MEADOW HIGH SCHOOL
The aim of this document is to outline the financial procedure and practices in place at Meadow School. It will clearly define the roles and responsibilities of the Governing Body, its committees, the Headteacher and other staff and the limits of delegated authority established. The school adopts the London Borough of Hillingdon’s Scheme for Financing Schools which includes Standing Orders and Financial Regulations.
2. ROLES AND RESPONSIBILITIES
The Scheme for Financing Schools is the key document which defines the extent of a governing body’s responsibilities. The Scheme identifies those areas where the responsibility which the Local Authority (LA) will retain and those areas where the responsibility has been delegated to governing bodies.
The overall responsibility of the financial management of the school rests with the Governing Body. The Governing Body of Meadow School has delegated all decisions relating to financial management and budgetary control to the Resources Committee.
2.1 Financial Responsibilities of Resources Committee
Financial responsibilities to be retained by the Governing Body (including those responsibilities delegated to a Resources Committee):
2.1.1 Overall responsibility for the financial management and budgetary control of the school.
2.1.2 Approval of the revenue budget as prepared and submitted by the Headteacher.
2.1.3 Regular review of the school’s expenditure against the budget based upon reports from the Headteacher, giving details of performance, especially with respect to variations on the budget plan resulting in under/over-spends.
2.1.4 Approval of proposals to exceed agreed limits of delegated authority.
2.1.5 Approval of funds to be spent on prescribed capital projects subject to the Council’s agreement and statutory regulations.
2.1.6 Approval of the disposal of obsolete or surplus items of equipment valued at more than £100, but not exceeding £5,000 (above which the approval of the Director of Finance is required.)
2.1.7 The opening and acceptance of tenders required to comply with the Council’s standing orders for contracts provided to or by the Governing Body.
2.1.8 Regular review of the school policies and procedures relating to finance.
2.1.9 To oversee the school’s private fund.
2.2 Financial responsibilities to be delegated to the Headteacher.
2.2.1 Day-to-day responsibility for the financial management and budgetary control of the school.
2.2.2 To ensure compliance with the Council’s standing orders and financial regulations.
2.2.3 To ensure that sound internal systems of control are in place to allow the proper processing of the school’s transactions.
2.2.4 Authority to vire amounts not exceeding £5,000 between budgets.
2.2.5 Authority to authorise individual orders of up to £9,999.
3.1 Budget Timetable
School provides pupil number and other statistical information to the LA
Draft budget allocation is received from LA
Headteacher to produce draft budget using the following:
- Cost of committed expenditure for the following year
- Potential cost of new or variable expenditure for the following year
- Level of resources available to the school for the following year
- Identifying areas for growth or contraction in the event of a change from the draft budget
Draft school budget presented to Resources Committee for full discussion and draft approval
Final school budget allocation received from LA
Final outturn figures for previous year confirmed by LA
Final version of school budget presented to Resources Committee and full Governing Body for approval and submittal to the LA
Final over/underspend figures for previous year confirmed by LA
Budget monitoring and review during the year will:
- Verify that any savings agreed by the Governing Body are being achieved
- Identify whether projects or commitments where the actual costs were not known at the time the budget was agreed, are being contained within the approved budget
- Identify any new service or budget pressures which may require supplementary budget approval
- Identify any areas of budget underspend which may increase the planned balances for the school
- Reviewing later in the year whether the unallocated resources earmarked at the beginning of the year have been required and whether they can be diverted to other priority projects from the school development plan.
The Finance Manager will provide regular reports to the Resources Committee as part of this budget monitoring process.
The Governing Body is responsible for approving the first formal budget plan of each financial year, regardless of the arrangements for delegations.
4. ORGANISATIONAL STRUCTURE AND INTERNAL CONTROL
The school is committed to developing a structure that achieves value for money. Day to day responsibility for internal financial control is delegated by the Governing Body to the Headteacher. The Finance Manager has a major responsibility for the processing of transactions at the school. In the absence of the Finance Manager, the Peripatetic Bursar (LA), or Finance Officer is available to deal with any urgent financial matters.
The school’ s Signatories Mandate sets out authorisation requirements for orders, payment of invoices, petty cash and lists those members of staff who can sign cheques. Every invoice must be authorised and each cheque must have two signatures.
Each order must be signed by the budget holder. The Headteacher or Deputy Headteacher will act as a secondary authorisation on each order. The budget holder receiving the goods is responsible for checking goods against delivery notes. Any discrepancies are reported to the Finance Manager to be followed up.
The Finance Manager checks any invoices against orders before raising a cheque on SIMS.
No person can sign an order, invoice or petty cash slip that authorises payment to themselves or immediate family (or in which they hold a pecuniary interest).
Only the Headteacher and the Finance Manager and Finance Officer have access to the computer accounting system (SIMS – FMS6). Each may have their own access codes and passwords known only to them. Copies are kept in a sealed envelope in the safe. The data is backed up twice daily on site, at 7.00am and lunchtime, plus overnight offsite, with a 30 day cycle. This ensures only half a day’s work can be lost. .All financial records are retained for 6 years in line with LA policy.
5. FINANCIAL LIMITS OF RESPONSIBILITES
The Resources committee has authority to vire sums in excess of £5000 between budget areas and any such action to be reported at the next meeting of the full Governing Body.
The Headteacher has authority to vire between budget areas any sum up to £5000 and any such action to be reported to Governors in the next financial analysis report.
6.1 Banking arrangements
The school banks with the Lloyds TSB bank. The LA transfers the school’s budget into the school’s account on a monthly basis.
Cheques must be signed by two authorised signatories. The school cannot go overdrawn. The school receives a monthly bank statement and this is reconciled by the Finance Manager with the accounting system.
6.2 LA returns
The school is required to submit to the LA monthly a cost centre summary. Quarterly returns include reports detailing income, expenditure and VAT together with copies of latest bank statements.
Year end accounts are produced as per LA guidance.
6.3 Purchasing & Expenditure
Meadow High School is committed to providing value for money. Staff will check prices in order to find the best value products (as stated in the schools financial regulations).
Approval by Headteacher:
- For purchases less than £3,000 – demonstrate best value
- For purchases between £3,000 and £9,999 - 2 written quotes required.
Approval by Governing Body:
- For purchases between £10,000 and £49,999 – minimum of 5 written quotes required.
- For purchases/contracts between £50,000 and £99,999 – minimum of 5 tenders must be obtained.
Approval of Governing Body and Local Authority:
- For purchases/contracts of £100,000 and above – minimum of 5 tenders must be obtained and Governing Bodies are required to obtain LA countersignature on contracts for these amounts.
- For purchases/contracts of £173,934 (€200,000) and above – OJEU notice – European tender
Tenders must be submitted in sealed envelopes by the set deadline time then opened in the presence of the Headteacher and a member of the Governing Body.
Order Generation - Budget holders have delegated money to use in their departmental areas. Orders are passed to the Finance Manager who checks that enough money is left in that budget and generates an order on SIMS.
This is authorised by the Finance Manager and then passed to the Headteacher or Deputy
Headteachers for final authorisation before the order is placed with the supplier.
Delivery of Goods - Goods are checked against delivery notes by the budget holder. Any shortfalls or errors are reported to the Finance Manager for referral to the supplier.
Payment of invoices - The Finance Manager will ensure that invoices are correct, have not been previously paid and that VAT is correctly accounted for.
Invoices are matched with orders, payment is generated on SIMS and then a cheque raised. All documentation is passed to the Headteacher for final approval and signature, then to the Deputy or in either’s absence to another cheque signatory The alternative cheque signatories are the Assistant Heads. The Finance Manager must not be made a cheque signatory. The invoice is authorised by the Headteacher or Deputy Headteacher.
Procurement Cards – Use of the Procurement Card is permitted subject to the London Borough of Hillingdon’s ‘Regulations and User Guidance’ which has been adopted. The limit per card is £2,000 per card holder per month and £500 per transaction.
Petty Cash - A petty cash float not exceeding £100 is kept in a locked box in the safe (Finance Manager has key) to enable the purchase of small items. Payment vouchers are produced by SIMS and the receipts are stapled to these. These vouchers are passed to the budget holder or the Headteacher for authorisation. Once authorised reimbursement is made to the staff member who must sign for receipt of the cash. The maximum amount on any one claim must not be in excess of £100.
The Finance Manager is responsible for checking the balance of petty cash at least once each month.
Meadow High School uses Dataplan Education as its payroll provider who has taken on the responsibility to determine the appropriate national insurance, superannuation and income tax deductions within this contract.
All submissions to payroll including supply timesheets and overtime returns must be authorised in accordance with the school’s delegation mandate.
Mileage and subsistence allowances (where there is an agreed fixed rate) are submitted to the payroll provider to ensure correct treatment for tax, superannuation and national insurance.
Cash takings such as trips money, lettings income and non uniform collections will be counted by a member of staff other than the Finance Manager and then immediately passed to the Finance Manager who will check and sign for the money.
The Finance Manager will record all income on SIMS FMS6 or the private fund accounting system. All income is retained in the school safe prior to banking.
The Finance Manager will issue an official school invoice for all goods, letting or services provided by the school in compliance with any VAT regulations which might apply. Copies will be retained on file in numerical order for inspection by HM Revenue & Customs.
The school will endeavour to receive all monies due from invoices raised. Once all attempts to recover monies have failed, the Governors are authorised to write off sums under £250. Write offs valued at over £250 must be referred to the Education Finance Officer.
6.6 Private Fund
The school’s voluntary fund is managed following good financial principles and practices. The Finance Manager acts as Treasurer and records all payments and income. An independent auditor must audit the fund annually and where necessary a copy of the certificate of audit is sent to the Charity Commission along with the commission’s own annual return.
Cheque signatories for the private fund are the same as for the school’s bank account.
6.7 Payments to individuals
All people employed by the school must go through the payroll system and appropriate statutory deductions will be made.
6.8 Security of Assets
6.8.1 The Headteacher has responsibility for the safe custody and control of cash and other property
6.8.2 Curriculum co-ordinators have responsibility for the maintenance of stock levels within their own subject areas
6.8.3 An annual inventory check of items valued with an original purchase price of over £200 should be carried out by the Finance Manager/Facilities Manager and any discrepancies reported to the Headteacher. Missing equipment must be reported to the Governing Body
6.8.4 A register is kept in the school office for staff to sign before removing school property from the premises
6.8.5 Governors have delegated authority to dispose of items valued at £5,000 or less which become obsolete or surplus to the school’s requirements. Items under £200 can be written off by the Headteacher. The approval of the Corporate Director of Finance & Resources is required for the disposal of items valued at more than £5,000
6.8.6 There are two keys to the school safe. They are kept secure in the school’s combination lock safe, for which only the Office Manager, Finance Officer and Headteacher know the combination. Cash held in the safe is kept to a minimum and should not exceed the maximum insured amount and there is regular banking of monies.
6.8.7 The school is fully alarmed throughout. The alarms are set each night by the Site Manager. The code is only known to the Site Manager, Facilities Manager, Cleaner in Charge the Headteacher and the Deputy Headteacher.
All invoices should be checked that they show the correct information to reclaim or charge VAT where appropriate.
A VAT submittal report should be produced on a quarterly basis with a supporting full report showing individual transactions. The Headteacher signs the submittal report which is sent to the LA and a copy is kept by the school.
The private fund is not registered for VAT.
Meadow High School buys into the LA’s insurance policies. This insurance covers most eventualities including claims for the premises, school property and school trips. Any loss or incidents that may give rise to a claim are immediately notified to the LA.
Disclaimers are displayed that the school cannot accept responsibility for the loss or damage to personal property. Lockers are available to staff for storage of personal property.
APPROVED BY GOVERNORS: __________________________________