Academies: Finance

(asked on 25th April 2018) - View Source

Question to the Department for Education:

To ask the Secretary of State for Education, with reference to the the Academies Financial Handbook, how many contentious connected party transactions were referred to the Education and Skills Funding Agency in each year since that requirement was introduced.


Answered by
Nadhim Zahawi Portrait
Nadhim Zahawi
This question was answered on 30th April 2018

The primary responsibility for the oversight of trusts rests with the trustees themselves, supported by clear financial management and governance requirements set by the Education and Skills Funding Agency (ESFA) in the Academies Financial Handbook. Section 3.3 of the Academies Financial Handbook states that, “Novel, contentious and/or repercussive transactions must always be referred to ESFA for explicit prior authorisation.”

The information requested is contained within individual case files and not in a centrally recorded format.

The Public Accounts Committee report on academy finances, published 30 March 2018, recommended that “To prevent abuse, the department should tighten the rules in the next version of the Academies Financial Handbook, expected in July 2018, to prevent academies from entering into related party transactions without approval from ESFA.” The government is currently considering the recommendation and will formally respond to the report in late May.

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