The school accounts maintained by the Head of Finance on the central accounting system form part of the statutory accounts of the County Council. As such they must be prepared in accordance with statutory requirements. In addition to these central accounts all schools operating under the Funding Scheme maintain local accounting systems, approved by the Head of Finance, for the purpose of financial administration such as order generation, commitment accounting, the provision of management information and, in some cases, the operation of local bank accounts. These Regulations seek to ensure that the statutory accounts are prepared on a consistent basis in line with statutory requirements, including those relating to accounting for VAT, Income Tax, and meet the requirements of CFR.
5.1 Schools’ local accounting systems shall be operated in accordance with guidelines and instructions issued from time to time by the Head of Finance.
5.2 Any changes to the existing financial systems or the implementation of new systems must be approved by the Head of Finance prior to any new developments or changes.
5.3 Schools are required to assist the Head of Finance in maintaining the County Council's statutory accounts and monitoring systems by supplying such information as they require and ensuring that the information transferred from the school's local accounting system for input to the central accounting system is accurate.
5.4 The accounts maintained by the Head of Finance are the County Council's statutory accounts and the amount of a school's expenditure and income for a financial year shall be determined solely by reference to these statutory accounts. Details of expenditure and income processed through the school's local accounting system shall be forwarded to the Finance Team on a monthly basis in the manner prescribed. Payments made and income received through the central system shall be forwarded to each school, where the responsibility for the monthly reconciliation of the two sets of data lies.
5.5 Schools must comply with the VAT Regulations detailed under section 20 of the VAT Act 1983 and subsequent amendments. Detailed guidance on the application of the VAT regulations at schools is published on the SchoolsWeb in the 'Value Added Tax Guide' issued by the Head of Finance. General responsibilities concerning accounting for VAT are set out in the accompanying financial instructions.
5.6 Except where the written permission of the Secretary of State has been obtained, Governing Bodies must not make arrangements for overdrafts, loans or other forms of credit or deferred purchase, nor offer any security to a bank or other financial institution. The Authority has no legal power to act as guarantor to loans taken out by Governing Bodies. Trustees and Foundations, may, however, borrow as private bodies.
5.7 Unless otherwise stated in the Funding Scheme, investments of surplus monies on local bank accounts must only be made with those banks and building societies included on the authorised list prepared and maintained by the Head of Finance, from whom a copy is available on request.
5.8 Governing Bodies are responsible for ensuring that safe and efficient arrangements are in place for controlling the operation of the local bank account and that the Notes for Guidance on the operation of School Bank Accounts, issued by the Head of Finance, are complied with.