The tools to ensure finance adds up

Do you remember Financial Management Standard in Schools (FMSiS) which was introduced in the early 2000s and made compulsory in 2007 for all schools?

FMSiS was that self evaluation tool which enabled business managers to compile file upon file of documentation to satisfy a bureaucratic need to meet more than 100 different assessment criteria. There is no doubt that there is a requirement for some sort of tool to assist governors in discharging their duties, but this required a simpler national standard to avoid the massive burden to schools which previously existed.

A clearer method of self assessment
The Schools Financial Values Standard (SFVS) was introduced from September 2011, comprised of 23 questions aimed at governing bodies to assist them in ensuring they have secure financial systems and management in place.

The list of questions is split into four sections: the governing body and school staff; setting the budget; value for money, and protecting public money. These are followed by a summary of agreed remedial action and a timetable for reporting back.

On the face of it the 23 questions alongside the support notes provide a much simpler and clearer method of self assessment, together with guidance for governors that enables them to be confident about the financial management of their school. It should be clear that the standard is primarily aimed at governors, however it is inevitable that the school’s business manager will be heavily involved in the self-evaluation process.

Although this appears as more work for the SBM in a world where we are seeing falling educational budgets, it is imperative that we have effective financial management to target resources to raise standards and attainment. I find it is also an ideal opportunity for governors to gain an insight into the role of the business manager and the finance team as a whole.

Clarity
The notes which are available to help governors assess the answers to each question are a vast improvement on the old FMSiS, giving clarity to what they are looking for and what evidence would be appropriate. Using this document as part of the induction and ongoing training for governors, particularly those who sit on the finance committee, has proved useful in ensuring that the strategic role of the governing body remains clear, as well and giving them the confidence to ask those challenging questions which are both appropriate and timely.

Responsible Officer
One of the positives to have come out of the financial handbook for academies is the introduction of the responsible officer (RO) role – a role which could be replicated in maintained schools. The RO, whose responsibility it is to sample transactions to ensure that correct procedures are being followed, would be in a position of strength and able to lead the governors through the SFVS self assessment process, being confident that the evidence which has been gathered is a true reflection of the systems and processes which are embedded in the day-to-day running of the school.

Following the demise of the FMSiS, governors still need to have assurance that they have secure financial management in place and the framework of the SFVS provides this assurance. Unlike its predecessor SFVS will not be externally assessed but a copy of each signed record must be sent to the local authority’s finance department, where it will be used to inform the programme of financial assessment and audit. This is an annual return and good practice would be to build this in to the governors’ annual schedule of meetings.

The role of Governors
I cannot say I was the greatest fan of FMSiS as it was a heavy bureaucratic burden, particularly on some of the smaller primary schools I work with, but I feel reassured that the governors will continue to be required to accept, and recognise, the responsibility they have with regard to the financial management of their school.

With an improved and more streamlined structure of self assessment in place I hope that governors will see the benefit in undertaking the annual review and feel more confident when reporting to other stakeholders. We often find that recruiting governors onto our finance committee the most difficult, frequently because they feel insecure about their knowledge of school finance. Although they are still not beating down my door to come and spend some time going through the finance systems we have in place, the supporting notes, which are far more accessible with (on the whole) plain, easy to understand, language, makes the role a little less highbrow and specialist.

I believe we should be transparent in our leadership and management of the resources of our schools. I am never afraid to have a governor come and talk through what I do and challenge me over some of the decisions I make and, having the structure of the SFVS to guide those discussions, will ensure that we stay on course.

About the author
Kerry Brimfield is school business director at Dyson Perrins CofE Academy in Malvern, Worcestershire where she provides strategic business leadership to the school and seven local primaries. As a School Business Management support advocate for the National College for School Leadership, Kerry leads one of the college’s demonstration projects aimed at highlighting the role of the school business director. For more about the college’s school business management programmes and the work done by Kerry and her colleagues, go to www.nationalcollege.org.uk/sbm