Academies Accounts Direction 2024/25: Minimal change may offer some good news
The Department for Education (DfE) have published the Academies Accounts Direction for 2024 to 2025, and it’s fair to say that this year’s publication sees the fewest number of changes since the Department first started publishing the guidance. This is at least a bit of good news for academy trusts against a challenging financial backdrop. It’s also good news for auditors after a few years of change and more onerous requirements as a result of regulation within our sector.
There is some updated and refreshed guidance for auditors in the auditing framework, but this is unlikely to mean a significant change in the overall approach to audit and regularity reporting. There are some minor changes to the wording for engagement letters and the regularity report, these will be picked up by our teams as part of the 2024/25 process.
It is a good idea for CFOs and their finance teams to refresh their understanding of the key requirements, and of course your usual Azets adviser will be more than happy to discuss any technical matters throughout the year as they arise.
Once again, there is some additional information around the preparation of trustees’ reports, this time clarifying the trusts that meet the definition of a medium or large company must include a separate “strategic report” within the trustees’ report covering the achievements and performance of the academy trust, the trustees’ assessment of going concern, and a statement describing how trustees have promoted the success of the company. The Direction also suggests that academy trusts should consider including a non-financial and sustainability statement within this section, although this is only a legal requirement if the trust has over 500 employees and turnover of over £500million.
The Direction also includes guidance where trusts have been able to take out finance leases under the updated requirements of the 2024 Academy Trust Handbook, including how to account for them what to disclose in the financial statements. If you have taken out any such leases in the year, please ensure you are accounting for them appropriately and provide your auditor with all relevant documentation as part of the audit process.
The model “Coketown” accounts reflect some of the changes noted above, with amended audit and regularity report wording for auditors, and also updated wording on the accounting officer’s statement – please ensure that the statement in your financial statements is up-to-date. References to the ESFA in the model accounts have also been updated to reflect the transfer to the DfE – again, please ensure your financial statements reflect the changes.
Other minor changes include some amened wording for the governance statement section on internal scrutiny for trusts with income of over £50 million, and a change to wording in the pensions note in respect of the Teachers’ Pension Scheme.
So, all in all, very little to get excited about, and a minor welcome element of stability for academy trusts and auditors.
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If you have any questions on the Academies Accounts Direction for 2024 to 2025 and how it may impact you, please get in touch with one our specialists via the form below or contact your usual Azets advisor.
