Academies Finance Handbook 2012


We outline the key changes of the new academies financial handbook, released by the Education Funding Agency (EFA) on the 21 September 2012, which replaces the previous 2006 version. The handbook is much shorter than original, but the requirements around financial control have not reduced, they have increased in many areas.

Audit work

The EFA’s expectations are that:

  • all Academy Trusts (ATs),  that are a multi-academy federation, must have a dedicated audit committee
  • ATs with an income of over £10m or capitalised asset value of over £30 million should consider having a dedicated audit committee and
  • other ATs may have a dedicated audit committee.

The relevant committee must review the risks to internal financial control. Options of  managing this programme of risk review may include:

  • The work of an internal audit service
  • Supplementary programme of work by the AT’s external auditors.
  • The work of a responsible officer (ie an individual who is a non-employed governor with an appropriate level of qualifications and/or experience), and who neither charges nor is paid by the AT for their work
  • Completing the work by peer review (ie the work being performed by the PFO, or a suitably qualified or experienced member of the finance team, from another AT, as an “independent reviewer”).

General Annual Grant Limits

These limits have now being removed. However where an AT has clauses in its funding agreement limiting the amount of carry forward the provisions in that funding agreement will prevail until such time as those clauses are amended by agreement between the parties to reflect the new arrangements

Accounting Officer Statement


An accounting officer’s statement on governance, regularity, propriety and compliance must be included in the AT’s annual report.

Financial Management and Governance Evaluation

This form will no longer be required by those academies who have completed timely, audited unqualified annual accounts. New ATs that will not be producing financial statements will be asked to complete a revised, shorter, FMGE for their first year only or to agree an alternative method of providing assurance for this interim period.

Delegated Authority

The handbook also provides limits on delegated authority over different categories of financial transaction including;

  • Liabilities and Write Offs
  • Staff severance and compensation payments
  • Asset sales and tenancy agreements
  • Novel and contentious payments
  • Leases

Download the Academies Financial Handbook and read the handbook frequently asked questions