1. Excessive Surplus Balances

2. NEW RULES ON SURPLUSES Following consultation with and approval from the Schools Forum it was agreed that the level of schools balances would be reduced- a summary can be seen below. These limits will be reviewed during 2011/12 due to government regulations. Schools are only allowed an excess for one year, unless a capital build is involved. Existing ‘Allowed’ Excess Balance i.e. at 1 st April 2010 First Step phased Reduction i.e. ‘Allowed’ excess Balance at 1 st April 2011 Final step phased Reduction i.e. ‘Allowed’ excess Balance at 1 st April 2012 Primary/Special/Nursery 8%6.5%5% Secondary 5%3.5%2% De Minimis- All Schools £25,000£22,500£20,000

3. Summary of Revenue Surplus Balances over Limits 2008/09 Number (Actual) 2008/09 Amount (Actual) 2009/10 Number (Actual) 2009/10 Amount (Actual) 2009/10 Claw back 2010/11 Number (Requests) 2010/11 Amount (Requests) Primary19£255,74410£207,110£82317£498,448 Secondary5£1,074,4432£374,4358£1,303,884 Nursery2£37,46800£21,6572£18,884 Special1£45,689002£123,392 TOTAL27£1,398,62712£581,54529£1,944,608

4. Projected Balances from September 2010 3 yr plans 2009-10 Actual Balances 2010-112011-12 Primary£4,716,285£4,491,609£3,116,994 Secondary£2,503,897£2,443,974£1,094,996 Special£231,381£308,074£158,896 Nursery£109,990£137,594£119,707 Total£7,561,553£7,381,251£4,490,593

5. Excess Balances If approved then excessive c/f will be monitored in the next financial year. Helpful if schools inform us of when expenditure has been incurred

6. Schools in Financial Difficulty Examining the Reasons

7. Deficits at 31-3-10 School budget Share NumberRange £ Total £ Primary71,577- 32,128 80,490 Secondary427,620- 170,069 379,126 Special and nursery 000 Totals111,577- 170,069 459,616

8. Projected deficits from September 2010 3 year plans 2010/11 No 2010-11 Value 2011-12 No 2011-12 Value 2012-13 No 2012-13 Value Primary 4£71,54119£354,13451£1,670,638 Secondary 2£194,9503£326,8358£2,396,753 Special 00002£40,364 Nursery 00001£77,858 Total 6£266,49122£680,96962£4,185,613

9. Deficit Budgets If the school finds itself in a predicted deficit position, the Head and Governors must discuss what cause of action will be taken A deficit recovery plan must be submitted to the LA by 31 st May and 31 st December Notice of Concern If a school fails to comply with Scheme for Financing Schools or safeguard the financial position of LA or school.

10. Completing a deficit recovery plan Form on the schools intranet to complete Recovery over a maximum of 3 years Common problem is not enough financial information given to back up the recovery plan. Signed by Head and Chair of Governors New ‘budget adjustment scenario calculator’ spreadsheet devised to assist in the process.

11. Questions on Deficit Recovery Form Balances- these are the cumulative balances predicted at the year end- 3 year plan submitted Reason/s for going into deficit How do you intend to recover the deficit (details with costings) By what date will the deficit be recovered? Need copy of minutes showing Governors have discussed and approved this deficit Copy of CFR summary Form signed by Head and Chair of Governors

12. Deficit Approvals The Assistant Director of CFAS (John Wilson) will consider all applications The approval once given will be valid for the length of the recovery period as long as future submitted 3 year budget plans are in line with the recovery plan. If the deficit has increased from the anticipated position, then a further submission will need to be made and reasons given why the school is not on course.

13. Possible Factors Workforce reform and school structures Changes in Funding School meals Curriculum / class planning Challenging circumstances : attainment/ deprivation / SEN/ EAL Falling rolls and surplus places Poor financial management in school

14. Year End Balances and Considerations

15. Anticipating Year End Balances At the March / April 3 Year Plan Visit Schools Finance ask you for a predicted year end balance to build in to the 3 year plan Why? To give an indication of the cumulative balance at the end of the following year ie Can we afford to do all that we have planned??

16. Variance between estimated and actual carry forwards projected carry forward 2009-10 and April 2010 3 yr plan £0- £999 £1,000- £4,999 £5,000- £9,999 £10,000- £19,999 £20,000- £29,000 £30,000- £49,999 £50,000+ Primary585496100 Secondary 5233212 Special0111000 Nursery3000100 Totals66571310402

17. How Start with Reserves figure Look at budget remaining column Take into account –Any commitments / planned spend –Income/ funding not yet received

18. Year End Considerations Recharges complete? Examples include : School meals, Joint Projects Accruals Creditor – Goods received but not yet invoiced Debtor – Income due but not received NB.All of the above need to be taken into account when predicting your year end position

19. Governors Always be aware of your financial position A surplus balance over the allowed amount could be clawed back- consider how balances can be spent to raise attainment and support the pupils in school now. A deficit position will require intervention, and should be managed to reach a recovered position. (know the reason for a deficit ie falling pupils, over staffed, reduced funding, unexpected costs, loss of income, staffing issues.

20. Local Authority Support 3 year budget plans Budget monitoring reports Benchmarking information (Key indicators) New ‘pupil number funding’ spreadsheet New ‘budget adjustment scenario calculator’ spreadsheet Contingency funding – if applicable Joint visit by finance and SIP- if necessary Training provided to school staff and governors

21. Accountancy SLA 100% of the East Riding schools buy into the accountancy SLA Other financial services available at an extra charge ie individual GB training £158 2010-11