ST PETER’S CATHOLIC HIGH SCHOOL
& SIXTH FORM CENTRE
Finance Policy
May 2011
Contents
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Section 1: |
Budgets |
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Section 2: |
Payroll |
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2.2 Time sheets |
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2.5 Supply teachers |
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Section 3: |
School Fund |
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3.1 Accounts |
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3.2 Signatories |
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Section 4: |
Assets |
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4.1 Inventory |
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Section 5: |
Income |
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5.1 Credit income |
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5.2 Cash income |
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5.3 Banking |
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5.4 Charging policy |
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5.5 Donations |
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Section 6: |
Purchasing |
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6.1 Ordering |
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6.4 Receipt of goods |
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6.6 Petty cash |
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6.7 Credit Card |
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Section 7: |
Register of Interests |
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Section 1: Budgets
1.1 Budget construction
The Head is responsible, with the Business Manager, for the detailed preparation of the annual budget. In doing this they will consult with other members of staff to ascertain detailed requirements.
The Finance Committee will determine the overall sum within which the budget must be set, and the amount of any anticipated balance to be carried forward into the following financial year.
In constructing the budget, the Head and Business Manager must take account of priorities identified in the School Improvement Plan and incorporate the costs of these in the budget. Priorities identified in the School Improvement Plan must always be costed.
The budget total must not exceed the amount of the LA allocation plus or minus any balance brought forward from the previous year. If it appears that this cannot be achieved, the Head and Chair of Governors must inform the Schools’ Finance Team immediately this becomes apparent.
The Finance Committee must meet in the Autumn term to consider a broad budget strategy, and again in the Spring term to consider and approve the detailed budget. The full Governing Body must subsequently approve the full budget, and minute this approval. The approved Governors Budget Plan Template must then be submitted to the Schools’ Finance Team, along with a signed statement by the Chair of Governors in accordance with the timeline required by Schools Finance.
In constructing the detailed budget, factors the Head and Business Manager must take account of include:-
· changes in pupil numbers
· changes in overall and specific funding
· flexibility of use or ring-fencing of funding
· current and previous year's expenditure levels at individual budget heading levels
· School Improvement Plan priorities
· staff pay awards and increments
· anticipated price inflation
· changes in the staffing complement
· changes in the supply of services (gas, electricity, water etc.).
· requirements for school specialisms
· facility development and ICT resources
1.2 Budgetary control and monitoring
The Head and Business Manager are responsible for regular, detailed control of the school budget. To achieve this they will analyse monthly reports from the school's accounting system. Such reports shall show, for each budget heading:-
· total budget for year
· total commitment and expenditure to date
· variances
The Head and Business Manager are empowered to take remedial action to address variances, by effecting virements between individual budget headings. Individual virements may be authorised as follows:-
· up to £20,000 - Business Manager
· 20,000 to 50,000 - Head
· Over £50,000 - Finance & Premises Committee
All virements, once approved, must be promptly recorded in the school's accounting system to keep the approved budget up to date.
The Head and Business Manager will present detailed budget monitoring statements to the Finance and Premises Committee each financial quarter, such statements shall show for each budget heading:-
· total budget for year
· total commitment and expenditure to date
· variances
The Finance and Premises Committee shall consider such statements; the Business Manager will provide explanations for any significant variances identified. The Chair of the Finance Committee, supported by the Head and Business Manager, shall report termly to the full Governing Body, identifying any significant budgetary issues and any remedial action taken or needed, and any policy decisions needed.
The Head may assign budgetary control of individual budget headings to other members of staff (e.g. Deputy and Assistant Heads, Business Manager and Heads of Department). Such members of staff must control their own budget area, control equipment and stock, receive regular budget statements and submit an annual report and funding request for the department based on perceived need and prioritisation of objectives based on the departmental improvement plan. The Head remains ultimately accountable to the Governing Body for all budget headings.
All staff must contribute to best value and the efficient running of the school by maximising efficiency and minimising waste (e.g. heating, lighting, telephones).
All staff should ensure that all school facilities, equipment and resources are taken good care of.
Teachers should ensure that students are properly prepared for all exams and qualifications for which they have been entered.
Payroll expenditure data notified by Payroll Services must be entered promptly each month by the Business Manager on to the school's accounting system.
Other, non-pay, expenditure notified by Shire Hall must be reconciled promptly on a monthly basis to the school's accounting system by the school finance team.
When the accounts for each financial year are closed, a final statement from the school's accounting system must be presented to the next meeting of the Finance Committee.
A Statement of Internal Control must be prepared, reviewed and approved by the Head, Chair of Governors and Chair of Finance Committee each year, as soon as practicable after the end of the financial year.
The FMSiS (Financial Management System in Schools) framework must be adhered to.
Back to contents
Section 2: Payroll
A list of authorised payroll signatories must be maintained by the Business Manager. This includes the Head, Chair of Governors, Deputy Head and Business Manager
2.1 Starters/variations/leavers
All forms for:-
· setting up new employees and new contracts on the payroll
· effecting variations to pay
· taking existing employees off the payroll
must be made out by the HR Manager and authorised (signed) by the Business Manager, or in his absence the Head. The forms must then be sent directly and promptly to Payroll Services.
2.2 Time sheets
All time sheets submitted by a member of staff must be checked initially by the HR Manager, and then authorised (signed) by the Business Manager, or in his absence, the Head. Authorised time sheets must be sent directly to Payroll Services, and never handed back to the employee.
2.3 Checking of payroll data
Payroll data received monthly from Shire Hall must be scrutinised by the Business Manager, in conjunction with the HR Manager, to ensure all employees are recognised, pay appears reasonable and for the accuracy of pay calculations.
2.4 Pay-related expenses
All pay-related expenses must be processed through the payroll system. Pay-related expenses must never be paid via petty cash, or by the creditor payment system. If any doubt exists about whether an item should be processed via the payroll system, the Creditor Control section in Shire Hall must be contacted for advice.
2.5 Supply teachers
The Governing Body will decide, on the basis of advice from the Head and Business Manager, whether supply teacher insurance cover shall be taken out, and the extent of the cover. All claims submitted by supply teachers must be authorised (signed) by the Business Manager, or in his absence, the Head. Reimbursement claims must be submitted on a monthly basis by the HR Manager. The Business Manager in conjunction with the HR Manager must check on a monthly basis that correct amounts have been charged as per the payroll summary data.
Section 3: School Fund
3.1 Accounts
The accounts of the School Fund are to be maintained on a day to day basis by the school Finance Officer. All income and expenditure will be entered promptly in the accounts. A Bank reconciliation will be performed monthly when bank statements are received, between the balance as per the accounting record and the balance as per bank statements.
3.2 Signatories
The following are authorised to sign cheques on the bank accounts:-
- Head
- Deputy Head
- Business Manager
- Assistant Heads (2)
There must be two signatures on each cheque.
3.3 Final accounts and audit
Final accounts are prepared at the end of the School Fund financial year by the school Finance Officer and reviewed with the Business Manager. The accounts will be audited by an auditor appointed by the full Governing Body. The auditor will not be a member of the Governing Body. In appointing an auditor and operating the Fund, the Governors will follow the instructions laid down in the County Council's Manual on Unofficial Funds.
The audited accounts should be presented to the full Governing Body as soon as possible for approval. Governors' approval must be recorded in the minutes of the meeting. Once approved, the Clerk to the Governing Body will return the requested form (FN12) to Shire Hall.
School Fund monies must be kept, and recorded, separately from the school's capitation monies and securely held.
Section 4: Assets
4.1 Inventory
The portable, desirable, attractive assets of the school, as well as any assets of intrinsic value (e.g. antiques) will be recorded in the school's inventory. Full details (make, model, serial number, approximate value) shall be recorded, subject to a minimum value for an individual item of £500.
The Business Manager has overall responsibility for keeping the inventory up to date; each department head is responsible for keeping their individual department’s inventory up to date by adding new items when they are received into school.
All inventory items should be security marked by a suitable permanent security marking system e.g. smart water, ultra violet pen, bar coding, warning stickers.
Items up to a value of £500 may be sold or written out of the inventory on the authority of the Business Manager or Head. Over this limit, the Governing Body must authorise and details recorded in the minutes. Reasons must be recorded in the inventory, together with the Head’s or Business Manager's signature (items up to £500) or the Governors' minute reference (£500 and over). An official receipt for sales income must be issued to the purchaser. VAT must be charged when required.
Inventories shall cover all areas of the school, and be arranged on a room-by-room basis. A separate inventory will be maintained to include items which are not allocated to a specific room.
The inventory shall be checked against the actual assets by the Business Manager on an annual basis. Any discrepancies shall be investigated immediately, and if necessary the Governors, Police and the authority's auditors shall be informed. The check shall be evidenced by the checker signing and dating the inventory.
4.2 Off-site register
Any inventory items taken off-site by members of staff for official purposes must be recorded in a register. The date borrowed, and the signature of the borrower, must be recorded. On the return of the item the date of return will be recorded.
Section 5: Income
5.1 Credit income
(Where payment for goods/services provided by the school is made after the provision takes place).
An official invoice must be raised by the Business Manager, or other person under the direction of the Business Manager, in all cases and sent to the debtor as soon as possible after the provision of the goods/service, and no later than one month after the provision.
A file of copy invoices will be maintained by the Finance Team; this will be arranged into 'paid' and 'unpaid' invoices. The copies of unpaid invoices will act as a control record for the sending of reminders and the chasing of unpaid debts.
Reminders will be sent after the following periods if the debt remains outstanding:-
1st reminder 28 days after the due date
2nd reminder 56 days after the due date
If after 84 days the debt remains unpaid, consideration will be given by the Business Manager, Head and/or Governors to writing the debt off in accordance with the following limits:-
- up to £200 - Head or Business Manager may authorise write-off
- up to £500 - Chair of Governors may authorise write-off
- over £500 - Finance Committee may authorise write-off.
In each case, the possibility of taking legal action to recover the debt must be considered by Business Manager, Head, Chair, and Governors as appropriate.
As well as sending formal reminders, efforts must be made by the school to contact the debtor in order to secure recovery of the debt. If payment has not been received after 28 days of the due date, no further goods or services must be provided until the outstanding debt is settled.
When an invoice is paid, details of the payment must be written on the copy invoice. Receipts can be issued to debtors on request, the receipt number is to be written on the copy invoice and a duplicate copy of the receipt must be retained at school.
5.2 Cash income (i.e. where payment is received at the time goods/services are provided).
Detailed records must be maintained for all cash income. An official receipt may be issued to the payer on request at the time the payment takes place, and a duplicate copy retained at the school.
5.3 Banking
All income received (cash or cheque) must be banked promptly and intact. No payments may be made out of income collected. A record to evidence the banking must be kept (e.g. stamped paying-in slip).
5.4 Charging policy
The full Governing Body will set a charging policy to cover:-
- lettings
- school visits
- music tuition
- private photocopying
- private telephone calls
- school visits (which will be costed by the teacher organiser, who will also take into account any students in financial difficulty)
The charging policy will be reviewed annually by the Governing Body. Charges levied by the school will be in line with this policy.
5.5 Donations
Donations from any sources must be acknowledged by the issue of an official receipt to the payer. All donations must be banked promptly and intact.
5.6 Official Capitation and School Fund income
All income used to offset expenditure incurred on the capitation budget (e.g. lettings, photocopying, telephone calls, music tuition, sales of work) must be paid into the School main bank account and coded to an appropriate income code. Monies received from any sales of school equipment must similarly be paid into the school main bank account.
Donations may be paid into the School main bank account or the School Fund dependent upon the wishes of the donor which must be ascertained beforehand.
5.7 Cash received from pupils
Cash received from pupils in class or reception must be fully and accurately recorded. Cash collected must be handed over to the Finance Office frequently. An official receipt for the income will be generated and retained with the income record.
5.8 Security of receipt books and tickets
All unused receipts and tickets to be used to acknowledge receipt of income, must be held securely in the school finance office.
Section 6: Purchasing
6.1 Ordering
School procedures for purchasing should ensure that purchases are as required and are only for valid school purposes.
The schools Best Value Statement details the principles and procedures which apply to the purchase of all goods are services for the school and must be followed at all times.
Orders must be approved by the appropriate budget holder. The orders should then be processed by the finance office team. The official order produced from the computer system must be signed by the Business Manager before it is sent to the supplier. If an order has been placed over the telephone an official confirmatory order must be sent as soon as possible afterwards.
The IT Manager must always be consulted before ordering any computer equipment.
Official orders must not be used to procure goods for private purposes.
Official order stationery must be held in a secure location.
Copies of all official orders placed must be retained on file at the school by the finance office team.
When placing orders it is the responsibility of the initiator to ensure that Gloucestershire County Council Financial Regulations and Standing Orders are adhered to, these being -
6.2 Quotations/tenders
Financial Regulations - for orders for goods/services under £50,000:
· £1,000 - £5,000 - at least three prices to be examined and retained, these prices may be taken from suppliers' written or verbal quotations or catalogues/price lists.
· £5,001 - £50,000 - independent written evidence of at least three prices must be obtained and retained.
Independent written evidence means quotations provided on suppliers' headed notepaper.
Standing Orders - for orders for goods/services over £50,000.
Tenders must be invited in accordance with specific Standing Orders.
· from at least three appropriate contractors, or
· by open competition by advertisement in local newspaper or appropriate journal.
Standing Orders for contracts over £140,000
In the event that the school wishes to place a contract worth over £140,000 (for the lifetime value – not just a single year). The purchasing rules are complicated and the Finance / Premises committee and Business Manager should review the purchase in accordance with the GCC standing orders.
6.3 Governor involvement
DELEGATED RESPONSIBILITY Governors delegate the responsibility for adherence to the above requirements to the Head and Business Manager.
As well as ensuring that the above requirements have been adhered to, it is the responsibility of the Head and Business Manager to ensure that Governors are consulted in the following circumstances:-
- Review of quotations obtained where estimated costs exceed £50,000.
- Review of quotations when the lowest quote is not the most suitable or when the pre-requisite number of quotes could not be obtained. In such circumstances the Governors should formally authorise a waiver of the regulations, either prior to the purchase or retrospectively, if necessary.
6.4 Receipt of goods
Once items ordered have been received, the Budget Holder must ensure that items delivered, correspond to details contained in the delivery note. Upon examination of goods the Budget Holder must also ensure that both quality and quantity are appropriate.
6.5 Invoice check and authorisation
Invoices received must be checked to both copy orders and delivery notes to ensure that invoices relate to goods ordered and delivered. Invoices should also be checked for arithmetical correctness. All invoices must be certified for payment by the Budget Holder before being passed for payment (or the Head in the Budget Holder’s absence).
Invoices passed for payment must be recorded promptly in the school's accounting system by the finance officer.
6.6 Petty Cash
Day to day operation of the petty cash account is the responsibility of the finance officer.
All petty cash expenditure, and reimbursement income, must be promptly recorded in the petty cash record.
Each time a reimbursement claim is submitted, the finance officer must complete a reconciliation ensuring that cash expended, plus cash in hand or at bank, equals the amount of the advance.
All members of staff who wish to purchase goods or services from the petty cash account must present vouchers (receipts, paid invoices etc.) to the Finance Officer when reclaiming cash from the account. These vouchers must be retained by the Finance Officer and returned with the reimbursement claim.
In normal circumstances individual purchases from petty cash must not exceed £50. Amounts above this sum, up to a maximum of £250, should only be in exceptional circumstances and with prior approval of the Business Manger. Such payments should be for emergencies only and should not simply result from a lack of planning.
All cash and cheque books held must be retained securely.
6.7 Credit Card
Governors have authorised the use of two school credit cards. The first is for the use of the Finance Team and is in the name of the Business Manager. The second is for the use of Extended Schools, Food Technology and Hospitality & Catering staff; there are four cards, in the names of the relevant staff
The credit card have a credit limits of £4,000 and £7,500; any changes in the limits will be implemented by the Business Manager, following consultation and approval by the Head and Chair of Governors.
The credit cards must be kept in the safe, and only taken out when required.
A detailed record of expenditure must be kept for all purchases.
Care must be taken with all internet purchases, including purchasing only from recognised suppliers and only from sites adopting the internet security protocol https://
The credit cards must be settled in full each month; it must not be used as a line of credit.
The Finance credit card will be held in the name of the Business Manager. The credit card may only be used by the Business Manager and Finance Officers.
The Extended Schools, Food Technology and Hospitality & Catering credit card will be held in the names of the relevant staff. Each named person must sign an assurance that they will only use the credit card in accordance with the Finance Policy and specifically only for school related expenditure and never for any personal expenditure.
The Finance Officer is responsible for reconciling the monthly expenditure. Any items which do not have detailed record of expenditure or do not appear to be for bona fide school purposes must be immediately reported to the Business Manager and Head and fully investigated.
Failure by an individual card holder to adhere to the rules for the use of the school credit card will result in removal of their credit card, and may lead to disciplinary procedures.
The Business Manager will authorise all purchases made on the credit card by the Finance Officer. The Head will authorise all purchases made on the credit card by the Business manager.
The Business Manager will carry out a monthly check on a sample of the transactions, and will post the credit card transactions onto the finance system.
Section 7: Register of Pecuniary and Other Interests
The school shall maintain such a Register.
7.1 Persons to be included:-
1. All Governors
2. Headteacher
3. All senior staff i.e. Deputy Head, Assistant Heads, Heads of Departments, Business Manager
7.2 Interests to be recorded
The basic principle to be followed is that any interest should be recorded which could be seen to improperly influence any decisions taken, pecuniary or otherwise, regarding the operation of the school.
Examples of such improper influence might be:-
· to purchase goods or materials from a company in which a Governor/senior member of staff has a financial interest without going through the correct procedures re. obtaining competitive prices;
· promoting a member of staff who has close personal relationship (spouse, partner, son, daughter etc.) with Governor/senior member of staff, without going through correct procedures re. recruitment and selection.
There can not be a definitive, comprehensive list of the interests which should be recorded.
The following is intended to give some guidance:
- having a financial, or other, interest in an organisation which could feasibly be in a position to supply goods/services to the school.
- having a close personal relationship with a person in the above categories.
- being in a position to potentially influence decisions made about the school.
- having a close personal relationship with a Governor or member of staff.
If staff or Governors are in any doubt, guidance should be sought from the Head or Chair of Governors.
Date approved May 2011
Date for next review May 2012