For many schools, the conversion to academy status is a big step though much of the change is felt not by the pupils and teaching staff but by those working behind the scenes in the accounts department.
Completing the schools accounts for the first time after converting to academy status should not be underestimated and the advise from many educational organisations who have ‘been there and done that’ is that the first year is probably the time where professional expert advice is most helpful in tackling the complex accounting issues.
As with any new process, teething problems are inevitable, especially as a change in business practices for academies can be a world away from those encountered in a school, and they will be different again for those converting to Multi Academy Status (MAT).
Some of the problems converting schools may encounter include:
- Familiarisation with new terms and business processes
- Lack of support for those in financial roles
- Confusion over VAT registering implications
- Evaluating fixed assets on conversion
This is where getting the right advice could help the smooth transition to academy status during the first year and working with an experienced team of accountants from a firm which has experience in this specialist field can help academies avoid the common mistakes and navigate the new processes with the confidence that they are meeting all the regulatory requirements, and maybe even saving money too.
As academies are established as private limited companies, they need to comply with the Companies Act along with certain accounting requirements including preparing accounts which comply with the Charities’ Statement of Recommended Practice (SORP). This must then be audited by an external auditor and published.
At Nicklin, we can help converting schools to meet the challenges that converting to academy status brings, including help with managing budgets and advising on robust financial controls and procedures. For more information on how we can help, please contact us.