Academies & Multi Academy Trusts (MATs)
At Haslers
We work with academies and Multi Academy Trusts (MATs) across Essex and North East London
Academies have much greater control over their budgets and the way they operate than traditional state schools but independence from local authority control brings with it new challenges and responsibilities. Freedom from Local Authority control means that academies have many more decisions to make so it helps to have advisers who have seen it all before to guide you through the process and make it as straightforward as possible.
As specialist academy accountants, we provide a full-service offering non-audit and audit support services pre-conversion and post conversion. We recognise that academies have very specific accountancy, audit, tax and advisory needs, starting from a point long before their transition to academy status. We are highly experienced in helping schools with their finance and governance issues.
We have close relationships with our education clients, which mean we remain close to the issues they are facing. In addition to a termly Newsletter bespoke to the sector, we hold termly seminars with our education clients and contacts to discuss the issues that are being experienced in the sector and find solutions for them through the advice and support that we give.
Moving to academy status or establishing a free school is a major decision, with long-term implications, so it requires thorough research and careful assessment before the decision is made to go ahead.
When schools are considering moving to academy status, an essential step is to explore in detail all aspects of their financial position, systems and controls and to assess how the impact on these issues from conversion.
As well as demonstrating that there is a genuine need for their school in the community, teams behind new free schools must also have in place robust financial plans and financial controls, enabling them to make effective use of funding and ensure that the school will be viable and well managed when it opens.
Haslers’ education experts can provide independent, objective advice to ensure those responsible for academy conversions or establishing free schools are able to make informed decisions about the way forward.
We also provide a range of services designed to enhance the school’s capacity to make a successful transition to academy status or start life as a free school in the strongest position.
Our Services Include...
- advice on and assistance with reporting and returns to the ESFA
- establishing the financial position of a school prior to conversion, including valuation of land and buildings on transfer and the position of pension schemes
- advising on monitoring cash flow, budgeting and financial projections
- advising on governance policies and processes relating to reserves, internal controls, risk management, investment and accounting
To find out more about Haslers’ East London and Essex-based accountancy and tax services for academies, free schools and independent schools, please contact us.
- advising on the roles and responsibilities of governors, finance committees and audit committees
- advice on accounting system compliant with the Charities Statement of Recommended Practice (SORP) and the Companies Act or improvements to strengthen and improve existing systems
- advice on VAT issues, including registration and reclaiming VAT
- advice on corporation tax issues arising from commercial and community activities
- audits and year-end accounts
- Accounting for Academies workshops and other financial training
- HR compliance advice
As academies and free schools become established, their in-house teams become more experienced in their roles.
As a result, they may find they need professional advisers who can provide more specialist or higher level services than those they appointed at the start of their academy or free school journey.
As commercially minded organisations that control substantial budgets, academies and free schools also look to gain maximum value from their funding, in order to focus resources on their key objective of achieving educational excellence.
At Haslers accountants in East London and Essex, we recognise that academies and free schools have specific accountancy, audit and business advisory needs and have developed a suite of cost-effective services tailored to their needs.
Our education specialists will tailor their advice to your specific needs, providing as much or as little support as you require.
Our Services Include...
- advice on and assistance with reporting and returns to the ESFA
- preparing annual accounts compliant with the Charities SORP and the Companies Act
- auditing financial year end statements
- advice on and design of accounting packages and financial controls
- advice on accounting software
To find out more about Haslers’ East London and Essex-based accountancy and tax services for academies, free schools and independent schools, please contact us.
- preparing and interpreting management accounts
- assisting with budgeting and financial forecasting
- treasury management
- advice on VAT issues, including registration and reclaiming VAT
- corporation tax issues arising from commercial and community activities
- company secretarial services
- guidance and support for governors
- responsible officer
- Accounting for Academies workshops and other financial training
- HR advice
The advantages of academy or free school status include direct government funding and in-house control of finances.
While academies and free schools enjoy greater financial freedoms, robust budgeting and financial management are crucial to their ongoing operational success.
Budgeting goes far beyond knowing how much money is available, allocating funds and keeping track of expenditure.
Academies and free schools also need to look at a much bigger picture that takes into account short, medium and long-term goals and objectives as well as ongoing costs and commitments. By working in this way, academies and free schools can put in place sustainable, profiled budgets and financial plans designed to achieve their desired outcomes.
At Haslers, our education team will work with you to explore in detail your likely income and expenditure and draw up budgets to match resource allocation to your academy or free school’s priorities and development plan, working within realistic parameters.
Our Services Include...
- Budget planning, preparation and profiling
- Reporting against budgets
- Cash flow forecasting
To find out more about Haslers’ East London and Essex-based accountancy and tax services for academies, free schools and independent schools, please contact us.
- Preparation and interpretation of monthly or quarterly management accounts
- Recommendations for suitable or more effective accounting software to support budget planning and monitoring
- Advice on improving existing financial systems and controls and implementing chances
- VAT and taxation advice
All Academy Trusts are required to establish an ongoing programme of internal scrutiny work to ensure systems and processes are operating as laid down.
In 2020, the ESFA changed its rules and audit firms are no longer permitted to provide both external audit and internal audit services for a Trust. This has re-inforced the importance that the ESFA places on the Internal Scrutiny function.
At Haslers, we have years of experience in working with Academy Trusts. We are well placed to provide guidance to the Trust Board in evaluating its systems, both financial and non-financial, identifying the key risks to the organisation and from there establishing the areas to be focused on.
We will work with you to establish a rolling programme of work and report our findings and recommendations to you.
Academies and free schools are not liable to corporation tax but trading activities carried out to generate extra income could, in some circumstances, create a corporation tax liability.
While opportunities for exemptions exist, academies and free schools with a trading income that is regularly close to, or exceeds, an HM Revenue & Customs limit of £50,000 a year may want to consider using a subsidiary trading company.
The income and profits of a subsidiary trading company would be taxable in the same way as the income and profits of any ordinary limited company, and it would also be treated as a normal business for VAT purposes.
But the subsidiary trading company can give all or part of its profits to its parent academy or free school and claim tax relief for those payments, which means it does not have to pay corporation tax on the profits it donates.
In this complex area, Haslers can provide expert advice to ensure that academies and free schools structure their trading activities in the most corporation tax-efficient way.
To find out more about Haslers’ East London and Essex-based accountancy and tax services for academies, free schools and independent schools, please contact us.
Academies and free schools will inevitably have to pay VAT on some costs involved in their educational activities so they will want to reclaim the VAT involved in a way that maximises recovery whilst minimising paperwork and administration.
Efficient VAT recovery is essential, to avoid a 20 per cent dent in cash flow or, even worse, a 20 per cent dent in their budget.
Once turnover reaches £85,000 (currently), the academy or free school has no choice about VAT registration, as it then becomes compulsory. However, the majority of academies or free schools will choose either to register voluntarily with HM Revenue & Customs (HMRC) or use a system known as the section 33B, or s33B, refund scheme, which enables them to reclaim their non-business VAT costs, even though their own VAT-liable supplies may be minimal.
Those that choose not to be VAT-registered can reclaim input VAT (VAT paid out) where it relates specifically to the provision of non‐business education, using HM Revenue & Customs’ form VAT126. However, they cannot reclaim input VAT relating to business activities.
As “business” has a very wide meaning for VAT purposes, academies and free schools will need to be very careful in deciding what their business and non-business activities are.
Each option has its advantages and disadvantages, both in financial and administrative terms, and each organisation will need to carefully consider which will be the most appropriate approach.
Haslers has a particular specialism in VAT and our experts will use their knowledge and experience to assist academies and free school in deciding the best way forward, then help implement the chosen approach.
We can carry out VAT accounting on your behalf or give you the tools you need for your own VAT reporting, providing ongoing assistance and advice as queries or issues arise. We can also advise on VAT issues arising from specific projects or transactions, to maximise tax efficiency and avoid potential pitfalls.
To find out more about Haslers’ Essex-based accountancy and tax services for academies, free schools and independent schools, please contact us.