A central feature of the delegation of the control of school budgets to Governing Bodies is the ability to carry forward any underspend at the financial year-end into the next financial year. Schools are generally not permitted to budget for a deficit and the expectation is that deficits should not arise. However, other than in exceptional circumstances, where a deficit is incurred the full amount will be carried forward to the next financial year. Please see the ‘Guidance for Deficits under the Policy for Supporting good Financial Management in Buckinghamshire Schools’ . These Regulations explain the process and set out requirements.
6.1 Any (over)underspend at the year end shall be determined solely by reference to the central statutory accounting system.
6.2 Where a Governing Body underspends the school budget allocation for a financial year it shall retain and carry forward the total underspend into the next financial year.
6.3 Where a Governing Body overspends its budget allocation for a financial year a sum equal to the overspend will be rolled forward as a first call on its budget share for the next financial year.
6.4 Immediately a potential deficit becomes apparent, i.e. where planned expenditure is likely to exceed the combined total of the budget share, grants, other income and any accumulated balance, the Chairman of Governors and the Headteacher shall ensure that the Finance Team is informed. Where the likely deficit is of sufficient magnitude that it cannot be fully recovered within the following financial year, the governing body shall submit a plan setting out how, and over what period, the deficit is to be recovered, in accordance with the ‘Guidance for Deficits under the Policy for Supporting good Financial Management in Buckinghamshire’.