NEW PRINCIPALS’ TRAINING

1. NEW PRINCIPALS’ TRAINING Managing School Finances October 2007

2. Facilitators • Neil Craig • Lisa Cross • George Blackam • Suzanne Kerr

3. Learning outcomesBy the end of the course on financial management, new principals should: • Have a better appreciation of their roles and responsibilities in relation to financial management • To explain the budget setting environment including the LMS Common Formula and Centrally held budgets • Understand the necessity for financial planning and the timescales involved

4. Learning outcomes cont.. • Provide examples of how to complete 1year/3year plans and how to allocate the budget over different areas • Know where they can get support and further help • Feel confident about their knowledge of what is involved in financial management

5. ROLE OF LMS • to provide high quality financial planning and management information to meet the needs of School Principals and Boards of Governors of schools.

6. Role of the Governors • Plan and control use of resources • Contain expenditure within approved budget • Manage resources economically, effectively and efficiently • Establish proper financial controls • Financial management: planning, reviewing, forecasting and monitoring • AFFORDABILITY

7. Principal must • Keep all governors informed on a regular basis • Have finance on the agenda for each BoG meeting • Work closely with finance committee • Manage the responsibilities that have been delegated to them by the BoG

8. OBJECTIVE OF COMMON FUNDING FORMULA (CFF) “To ensure that schools with similar characteristics receive similar levels of funding regardless of the area or sector in which they are located.”

9. SCHOOL FUNDING

10. Sources of Funding Schools delegated budget is determined by LMS Common Formula Funding – DE MAIN DRIVERS • Pupils Nos • Premises Factor • Targeting Social Need • Small Schools Support • Teacher Salary Protection • Others £

11. AWPUs 2007-2008 (£1,885) Funding Per Capita • Nursery £3,359 • Primary £2,430 • Secondary £3,805 • Grammar £3,391

12. CONSULTATION Proposed Factor Changes Primary AWPU 1.03 Service Personnel 0.4

13. Closing Date for Submissions • Return to Board 30 October 2007 • Return to DE 12 November 2007

14. Sources of Funding cont Earmarked Funds Extended Schools Funding MAGS 1 AND MAGS 2 • Time Bound • Specific Project • Delegated Budget • Tracking expenditure £

15. Central Funding Board Funded Items • Teacher Substitution Costs • Special Educational Needs • Redundancy • Contingency Funding • Curriculum Reserve Fund • Rates • Other £

16. Central Funding cont External Funds • Drug Education Programme £

17. Capital Funding £ • Minor Works ( up to £300k) - Apply through Property Services - Priority Assessment, eg Health and Safety • Disability Access Funding • Virement from LMS Budget (>£15k)

18. 2008/9 FINANCIALPLANNING PROCESS OCTOBER SchoolForwards census information to DE via C2k and forwards paper copy to SEELB Funding for 2008-2009 financial year NOVEMBER LMS Send out Staffing List for2008-2009 School Reviews amends and returns JANUARY LMS Validation of Annual Census Data to DE FEBRUARY DE Run Common Formula Funding  Budget Share LMS FEBRUARY DE Run Common Formula Funding  Budget Share LMS Send out Budget Statement to schools Issue 1 Year Plan using figures confirmed by school for staffing complement plus an estimation of running costs Request three year plan School Review projected position Make Amendments, as appropriate Date for Redundancy April School completes one year plan and three year plan from website Sign, date and return to Board by required date MAY / JUNE LMS Final reports available on LMS website School Allocate expenditure on budget allocation form sign, date and return to LMS LMS Upload budget allocation onto Board financial system

19. FINANCIAL PLANNING • Two elements that need to be closely linked: • School Development Plan • School Financial Plan

20. Planning the Annual Budget One Year Plan • Total Resources Available 2007- 08 • Total Projected Spend for 2007-08 • Projected End Of Year Balance March 2008 • Amendments Made if appropriate • Signed by Chairman of BoG and returned • Agreed expenditure transferred to Budget Allocation Form • Budget Uploaded onto Financial System

21. 3 YEAR PLAN • Year 1 - As per Budget Allocation • 2 & 3 - Amend pupil nos. Increase/Decrease budget by rise/fall in pupils x per capita • Expenditure assumed constant • Amend additional expenditure/savings as appropriate • Review Outcome

22. DE WORKBOOK • Requirement from Department of Education • Surplus Deficit 5% or £75,000 of delegated budget (whichever is the lesser) • Re- assessment throughout the year by Department of Education • School Performance Review Group

23. Green Achieved within 5% or £75,000 whichever the lesser Yellow Substantially achieved (minor concerns) Amber Significant Concerns. Board addressing situation Red Unacceptable outside the limits. Action plan needs to be agreed with school 3 YEAR PLAN

24. Budget Monitoring • Reports issued monthly • Summary and Detail available • Available on Website • Access from home if desired • Review every month

25. REPORTS • Budget and Expenditure Report • Staffing Report • Detailed Transaction Report (M3) • Journal Adjustment Report (M4)

26. IN YEAR ADJUSTMENTS • deal with emergencies • change of plans • need to keep balanced budget

27. C2k/FMS SYSTEM • Used in Schools for - Raising orders - Entering invoices - Reconciliation to Board system • Can generate a range of reports that may supplement Board issued reports • Must be kept up to date and reconciled

28. NORTHERN IRELAND SUBSTITUTE TEACHER (NISTR) REGISTER • Centralised qualification and criminal record checks • Integrated TR140 timesheets  • Increased choice – access to regional database of substitute teachers • System matches cover requirements against teachers on register who are available on dates required • Teachers' calendars updated on confirmation of bookings • Provides information on previous work experience and expertise • No cost to schools - the register is being funded centrally

29. ACTIVITY ONE

30. ACTIVITY TWOPREPARING FOR BUDGET SETTINGWhat, Why, Where?

31. ACTIVITY THREE CASE STUDY

32. PLANNING FOR THE FUTURE

33. EXPECT THE UNEXPECTED • What is the future enrolment trend? • Has your school any outstanding commitments? • Are there any options available to reduce variable costs?

34. POINTS TO CONSIDER • Is there a strong link between the school development plan and the financial plan? • Are you familiar with your school’s budget setting and monitoring arrangements? • Do proper financial controls exist?

35. Learning outcomes • Have a better appreciation of their roles and responsibilities in relation to financial management • To explain the budget setting environment including the LMS Common Formula and Centrally held budgets • Understand the necessity for financial planning and the timescales involved

36. Learning outcomes cont.. • Provide practical examples of how to complete 1year/3year plans and how to allocate the budget over different areas • Know where they can get support and further help • Feel confident about their knowledge of what is involved in financial management

37. Sources of Information • Three Year Financial Plans • Budget Allocation Forms • Budget Statements • Outturn Statements www.seelb.org.uk • Monthly Financial Reports lms.nielb.com • Common Formula Funding Scheme www.deni.gov.uk • C2k/FMS Kathleen Dobbin 028 9027 9029

38. Open Forum • Questions • Evaluation • Close Questions