Academies Accounts Direction

The new Accounts Direction for 2014 – 15 was finally released on 15 June. Or rather, the two Accounts Directions for 2014 – 15 were released!


Any Academy Trusts which have been incorporated in 2015 will have to comply with the new UK accounting framework FRS102, and an Accounts Direction which takes account of the requirements of this new framework has been produced specifically for those Trusts. For the majority of Trusts, which will not have to comply with FRS102 until 2016, an updated version of the 2013 – 14 Accounts Direction has been released, which gives some additional guidance and clarification, but does not radically change the accounting requirements. It is this version that we will focus on in this blog and in our client seminars in July.

The main changes are:
Governance Statement
• New section about Value for Money – this is no longer a separate statement from the Report and Accounts
• Re-emphasis of requirement to carry out a governance review in the first year, and then to continue to do this annually as a matter of best practice

Financial Reporting
• Disclosure of donated “income” to be split between fixed asset donations and other
• Updated list of funding streams included in GAG for purpose of carry forward calculation at year end
• Requirement to disclose all non contractual severance payments regardless of value (previously only those over £5,000) – but still no requirement to disclose names.
• Clarification that the disclosure of remuneration paid to trustees should include pension contributions, also in bands of £5,000
• Further guidance on accounting for buildings occupied by church academies, based on the substance of the arrangement rather than legal form
• New section on accounting for agency arrangements, and clarification that these include the Bursary Fund, which should not therefore be included within income and expenditure
• New section on accounting for risk protection arrangements – GAG income should be grossed up by the amount of the deduction made in respect of the RPA which is shown as a separate cost
• New section on accounting for academy combinations and dissolutions which are now both on the increase with the formation of many more MATs.

• Clarification that auditors should inform the EFA and National Audit Office if they are issuing a qualified audit report or modified regularity report
• Clarification that the audit report is addressed to the members of the trust


If you would like more information on the subject, please contact Tracey Johnson.