term) review of entries. The register will be available for inspection by governors, staff, parents and the EFA. An Academy Trust must publish on their website the relevant business and pecuniary interests of trustees and members.
Irregularities that impede the Governors ability to manage financial matters in a transparent manner will be reported to the Head Teacher.
FRAUD
The governing body and Head Teacher will inform all staff of school policies and procedures relating to fraud and theft, the controls in place to prevent them and the consequences of breaching these controls. This information will be included in the induction of new school staff and governors.
If it is suspected that money or property of the school has been stolen or misappropriated, or that a financial irregularity has occurred, the governors and/ or the Head Teacher will investigate the matter immediately. Reference should also be made to the school’s Whistleblowing and Fraud Policies.
The Academy Trust must notify the EFA if they incur losses through fraud or theft in excess of £5,000, individually or cumulatively, in any academy financial year.
ORDERS
All orders must be raised through SIMS onto official order stationery, and must only be made where there is sufficient budgetary provision. The Business Manager/finance assistant will sign to confirm that monies have been committed. Orders may be placed by any authorised person however if this is not the budget holder a counter signatory will be required and subsequently signed by the Head Teacher (ATLT).
Orders will not be made orally but require supporting paperwork and signed accordingly.
Orders over £1,000 but less than £10,000
At least two written quotations should normally be obtained for all orders between £1,000 and £10,000 to identify the best source of goods/services. Written details of quotations should be prepared by budget holders and retained with the purchase order for audit purposes. Telephone quotes are acceptable if these are evidenced and emailed/faxed confirmation of quotes has been received before a purchase decision is made. Similarly it is recognised that due to the nature of the requirement for certain specialised services and equipment, there may not be sufficient interest or availability to enter into quotations/tenders. However best value must be considered at all times.
Orders between £10,000 and £20,000
All goods/services ordered with a value between £10,000 and £20,000, or for a series of contracts which in total exceed £20,000 – at least three written quotations.
Orders in Excess of £20,000
Orders in excess of £20,000 must be subject to competitive tenders, unless the Governors decide otherwise, if this is the case, it will be evidenced in the Governing Body meeting minutes. Purchases for supplies and services where the total contract value exceeds £173,934 and works over £4,348,350 (rates revised annually) may fall under EU procurement rules. Details of which are included in the Academies Financial Management Handbook.
On receipt of goods, the delivery note is checked, signed and dated against the consignment note and original order. On receipt of the invoice, the BM confirms receipt of goods/services and passes for payment.
The BM prepares cheque/BACS payments through SIMS.
The cheques are signed by the authorised signatories, with the cheque list printout being signed by the Head Teacher. The BM and Head will sign to confirm that there is a sufficient cash balance in the bank to proceed with payment.
Cheques must be signed by two authorised signatories, one of whom should normally be the Head Teacher. Any cheque over £20,000 must also be countersigned by the Chair of Governors or Chair of Business.
BACS; The BM prepares electronically the BACS ‘batch’ for online authorisation by the authorised signatories. Three signatories for single payments 0 to £19,999 and four for single payments in excess of £20,000 are required.
No member of staff may authorise cheque/BACS payments relating to expenditure incurred or services supplied by themselves or their relatives.
Credit Notes
The Academy will ensure that appropriate credits are obtained for short or damaged deliveries, returns or invoicing errors. Credit notes will be processed without delay. If the supplier will not be used again, a cheque refund (or direct credit if applicable) will be requested.
Statements and Reminders
Statements and reminders will not be processed for payment. On receiving a statement or reminder from a supplier, the BM will check if all invoices listed have been processed for payment. If the statement shows invoices that have not been received, copies will be requested.
PETTY CASH
Petty Cash – An arrangement has been made for cash facilities at Lloyds TSB, Kingsthorpe Branch. The maximum to be held at Northgate School, Queens Park Parade at any one time is to be £400 (managed by the BM) and at The Bee Hive, Harborough Road £150 (managed by the Executive Deputy Head). This is to be contained within a cash tin and locked in the school safe at all times and whenever the premises are vacant.
Petty Cash may be used to reimburse any member of staff or anyone else acting on behalf of NSAC who makes a purchase other than by official order. However payment will not be authorised without a valid receipt and will only be paid within one month of purchase. Goods/services paid for by petty cash are done so on the understanding that there is sufficient un-committed monies held within the budget heading and that the member of staff has considered value for money and best value prior to purchase. Petty cash will be paid up to an amount of £35, payments in excess of this amount will be paid via cheque/BACS.
A Petty Cash Voucher must be signed for on all transactions by the Head (ATLD), BM and member of staff in receipt of funds and retained with the remaining cash float until reconciled.
The Head Teacher or member of the senior management team will undertake regular spot checks of the petty cash balance held in the school safe to that of the balance held on the SIMS system and sign accordingly.
BUSINESS CHARGE CARD
When considering ‘Best Value’ it is often necessary to make purchases via the internet. A business charge card allows the school the convenience of on-line payments.
The school will hold four bank payment cards for business purposes only. These will be in the names of the EHT (Miss S A Webb), the BM (Mrs C J Cope), The Bee Hive Centre Manager and Sweet Bee Manager (Miss H Morgan). Each payment card will have a monthly credit limit of £1000.
Card holders will be required to complete a ‘Request to Spend’/Purchase Order request prior to purchase, approved by the Head Teacher or a member of the ATLT. The BM will maintain a record of all transactions supported by receipts. On receiving the card statement (monthly) the BM will check all payments made and the Head of School (non card holder) will sign as correct.
The full balance will be debited at the statement date from the school’s bank account by direct payment before interest can be accrued.
B. QUOTES AND TENDERS
Where work is obviously less than £1,000 quotations are sought at the discretion of the Head Teacher. However, it is deemed good practice for items such as IT equipment and works required to school premises by contractors that quotes and tenders be sort for amounts of between £500 and £1000, as prices and costs vary enormously. For items £1,000 and above, two quotations and a Procurement Record are required from independent suppliers.
All items between £3,000 and £5,000 should be discussed, agreed and minuted at the relevant sub-committee meeting prior to being reported at the next full Governors Meeting. Unforeseen items over £5,000 should be brought to the attention of the Chair and be placed on the agenda of the next relevant committee or Full Governors meeting.
C. THE DATA PROTECTION ACT
The School is registered under the Act.
D. VIREMENTS
The potential need to vire an amount of money is identified by the Business Manager and discussed with the Head Teacher:-
· For amounts of money between £0 and £5000 a record of the change and who approved it (BM/EHT) should be reported at the next Business meeting.
· For amounts of money between £5,000 and £15,000, approval to be sort by the Chair of the Business Committee and reported to the Business Committee in arrears.
· Monies above £15,000, approval to be sort by the Business Committee prior to movement of monies and reported to the full Governing Body in arrears.
All approved virements are to be minuted and approved by the Business Committee for the information of the full governing body.
E. BACK-UP PROCEDURES
The server backs up the computer system on a daily and weekly basis. The back-up tape contains both the Admin and Curriculum data, is encrypted, regularly tested and a copy is held off the premises nightly. Similarly a copy of the back-up tape is also kept in the fire proof safe in the BM Office.
F. ASSET MANAGEMENT AND FIXED ASSETS
An up-to-date inventory of School property is maintained and updated regularly as and when notifiable assets are procured. Serial numbers and identification marks must be recorded where appropriate as well as adequate descriptions for insurable items. The Premises/Facilities Manager has delegated responsibility for this task under direction of the Head Teacher and will maintain up to date Asset Management Register as required by the Auditors. The register will be required at least once a year, for audit purposes at year end in order to produce the company accounts and balance sheet.
The Governors will agree the amount of depreciation to be applied to costs associated with the register ie buildings, motor vehicles and furniture and IT equipment. The depreciation values currently are:
· (Land) & Buildings over 50 years @ 2%
· Motor Vehicles over 4 years @ 25%
· Furniture/Equipment over 5 years @ 20%
Ø Purchases over £750
· IT Equipment over 3 years @ 33.3%
Ø Purchases over £500
Other than land, buildings and heritage assets, trusts can dispose of any other fixed asset without the approval of EFA. The Trust will ensure that any disposal achieves the best price that can reasonably be obtained and maintains principles of regularity, propriety and value. A register will be kept of all items disposed.
G. HIRE OF SCHOOL PREMISES
The Governors have adopted a ‘Lettings Schedule and Rates of Payment’ as a general guide for use specifically at Northgate School, but have delegated authority to the Head Teacher to negotiate hire charges for community use. However there are room hire rates and conferencing charges available specifically relating to the Bee Hive, these are reviewed annually.
NSAC letting fee rates will be outlined in the Lettings Policy and will incorporate, as a minimum, the cost of reimbursement to the Premises Manager.
H. VALUE ADDED TAX (VAT)
The Governing Body will comply with current VAT regulations. VAT claims will be made and re-imbursed monthly. The BM will process and submit the claim electronically directly to HMRC and the Head Teacher (ATLT) will confirm and authorise the claim against the balances supplied from the academy’s SIMS system.