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John Cleveland College Academy Conversion Briefing For Parents Consultation Meeting 28 March 2012 1. What is an Academy Academies are independent state schools that are publicly and centrally funded, free from local authority control Academy Trust to run Academy through Company Limited by Guarantee with charitable exemption Funding Agreement between Academy Trust and Secretary of State to operate Academy Ultimately accountable to Secretary of State through DfE and YPLA Copyright Place Group 2012 Page 2 2. Consultation Academies Act requires that the governing body carries out consultation with appropriate people before entering into Funding Agreement • Purpose of consultation to establish any significant objection that might make the governing body reconsider conversion Consult, Consider, Respond and Report • Before or after the Academy Order has been applied for or granted Academy Consultation Report as decision gateway Stakeholders include • • • Staff Parents Pupils Copyright Place Group 2012 Other local schools Destination secondary schools Cluster schools Page 3 Politicians Unions Partners 3. Legal documents Memorandum & Articles of Association • Model documents that establish Academy Trust and sets out its governance • DfE agreed model document with Charities Commission to give Academies charitable exemption with Secretary of State as Principal Regulator • Some scope for amendments: governance, quorum and community object Funding Agreement (FA) • Model document setting out responsibilities and obligations of Secretary of State and Academy Trust • No scope for change: school specific information included Commercial Transfer Agreement (CTA) • Agreement between Local Authority and Academy Trust on transfer of staff, contracts, and liabilities from existing school Report on Title • Confirms ownership of land: Titles held by Land Registry Land Transfer • Model document adapted by Local Authority • Includes Shared Use Agreements e.g. Sports facilities Copyright Place Group 2012 Page 4 4. Securing the Land, premises and buildings Two situations 1. Academy Trust leases land and buildings from the Local Authority and Foundation on 125-year term at peppercorn rent 2. Academy Trust is the freeholder as a result of transfer from existing Foundation Different legal documents required for both • Leasehold agreement • Transfer of title (TR1) DfE need to approve Report on Title before Funding Agreement Academy Trust responsible for upkeep of land and buildings Capital funding from central bodies e.g. YPLA Copyright Place Group 2012 Page 5 5. How an Academy is governed Existing School Governing Body usually determine composition of future Academy Trust Members and Board of Governors • Any existing Foundation or Diocese will need to be involved Governance defined in Memorandum & Articles of Association which needs DfE approval Academy Trust is established by individual Members Academy Trust delegates management to the Governors, who: • comply with and ensure the Trust complies with company and charity law • manage and comply with the obligations in the Funding Agreement • ensure the quality of educational provision • challenge and monitor the performance of the academy • manage the academy trust's finances and property • employ staff Copyright Place Group 2012 Page 6 6. Academy governance Existing Governing Body agrees: • • • Composition of Academy Trust Members and the process for appointment Composition of Academy Board of Governors Agreement of Foundation Proposed Articles of Association submitted to DfE • • Sets out proposed governance model Memorandum lists the initial Members Academy Trust Members meet soon after conversion to appoint Governing Body • • • Nominate Community Governors Confirm Appointed Governors All Governors registered as Directors Copyright Place Group 2012 7. Financial status of Academy Trust Charitable Company Limited by Guarantee means • No charitable registration but compliance with charity law • No corporation tax but compliance with company law Required to submit annual return to Companies House • Financial year September 1- August 31 • Annual accounts audited by independent auditor by December 31 immediately after financial year end VAT recoverable through two routes • Register for VAT with HMRC • Recover VAT from HMRC (s.33B of Finance Bill) Trading activities may require creation of trading company • e.g. Nursery or Teaching School status Bank account holder Copyright Place Group 2012 Page 8 8. Financial responsibilities of Academy Trust Funding Agreement • • • • • • • Governing Body to approve annual budget Conditions for payment of grants by Secretary of State e.g. annual audit Appoint Accounting Officer Availability of pensions for all staff Borrowing Powers (or lack of them) Adequate insurance Comply with Academies Finance Handbook Articles of Association • Financial relationships between Academy Trust, Members and Governors • Appointment of Company Secretary • Indemnity of Governors/Directors Academies Financial Handbook • Must have Finance Committee • Statement of financial regulations, policies and operations • Appoint Responsible Officer Copyright Place Group 2012 Page 9 9. Academy funding Funding set out in General Annual Grant (GAG) letter from YPLA • • • • LACSEG (aka Top Slice) for AY 2012-13 per pupil (secondary) • • School Budget Share based on LA s251 report LACSEG Mainstreamed grants Rebates Average across England: Leicestershire £303 £237 September 2012 – August 2013 • • YPLA will then send draft GAG for 2012-13 up to one month prior to conversion AFY 2012-2013 based on January 2012 data Copyright Place Group 2012 Page 10 Any Questions ? Copyright Place Group 2012