BOARD OF GOVERNORS’ TRAINING School Financial Management

1. BOARD OF GOVERNORS’ TRAININGSchool Financial Management January 2011

2. AIMS • Responsibilities - SELB - Principal - Board of Governors (BoG) • Activities - Financial Planning - Financial Monitoring Board of Governor Training – School Financial Management

3. SELB’S RESPONSIBILITIES • Allocation information • Generate monitoring reports • Budget Plan approval (1 year/3 year) • LMS Section – provide advice & support Board of Governor Training – School Financial Management

4. PRINCIPAL’S RESPONSIBILITIES • Day-to-day financial management (as delegated by BoG) • 3 year Budget Plan preparation (as delegated by BoG) • Regular updates to BoG/Finance Committee of BoG • Advice to BoG on Financial Aspects of School Development Plan (SDP) Board of Governor Training – School Financial Management

5. BOARD OF GOVERNORS’ RESPONSIBILITIES “Legal managers of the schools” NIAO LMS Report Feb 2004 • Decide level of delegation to principal • Approval of the Budget Plan • Monitoring spend against Plan • Financial implications of SDP Board of Governor Training – School Financial Management

6. FINANCIAL PLANNING • Allocation • CFF Common Formula Funding • Pupil numbers • AWPU • Declining enrolments • Initiatives Board of Governor Training – School Financial Management

7. FINANCIAL PLANNING • Budget Plan “reinforce the link between school development planning and … resources to achieve those plans” NIAO LMS Report Feb 2004 PAC Hearing on NIAO LMS Report Mar 2005 • LMS Advice and Support in preparation of:- • 3 Year Plan • Submission of signed BOG approved Budget Plan • No planned deficit without SELB approval • Criteria for approval: • SELB recurrent budget • Maximum 5% of school budget or £75k whichever is lesser • Maximum 3 year Recovery Plan Board of Governor Training – School Financial Management

8. Approval Criteria • 3 yr approval(3) – Third year target achieved –robust & deliverable • 1yr approval(1NR) no autumn review – surplus/deficit outside target with positive risk assessment • 1yr approval(1R) with autumn review – significant concerns • Recovery not demonstrated(RND) – outside target - scope for recovery in third year • No recovery Plan(NRP) – outside target and /or under schools estates review, no scope for recovery Board of Governor Training – School Financial Management

9. FINANCIAL PLANNING • Case Study • Aim – Equip Governors with knowledge to make decisions on school budget plans • Legal Managers of schools Board of Governor Training – School Financial Management

10. IF No Action TakenBP1/P 3 YEAR BUDGET PLAN 2010 - 2013 NAME OF SCHOOL: Green Street Primary Please complete and return to the LMS Unit by 14 May 2010 Enrolments Oct 09 : 87 Est Oct 10: 82 Est Oct 11: 73 2010/11 Est 2011/12 Est 2012/13 Teaching staff 4 4 4 £ £ £ Carry-over from previous year 10,000 4,100 (14,600) CFF Allocation 239,000 229,000 211,000 TOTAL AVAILABLE 249,000 233,100 196,400 Spend Teaching Staff 201,000 204,000 208,000 Substitution 2,900 2,700 2,400 Non-Teaching staff 27,000 27,000 27,000 Running Costs 14,000 14,000 14,000 TOTAL NET SPEND 244,900 247,700 251,400 Est Bal at 31 March 4,100 (14,600) (55,000) Est Bal as a % of Total Available 2% (6%) (28%) Board of Governor Training – School Financial Management

11. Action Taken 2ndYearBP1/P 3 YEAR BUDGET PLAN 2010-2013 NAME OF SCHOOL: Green Street Primary Please complete and return to the LMS Unit by 14 May 2010 Enrolments Oct 09 : 87 Est Oct 10 : 82 Est Oct 11 : 73 2010/11 Est 2011/12 Est 2012/13 Teaching staff 4 3 3 £ £ £ Carry-over from previous year 10,000 4,100 3,900 CFF Allocation 239,000 229,000 211,000 TOTAL AVAILABLE 249,000 233,100 214,900 Spend Teaching Staff 201,000 187,500 180,000 Substitution 2,900 2,700 2,400 Non-Teaching staff 27,000 27,000 27,000 Running Costs 14,000 12,000 12,000 TOTAL NET SPEND 244,900 229,200 221,400 Est Bal at 31 March 4,100 3,900 (6,500) Est Bal as a % of Total Available 2% 2% ( 3%) Board of Governor Training – School Financial Management

12. Action Taken 3rd YearBP1/P 3 YEAR BUDGET PLAN 2010-2013 NAME OF SCHOOL: Green Street Primary Please complete and return to the LMS Unit by 14 May 2010 Enrolments Oct 09 : 87 Est Oct 10 : 82 Est Oct 11 : 73 2010/11 Est 2011/12 Est 2012/13 Teaching staff 4 4 3 £ £ £ Carry-over from previous year 10,000 4,100 (14,600) CFF Allocation 239,000 229,000 211,000 TOTAL AVAILABLE 249,000 233,100 196,400 Spend Teaching Staff 201,000 204,000 190,500 Substitution 2,900 2,700 2,400 Non-Teaching staff 27,000 27,000 27,000 Running Costs 14,000 14,000 12,000 TOTAL NET SPEND 244,900 247,700 231,900 Est Bal at 31 March 4,100 (14,600) (35,500) Est Bal as a % of Total Available 2% (6%) (18%) Board of Governor Training – School Financial Management

13. Case Study Summary • Enrolment estimates • Timely decisions • Initiatives & assumptions Board of Governor Training – School Financial Management

14. FINANCIAL MONITORING • Recommendations:- • Standing agenda item • Formal review minimum quarterly/termly • Report Pack:- • Monthly reports from SELB • Budget & Expenditure • Staffing Costs • Detailed Transaction Report • EB1 or Autumn Review Board of Governor Training – School Financial Management

15. Key Questions at next Board of Governors Meeting • Current approval category eg 3,1R,1NR,RND,NRP • Mar 10 end position deficit or surplus • Current Budget & Expenditure Report i.e. Balance Available • Estimate Mar 11 end position • Enrolment trend • Future commitment of additional resources in School Development Plan Board of Governor Training – School Financial Management

16. “It is important that Board of Governors act as ‘Critical Friends’, ie asking challenging questions.” NIAO LMS Report Feb 2004 PAC Hearing on NIAO LMS Report Mar 2005 Board of Governor Training – School Financial Management