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Academies Accounts Direction 2023/2024 – what’s new?

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The Academies Accounts Direction 2023-24 and related documents applying to financial statements for the year ended 31 August 2024 were published at the end of March 2024. The earliest we have ever seen!

Structure of documents 

As in previous years, the Accounts Direction is split into three documents:

  • Academies Accounts Direction (‘AAD’)
  • Academies Model Accounts (‘Coketown accounts’)
  • Framework and Guide for External Auditors and Reporting Accountants of Academy Trusts (‘Framework’).

We set out below a summary of the key changes made for 2024.

New section: “What an academy trust must do”

This section highlights the key requirements in relation to an academy trust’s accounts but does not seek to cover off all ‘musts’. The list is to remind academy trusts of their key obligations – but doesn’t add any new requirements.

Clarity on the relationship between the financial statements and other financial returns (paragraphs 1.4 – 1.5)

A further paragraph has been included to explain that some of the reporting requirements for the financial statements differ from those of the Academies Accounts Return (AAR) due to reporting under different accounting frameworks. It goes on to suggest that before finalising their annual accounts, trusts may wish to check them against the AAR guidance and validation rules to minimise AAR validation errors.

Another paragraph has been included to state those who use the DfE Chart of Accounts may find the structure and mappings worksheet within the Chart of Accounts workbook helpful in understanding the relationship between account codes, the AAR and the financial statements. It also reminds trusts that using the DfE Chart of Accounts enables the use of automation technology for completing the AAR and draft financial statements.

We encourage the use of the standard chart of accounts – it simplifies the AAR process and facilitates benchmarking against other trusts.


References to the Covid-19 supplementary bulletin have been removed from all documents as Covid-19 grants have either stopped or become part of usual business activity. So, no need to disclose these grants separately, unless they are material.

Governance Statement – expansion of “the review of effectiveness of the system of internal control” (paragraphs 1.17 and 2.48)

Trusts now must include a conclusion on whether the academy trust has an adequate and effective framework for governance, risk management and control. If the trust does not have an adequate and effective framework, the reason for this conclusion must be stated along with the plan for improvement. ESFA have said that this brings the governance statement in line with other central government bodies and arguably should have been within the statement previously.

The model accounts have been updated to include the new wording and also to remove the previous requirement to describe how the board maintains effective oversight, if it meets less than six times a year, to reflect the 2023 Handbook requirements.

ESFA feedback to the sector (paragraphs 1.20 – 1.23 and Annex A)

This section has been updated to reflect outcomes of ESFA’s latest assurance work from its review of trust accounts, audit findings reports and internal scrutiny reports.

Annex A includes the following issues and improvements required to comply with the Direction:

  • Submission deadlines are not always achieved due to changes in staff. Trusts should forward plan and establish a delivery timetable early in the year.
  • Trustees’ Reports often use exemplar text or text from a prior year rather than representing the trust’s current circumstances. Trustees must always review and approve the final text.
  • The elements of the governance statement covering internal scrutiny are not always consistent with the actual scrutiny arrangements at the academy trust. Trustees must be satisfied of the accuracy and consistency of the governance statement before its approval.
  • Internal scrutiny arrangements are often weak and set by the internal scrutineer. The planning of the programme for internal scrutiny must be informed by the academy trust’s risk register and agreed between the board, the audit and risk committee and the internal scrutineer.
  • High risk recommendations from the audit findings report are not always actioned in a timely manner and internal control deficiencies are not rectified. The audit and risk committee should review the auditor’s findings and monitor timely action taken by the academy trust’s management in response to the findings.
  • Academy trusts must not omit statements from the model accounts that must be used, e.g., additional statements relating to estates management. Financial statements templates should be annually updated for changes in the Direction.

Statement of regularity, propriety and compliance (paragraph 2.57)

The AAD now provides a further example of sources of information to inform the accounting officer’s statement.

“A review of other external sources of assurance available to the academy trust over the year, for example specialist reviews or inspections.”

Core 16-19 education funding disclosure (paragraph 2.98)

This confirms academy trusts should separately disclose material non-GAG DfE/ESFA grants they have received in the ‘funding for the academy trust’s educational operations’ note within charitable activities income. This could include Student Support Services, 16-19 core education funding, Pupil Premium and Service Premium, Pupil Number Adjustment, Universal Infant Free School Meals, Insurance, PE and Sports Grant, and Teachers Pay Grant.

The model accounts have been updated to reflect this analysis.

Staff costs note – other employee benefits (paragraph 2.134)

The revised AAD also clarifies that the staff costs note should separately identify other employee benefits. Examples of these benefits provided in FRS102 include non-monetary benefits such as medical care, housing and cars. The staff costs note in the model accounts has been updated.

Premises occupied under long leasehold – valuation (paragraph 3.27)

Clarification has been given on how to recognise an appropriate fair value for a property asset occupied under long leasehold. The Direction provides options on how a trust may determine a reasonable and reliable estimate of the current value.

A new option to assess the value transferring from an academy trust has been added and a previously listed option to assess using DfE valuations has been expanded.

Agency arrangements (paragraph 3.132)

The example text in the model accounts has been updated to include disclosure of the cumulative unspent fund balances and how much is repayable to ESFA.

Other changes in the model accounts, not covered above, include:

  • An updated pensions note, which reports the latest actuarial valuation of the Teacher’s Pension fund and increased employer contributions from 1 April 2024.
  • Guidance on the disclosures academy trusts should consider on the extent to which any LGPS fund surplus has been recognised as an asset.

If you would like further guidance on these points or any other aspects of the Academies Accounts Direction and related documents, please contact one of your usual academy contacts at BHP for a discussion.