The Trustees present their annual report together with the accounts and independent auditor's reports of the charitable company for the period 1 September 2019 to 31 August 2020. The annual report serves the purposes of both a Trustees' report and a directors' report under company law. The report has been prepared in accordance with Part VI of the Charities Act 2011, together with reference to guidance provided in the Education and Skills Funding Agency’s (“ESFA”) Academy’s Financial Handbook 2019 and Accounts Direction 2019-2020.
The financial statements have been prepared in accordance with the accounting policies on pages 30 to 34 of the financial statements, and comply with the charitable company’s memorandum and articles of association, the Companies Act 2006, and the requirements of the Statement of Recommended Practice “Accounting and Reporting by Charities” as issued in March 2005 (‘SORP 2019’).
The Academy Trust operates nine primaries, two infant and two junior academies and a Pre-School in the Yorkshire area. The academies have a combined pupil capacity of 3,598 and have a roll of 3,383 as taken from the Spring census 2020.
The Academy Trust is a company limited by guarantee and an exempt charity. The charitable company's memorandum and articles of association are the primary governing documents of the Academy Trust.
The Trustees of Waterton Academy Trust are also the directors of the charitable company for the purposes of company law. The charitable company is known as Waterton Academy Trust. Details of the Trustees who served during the year are included in the Reference and Administrative Details on page 1.
Each member of the charitable company undertakes to contribute to the assets of the charitable company in the event of it being wound up while they are a member, or within one year after they cease to be a member, such amount as may be required, not exceeding £10, for the debts and liabilities contracted before they ceased to be a member.
In accordance with normal commercial practice, Waterton Academy Trust has adopted the Risk Protection Arrangement (RPA), in accordance with the Academies Financial Handbook, to protect governors and officers from claims arising from negligent acts, errors or omissions occurring whilst on Trust business. The RPA provides cover up to £5 million on any one claim. The cost of RPA is included in the total insurance cost.
The total number of Trustees including the Chief Executive Officer who are employees of the company shall not exceed one third of the total numbers of Trustees.
Trustees and Governors are elected via the following arrangements:
Trustees are appointed to the Trust board by the Members
The Local Hub Board (LHB) Chairs are independent and appointed by Trustees
Each Academy Standards Committee (ASC) elects a LHB representative
The Headteacher’s Group elects two members to each LHB
Members appoint through Academy Ambassadors etc. to ensure skillsets are appropriate.
The training and induction provided for each new Trustee or Governor will depend on their existing experience. Copies of policies, procedures, minutes, accounts, budgets, plans and other documents are provided for all Trustees and Governors of the Trust to assist them in their role as Trustees. The Trust Governance Officer supports all levels of governance and associated training.
The Trust currently consists of thirteen schools and one pre school; seven converter primary schools, one converter junior school, two converter infant schools, one sponsored junior school (now judged good by Ofsted) and two sponsored primary schools (one now judged RI by Ofsted).
Walton Primary Academy (Converter)
Normanton Common Primary Academy (Converter)
Normanton Junior Academy (Sponsored)
Lee Brigg Infant & Nursery School (Converter)
Crofton Infants’ School (Converter)
Sharlston Community School (Converter)
South Kirkby Academy (Converter)
Wrenthorpe Academy (Converter)
Cherry Tree Academy (Sponsored)
Ackworth Mill Dam School (Converter)
King’s Meadow Academy (Re-brokered sponsored)
West End Academy (Re-brokered)
Waterton Pre School
Churchfield Primary School (Converter)
The governance structure consists of the following levels; the Members, the Board of Trustees, the LHBs and the ASCs.
The Trustees are responsible for the strategic direction, financial and health and safety compliance, monitoring individual academy performance and appointment of academy Headteachers.
The Trustees meet as a full board three times per year and the Resources and Standards Committees sitting within the LHBs, each meet three times per year.
Each LHB and ASC receives delegated authority from the Trust Board to support the Trust Board in fulfilling its obligations.
The Chief Executive Officer, working with the central team and individual academy Headteachers, is responsible for the overall performance of the Trust and implementing the policies laid down by the Trustees.
Other than Trustees who have a substantive role within the Trust, no remuneration is paid to Trustees who are volunteers, under any circumstances.
All Headteachers are subject to annual Performance Management reviews in accordance with STPCD and this is applied consistently across the Trust. There have been few occasions where the complexity and challenge of the role is such that it was necessary to offer remuneration above the indicative range for a school, but this is fully reviewed by SLT and reported to Trustees, for transparency. All performance management uplifts are presented to Trustees for approval and appropriately recorded in minutes of meetings.
The Trust SLT are also subject to annual Performance Management reviews which are reported to Trustees as above. In accordance with the requirements of the AFH, a robust process is in place for determining the remuneration for the CEO. The decision is made by the Trust Board and appropriately approved and recorded.
The Trustees recognise the importance of employee engagement in all aspects of its work. The Trust has a robust appraisal system, staff wellbeing group and are currently negotiating ways forward to implement formal meetings with Trade Unions on a regular basis. Staff surveys take place regularly and were of particular use during remote working due to COVID19.
The Trustees recognise the importance of developing relationships with suppliers, customers and other stakeholders. In recent years, the Trust has moved to whole trust agreements for major contracts such as school meals provision and supply agency cover, using established framework agreements for the benefit of all our family of schools. In addition to this, we work alongside local and smaller businesses and have developed excellent relationships with all our stakeholders. During the COVID-19 pandemic, the Trust worked with the school meals contractor to provide food hampers for vulnerable pupils and families within our community, which were distributed to our schools by our contractor for buildings compliance. This is testament to the partnerships we promote.
The Trust is the member of Waterton Pre Schools. The Pre-Schools currently consists of one setting, details of this is included within these accounts. The Trust is not a member of any soft federations.
The Trust has commissioned works from Omnibus Education. This is a related party transaction and all the appropriate procedures and declarations were in place.
The principal objective of the T rust is to improve the outcomes for all children within the T rust and wherever possible beyond. This will be achieved through working in partnership with our schools to implement a wide range of school improvement initiatives.
The aims of the T rust during the year ended 31 August 20 20 are summarised below:
To provide rapid and sustained improvement in regards to children’s outcomes;
To continue to develop the high quality leadership in each school ;
To continue to provide a broad and balanced curriculum across the T rust ;
To promote collaborative working at all levels ;
To respond to the challenges during the COVID19 pandemic to minimise the impact on pupil outcomes;
To promote opportunities for blended learning which are sustainable in future years;
To create an organisation that ensures we operate efficiently and provide value for money in challenging circumstances; and
To meet our charitable objective .
Key priorities for the year are contained within the School Improvement Plan for each academy and the Strategic Development Plan for the Trust. Areas for improvement are identified through external and internal monitoring and evaluation processes.
The Trustees confirm that they have complied with the duty in Section 17(5) of the Charities Act 2011 to have due regard to the Charity Commissioners general guidance on public benefit in exercising their powers or duties. They have referred this to their guidance when reviewing the Trust ' s aims and objectives and planning its future activities.
The T rust aims to advance for the public benefit, education in the academies that it is responsible for and wherever possible beyond. In particular, we are working to support all of the schools in the T rust and to develop a culture of mutual support and development across these schools.
Given the unprecedented circumstances surrounding COVID19, the Trust has no officially recognised set of published results for 2019-20. All pupil assessments have been carried out through teacher appraisals and it has been agreed that the Trust will not publish these outcomes. The rationale for this decision is predicated on there being no reliable local or national benchmark to assess performance against and not having had the opportunity to carry out a meaningful and robust moderation process.
Attendance
As with pupil outcomes, given the unprecedented circumstances surrounding COVID19, the Trust has no officially recognised set of published attendance figures for 2019-20. Academies have been reporting attendance figures on a daily basis to the trust, LA and DfE, however it has been agreed that these figures will not be made public. The rationale for this decision is predicated on there being no reliable local or national benchmark to assess attendance against and the complexity around contextual differences as a result of COVID19.
External Accountability - Ofsted Cycle and Outcomes
Academy |
Pre-conversion Judgement |
Recent Judgement |
WPA |
Good |
Good |
NCPA |
Good |
Good |
NJA |
Inadequate |
Good |
LBIS |
Outstanding |
Outstanding |
CIS |
Good |
Good |
SKA |
Good |
Requires Improvement |
WEA |
Good |
Good |
WA |
Good |
Good |
CPA |
Inadequate |
Requires Improvement |
Since its inception, the Trust has undergone ten inspections, returning very strong outcomes. The vast majority of schools have progressed provision, with only SKA having returned a negative outcome. This year has seen Wrenthorpe Academy retain a very strong good judgement and Cherry Tree Academy being taken out of an inadequate judgement and lifted to a requires improvement judgement. We are confident that the schools in the current Ofsted window will also return positive judgements.
COVID19 Security
A new challenge that brings with its external scrutiny, is that of being COVID19 secure. The current pandemic has resulted in the Trust expending a great deal of resource where previously, there was no requirement. A significant amount of time and money has been expended on cleaning equipment, PPE and additional staff costs to ensure that our schools remain open and COVID19 secure. All academies have produced detailed risk assessments and operational plans, supported by the trust central team. A recent HSE inspection has validated this work.
2020 Financial key performance indicators |
Financial performance is monitored throughout the year and action taken to ensure that:
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After making appropriate enquiries, the board of Trustees has a reasonable expectation that the Academy Trust has adequate resources to continue in operational existence for the near future. For this reason, the board of Trustees continues to adopt the going concern basis in preparing the accounts. Further details regarding the adoption of the going concern basis can be found in the statement of accounting policies.
The principal objective of the Trust is to improve the outcomes for all children within the Trust. The areas that are used to benchmark success are to be found within sections of this document , namely the strategic report and financial indicators. As a charitable organisation, the Trustees note their obligations to the requirement of section 172(1) (a) to (f) of the Companies Act 2006. The vision and values of Waterton Academy Trust indicate its desire to ensure that all decisions are taken with regard to the community which it serves.
The majority of the Academy Trust's income is obtained from the DfE via the ESFA in the form of recurrent grants, the use of which is restricted to the provision of education. The grants received from the DfE during the year ended 31 August 2020 and the associated expenditure are shown as Restricted Funds in the Statement of Financial Activity (SOFA).
The financial position of the Trust remains strong, although challenging in some schools and in particular, Early Years. The total restricted and unrestricted reserves, excluding pensions and fixed assets as at 31 August 2020 was £1,707,468.
During the period, the Trust's finances have been affected by the COVID-19 pandemic. These include, but are not limited to:
increased costs in relation to additional cleaning and hygiene, staffing, PPE equipment,
loss of income relating to school meals, lettings, breakfast clubs and after-school care etc
the requirement to continue to pay suppliers in accordance with the Governments' Procurement Policy Notices (PPNs)
Staff employed in wraparound care positions across the Trust were furloughed and a claim was made through the Coronavirus Job Retention Scheme. This income is recognised in our financial statements.
A planned organisational model for growth is in place and Churchfield Primary joined the Trust in December 2019. However, the rise of the COVID19 pandemic during the period has hampered any further growth in the immediate future.
The Trust receives Capital grants from the ESFA for fixed assets. Individual academies receive annual Devolved Formula Capital (DFC) and the Trust receives School Condition Allocation (SCA), both of which are formula based Capital. Such grants are shown in the SOFA as restricted income in the Fixed Asset Fund and allow further investment in maintaining and improving the academies across the estate.
Capital projects during the period include a classroom refurbishment at Sharlston Community School and a single storey extension to form a classroom and staffroom at Ackworth Mill Dam, as a result of increasing the PAN to 30. Further investment has been made in developing a Centre for Excellence in the former library at Walton Primary Academy offering apprenticeship training, creating an additional revenue income stream. During 2020/21, the second phase of development on the Mill Dam site will be completed, expanding the Early Years setting. £140,000 grant 106 capital funding has been secured from the LA to assist with funding these works.
At 31 August 2020 the net book value of fixed assets was £29,973,404. The assets were used exclusively for providing education and the associated support services to the pupils of the Trust. The Restricted Fixed Asset Fund balance is reduced by annual depreciation charges over the expected useful life of the assets concerned.
The land and buildings were gifted and a 'right to use' granted to the Academy Trust upon transfer.
The deficits in the Local Government Pension Scheme (LGPS) in respect of its non-teaching staff, are recognised on the Balance Sheet in accordance with the provisions of FRS 102, and this liability has increased from £7.8m to £12.3m during the period.
The Board of Trustees consider it prudent to retain an appropriate level of reserves designed to meet the long term needs of facilities and equipment renewal and any other unforeseen expenditure and liabilities. A Reserves Policy, which is reviewed annually, has been developed to provide a framework for strategic planning and decision-making and to protect the Trust’s activities.
Individual academies are expected to set balanced budgets each year, but the Trust recognises that this is challenging in some settings depending on individual circumstances. In these circumstances, the Trust will support the academy to ensure that any projected in-year budget deficit does not have a detrimental impact on service delivery and a plan to return them to surplus is put in place.
Trust reserves are pooled for the benefit of the Trust as a whole but profiled to each academy. Academies can access reserves by submitting Access to Reserves bids to the LHB to fund development plans, be it educational resources or capital projects. Only in exceptional circumstances can reserves be allocated to fund ongoing revenue expenditure. Repayment plans over the short and medium term are put in place.
Planned expenditure against reserves can include, but is not limited to:
The investment in buildings, IT and other capital projects;
Funding of unforeseen emergency maintenance/works;
Short term fluctuations in pupil numbers and lagged funding;
Funding of staffing restructures, compromise payments and redundancies etc to promote future cost savings; and
Funding of educational priorities.
As at the period ending 31 August 2020, total reserves was £19,616,125, of which £18,456,299 are restricted and not available for general purposes of the academy Trust. This is in line with current policy.
The Board of Trustees seek s to reach a balance between investment return and risk, to realise a reasonable return on the funds available, whilst adopting a risk averse approach. As such , the Board does not consider the investment of surplus funds as a primary activity, but rather a requirement for the effective management of the various funds entrusted to the Board.
Due to the nature of the funding cycle, the Trust may at times hold large cash balances which may not be required for immediate use. Where cash flow allows, sums are invested under instruction from the Trustees in an investment account which sits alongside the Trust current account and is accessible at all times but at no time exposes those funds to any risk.
The Trustees have assessed the major risks to which the trust is exposed. The Trust SLT has undertaken further work to develop and embed the system of internal control into operational practice, including financial, operational and risk management designed to protect the trust’s assets and reputation.
The Trust has a Risk Management Policy and Risk Register. Trustees review the major risks to which the Trust is exposed, at each Trust Board meeting, as part of the CEO report.
The key risks have been determined as:
Safeguarding and child protection - the Trustees continue to ensure that the highest standards are maintained in the areas of selection and monitoring of staff, the operation of child protection policies and procedures, health & safety and discipline.
Recruitment – the success of the Trust is reliant on the quality of its staff and teaching. Trustees monitor and review policies and procedures for recruitment, training and CPD to ensure that quality staff are retained and succession planning is appropriate.
Financial – uncertainty regarding future Government funding streams. There can be no assurance that Government policy will remain the same or that funding will continue at the same level. Strategies are in place to ensure financial stability is sustainable, without affecting the quality of education provision across the Trust. The implications of Brexit are unknown.
Cash Flow – There is no significant risk that the Trust will be unable to finance its day-to-day operations. Cash flow is monitored on a daily basis at trust level, to ensure that all financial commitments are met and movement of funds between academies is undertaken as necessary.
Fraud and mismanagement of funds - all appropriate staff receive training to keep them updated with best financial practice and further develop their skills. The CFO is tasked with ensuring appropriate practice is adhered to and compliant with ESFA regulations.
Legal risks – legislative requirements such as the Child Protection Act are not complied with.
Reputational - the continuing success of the Trust is dependent on implementing rapid and sustained educational achievement in its academies and continuing to attract applicants in sufficient numbers by maintaining the highest educational standards. To mitigate this risk, Trustees ensure that student success and achievement are closely monitored and reviewed.
As part of its risk management strategy, the Trust currently uses the Risk Protection Arrangements (RPA) which is specifically designed for academies as an alternative to commercial insurance to transfer some risks. Under RPA, the Government covers the losses instead of an alternative insurance provider. All academies joining the Trust will use RPA.
The Trust's dealings with financial instruments are limited to treasury accounts, bank accounts, creditors and debtors. This limitation serves to minimise credit and liquidity risks when this is combined with the nature of the trust's debtors, being principally LAs and other schools and therefore the risk to cash flow is also minimal. The Government defined benefit pension scheme shows a deficit of £12,349,000 which is a significant liability on the Balance Sheet.
The COVID19 pandemic has established itself as the single most significant risk to the Trust. Trustees, SLT, Headteachers and the central team responded with a systematic and robust approach which will provide a framework for the future.
The Trust only participates in low level fundraising events throughout the school year. The purpose of this is not to fund the Trust’s core provision of education but to support related activities and charities such as Children in Need, Macmillan Cancer Support, Jeans for Genes etc. This fundraising does not involve any professional fundraisers or commercial organisations and funds raised for a specific purpose are restricted to expenditure against the same. During 2019-20 fundraising was minimal due to the restrictions throughout the COVID19 crisis.
Many of our schools have parent groups who raise funds for school activities and equipment, but these sit outside the Trust operations and are not administered by trust employees.
We have followed the 2019 HM Government Environmental Reporting Guidelines. We have also used the GHG Reporting Protocol – Corporate Standard and have used the 2020 UK Government’s Conversion Factors for Company Reporting.
Given the COVID19 pandemic that arose during the reporting period, the Trust did not operate at full capacity due to school not open to all pupils, therefore the figures reported are lower than would be expected in a normal year.
The chosen intensity measurement ratio is total gross emissions in metric tonnes CO2 equivalent per pupil, the recommended ratio for the sector.
The Trust will endeavour to reduce the carbon omissions and run our energy more efficiently whenever the opportunity arises. Steps taken to address these issues in year are detailed in the table below:
Energy Efficiency |
Sept 2019 – August 2020 |
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Ackworth Mill Dam |
Extension:- The main building has been extended in line with up to date CDM regulations which will cover newly installed insulations and felt roofing systems. A newly formed brick building was installed with 150mm Kingspan into the insulation cavity
The build has used varying measures to aid energy efficiency in addition to the products outlined above e.g. lowered ceilings, additional insulation, new fire doors, insulated pipework from existing boiler and new, more energy efficient radiators installed. |
Crofton Infants’ |
New UPVC double glazed windows installed with trickle vents. All windows have been sealed to the internal brickwork course and encased in UPVC casing removing any drafts through the cavity. Heat loss previously experienced and heating requirements have been significantly reduced. |
Cherry Tree Academy |
LED Installation throughout the building has enabled the building to become more energy efficient in provision while reducing electrical costs to the site |
Lee Brigg Infant & Nursery School |
Part LED install to the site has enabled the building to become more energy efficient in provision while reducing electrical costs to the site
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King’s Meadow Academy |
Installation of suspended ceilings and LED lighting introduced to 80% of the building has improved energy efficiency and reduced electrical costs to the site.
New more energy efficient boiler will reduce gas energy consumption
New roof and insulation to 80% of site will reduce heat loss and consumption in this area. |
Walton Primary Academy |
LED Installation throughout the building has enabled the building to become more energy efficient in provision while reducing electrical costs to the site.
Review of insulation in 30 % of building during refurbishment. New Kingspan insulation fitted. |
Wrenthorpe Academy |
Part LED Install to the site, has enabled the building to become more energy efficient in provision while reducing electrical costs to the site
|
West End Academy |
Foundation Stage Building refurbishment inclusive of new UPVC double glazing and LED full lighting conversion. |
The Trust will continue to develop its family of schools in order to continue to support children, some of whom come from challenging backgrounds. Future growth is fundamental to the ethos of the Trust and brings with it opportunities such as economies of scale and reductions in the financial impact that the core has on individual academy budgets.
The Trust will look to grow outside the Wakefield area and create geographically suitable hubs but will build capacity to support new schools as necessary.
The Trust aims to provide the highest educational opportunities and improve outcomes for all pupils, at all levels, to maximise their life chances.
The Trust will aim to attract high quality teachers and support staff, providing professional development to secure delivery of quality provision.
The Trust will work with strategic partners to improve the educational opportunities for pupils in the wider community.
The Trust will continue to improve and maintain its buildings to ensure that our pupils have the best facilities available.
The Trust will further develop its approach to blended learning as a result of the challenges arising from the COVID19 crisis and will ensure that pupil outcomes are achieved.
The Trust will develop the Centre for Excellence as a training hub to deliver apprenticeship training and create an additional revenue income stream.
The Trust and its Trustees do not act as the custodian trustees of any other Charity.
In so far as the Trustees are aware:
There is no relevant audit information of which the charitable company's auditor is unaware; and
The Trustees have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditor is aware of that information.
The auditor, GBAC Limited, are willing to continue in office and a resolution to appoint them will be proposed at the annual general meeting.
The trustees' report, incorporating a strategic report, was approved by order of the board of Trustees, as the company directors, on
As Trustees we acknowledge that we have overall responsibility for ensuring that Waterton Academy Trust has an effective and appropriate system of control, financial and otherwise. However, such a system is designed to manage rather than eliminate the risk of failure to achieve business objectives and can provide only reasonable and not absolute assurance against material misstatement or loss.
The board of Trustees has delegated the day-to-day responsibility to the Chief Executive Officer as accounting officer, for ensuring financial controls conform with the requirements of both propriety and good financial management and in accordance with the requirements and responsibilities assigned to it in the funding agreement between Waterton Academy Trust and the Secretary of State for Education. They are also responsible for reporting to the board of Trustees any material weaknesses or breakdowns in internal control.
The information on governance included here supplements that described in the Trustees' Report and in the Statement of Trustees' Responsibilities. The board of Trustees has formally met 9 times during the year.
Due to the unprecedented circumstances of COVID19, from April 2020 the Trust Board met remotely (using Microsoft Teams) and met more frequently in order to respond with agility to the changing guidelines and to ensure actions and decisions were made swiftly and appropriately. The LHBs and ASCs have also met remotely from this time, and all continue to operate within this arrangement.
Attendance during the year at meetings of the board of Trustees was as follows:
During the academic year A Fitton resigned from the role of Trustee, and A Goudie and L Rowlinson-Brown were appointed to the Trust Board.
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As Accounting Officer, the CEO has responsibility for ensuring that the Academy Trust delivers good value in the use of public resources. The Accounting Officer understands that value for money refers to the educational and wider societal outcomes achieved in return for the taxpayer resources received.
The Accounting Officer considers how the Academy Trust’s use of its resources has provided good value for money during each academic year, and reports to the Board of Trustees where value for money can be improved. The Accounting Officer for the Academy Trust has delivered improved value for money during the year by: Agreeing economies of scale reductions with suppliers;
Improved SLA value through additional services without additional cost;
Reviewing SLAs and moving towards Trust wide arrangements for all schools to create savings;
Increased staff skillset through Trust working;
Reviewing staffing structure and efficiency;
Employment of internal school improvement strategies;
Commissioning of shared services in partnership with external academy partners;
Utilising Capital funds effectively to carry out major repairs and transform teaching and learning space;
Ongoing self-evaluation of procedures and working practice to drive improvement and cost efficiencies;
Furloughing staff working in wrap-around care settings in order to minimise loss of income and protect individual school budgets during the COVID19 crisis;
Securing grant funding from the LA to expand Ackworth Mill Dam into a single form entry school and secure future funding in relation to increased pupil numbers; and
Creating a Centre for Excellence to deliver the Apprenticeship Programme in Supporting Teaching and Learning in Schools and offer CPD for staff and external partners.
The system of internal control is based on an on-going process designed to identify and prioritise the risks to the achievement of Academy Trust's aims and objectives, to evaluate the likelihood of those risks being realised and the impact should they be realised, and to manage them efficiently, effectively and economically. The system of internal control has been in place in Waterton Academy Trust for the period 1 September 2019 to 31 August 2020 and up to the date of approval of the annual report and accounts.
The Board of Trustees have reviewed the key risks to which the Academy Trust is exposed together with the operating, financial and compliance controls that have been implemented to mitigate those risks. The Board of Trustees is of the view that there is an ongoing process for identifying, evaluating and managing the Academy Trust's key strategic risks that has been in place for the period 1 September 2019 to 31 August 2020 and up to the date of approval of the annual report and accounts. This process is reviewed by the Board of Trustees at each meeting.
The Academy Trust's system of internal financial control is based on a framework of regular management information and administrative procedures including the segregation of duties and a system of delegation and accountability. In particular it includes:
Comprehensive budgeting and financial monitoring systems with an annual budget and periodic financial reports, which are reviewed and agreed by the Board of Trustees;
Hub Board Resources Committee scrutiny of financial performance against the forecasts and of major purchase plans, capital works and expenditure programs;
Setting targets to measure financial and other performance;
Clearly defined purchasing (asset purchase or capital investment) guidelines;
Delegation of authority and segregation of duties; and
Identification and management of risks.
The Trust Board have considered the need for a separate audit committee but have decided to include the remit of this committee into that of the Resources Committee for each LHB.
To fulfil the requirements of the ESFA and Academies Financial Handbook, Trustees have engaged the services of an independent consultant to carry out internal audit work and transactional testing.
As Accounting Officer, the Chief Executive Officer has responsibility for reviewing the effectiveness of the system of internal control. During the year in question, the review has been informed by:
The work of the external auditor; and
The work of the executive managers within the Academy Trust who have responsibility for the development and maintenance of the internal control framework; and
The internal scrutiny work.
The A ccounting O fficer has been advised of the implications of the result of their review of the system of internal control by external auditors for 1 September 2019 to 31 August 2020 .
Approved by order of the board of Trustees on 27 January 2021 and signed on its behalf by:
The Trustees (who also act as governors for Waterton Academy Trust and are also the directors of Waterton Academy Trust for the purposes of company law) are responsible for preparing the Trustees' Report and the accounts in accordance with the Annual Accounts Direction issued by the Education Funding Agency, United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice) and applicable law and regulations.
Company law requires the Trustees to prepare accounts for each financial year. Under company law, the Trustees must not approve the accounts unless they are satisfied that they give a true and fair view of the state of affairs of the charitable company and of its incoming resources and application of resources, including its income and expenditure, for that period.
In preparing these accounts, the Trustees are required to:
Select suitable accounting policies and then apply them consistently;
Observe the methods and principles in the Charities SORP 2019;
Make judgements and accounting estimates that are reasonable and prudent;
State whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the accounts; and
Prepare the accounts on the going concern basis unless it is inappropriate to presume that the charitable company will continue in business.
The Trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the charitable company's transactions and disclose with reasonable accuracy at any time the financial position of the charitable company and enable them to ensure that the accounts comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the charitable company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The Trustees are responsible for ensuring that in its conduct and operation, the charitable company applies financial and other controls, which conform with the requirements both of propriety and of good financial management. They are also responsible for ensuring that grants received from ESFA/DfE have been applied for the purposes intended.
The Trustees are responsible for the maintenance and integrity of the corporate and financial information included on the charitable company's website. Legislation in the United Kingdom governing the preparation and dissemination of accounts may differ from legislation in other jurisdictions.
Approved by order of the board of Trustees on 27 January 2021 and signed on its behalf by:
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the 'Auditor's responsibilities for the audit of the accounts' section of our report. We are independent of the Academy Trust in accordance with the ethical requirements that are relevant to our audit of the accounts in the UK, including the FRC’s Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
the trustees' use of the going concern basis of accounting in the preparation of the accounts is not appropriate; or
the Trustees have not disclosed in the accounts any identified material uncertainties that may cast significant doubt about the group's or the Academy Trust’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the accounts are authorised for issue.
Other information
The Trustees are responsible for the other information , which comprises the information included in the a nnual report other than the accounts and our auditor’s report thereon. Our opinion on the accounts does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.
In connection with our audit of the accounts, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the accounts or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the accounts or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.
We have nothing to report in this regard.
In our opinion, based on the work undertaken in the course of the audit:
the information given in the trustees' r eport including the incorporated strategic report for the financial year for which the accounts are prepared is consistent with the accounts; and
the trustees' r eport including the incorporated strategic report ha s been prepared in accordance with applicable legal requirements.
In the light of the knowledge and understanding of the group and the Academy Trust and its environment obtained in the course of the audit, we have not identified material misstatements in the trustees' r eport , including the incorporated strategic report .
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:
adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
certain disclosures of trustees' remuneration specified by law are not made; or
As explained more fully in the s tatement of trustees' r esponsibilities, the Trustees are responsible for the preparation of the accounts and for being satisfied that they give a true and fair view, and for such internal control as the Trustees determine is necessary to enable the preparation of accounts that are free from material misstatement, whether due to fraud or error.
In preparing the accounts, the Trustees are responsible for assessing the group and the Academy Trust’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Trustees either intend to liquidate the charitable company, or have no realistic alternative but to do so.
Our objectives are to obtain reasonable assurance about whether the accounts as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these accounts.
A further description of our responsibilities for the audit of the accounts is located on the Financial Reporting Council’s website at: http://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.
Use of our report
This report is made solely to the charitable company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006 . Our audit work has been undertaken so that we might state to the charitable company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the charitable company and the charitable company 's members as a body, for our audit work, for this report, or for the opinions we have formed.
In accordance with the terms of our engagement letter dated 10 November 2020 and further to the requirements of the Education & Skills Funding Agency (ESFA) as included in the Academies Accounts Direction 2019 to 2020, we have carried out an engagement to obtain limited assurance about whether the expenditure disbursed and income received by Waterton Academy Trust Group during the period 1 September 2019 to 31 August 2020 have been applied to the purposes identified by Parliament and the financial transactions conform to the authorities which govern them.
This report is made solely to Waterton Academy Trust and ESFA in accordance with the terms of our engagement letter. Our work has been undertaken so that we might state to the Waterton Academy Trust and ESFA those matters we are required to state in a report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than Waterton Academy Trust and ESFA, for our work, for this report, or for the conclusion we have formed.
The Accounting Officer is responsible, under the requirements of Waterton Academy Trust’s funding agreement with the Secretary of State for Education dated 28 August 2014 and the Academies Financial Handbook, extant from 1 September 2019, for ensuring that expenditure disbursed and income received is applied for the purposes intended by Parliament and the financial transactions conform to the authorities which govern them.
Our responsibilities for this engagement are established in the United Kingdom by our profession’s ethical guidance and are to obtain limited assurance and report in accordance with our engagement letter and the requirements of the Academies Accounts Direction 2019 to 2020. We report to you whether anything has come to our attention in carrying out our work which suggests that in all material respects, expenditure disbursed and income received during the period 1 September 2019 to 31 August 2020 have not been applied to purposes intended by Parliament or that the financial transactions do not conform to the authorities which govern them.
We conducted our engagement in accordance with the Academies Accounts Direction 2019 to 2020 issued by ESFA. We performed a limited assurance engagement as defined in our engagement letter.
The objective of a limited assurance engagement is to perform such procedures as to obtain information and explanations in order to provide us with sufficient appropriate evidence to express a negative conclusion on regularity.
A limited assurance engagement is more limited in scope than a reasonable assurance engagement and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in a reasonable assurance engagement. Accordingly, we do not express a positive opinion.
Our engagement includes examination, on a test basis, of evidence relevant to the regularity and propriety of the Academy Trust's income and expenditure.
The work undertaken to draw to our conclusion includes:
Discussions with officers of the academy throughout the audit process to ensure that all regularity threats have been addressed;
Testing of income and expenditure for compliance with the funding and other agreements, the Academies Financial Handbook and the academy's systems of controls;
Review of the activities carried out by the academy;
Review of the academy's internal financial procedures to ensure that adequate controls are in place to prevent or identify regularity issues;
Ensure ESFA approval has been obtained where appropriate for relevant transactions.
In the course of our work, except for the matters listed below, nothing has come to our attention which suggests that in all material respects the expenditure disbursed and income received during the period 1 September 2019 to 31 August 2020 has not been applied to purposes intended by Parliament and the financial transactions do not conform to the authorities which govern them.
The accounts set out on pages 25 to 56 were approved by the board of Trustees and authorised for issue on
The accounts set out on pages 25 to 56 were approved by the board of Trustees and authorised for issue on 27 January 2021 and are signed on its behalf by:
A summary of the principal accounting policies adopted (which have been applied consistently, except where noted), judgements and key sources of estimation uncertainty, is set out below.
The accounts of the Academy Trust, which is a public benefit entity under FRS 102, have been prepared under the historical cost convention in accordance with the Financial Reporting Standard Applicable in the UK and Republic of Ireland (FRS 102), the Accounting and Reporting by Charities: Statement of Recommended Practice applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) (Charities SORP (FRS 102)), the Academies Accounts Direction 2019 to 2020 issued by ESFA, the Charities Act 2011 and the Companies Act 2006.
Waterton Academy Trust meets the definition of a public benefit entity under FRS 102.
The Trust is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:
- Section 4 ‘Statement of Financial Position’: Reconciliation of the opening and closing number of shares; - Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosure. |
The Trustees assess whether the use of going concern is appropriate, i.e. whether there are any material uncertainties related to events or conditions that may cast significant doubt on the ability of the charitable company to continue as a going concern. The Trustees make this assessment in respect of a period of at least one year from the date of authorisation for issue of the accounts and have concluded that the Academy Trust has adequate resources to continue in operational existence for the foreseeable future and there are no material uncertainties about the Academy Trust’s ability to continue as a going concern. Thus they continue to adopt the going concern basis of accounting in preparing the accounts.
The consolidated financial statements incorporate those of Waterton Academy Trust and all of its subsidiaries (ie entities that the g roup controls through its power to govern the financial and operating policies so as to obtain economic benefits). Their results are incorporated from the date that control passes.
All financial statements are made up to 31 August 2020 . Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the g roup.
All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
The Academy Trust has taken advantage of the exemption contained within section 408 of the Companies Act 2006 not to present its own income and expenditure account. The surplus of the Academy Trust for the period ended 31 August 2020 is £1,324,474 (2019 £1,029,985 ).
The conversion from a state maintained school to an academy trust involved the transfer of identifiable assets and liabilities and the operation of the school for £nil consideration. The substance of the transfer is that of a gift and it has been accounted for on that basis as set out below.
The assets and liabilities transferred on conversion from the convertor schools in the year to the academy trust have been valued at their fair value. The fair value has been derived based on that of equivalent items. The amounts have been recognised under the appropriate balance sheet categories, with a corresponding amount recognised in Charitable activities – transfer from local authority on conversion in the Statement of Financial Activities and analysed under unrestricted funds, restricted general funds and restricted fixed asset funds. Further details of the transaction are set out in note 27.
All incoming resources are recognised when the Academy Trust has entitlement to the funds, the receipt is probable and the amount can be measured reliably.
Grants are included in the statement of financial activities on a receivable basis. The balance of income received for specific purposes but not expended during the period is shown in the relevant funds on the balance sheet. Where income is received in advance of meeting any performance-related conditions there is not unconditional entitlement to the income and its recognition is deferred and included in creditors as deferred income until the performance-related conditions are met. Where entitlement occurs before income is received, the income is accrued.
General Annual Grant is recognised in full in the statement of financial activities in the period for which it is receivable, and any abatement in respect of the period is deducted from income and recognised as a liability.
Sponsorship income provided to the Academy Trust which amounts to a donation is recognised in the statement of financial activities in the period in which it is receivable (where there are no performance-related conditions), where the receipt is probable and it can be measured reliably.
Donations are recognised on a receivable basis (where there are no performance-related conditions) where the receipt is probable and the amount can be reliably measured.
Other income, including the hire of facilities, is recognised in the period it is receivable and to the extent the Academy Trust has provided the goods or services.
Goods donated for resale are included at fair value, being the expected proceeds from sale less the expected costs of sale. If it is practical to assess the fair value at receipt, it is recognised in stock and ‘Income from other trading activities’. Upon sale, the value of the stock is charged against ‘Income from other trading activities’ and the proceeds are recognised as ‘Income from other trading activities’. Where it is impractical to fair value the items due to the volume of low value items they are not recognised in the accounts until they are sold. This income is recognised within ‘Income from other trading activities’.
Donated fixed assets are measured at fair value unless it is impractical to measure this reliably, in which case the cost of the item to the donor is used. The gain is recognised as income from donations and a corresponding amount is included in the appropriate fixed asset category and depreciated over the useful economic life in accordance with the Academy Trust‘s accounting policies.
Expenditure is recognised once there is a legal or constructive obligation to transfer economic benefit to a third party, it is probable that a transfer of economic benefits will be required in settlement, and the amount of the obligation can be measured reliably.
Expenditure is classified by activity. The costs of each activity are made up of the total of direct costs and shared costs, including support costs involved in undertaking each activity. Direct costs attributable to a single activity are allocated directly to that activity. Shared costs which contribute to more than one activity and support costs which are not attributable to a single activity are apportioned between those activities on a basis consistent with the use of resources. Central staff costs are allocated on the basis of time spent, and depreciation charges are allocated on the portion of the asset’s use.
All resources expended are inclusive of irrecoverable VAT.
This includes all expenditure incurred by the Academy Trust to raise funds for its charitable purposes and includes costs of all fundraising activities events and non-charitable trading.
These are costs incurred on the Academy Trust's educational operations, including support costs and costs relating to the governance of the Academy Trust apportioned to charitable activities.
Assets costing £500 or more are capitalised as tangible fixed assets and are carried at cost, net of depreciation and any provision for impairment.
Where tangible fixed assets have been acquired with the aid of specific grants, either from the government or from the private sector, they are included in the balance sheet at cost and depreciated over their expected useful economic life. The related grants are credited to a restricted fixed asset fund in the statement of financial activities and carried forward in the balance sheet. Depreciation on such assets is charged to the restricted fixed asset fund in the statement of financial activities so as to reduce the fund over the useful economic life of the related asset on a basis consistent with the Academy Trust's depreciation policy. Where tangible fixed assets have been acquired with unrestricted funds, depreciation on such assets is charged to the unrestricted fund.
Depreciation is provided on all tangible fixed assets other than freehold land, at rates calculated to write off the cost of each asset on a straight-line/reducing balance basis over its expected useful life, as follows:
A review for impairment of a fixed asset is carried out if events or changes in circumstances indicate that the carrying value of any fixed asset may not be recoverable. Shortfalls between the carrying value of fixed assets and their recoverable amounts are recognised as impairments. Impairment losses are recognised in the statement of financial activities.
Liabilities are recognised when there is an obligation at the balance sheet date as a result of a past event, it is probable that a transfer of economic benefit will be required in settlement, and the amount of the settlement can be estimated reliably. Liabilities are recognised at the amount that the Academy Trust anticipates it will pay to settle the debt or the amount it has received as advanced payments for the goods of services it must provide.
Rentals payable under operating leases are charged against income on a straight-line basis over the period of the lease.
Stock is valued at the lower of cost and net realisable value. Net realisable value is based on estimated selling price less further costs to completion and disposal. Provision is made for obsolete and slow moving stock.
The Academy Trust is considered to pass the tests set out in Paragraph 1 Schedule 6 of the Finance Act 2010 and therefore it meets the definition of a charitable company for UK corporation tax purposes. Accordingly, the Academy Trust is potentially exempt from taxation in respect of income or capital gains received within categories covered by chapter 3 part 11 of the Corporation Tax Act 2010 or Section 256 of the Taxation of Chargeable Gains Act 1992, to the extent that such income or gains are applied exclusively to charitable purposes.
Retirement benefits to employees of the Academy Trust are provided by the Teachers' Pension Scheme ('TPS') and the Local Government Pension Scheme ('LGPS'). These are defined benefit schemes and the assets are held separately from those of the Academy Trust.
The TPS is an unfunded scheme and contributions are calculated so as to spread the cost of pensions over employees' working lives with the Academy Trust in such a way that the pension cost is a substantially level percentage of current and future pensionable payroll. The contributions are determined by the Government Actuary on the basis of quadrennial valuations using a projected unit method. The TPS is an unfunded multi-employer scheme with no underlying assets to assign between employers. Consequently, the TPS is treated as a defined contribution scheme for accounting purposes and the contributions are recognised in the period to which they relate.
The LGPS is a funded multi-employer scheme and the assets are held separately from those of the Academy Trust in separate trustee administered funds. Pension scheme assets are measured at fair value and liabilities are measured on an actuarial basis using the projected unit credit method and discounted at a rate equivalent to the current rate of return on a high quality corporate bond of equivalent term and currency to the liabilities. The actuarial valuations are obtained at least triennially and are updated at each balance sheet date. The amounts charged to net income or expenditure are the current service costs and the costs of scheme introductions, benefit changes, settlements and curtailments. They are included as part of staff costs as incurred. Net interest on the net defined benefit liability/asset is also recognised in the statement of financial activities and comprises the interest cost on the defined benefit obligation and interest income on the scheme assets, calculated by multiplying the fair value of the scheme assets at the beginning of the period by the rate used to discount the benefit obligations. The difference between the interest income on the scheme assets and the actual return on the scheme assets is recognised in other recognised gains and losses. Actuarial gains and losses are recognised immediately in other recognised gains and losses.
Unrestricted income funds represent those resources which may be used towards meeting any of the charitable objects of the Academy Trust at the discretion of the Trustees.
Restricted fixed asset funds are resources which are to be applied to specific capital purposes imposed by the Education Funding Agency where the asset acquired or created is held for a specific purpose.
Restricted general funds comprise all other restricted funds received and include grants from the Education Funding Agency.
Accounting e stimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
The Academy Trust makes estimates and assumptions concerning the future. The resulting accounting estimates and assumptions will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.
The present value of the Local Government Pension Scheme defined benefit liability depends on a number of factors that are determined on an actuarial basis using a variety of assumptions. The assumptions used in determining the net cost (income) for pensions include the discount rate. Any changes in these assumptions, which are disclosed in note 21, will impact the carrying amount of the pension liability. Furthermore a roll forward approach which projects results from the latest full actuarial valuation performed at 31 March 2016 has been used by the actuary in valuing the pensions liability at 31 August 2020. Any differences between the figures derived from the roll forward approach and a full actuarial valuation would impact on the carrying amount of the pension liability.
The academy trust has been eligible to claim additional funding in year from government support schemes in response to the coronavirus outbreak. The funding received is shown above under "exceptional government funding".
The academy furloughed some of its wraparound care staff under the government's CJRS. The funding received of £135,653 relates to staff costs in respect of 153 staff which are included within note 10.
The Academy Trust has provided the following central services to its academies during the year:
Human resources;
Financial services;
Legal services;
Educational support services;
Data services;
IT services;
Health & Safety;
School improvement;
Governance;
Premises management;
Statutory audit; and
Risk Management.
The Academy Trust charges for these services on the following basis:
6% of the total GAG
Included in staff restructuring costs are non-statutory/non-contractual severance payments totalling £56,432 (2019: £34,100). Individually, the payments were: £11,932, £11,000, £15,500 and £18,000.
The key management personnel of the Academy Trust comprise the senior management team and the headteachers as listed on page 1. The total amount of employee benefits (including employer pension contributions) received by key management personnel for their services to the Academy Trust was £ 1,646,014 (2019 £1,318,801).
One or more Trustees has been paid remuneration or has received other benefits from an employment with the Academy Trust. The Headteacher and other Staff Trustees only receive remuneration in respect of services they provide undertaking the roles of Chief Executive Officer and staff members under their contracts of employment, and not in respect of their services as Trustees. Other Trustees did not receive any payments, other than expenses, from the Academy Trust in respect of their role as Trustees.
The value of trustees' remuneration and other benefits was as follows:
David Dickinson (CEO)
Remuneration £125,000 - £130,000 (2019 £115,000 - £120,000)
Employer's pension contributions £30,000 - £35,000 (2019 £15,000 - £20,000)
During the year ended 31 August 2020, travel and subsistence expenses totalling £0 (2019 £630) were reimbursed or paid directly to no Trustees (2019 1 Trustee).
In accordance with normal commercial practice, the Academy Trust has adopted the Risk Protection Arrangement (RPA), in accordance with the Academies Financial Handbook to protect Trustees and officers from claims arising from negligent acts, errors or omissions occurring whilst on Academy Trust business. The RPA provides cover up to £5,000,000 on any one claim and the cost for the year ended 31 August 2020 is included in the total insurance cost, but cannot be separately identified.
Included above is a loan of £64,800 from Salix Finance Limited which is provided on the following terms :
5 years repayment schedule at 0% interest .
At the balance sheet date the Academy Trust was holding funds of £290,906 (2019 £257,145) relating to Local Authority funding.
The specific purposes for which the funds are to be applied are as follows:
Restricted funds
Fixed asset funds
Fixed asset funds are used solely for capital purposes in line with the strategic objectives of the Trust.
The capital grant conditions allow the funds to be used for improvement to buildings and other facilities, including ICT, or capital repairs / refurbishment in accordance with priorities set by each school. Where the grant is used for expenditure to repair and maintain schools or non-capital ICT this expenditure is allocated in the year.
Restricted income funds
Restricted income funding is received from the ESFA and Local Authority for the purposes of providing educational services. The excess GAG can be used to purchase fixed assets for the assistance in providing the educational services. Under the funding agreement with the Secretary of State, the Academy Trust was not subject to a limit on the amount of GAG that it could carry forward at 31 August 2020.
Pension reserves
The pension fund deficit is as a result of the actuarial valuation but does not result in an immediate cash flow impact on the Academy.
Unrestricted funds
Unrestricted funds will be used towards meeting the charitable objectives of the Trust at the discretion of the Trustees.
Walton Primary Academy is carrying a net deficit of £33,893, (2019 £50,356).
Sharlston Community School is carrying a deficit of £47,624 (2019 £42,381).
Lee Brigg Infant School is carrying a net deficit of £11,777.
Cherry Tree Academy is carrying a net deficit of £33,332
The Academy Trust is taking the following actions to return the academy to surplus.
Walton Primary
The School has remained in a deficit position for a number of years but this year returned an in-year surplus, reducing the overall deficit position. Expenditure has been rationalised wherever possible without impacting negatively on outcomes, which remain strong. The Central Team are working closely with the school to consider further reductions in staffing but a future maternity cover will further exacerbate the budget position. A balanced operational budget will be delivered in 2020/21.
Sharlston Community School
Over the past couple of years, the budget for SCS has deteriorated significantly due to investment in the site, LTS and a high level of maternity covers. The planned reduction in the deficit position at year-end did not materialise due to a loss of income in Early Years. An increase in pupil numbers will alleviate budget pressure in the longer term and a balanced operational budget is in place for 2020/21.
Lee Brigg Infants School
The school is the smallest in the Trust and is challenging financially, particularly in staffing. An Executive HT has been appointed to manage this school and NCPA. This will encourage collaboration and joint working across the two sites and a planned staffing restructure will result in both schools returning balanced operational budgets.
Cherry Tree Academy
A staffing review resulted in a new leadership team, and the introduction of the Trust's first Executive HT over two schools. Consequently, additional costs in relation to settlement agreements were expended but cost savings across both settings will be made in future years. The Coverdale behavioural unit in school continued to be a drain on financial resources in 2019/20, but the transitional period to full closure is underway and the full benefit will be realised in 2020/21.
The Academy Trust's employees belong to three principal pension schemes: the Teachers' Pension Scheme England and Wales (TPS) for academic and related staff; and the Local Government Pension Scheme (LGPS) for non-teaching staff, which are managed by West Yorkshire Pension Fund and South Yorkshire Pension Fund. Both are defined benefit schemes.
The pension costs are assessed in accordance with the advice of independent qualified actuaries. The latest actuarial valuation of the TPS related to the period ended 31 March 201 6 and that of the LGPS related to the period ended 31 March 201 6 .
There were no outstanding or prepaid contributions at either the beginning or the end of the financial year.
The Teachers' Pension Scheme (TPS) is a statutory, contributory, defined benefit scheme, governed by the Teachers’ Pension Scheme Regulations 2014 (amended) . Membership is automatic for full-time teachers in academies and, from 1 January 2007, automatic for teachers in part-time employment following appointment or a change of contract, although they are able to opt out.
The TPS is an unfunded scheme and members contribute on a 'pay as you go' basis - these contributions along with those made by employers are credited to the Exchequer. Retirement and other pension benefits are paid by public funds provided by Parliament.
The Government Actuary, using normal actuarial principles, conducts a formal actuarial review of the TPS in accordance with the Public Service Pensions (Valuations and Employer Cost Cap) Directions 2014 (amended) published by HM Treasury. The aim of the review is to specify the level of future contributions. Actuarial scheme valuations are dependent on assumptions about the value of future costs, design of benefits and many other factors. The latest actuarial valuation of the TPS was carried out as at 31 March 201 6 and in accordance with the Public Service Pensions (Valuations and Employer Cost Cap) Directions 2014 (amended) . The valuation report was published by the Government Actuary's Department on 5 March 201 9.
The key elements of the valuation and subsequent consultation are:
employer contribution rates set at 23.6 % of pensionable pay (including a 0.08% employer administration charge
total scheme liabilities (pensions currently in payment and the estimated cost of future benefits) for service to the effective date of £ 218 , 0 00 million, and notional assets (estimated future contributions together with the notional investments held at the valuation date) of £1 9 6, 1 00 million giving a notional past service deficit of £ 22 , 0 00 million
an employer cost cap of 10.9% of pensionable pay will be applied to future valuations
the assumed real rate of return is 2.4 % in excess of prices and 2% in excess of earnings. The rate of real earnings growth is assumed to be 2. 2 %. The assumed nominal rate of return is 4.45 %
The TPS valuation for 201 6 determined an employer rate of 23.6 %, which was payable from September 201 9 .
The pension costs paid to the TPS in the period amounted to £1,513,259 (2019 £920,214).
A copy of the valuation report and supporting documentation is on the Teachers’ Pensions website.
Under the definitions set out in FRS 102, the TPS is an unfunded multi-employer pension scheme. The Academy Trust has accounted for its contributions to the scheme as if it were a defined contribution scheme. The Academy Trust has set out above the information available on the scheme.
The LGPS is a funded defined-benefit scheme, with the assets held in separate trustee-administered funds. The total contributions are as noted below. The agreed contribution rates for future years are 15.5% - 16.1% for employers and 5.5% - 12.5% for employees. The estimated value of employer contributions for the forthcoming year is £685,428.
As described in note 27 the LGPS obligation relates to the employees of the Academy Trust, being the employees transferred as part of the conversion from the maintained school and new employees who join ed the s cheme in the period. The obligation in respect of employees who transferred on conversion represents their cumulative service at both the predecessor school and the Academy Trust at the balance sheet date.
Parliament has agreed, at the request of the Secretary of State for Education, to a guarantee that, in the event of academy closure, outstanding Local Government Pension Scheme liabilities would be met by the Department for Education. The guarantee came into force on 18 July 2013.
The Trust now operates within two local authority pension schemes and the actuarial reports are performed by two different actuaries. The sensitivity analysis performed by the different actuaries does not align perfectly with the sensitivity criteria highlighted in the disclosure, where relevant a range has been provided.
A defined contribution pension scheme is operated for all qualifying employees of Waterton Pre School. The assets of the scheme are held separately from those of the group in an independently administered fund. The charge to the statement of financial activity in respect of the defined contribution scheme is £2,818 (2019 - £2,341).
Owing to the nature of the Academy Trust's operations and the composition of the board of Trustees being drawn from local public and private sector organisations, transactions may take place with organisations in which the Academy Trust has an interest. All transactions involving such organisations are conducted at arm's length and in accordance with the Academy Trust's financial regulations and normal procurement procedures. The following related party transaction took place in the period of account.
Mrs H Beaman, the wife of Mr P Beaman (Trustee) is employed by the Trust and receives a salary within the normal pay scale for her role and receives no special treatment as a result of her relationship to a trustee.
Mr Darren Dickinson, brother of David Dickinson, CEO, is engaged as a consultant to undertake review of disadvantaged pupil's and deliver training to Headteachers. During 2019-20 the ESFA gave approval for the Trust to run Apprenticeship Programmes and the Centre for Excellence was developed to deliver training. Mr Darren Dickinson was successful in the tender process for the design and delivery of apprenticeships in supporting teaching and learning in schools which will be provided for both internal and external learners. As the tender was above £20k ESFA approval was sought and supporting documentation in relation to the tender process, minutes of Trustee meetings, policies etc was submitted together with the related party transaction online return. Approval was given 16th September and the first cohort will commence in January 2021. An updated declaration of interests has been completed by the CEO.
Mr Chris Thompson, son of Mrs S Thompson (Headteacher) is working as a peripatetic music teacher. He is paid in line with normal rates for such work and received no special treatment as a result of his relationship to a trustee.
On 1 December 2019 the Churchfield Primary School converted to academy trust status under the Academies Act 2010 and all the operations and assets and liabilities were transferred to Waterton Academy Trust from the Barnsley Local Authority for £nil consideration.
The transfer has been accounted for as a combination that is in substance a gift. The assets and liabilities transferred were valued at their fair value s and recognised in the balance sheet under the appropriate headings with a corresponding net amount recognised as a net gain in the s tatement of f inancial a ctivities as d onations – transfer from local authority on conversion .
The following table sets out the fair values of the identifiable assets and liabilities transferred and an analysis of their recognition in the statement of financial activities.
Each member of the charitable company undertakes to contribute to the assets of the company in the event of it being wound up while he or she is a member, or within one year after he or she ceases to be a member, such amount as may be required, not exceeding £10 for the debts and liabilities contracted before he or she ceases to be a member.
Waterton Pre School Limited - 10860302
These financial statements include Waterton Academy Trust and Waterton Pre School. The Pre School is controlled by the Trust by virtue of the Trust being the only member of the Pre School.
|
2020 |
|
2019 |
|
£ '000 |
|
£ '000 |
Income |
|
|
|
|
|
|
|
Funds on transfer from the Local Authority |
|
|
3 50 |
Coronavirus Job Retention Scheme Grant |
17 |
|
|
Other income |
200 |
|
146 |
Trading income |
11 3 |
|
1 30 |
|
33 0 |
|
62 6 |
Expenditure |
|
|
|
|
|
|
|
Direct staff costs |
( 2 61) |
|
( 184 ) |
Other support costs |
( 7 2) |
|
( 5 6) |
|
( 333 ) |
|
( 240 ) |
|
|
|
|
Surplus from all sources |
(3) |
|
38 6 |
|
|
|
|
|
|
|
|
Total assets as at 31 August 2020 |
40 7 |
|
39 7 |
|
|
|
|
Total liabilities as at 31 August 2020 |
( 2 4) |
|
( 1 1) |
|
|
|
|
Waterton Pre School Balance at 31 August 2020 |
38 3 |
|
38 6 |