School monitoring returns

There are a number of monitoring reports maintained schools must complete including financial returns and the School Summary Outturn. Information on what is required is detailed below. 

Consistent Financial Reporting (CFR)

Governing bodies of maintained schools and pupil referral units (PRUs) must provide the local authority with a School Summary Outturn (SSO), presented in accordance with approved headings and sub-headings and in compliance with the established accounting practices of the local authority. This is optional for maintained nurseries to follow this but in Waltham Forest we recommend that they follow the same standards. Further information on this financial statement is provided below.

To enable benchmarking and comparative reports to be produced between schools and regional areas, the Education & Skills Funding Agency (EFSA) requires schools and local authority's to use the Consistent Financial Reporting framework.

This framework stipulates what codes schools should use to record their income and expenditure on their financial systems. 

This framework is updated by the EFSA each year.

We encourage all schools to ensure that Governors, headteachers, senior leaders and finance staff understand the financial codes as this aids financial discussion and challenge.

Federated schools receiving a single budget share

If requested by the governing board, the School and Early Years Finance Regulations (England) allows local authorities to allocate a single budget share where there are two or more schools federated under section 24 of the Education Act 2002.

  • Federated schools receiving a single budget share should report collectively in their CFR return using the agreed school establishment number.
  • Federated schools receiving separate budget shares should report separately in their CFR return.

Financial reports required by the local authority

Maintained schools must follow the local authority's requirements on financial controls and monitoring in the management of their delegated budgets. The local authority monitors these budgets via the following reports:

  1. Ratified budgets
  2. Financial forecasts
  3. Quarterly returns
  4. Capital statement 
  5. School Summary Outturn  

1. Ratified Budgets

Governing Bodies of each school must formally approve (ratify) the formal annual budget plan for each financial year. In February of each year the local authority will supply all maintained schools with their Budget Share (a statement of income allocated to schools). Schools must ensure that their ratified budgets:

  • include proposed use of estimated surplus balances, intentions for expenditure in the current financial year, and notes of the assumptions underpinning the budget plan 
  • take full account of estimated deficits/surpluses at the previous 31 March
  • are signed by the Chair of Governors (or Chair of the relevant committee with the delegated powers to approve the budget) 
  • have the budget amount recorded in the minutes of the meeting where they were approved
  • are submitted to the local authority by 15 May each year.

Please note: Schools are recommended to set budgets which allow for appropriate levels of reserves to support the schools sustainability. The recommended thresholds are: Primaries between 3-8% of their annual income; Secondary and All-through schools between 2-5% of their annual income.

2. Financial Forecasts

The local authority requires maintained schools to submit budget forecasts covering each year for a 3 yr period beyond the current year, alongside the submission of their ratified budgets in May each year.

The LA funds licences for Access Education Budgets and Workspace for all maintained schools in Waltham Forest to support them with their forecasting and financial planning. 

3. Quarterly returns

Maintained schools are required to provide the local authority with quarterly budget monitoring returns two weeks after the end of June, September and December each year with details of realistic anticipated and actual income and expenditure.

These returns must also include the latest bank reconciliation, including a copy of the bank statement reconciled to. Schools are encouraged to include detailed notes on these returns to reduce the number of queries they receive from the Education Finance team, this should include explanations for any major variances between the quarterly monitoring submissions.

In the Quarter 3 return, schools who are expecting to carry balances exceeding the recommended maximum (8% primary and Special schools, 5% Secondary Schools) are requested to submit information detailing how they accrued the balance and how they intend to utilise them.

Best practice: Schools are encouraged to complete monthly monitoring for internal reporting to their Headteacher, Chair of governors and/or Chair of Resources Committee.

Please note: Where the local authority highlights a school facing financial challenge they may be required to provide more frequent submissions. This will be confirmed in writing to the school by the Education Finance team.

4. Capital Statement

In February each year, maintained schools are required to complete their capital close down and submit a statement outlining their use of capital funds. 

5. School Summary Outturn 

All maintained schools are required to submit a School Summary Outturn (SSO) to the Education Finance team in April each year.

The SSO, also known as an end of year financial report, shows ratified budgeted (planned income and expenditure) alongside the actual income and expenditure. The report includes both revenue and capital funds.

Explanations for any variances between the planned and actual figures should be provided and any impact on the school outlined. 

This information is used by the local authorities Section 251 return. 

Community facilities activity

Governing Bodies are required to maintain separate accounts for activities undertaken as community facility. A Community facility financial summary of these activities is required to be submitted to the local authority every 6 months.

Please note: Where the local authority has concern over the potential financial consequences of the community facility on the school, the school may be required to supply financial statements every 3 months. This will be confirmed in writing to the school by the Education Finance team. If returns suggest that the community facility is moving towards a deficit the Governing Body may be requested to submit a viable recovery plan to the local authority for agreement.

Last update: Friday 28th of February 2020 11:14:26 AM