ALPHA Academies Trust (formerly The College Academies Trust)

Transcription

1 ALPHA Academies Trust (formerly The College Academies Trust) Registered number: Trustees report and financial statements For the year ended 31 August 2017

2 CONTENTS Page Reference and Administrative Details 1-2 Trustees' Report 3-14 Governance Statement Statement on Regularity, Propriety and Compliance 19 Statement of Trustees' Responsibilities 20 Independent Auditor's Report on the Financial Statements Independent Reporting Accountant's Assurance Report on Regularity Statement of Financial Activities Incorporating Income and Expenditure Account 26 Balance Sheet 27 Statement of Cash Flows 28 Notes to the Financial Statements 29-53

3 REFERENCE AND ADMINISTRATIVE DETAILS Members Trustees C Jones, Chair D Heywood (appointed 1 October 2016) J Patino (appointed 9 March 2017) P Richards (appointed 1 October 2017) M White (appointed 9 March 2017) C Jones, Chair D Heywood P Jackson S Robinson J Sharma (appointed 26 May 2017) K Townshend R Maguire (appointed 26 May 2017) R Billington (appointed 3 April 2017) Company registered number Company name Principal and registered office Company secretary Accounting Officer Senior management team Independent auditor Bankers The ALPHA Academies Trust ( formerly) the College Academies Trust) Discovery Drive Stoke-on-Trent ST2 0GA M Bagshaw S Robinson Sarah Robinson, Chief Executive Officer (CEO) Ann-Marie Lucy, Chief Operating Officer Simon French, Principal Darren Bishop, Principal Jonathon Badderley, Principal Lee Nixon, Principal (resigned 31 December 2016) Mazars LLP Chartered Accountants Statutory Auditor Park View House 58 The Ropewalk Nottingham NG1 5DW Lloyds Bank Plc 125 Colmore Row Birmingham B3 3SF - 1 -

4 REFERENCE AND ADMINISTRATIVE DETAILS OF THE ACADEMY TRUST, ITS TRUSTEES AND ADVISERS Advisers (continued) Solicitors Freeths LLP Federation House Station Road Stoke on Trent ST4 2SA - 2 -

5 TRUSTEES' REPORT The Trustees (who are also directors of the charity for the purposes of the Companies Act) present their annual report together with the audited financial statements of The ALPHA Academies Trust (formerly The College Academies Trust) for the year ended 31 August The Trustees confirm that the Annual Report and financial statements of the Trust comply with the current statutory requirements, the requirements of the Academy Trust's governing document and the provisions of the Statement of Recommended Practice (SORP) "Accounting and Reporting by Charities" issued in March The Trust is made up of 5 Academies comprising of 2 High Schools, 1 Primary and 2 Studio Colleges in the city of Stoke on Trent. The Trust s Academies have a combined pupil capacity of 2,600 on roll in the school census year November STRUCTURE, GOVERNANCE AND MANAGEMENT Constitution The Academy Trust is a charitable company limited by guarantee and an exempt charity. The Academy Trust is constituted under a Memorandum an Articles of Association which are the primary governing documents of the Trust. Details of the Trustees who served during the year are included in the Reference and Administrative details on page 1. Members' Liability 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. Trustees' Indemnities The Academies Trust, through its insurance provision, indemnifies Trustees against claims made arising from professional negligence or errors and omissions whilst on Trust business. The ESFA, RPA insurance cover provides unlimited cover. Method of Recruitment and Appointment or Election of Trustees In the 2016/17 academic year Stoke on Trent College remained as sponsor of The College Academies Trust, and through this relationship its Governing Body took an active role and nominated a number of Trustees to the Trust Board. Other Governors representing staff, parents, employers and education partners have been nominated by other interested parties and form part of the local Governing Body Boards. The management of the Trust is the responsibility of the Trustees who are selected and co-opted under the terms of the Memorandum and Articles of Association. The Trustees are Directors of the charitable company for the purposes of the Companies Act 2006 and Trustees for the purposes of the charity legislation. On 15th July 2017 The College Academies Trust gained its own independent sponsor status. This was with the support and approval of the Stoke on Trent College board of Governors, the DfE and the Regional School Commissioner. This decision, in effect, de-coupled the College from the Trust. This changed prompted a review of governance arrangements and it was agreed to increase the number of Trustees to 7 and Members to 5. Independent Trustees and Members were appointed, in line with Memorandum and Articles, this was to give greater breadth of skills and experience in the education sector

6 TRUSTEES' REPORT (continued) On 31st July 2017 the College Academies Trust changed its name to ALPHA Academies Trust, this was to reflect the fact that Stoke on Trent College had ceased to be the sponsor. In May 2017 the Trustees undertook a review of the Articles of Association and made a number of changes in line with the model set as recommended by the Trust s legal advisers. The term of office for any Governor is four years, with a maximum two terms of office considered as good practice. This time limit does not apply to the Trust Chief Executive. The recruitment and succession planning of Trustees supports the Trust s Vision and Strategic Ambitions. The skills and profile of the Trust Board must reflect the governance needs of the Trust including; Leadership, Policy, Governance Education - Curriculum and Performance Risk and Audit Strategic Partnership; Economic regeneration Human Resource Estates and Property Health and Safety Human Resources Finance Safeguarding Policies and Procedures Adopted for the Induction and Training of Trustees and Governors The Trust Board requires its Trustees and Governors to have a broad range of skills and previous experiences in order to be effective in governance. The Board undertakes an annual audit and review of skills to inform the recruitment and development process for all Trustees and Governors. The steps taken to recruit and appoint a new trustee or governor are set out below. Induction of new Trustees/Governors is provided by the Clerk to the Trust on appointment. Where necessary the induction programme will include training on educational, legal and financial matters together with any statutory training in respect of safeguarding, Prevent and health and safety policy and procedures. All new Trustees / Governors will be given the opportunity to tour the Academy they are to be a Governor at and have the chance to meet with staff and students. They are provided with copies of key documents, such as policies, procedures, accounts, budgets, plans and other documents they need to undertake their role as a Trustee / Governor. It is expected that only a small number of new Governors will be appointed each year. Any induction will be carried out informally and will be tailored specifically to the individual

7 TRUSTEES' REPORT (continued) Organisational Structure The Trust has a Board of Trustees responsible for overseeing the strategic direction and performance of the academies within the Trust and the Trust overall. Two sub-committees of the Board have been established: the Finance and Operations Committee and the Audit Committee. Each Academy has a local governing body that meets a minimum of four times per year. The Trust has established a leadership and management structure to enable efficient and effective delivery and provide value for money. The structure comprises: The Members The Trustees The Local Governing Bodies The Executive Leadership Team of the Trust The Academy leadership teams for each Academy The Chief Executive leads an Executive Leadership Team comprising all Academy Principals and the Chief Operating Officer. This group is responsible for the implementation of Trust strategy and prioritising work plans at Trust level. The Chief Executive assumes the role of Accounting Officer for the Trust. Each Academy within the Trust is led by a Principal with an appropriate leadership team to support the Academy. All roles and responsibilities are clearly set out in a Scheme of Delegation. The Finance and Operations Committee is responsible for all Finance, HR and Estates and Premises items. The Audit Committee is responsible for the audit and risk register. All have approved terms of reference set out in the Scheme of Delegation. The internal audit role is carried out by HCSS and all reports are monitored and reviewed by the Audit committee. The Trust Board have approved a scheme of financial delegation which clearly sets out the level of financial authority delegated to Trustees, Local Governing Bodies, the Finance and Operations Committee, the Chief Executive, Chief Operating Officer, Principals and members of the Senior Leadership Teams in each Academy. The Senior Leadership Team (SLT) are responsible for the day to day operations of the Academy at an executive level, they implement the policies laid down by the Trustees and report back to them. The SLT is led by a Principal. The Principal of each Academy reports to the Chief Executive who is also the Accounting Officer for the Trust. The Senior Leadership Team are responsible for developing and implementing Academy plans which seek to deliver the best possible education for its students within the agreed budget and scheme of delegation approved by the Directors. The Extended Leadership Team (ELT) is made up of Heads of Faculty and Lead Managers in the Achievement & Behaviour Teams and also the operational teams. These managers are responsible for the day to day operation of the Academy, in particular organising the teaching / support staff, facilities and students. Heads of Faculty have delegated budgets and management responsibilities

8 TRUSTEES' REPORT (continued) Arrangements for setting pay and remuneration of key management personnel The Chief Executive, Principals and all senior leaders engage in an annual cycle of performance management. The process involves the review of the previous year s performance and setting specific objectives for the forthcoming year. The Trust s Standards Improvement Partner supports the Board in providing an external assessment of the performance of individual post holders in respect of their performance against objectives and the self evaluation process. The National Standards of Excellence for Head Teachers (DfE 2015) are used as guidance to support this process as well as shaping the practice and professional development of senior leaders; informing the appraisal process; supporting recruitment and providing a framework for training middle and senior leaders. The Trust has adopted the Stoke on Trent Local Authority policy and procedures (agreed by Trade Unions) for performance management. This enables the process to be benchmarked against local Schools and Academies. Decisions relating to pay progression are presented to the Trust Board for approval in line with the Trust s Scheme of Delegation. In addition, the Trust has adopted the School Teachers pay and conditions document that was agreed both nationally and locally. The pay scale adopted in the Trust is the current teachers and support staff national pay scales. These arrangements have been agreed by the recognised Trade Unions and ensures equal pay in line with the Performance Management policy. Related Parties and other Connected Charities and Organisations Stoke on Trent College acted as the sponsor to The College Academies Trust until 31st July 2017.Where economically feasible and in the best interests of both organisations, services and resources were shared or organised on a joint basis. A number of students from The Discovery Academy and Excel Academy attend courses at Stoke on Trent College to enhance their education in specialist areas under normal business arrangements. There is also a charge for the Group Chief Executive s time (until appointed by the Trust as full time CEO in March 2017), which is spent running the Trust and a charge in respect of the Sponsor's Director of Finance who also supports the Trust. Both are employed by Stoke on Trent College. In addition the Trust purchased services from Stoke on Trent City Council under normal business arrangements. The Discovery Academy provided a number of centralised services to the other Academies in the Trust to help reduce costs and streamline back office services. The Studio Colleges are based at Stoke on Trent College Burslem and the Centre of Refurbishment Excellence building in Longton and the students also spend time at both the Discovery and Excel sites. From August 2017 The College Academies Trust changed it name to the ALPHA Academies Trust and became its own sponsor

9 TRUSTEES' REPORT (continued) OBJECTIVES AND ACTIVITIES Objectives, Strategies and Activities Our Strategic Ambition The Trust will continue to prioritise raising standards of progress and attainment for all students in all academies. Alongside this the Trust will ensure that each school sets a balanced budget each year and all expenditure is managed within set budgets. The Trust is also seeking to expand the number of academies within the multi-academy trust over the next five years. This is in line with the Trust s strategic ambitions and business model to develop a sustainable model of a MAT based on geographical clusters incorporating primary and secondary schools. The strategic aim is to expand from an established Trust of five academies based in Stoke on Trent and around 2,600 pupils to a Regional Trust model with between schools and approximately 10,000 to 12,000 students. Our strategic ambitions are driven through the development of our approach to developing a Growth Mindset culture. For our Trust this focuses on: Expect Excellence Unwavering high expectations Overcome Obstacles Ambition and confidence to exceed targets Maximum Effort Motivated to use feedback to do your best Expert Teaching and Feedback Expert coaching provides the right feedback to improve Inspire and be Inspired Being part of the change Pride and Respect Proud to work as part of a team Developing System Leadership System leadership takes place when leaders working together plan and deliver a strategy that improves educational outcomes for children across a number of schools, some of whom the leaders never get to meet. The Trust provides the following professional support to all five Academies in the Trust: Strategic planning Educational Financial Management Human Resources Estates Management Governance and Clerking Business Management Legal Services Contracts Management Policy Development Health, Safety and Welfare Safeguarding and Child Protection IT services and support - 7 -

10 TRUSTEES' REPORT (continued) Community Aspiration: Our Academies will work with community leaders to develop a high profile and positive, aspirational culture within their local community; Our Academies will develop an effective parental voice influencing school improvement. To support growth the Trust is reviewing and auditing the following areas: Standards and Track Record of improving schools including performance over time and response of the Trust to under performance; People and Leadership including internal capacity to create regional hubs, the finance and HR capacity and School to School support models; Governance including Board capacity and strength, the accountability model; Financial sustainability including financial health and medium and long term planning; Risk Management including risk plans and mitigation. Public benefit The Trust s Trustees have complied with their duty to have due regard to the guidance on public benefit published by the Charity Commission in exercising their powers or duties. Inextricably linked with this purpose is the aim of contributing to the public good. Through the provision of incidental educational activities and other activities we aim to contribute considerable benefits to the local community. There have been a significant number of activities undertaken by the Academies in the Trust during the financial period to further its charitable process for the public benefit. We feel that we make a good contribution to community cohesion. STRATEGIC REPORT Review of Activities Discovery At the Discovery Academy, an Ofsted inspection in October 2016 judged the Academy as Requires Improvement, more specifically the following individual areas were judged as good Leadership and Management; Teaching, Learning and Assessment; Behaviour and Safeguarding. External reviews had confirmed that systems and procedures were effective in raising standards. This has also been confirmed by the significant improvements that have been made across a range of progress and attainment measures, following the publication of the 2017 GCSE results. Progress 8 was in 2017 compared with in in English and Maths was 52% in 2017 compared with 47% in 2016 EBACC was 17% in 2017 compared with 9% in 2016 Attainment 8 was 41 in 2017 compared with 40 in 2016 EBACC element of Progress 8 was compared with in 2016 The results also place the Discovery Academy as the most improved school in the City

11 TRUSTEES' REPORT (continued) Excel Students at The Excel Academy performed well and in line with expectations in the 2017 GCSE exams. Performance in Mathematics and English was in line with national expected progress and consolidated the significant improvements in recent years. The results also confirmed improvements in Science and some improvement in Humanities. Students progress over a range of other subjects including Art, Photography, Textiles, Sport and BTEC qualifications was very positive. The reputation of the Academy continues to grow with years 7, 8 and 9 now oversubscribed and applications to join the Academy in 2018 increasing further. This poses challenges as the Academy implements structures to meet the needs of the growing student population. However the Academy has a clear plan in place to further improve outcomes. The positive ethos of pride and respect and a focus on growth mindset is becoming embedded and is impacting on students' attitudes to learning. Future results should reflect this. Maple Court The Academy continues to build on the improvements recognized in the January 2016 Ofsted Inspection. The quality of teaching is consistently good as a result of rigorous leadership and consequently progress scores from Key Stage 1-2 were above average for Writing and Mathematics and in the top 20% of schools nationally (July 2017). The Academy met the National Floor Target at the end of Key Stage 2. Further investment in the building has taken place following the completion of the new kitchen and dining area and all classrooms have now been refurbished. The Academy plans to develop a programme of improvements to the outside grounds commencing in Studio Colleges The Principal of the Studio Colleges resigned in December 2016 to take up a Principal s post at an Academy. The Trust undertook a review of the long-term future viability of the Studio Colleges (CABE and MADE) given the low and declining levels of student recruitment and existing student numbers. The Trust has taken the decision to close both Studio Colleges and has entered into discussion with the RSC and DfE in respect of a proposal to phase the closure over the next two years with CABE closing in 2018 and MADE in The Trust has prepared financial forecasts to model the financial effect of this phased closure on both schools and on the Trust. To support this phased closure and support the educational needs of all students at the Studio Colleges, the Trust appointed the Chief Executive Officer as the Interim Principal of the Studio Colleges and made arrangements for the students to access the majority of their core subject teaching at their home school, either Discovery Academy or Excel Academy. This arrangement has proved successful and was commended by Ofsted during their inspection in October Studio College Cabe deficit will be covered by Studio MaDE overall reserves surplus. Any combined deficit arising on the closure of the two Studio Schools, CaBE and MaDE, will be met by the overall general reserves held within the Trust

12 TRUSTEES' REPORT (continued) Key Performance Indicators The Trust is committed to delivering the highest standards of education in all of its Academies and to providing every student with the opportunities, ambition and aspiration to succeed and progress. Each Academy in the Trust has its own Development Plan designed to address specific areas for development. However, the ALPHA Trust Board has identified a number of areas for development common to all Academies in the Trust and has a clear focus on addressing these: 1. Raising attainment across all subjects so that our students make accelerated progress, achieve their targets and exceed National Averages 2. Utilise pupil premium funding effectively to support the progress and achievement of disadvantaged students 3. Ensure that the quality of teaching in all of our Academies is consistently good or better 4. Provide learning environments that are safe and secure, where behaviour and attitudes to learning are good or better and attendance is improving towards National targets 5. Improve the effectiveness of leaders and managers at all levels to ensure maximum impact and measurable improvements in student performance 6. Develop staffing, systems and outcomes to the standard required to ensure a good or better judgement by OFSTED 7. Continue to raise the profile and reputation of the Trust and the Academies within it to attract increasing numbers of students 8. Expand the membership of the Trust and the wider Federation in accordance with the strategic plan. Going Concern After making appropriate enquiries, the Board of Trustees has a reasonable expectation that ALPHA Academies Trust has adequate resources to continue in operational existence for the foreseeable future. For this reason it continues to adopt the going concern basis in preparing the financial statements. Further details regarding the adoption of the going concern basis can be found in the Statement Accounting Policies. FINANCIAL REVIEW The ALPHA Academies Trust financial objectives are to achieve an annual operating surplus, to fund capital projects required over the coming years and to pursue alternative sources of funding to support the Trust s projects. Most of the Trust funding is obtained from the ESFA in the form of recurrent grants the use of which is restricted to particular purposes. The grants received from the ESFA during the year ending 31st August 2017 and the associated expenditure are shown as restricted funds in the Statement of Financial Activities. The analysis of the specific grants received can be seen in note 2 to the financial statements. The Trust also received grants for fixed assets from the ESFA. In accordance with the Charities Statement of Recommend Practice. Such grants are shown in the Statement of Financial Activities as restricted income in the fixed asset fund. The restricted fixed asset fund balance is reduced by annual depreciation charges over the expected useful life of the assets concerned

13 TRUSTEES' REPORT (continued) During the year ending 31st August 2017, grants included devolved capital totalling 58,267. This was primarily spent on the maintenance of assets and perimeter fencing. The Trust also received capital funding from the ESFA of 572 for MaDE Studio College. All the funding above was spent for the purposes intended and within the timeline specified by the ESFA. The financial statements reflect the sixth year of operational activity for the Trust. During the period 2016 / 2017 the Trust received total income of 15,450,980 of this sum 12,842,826 was received from the DfE via the Education Skills Funding Agency in respect of its General Annual Grant. This is used for day to day running costs. Costs for the year totalled 16,213,567 (excluding depreciation). The total free reserves being held at year end are 4.3m. The reserves are being held to support the coming years reducing student numbers in two of our Academies and also growth in other academies. In addition there are a number of capital projects including the refurbishment of two 3G football pitches and a need to support the Discovery Academy as it has come out of a PFI scheme. The reserves have reduced annually in line with the reserves policy. The LGPS deficit as at the 31st August 2017 increased to 6.5m from 5.9m. The agreed contribution rates for 2016 / 17 was 21.2 % and for 2017 / 18 increased to 22.2%. The revised rates for future years have been produced in the latest valuation carried out earlier in The new triennial valuation carried out by Staffordshire Pension Fund Agency shows the rates for 2018/19 will increase to 23.2% and 24.2% in 2019/20. A review on staffing structures, financial prudence and additional grants has helped the Trust to achieve a planned operating surplus. Staff numbers have reduced over the last 5 years making some significant savings. The accounts include the valuation of the buildings and grounds within the Trust, which amounted to 47,204,318 at 31 August Reserves Policy The Board of Trustees reviews the reserve levels of the Trust annually at the year end and as a part of its budget planning. This review encompasses the nature of the income and expenditure streams, the need to match income with commitments and the nature of reserves. Trustees determine what the level of uncommitted reserves should be and forms part of the reserves policy, which is reviewed annually. The aim is to provide sufficient working capital to cover delays between spending and receipt of grants and to provide a cushion to deal with unexpected emergencies such as urgent maintenance. As a part of its monitoring of in year financial performance, the Trustees review the forecast impact on reserves and consider this as a part of its medium term financial planning. During 2016 / 2017 the Board of Trustees planned to establish a high level of restricted general reserves at the year end. This is required to enable it to both manage unforeseen emergencies and also to enable planned use over the medium term to mitigate against anticipated reduced student roll (at the Discovery Academy and the Studio Colleges) and budget shortfall for lagged funding at Excel Academy due to its growth. Included in these reserves is a contingency for life cycle items as the Discovery Academy is no longer part of the PFI scheme and the Excel Academy will require some additional building works due to the growth in numbers and lack of classroom space. Total funds held at 31 August 2017 were 45,584,149 (2016: 47,554,510) of which 4,336,570 (2016: 4,602,408) relates to unrestricted and restricted general funds. Investment Policy The Trust has withdrawn 1,500,000 previously invested in a Lloyds Bank deposit account. The treasury policy in place is reviewed annually by the Board. It is proposed to invest 1,000,000 in a 32-day short term notice deposit account to provide quick and easy access while interest rates are minimal

14 TRUSTEES' REPORT (continued) Principal Risks and Uncertainties Financial - the Trust has considerable reliance on continued Government funding through the ESFA. In the last year 95% of incoming resources was Government funded and whilst this level is expected to continue, there is no assurance Government policy or practice will remain the same or that public funding will continue at the same levels or on the same terms. The impact of the fair funding formula is awaited. Failures in governance and/or management - the risk in this area arises from potential failure to effectively manage the Trust s finances, internal controls, compliance with regulations and legislation, statutory returns etc. The Trustees through their governance structure continue to review and ensure appropriate measures are in place to mitigate these risks. Reputational the continuing success of the Trust is dependent on the success of each of its Academies, which are reliant on continuing to attract applicants in sufficient numbers by maintaining the highest educational standards. To mitigate this risk, Trustees and Local Governors ensure that student success and achievement are closely monitored and reviewed. Safeguarding and Child Protection the Trustees and Local Governors 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 and safety and discipline. Fraud and mismanagement of funds The Trust appoints Internal Auditors, HCSS to carry out checks on financial systems and records as required by the financial procedures manual. Trustees are aware of any major risks to which the Academies Trust is exposed, in particular those relating to the specific teaching, provision of facilities and other operational areas of each of the schools and its finances. Systems have been implemented, including operational procedures and internal financial controls in order to minimise risk. Where significant risk still remains they have ensured that adequate insurance cover is in place

15 TRUSTEES' REPORT (continued) PLANS FOR FUTURE PERIODS The Trust will continue to prioritise raising standards of progress and attainment for all students in all academies. Alongside this the Trust will ensure that each school sets a balanced budget each year and all expenditure managed within set budgets. The Trust is also seeking to expand the number of academies within the multi-academy trust over the next five years. This is in line with the Trust s strategic ambitions and business model to develop a sustainable model of a MAT based on geographical clusters incorporating primary and secondary schools. Strategic Ambitions to 2020 Our Vision To lead a high performing Trust of great schools, clustered in local communities across Stoke-on-Trent, Staffordshire and Cheshire. Our Mission Every pupil will go to a school in the Trust where: there is good behaviour, strong discipline, order and safety where they are taught a broad, balanced and flexible curriculum including skills for learning and life they are taught in a way that meets their needs, where their progress is regularly checked and where additional needs are spotted early and supported they take part in sport and cultural activities their health and wellbeing is promoted; where they the chance to express their views and where their families are welcomed and valued. Our Values We always put pupils first We are known for our track record in raising performance We work collaboratively with schools in the Trust and partners outside the Trust We support our staff to develop their expertise and aim to recruit, develop and deploy staff to increase the capacity of the Trust We strive for excellence in all we do. Our Growth Mindset forms the basis of strategic priorities for each academy Expect Excellence Challenge Yourself Overcome Obstacles Maximum Effort Expert Teaching and Feedback Inspire and be inspired Pride and Respect. FUNDS HELD AS CUSTODIAN TRUSTEE ON BEHALF OF OTHERS The Academy does not hold funds as a custodian Trustee on behalf of others

16 TRUSTEES' REPORT (continued) PROVISION OF INFORMATION TO AUDITOR Each of the persons who are Trustees at the time when this Trustees' Report is approved has confirmed that: so far as that Trustee is aware, there is no relevant audit information of which the charitable company's auditor is unaware, and that Trustee has taken all the steps that ought to have been taken as a Trustee in order to be aware of any information needed by the charitable company's auditor in connection with preparing its report and to establish that the charitable company's auditor is aware of that information. Auditor The auditor, Mazars LLP, has indicated its willingness to continue in office. The Designated Trustees will review the auditors contract as it is at the end of the 3-year contract. The Trustees' Report was approved by order of the board of trustees, as the company directors, on 11 December 2017 and signed on its behalf by: C Jones Chair of Trustees

17 GOVERNANCE STATEMENT Scope of Responsibility As Trustees, we acknowledge we have overall responsibility for ensuring that The ALPHA Academies 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 The ALPHA Academies 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. Governance 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 8 times during the year. Attendance during the year at meetings of the board of trustees was as follows: Trustee Meetings attended Out of a possible C Jones, Chair 8 8 D Heywood 8 8 R Billington 2 3 P Jackson 7 8 R Maguire 1 3 S Robinson 7 8 J Sharma 1 1 K Townshend 7 8 Governance reviews This year the Trust completed the action plan prepared following the full Governance review carried out by the National Governance Association in June One of the main recommendations was to review governance arrangements an increase the number of Members and Trustees. Whilst some changes in this respect took place last year, the Trust has appointed 4 Members and 3 Trustees following a recommendation from the DfE to provide additional capacity to grow in line with the Trust s application for independence. A number of training sessions took place covering finance responsibilities and the EFA frame work. Pupil Premium funding, Pupil data levels, Ofsted frame work courses and Prevent training. The training has had a good impact as the Governors now feel they have good under-pinning knowledge and are more confident in asking challenging questions on the above subject areas. This has enabled the Governing Body Boards to be more effective. The Audit Committee is also a sub committee of the main board of Trustees. Its purpose is to maintain an oversight of the Academy Trust's governance, risk management, internal control and value for money framework. It will report its findings annually to the Governing Body and the Accounting Officer as a critical element of the Academy Trust's annual reporting requirements. The Audit Committee has no executive powers or operational responsibilities / duties

18 GOVERNANCE STATEMENT (continued) Attendance at meetings in the year was as follows: Trustee Meetings attended Out of a possible N Bromley (chair) (resigned May 2017) 1 1 K Townsend 2 2 A Fox (appointed February 2017) 1 1 There is also a Trust Finance and Operations committee that meetings twice a year. CAT Finance & Operations Committee Attendance at meetings in the year was as follows: Meetings attended A Veale 2 2 C Jones 2 2 S Robinson 2 2 A Moult 1 1 Out of a possible There are also 4 Local Governing Body meetings held at each Academy annually. Review of Value for Money As Accounting Officer, the Chief Executive Officer has responsibility for ensuring that the 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 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, including the use of benchmarking data where available. The Accounting Officer for the Trust has delivered improved value for money during the year by: The Trust takes a prudent approach to expenditure as 75% of the Trust s budget is spent on staffing. Staffing structures are reviewed annually to ensure that they are fit for purpose and can adapt and respond to support successful attainment of the objectives within the Academies development plans. A number of savings have been made this year against budget. The Trust has carried out two restructures during the year to ensure effective and efficient structures are in place to support the curriculum and operations of the Academies. The Trust has a high proportion of skilled and experienced support staff who are deployed throughout the Trust to deliver a number of back office services that have been centralised to gain economies of scale. An example of this is that this year the Trust created a number or roles by utilising current staff. Two posts created were an Executive Business Manager, who is responsible for HR and payroll and an Assistant Principal, who is responsible for Safeguarding and Pupil Premium in the group

19 GOVERNANCE STATEMENT (continued) A number of estimated savings have been made as detailed below: An educational materials agreement has been negotiated to save 20% off cost A group Payroll and HR contract has savings of c. 3,000 A group counselling SLA has savings of c.3,000 In-house branding has savings of c.19,000 Group CPD training has savings of c.5,000 In house project of building six websites has savings of c.36,000 There is a continuing programme of targeted cost savings for head office and academies The Purpose of the System of Internal Control The system of internal control is designed to manage risk to a reasonable level rather than to eliminate all risk of failure to achieve policies, aims and objectives; it can therefore only provide reasonable and not absolute assurance of effectiveness. The system of internal control is based on an ongoing process designed to identify and prioritise the risks to the achievement of Academy Trust policies, aims and objectives. Also 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 the ALPHA Academies Trust for the year ended 31 August 2017 and up to the date of approval of the annual report and financial statements. Capacity to Handle Risk The Board of Trustees has 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 Trustees are of the view that there is a formal ongoing process for identifying, evaluating and managing the Academy Trust's significant risks. The Trustees also note that this has been in place since 1st September 2016 to 31 August 2017 and up to the date of approval of the annual report and financial statements. This process is regularly reviewed by the Board of Trustees. The Risk and Control Framework 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 monitoring systems with an annual budget and periodic financial reports which are reviewed and agreed by the Board of Trustees regular reviews by the Trustees and local governing bodies of reports which indicate financial performance against the forecasts and of major purchase plans, capital works and expenditure programmes setting targets to measure financial and other performance clearly defined purchasing (asset purchase or capital investment) guidelines; delegation of authority and segregation of duties production of a 3-year budget plan presented to the Finance & Operations committee; identification and management of risks. The Board of Trustees has considered the need for a specific internal audit function and has decided to appoint HCSS Education as internal auditor. The internal auditor's role includes giving advice on financial matters and performing a range of checks on the Trust s financial systems. Twice a year the internal auditor reports to the Audit committee on the operation of the systems of control and on the discharge of the board of trustees' financial responsibilities. A schedule of work was approved during the year and adhered to. The schedule included the assets checks,

20 GOVERNANCE STATEMENT (continued) testing of payroll, purchasing, payment and banking procedures as well as review of cash control and budget monitoring process across the Trust. There were no findings which were perceived as a high or material risk. HCSS have delivered their schedule of work as planned and did not identify any material control issu Review of Effectiveness 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 internal auditor the work of the external auditor the financial management and governance self assessment process the work of the executive managers within the Academy Trust who have responsibility for the development and maintenance of the internal control framework. The Accounting Officer has been advised of the implications of the result of their review of the system of internal control by the internal auditors and a plan to ensure continuous improvement of the system is in place. Approved by order of the members of the board of trustees on 11 December 2017 and signed on their behalf, by: C Jones, Chair Chair of Trustees S Robinson Accounting Officer

21 STATEMENT ON REGULARITY, PROPRIETY AND COMPLIANCE As Accounting Officer of ALPHA Academies Trust (formerly The College Academies Trust) I have considered my responsibility to notify the academy trust board of trustees and the Education and Skills Funding Agency (ESFA) of material irregularity, impropriety and non-compliance with ESFA terms and conditions of funding, under the funding agreement in place between the academy trust and the Secretary of State for Education. As part of my consideration I have had due regard to the requirements of the Academies Financial Handbook I confirm that I and the academy trust board of trustees are able to identify any material irregular or improper use of funds by the academy trust, or material non-compliance with the terms and conditions of funding under the academy trust s funding agreement and the Academies Financial Handbook I confirm that no instances of material irregularity, impropriety or funding non-compliance have been discovered to date. If any instances are identified after the date of this statement, these will be notified to the board of trustees and ESFA. S Robinson Accounting Officer Date: 11 December

22 STATEMENT OF TRUSTEES' RESPONSIBILITIES The Trustees (who act as governors of The ALPHA Academies Trust ( formerly) the College Academies Trust) and are also the directors of the charitable company for the purposes of company law) are responsible for preparing the Trustees' Report and the financial statements in accordance with the Annual Accounts Direction issued by the Education and Skills Funding Agency, United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice) and applicable law and regulations. Company law requires the Trustees to prepare financial statements for each financial year. Under company law the Trustees must not approve the financial statements 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 financial statements, the Trustees are required to: select suitable accounting policies and then apply them consistently; observe the methods and principles of the Charities SORP 2015 and the Academies Accounts Direction 2016 to 2017; make judgments and accounting estimates that are reasonable and prudent; state whether applicable UK Accounting Standards (FRS 102) have been followed, subject to any material departures disclosed and explained in the financial statements; prepare the financial statements 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 financial statements comply with the Companies Act 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 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 financial statements may differ from legislation in other jurisdictions. Approved by order of the members of the board of trustees and signed on its behalf by: C Jones, Chair Chair of Trustees Date: 11 December

23 INDEPENDENT AUDITOR'S REPORT ON THE FINANCIAL STATEMENTS TO THE MEMBERS OF Opinion We have audited the financial statements of ALPHA Academies Trust (formerly The College Academies Trust) (the 'trust') for the year ended 31 August 2017 which comprise the Statement of Financial Activities, the Balance Sheet, the Statement of Cash Flows and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law, the Academies Accounts Direction 2016 to 2017 issued by the Education and Skills Funding Agency and United Kingdom Accounting Standards including the Financial Reporting Standard Applicable in the UK and Republic of Ireland ((Charities SORP 2015 (FRS 102)) (United Kingdom Generally Accepted Accounting Practice). In our opinion, the financial statements: give a true and fair view of the state of the charitable company s affairs as at 31 August 2017 and of its incoming resources and application of resources, including its income and expenditure, for the year then ended have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; have been prepared in accordance with the requirements of the Companies Act 2006; and have been prepared in accordance with the Charities SORP 2015 and Academies Accounts Direction 2016 to 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 financial statements section of our report. We are independent of the charitable company in accordance with the ethical requirements that are relevant to our audit of the financial statements 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. Conclusions relating to going concern We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where: the Trustees use of the going concern basis of accounting in the preparation of the financial statements not appropriate; or the Trustees have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company 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 financial statements are authorised for issue

24 INDEPENDENT AUDITOR'S REPORT ON THE FINANCIAL STATEMENTS TO THE MEMBERS OF Other information The Trustees are responsible for the other information. The other information comprises the information included in the Trustees Annual Report, other than the financial statements and our auditors reports thereon. Our opinion on the financial statements 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 financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements 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 financial statements 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. Opinion on other matter prescribed by the Companies Act 2006 In our opinion, based on the work undertaken in the course of the audit: the information given in the Trustees Annual Report including the incorporated strategic report for the financial year for which the financial statements are prepared is consistent with the financial statements;and the Trustees Annual Report including the incorporated strategic report have been prepared in accordance with applicable legal requirements. Matters on which we are required to report by exception In light of the knowledge and understanding of the charitable company and its environment obtained in the course of the audit, we have not identified material misstatements in the Trustees Annual Report including the incorporated strategic report. We have nothing to report in respect of the following matters where 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 we have not received all the information and explanations we require for our audit