The Education Funding Agency (ESFA) Accounting Officer letter

The Chief Executive of the ESFA has released his annual ‘Dear Accounting Officer’ letter. This is always a useful indicator of the areas the ESFA have paid particular attention to in the previous year and the areas they will be focusing on in the coming year.

Governance is clearly the biggest area of focus for the ESFA at present; the letter ends with a reminder that good governance and oversight will result in good financial health which is essential to delivering an education system that maximises the potential of students.

Looking at the previous year, a number of academies have been identified by the ESFA as having weaknesses in their financial management and governance which result in them falling short of the requirements of the Academies Financial Handbook and the Nolan Principles of public life.

The ESFA recommendations to ensure that your academy trust maintains a good standard of financial management and governance include:

  • Being satisfied that the lines of internal accounting are appropriate
    • Are the academy trust’s leadership team seen to be following academy policy?
    • Is the leadership team sufficiently challenged by the board?
    • Is there a good level of segregation of duties?
    • Is there enough documentation to show a transparent decision making process has taken place?
  • Establishing and monitoring polices which your governors are happy to defend in public
    • Are expenses claims made by trustees reasonable?
    • Are staff appointed on merit alone?
    • Is remuneration of all staff justifiable?
  • Ensuring that compliance with financial frameworks is evidenced
    • Do you retain evidence to support your compliance?
    • Is compliance overseen by the governors and subject to a sufficient level of scrutiny?
  • Ensuring your board has the right mix of skills and experience
    • Has a skills gap audit been undertaken?
    • Is there a programme in place to address any areas of deficiency?
  • Ensuring related party transactions are managed appropriately
    • Do procurement records show value for money has been the overriding factor in the decision making process?
    • Are transactions with related parties at cost?
    • Is the register of business interests up to date?

Tait Walker can help your academy trust to ensure that the financial management complies with the academy financial handbook and Nolan Principles of Public Life. Our internal assurance programmes review the systems and controls in place and enable us to work with your academy trust to implement procedures and controls which reflect the unique needs of your academy trust and ensure high standards of financial management and governance are maintained.

For further information, please contact Beth Ramsden on 0191 285 0321 or email

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