The Academies Accounts Direction (the Direction) 2023 to 2024 has now been published. In addition to the Direction, updated versions of Academies Model Accounts 2023 to 2024 and the Auditor Framework and Guide have also been published.
The Direction outlines requirements for academy trusts preparing their annual report and financial statements for accounting periods ending on 31 August 2024. As the requirements in the Direction are mandatory, it is an essential reporting document for all those involved in the preparation of the annual report and financial statements.
Each year the Direction includes some changes, these can differ in substance from completely new obligations to the clarification of existing responsibilities. This year’s changes are minimal and are intended to provide further explanation or additional guidance on current requirements.
Here is an overview of the main changes to be aware of this year:
- A new ‘What an academy trust must do’ section – setting out the key requirements in relation to an academy trust’s accounts. This includes some of the essentials, but not all ‘musts’.
- Financial statements and other financial returns. Provides more clarity on the relationship between the financial statements and other financial returns, specifically in relation to the Academies Accounts Return (AAR). It highlights the fact that the AAR is used to produce the (consolidated) Sector Annual Report and Accounts, which report under a different account framework.
See paragraphs 1.4-1.5.
- References to the COVID-19 supplementary bulletin removed – COVID-19 grants have either stopped or become part of business-as-usual activity.
- Focus on the effectiveness of the system of internal control. The review of effectiveness must include a conclusion on whether the academy trust has an adequate and effective framework for governance, risk management and control, as well as a review of value for money.
See paragraphs 1.17 and 2.48.
- Updated ‘Feedback to the sector from ESFA’ section. This includes reference to the annual report ESFA publishes on the themes arising from its assurance work and the areas it has identified, which will help academy trusts improve compliance.
See paragraphs 1.20-1.23 and Annex A.
- Accounting Officer’s statement of regularity, propriety and compliance. The Accounting Officer must ensure that the academy trust is working within the boundaries of regularity and propriety, performed throughout the year as part of their oversight of internal control processes. The Direction highlights additional sources of information to inform the Accounting Officer’s statement.
See paragraph 2.57.
- 16-19 core education funding. The Direction confirms how 16-19 core education funding should be disclosed in the financial statements.
See paragraph 2.98.
- Staff costs note and other employee benefits. The staff costs note comprises total staff costs and employee benefits for all employees and should separately identify ‘other employee benefits’.
See paragraph 2.134.
- Determining an appropriate value (premises occupied under a long leasehold). Outlines how to determine an appropriate fair value for the initial recognition of premises occupied under a long leasehold.
See paragraph 3.27.
- Updated information to disclose for agency arrangements – this should include cumulative unspent fund balances.
See paragraph 3.132.
The complete Academies Accounts Direction 2023 to 2024 can be found here.
The updated Academies Model Accounts can be found here. Content changes to the model accounts have been highlighted in yellow.
We are here to support you in understanding the guidance within the Academies Accounts Direction and to ensure your compliance with all current requirements.
Should you have any queries regarding the requirements and specific guidance for preparing the annual report and financial statements, please get in touch with us using the details below.
