Academy Trust Handbook 2024 released

After a delay in release due to the recent election, the Education and Skills Funding Agency (ESFA) have now published the Academy Trust Handbook for 2024. 

In a letter to accounting officers on 31 July 2024, the ESFA explained that changes in this year’s edition have deliberately been limited to offer a period of greater stability. 

However, there are a number of areas of change to draw to your attention: 

• Finance Leases – approval requirements 

• Internal scrutiny – options clarified for larger trusts and qualifications for trustees and peer reviewers 

• Electric Vehicle Salary Sacrifice (EVSS) Schemes – clarifying the position around when trusts must approach the ESFA  

• Digital and technology standards – a reminder of importance and actions required for cyber security 

• Estates management – Extension of list of circumstances in which a notice to improve may be issued 

• Reserves policy – emphasis on a clear plan for managing reserves 

Finance Leases

From 1 September 2024 Trusts will be able to take out finance leases, without approaching the ESFA for prior approval, where the asset type they are leasing appears on the Department for Education’s (DfE’s) approved list. The ESFA have explained the importance for Trusts to have appropriate flexibility to manage spending decisions locally, and this new freedom should help Trusts manage their assets effectively 

Internal scrutiny

The ESFA are clear that Trusts must deliver internal scrutiny in the way that is most appropriate for their circumstances. 

The key change here is that Trusts with an annual revenue income over £50 million should (and from 1 September 2025 must) deliver internal scrutiny using any combination of the following:  

• an in-house internal auditor 
• a bought-in internal audit service

Additionally, the ESFA have clarified the qualifications and experience required by those carrying the programme of internal scrutiny: 

• auditors should be members of a relevant professional body 
• trustees and peer reviewers performing the work should have appropriate qualifications and/or experience relevant to the area being reviewed. 

Trusts should work towards this position where it is not already the case. 

Electric Vehicle Salary Sacrifice (EVSS) Schemes

From the 1 September 2024 Trusts must approach the ESFA to seek approval for the following transactions: 

• entering into a new electric vehicle salary sacrifice scheme 26 
• accepting any further employees onto an existing electric vehicle salary sacrifice scheme.

Trusts must contact ESFA early in the planning stage, both in relation to new schemes and accepting further employees onto existing schemes. 

Digital and technology standards

A reminder from the ESFA that Trusts should refer to the DfE’s digital and technology standards, which were developed to support trusts in making more informed decisions about technology 

Academy trusts must also be aware of the risk of cybercrime, put in place proportionate controls and take appropriate action where a cyber security incident has occurred. Trusts should take appropriate action to meet DfE’s cyber security standards, which were developed to help them improve their resilience against cyber-attacks. 

Estates Management

Where DfE or ESFA has concerns about financial management or governance in an academy trust, the department may issue, and publish, a Notice to Improve (NtI). 

This has now been expanded to include where trustees and the executive failing to manage their school estate and maintain it in a safe working condition strategically and effectively. 

Reserves policy

A further emphasis from the ESFA that the board of trustees must set a policy for holding reserves, and explain it in its annual report, including a clear plan for managing reserves. 

The ESFA have provided good practice guide for Academy Trust Reserves here. 

For further information regarding the Academy Trust Handbook, or to speak to a member of our team, please contact us today.