SCHOOLS FORUM

For: Information

Date of Meeting:	29 March 2017

Item: Reconciliation of 2015/16 Settlement Discrepancy and Impact on 2018

Purpose of the report:

To clarify the position in respect of the perceived discrepancy between the 2015/16 school budget allocation and the funding from the (Education Funding Agency) EFA.

Summary:

A review in preparation for the year end accounts 2016/17 created concern that there may be an over-allocation to schools in 2015/16 of £1,046k. This concern appeared to be validated through a notification from EFA that disagreed with a return submitted.

Given the imminent issuing of schools budgets for 2017/18, the issue was speedily raised with the Chairman of the Schools Forum, so that possible options could be explored in addressing the perceived over-allocation.

Simultaneously, a forensic analysis and reconciliation of the schools finances was undertaken, going back to 2014/15, to attain a comprehensive understanding of the financial position.

It was uncovered that the initially perceived over-allocation did not exist: £89.32m grant was allocated and paid by the EFA in 2015/16, and £89.32m was allocated to budgets. The source of the suspected over-allocation was a note in the Statement of Accounts (year ended 31 March 2016) that incorrectly indicated a total £90.37m schools budget allocated. Although the resulting DSG Schools Forum balance of £2.177m was correct, the note explaining the balance was erroneous. It is the balance figure (level of Reserves), not the note, that becomes a substantive part of the Council’s financial statements.

The erroneous figure of £90.37m was the figure initially notified to the EFA and was understandably rejected. They have subsequently been notified of the £89.32m, a figure we both now agree upon.

Recommendations

Schools Forum are asked to:

Note that there is no discrepancy with the 2015/16 budget allocation to schools and therefore no impact on subsequent budgets;

Note that future financial monitoring statements presented to the Schools Forum will include a reconciliation to the latest EFA funding notification for that year.

Graham Ebers

Director of Corporate Services

March 2017