Registered number: HAYES SCHOOL (A COMPANY LIMITED BY GUARANTEE) ANNUAL REPORT AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2016

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1 Registered number: ANNUAL REPORT AND FINANCIAL STATEMENTS

2 CONTENTS Page Reference and administrative details 1-2 Trustees' report 3-9 Governance statement Statement on regularity, propriety and compliance 13 Statement of Trustees' responsibilities 14 Independent auditors' report on the financial statements Independent reporting accountant's assurance report on regularity Statement of financial activities incorporating income and expenditure account 19 Balance sheet 20 Statement of cash flows 21 Notes to the financial statements 22-43

3 REFERENCE AND ADMINISTRATIVE DETAILS Members and Trustees Trustees C Peters, Vice Chair M Hanbury, Head Teacher J G E Frost, Director (resigned 16 March ) C M Pagett, Chair M Williams H Warren P Childs K Roberts C Mann (resigned 31 August ) S Giles K Grosvenor A Howarth J Palfrey M Curtis (appointed 29 September 2015) N Williams (appointed 26 January ) Company registered number Company name Hayes School Principal and Registered office Hayes Road Paignton Devon TQ4 5PJ Company secretary Accounting Officer Senior management team Independent auditors Bankers S M Hindle M Hanbury M Hanbury, Headteacher K Roberts, Deputy Head D Torpey, Assistant Head L Marchant, Assistant Head M Hartland, Phase Leader D Strong, Foundation Leader J Palfrey, HLTA Bishop Fleming LLP Chartered Accountants Statutory Auditors 50 The Terrace Torquay Devon TQ1 1DD HSBC 7 Palace Avenue Paignton TQ3 3ED Page 1

4 REFERENCE AND ADMINISTRATIVE DETAILS Advisers (continued) Solicitors Kitsons Minerva House Orchard Way Edginswell Park Torquay TQ2 7FA Page 2

5 TRUSTEES' REPORT The Trustees present their annual report together with the financial statements and auditors report of the charitable company for the year ended 31 August. The annual report serves the purpose of both a Trustees report, and a Directors report under company law. The Trust operates an academy for pupils aged 3 to 11 in Paignton and the surrounding area. It has a pupil capacity of 446 and had a roll of 446 in the school census on 25 January. STRUCTURE, GOVERNANCE AND MANAGEMENT Constitution The Academy 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. The Trustees of Hayes School are also the directors of the charitable company for the purposes of company law. Details of the Trustees who served throughout the year, except as noted, are included in the Reference and Administrative Details on pages 1 to 2. Members Liability 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/she is a member, or within one year after he/she ceases 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 Trustees benefit from indemnity insurance purchased at the Academy s expense to cover the liability of the Trustees which by virtue of any rule of law would otherwise attach to them in respect of any negligence, default or breach of trust or breach of duty of which they may be guilty in relation to the Academy, provided that any such insurance shall not extend to any claim arising from any act or omission which the Trustees knew to be a breach of trust or breach of duty or which was committed by the Trustees in reckless disregard to whether it was a breach of trust or breach of duty or not and provided also that any such insurance shall not extend to the costs of any unsuccessful defence to a criminal prosecution brought against the Trustees in their capacity as Directors of the Academy. The limit of this indemnity is 2,000,000. TRUSTEES Method of Recruitment and Appointment or Election of Trustees On 01 April 2011 the Trustees appointed all those Trustees that served the predecessor school to be Trustees of the newly formed Academy. These Trustees were appointed for a term of office that would end when their original term at the predecessor school would have ended, thus ensuring a staggered re-election or replacement process. The Academy's Board of Trustees comprises the Headteacher, a minimum of 5 Parent Trustees, up to 3 Staff Trustees (providing that the total number of Trustees, including the Headteacher, who are employees of the Academy Trust, does not exceed one third of the total number of Trustees) and up to 6 other Trustees. The Academy Trust shall have the following Trustees as set out in its Articles of Association and funding agreement: up to 2 Partnership Trustees who are appointed by members. up to 2 LA Trustees who are appointed by the Local Authority. up to 5 Parent Trustees who are elected by Parents of registered pupils at the Academy. up to 3 staff Trustees appointed by Trustee board Including the head. up to 2 Community Trustees who are appointed by the Trustee board. the Headteacher who is treated for all purposes as being an ex officio Governor. Trustees are appointed for a four-year period, except that this time limit does not apply to the Headteacher. Subject to remaining eligible to be a particular type of Trustee, any Trustee can be re-appointed or re-elected. Page 3

6 TRUSTEES' REPORT (continued) When appointing new Trustees, the Board will give consideration to the skills and experience mix of existing Trustees in order to ensure that the Board has the necessary skills to contribute fully to the Academy's development. Policies and Procedures Adopted for the Induction and Training of Trustees The Academy has Trustee Recruitment, Induction and Training policy available from the Clerk to the Trustees. The training and induction provided for new Trustees will depend upon their existing experience but would always include a tour of the Academy and a chance to meet staff and pupils. All Trustees are provided with copies of policies, procedures, minutes, accounts, budgets, plans and other documents that they will need to undertake their role as Trustees. As there are normally only two or three new Trustees a year, induction tends to be done informally and is tailored specifically to the individual. Advantage is taken of specific courses offered by the Local Authority and other bodies. Organisational Structure The Board of Trustees normally meets once each term. The Board establishes an overall framework for the governance of the Academy and determines membership, terms of reference and procedures of Committees and other groups. It receives reports including policies from its Committees for ratification. It monitors the activities of the Committees through the minutes of their meetings. The Board may from time to time establish Working Groups to perform specific tasks over a limited timescale. There are 4 committees as follows; Finance and Resources Committee - this meets at least four times a year and is responsible for monitoring, evaluating and reviewing policy and performance in relation to financial management, compliance with reporting and regulatory requirements and reporting, receiving reports from the Responsible Officer/internal audit and drafting the annual budget including setting staffing levels. It also incorporates the role of an audit committee. Curriculum Committee - this meets once a term to monitor, evaluate and review Academy policy, practice and performance in relation to curriculum planning, communications, target setting and assessment, examinations and all pastoral issues. Premises Committee Personnel Committee It is planned to combined Finance/Premises and Curriculum/Personnel for the year /17 and if successful to continue this way into the future. The following decisions are reserved to the Board of Trustees; to consider any proposals for changes to the status or constitution of the Academy and its committee structure, to appoint or remove the Chairman and/or Vice Chairman, to appoint the Headteacher and Clerk to the Trustees, to approve the Annual Development Plan and budget. The Trustees are responsible for setting general policy, adopting an annual plan and budget, approving the statutory accounts, monitoring the Academy by the use of budgets and other data, and making major decisions about the direction of the Academy, capital expenditure and staff appointments. The Academy has a leadership structure, which consists of the Trustees, The Senior Leadership Team and Team Leaders. The aim of the leadership structure is to devolve responsibility and encourage involvement in decision making at all levels. The Head Teacher is the Accounting Officer. Arrangements for Setting Pay and Remuneration of Key Management Personnel The Trustees consider the Board of Trustees and the senior leadership team comprise the key management personnel of the Academy in charge of directing and controlling, running and operating the Trust on a day to day basis. All Trustees give their time freely and no Trustee received remuneration in the year. Page 4

7 TRUSTEES' REPORT (continued) Senior Management pay and remuneration is decided by the Pay Committee which meets yearly, any increase in pay is based on performance of the individual and the contribution they make towards the academy. Details of Trustees expenses and related party transactions are disclosed in the notes to the accounts. Connected Organisations, including Related Party Relationships There are no related parties which either control or significantly influence the decisions and operations of Hayes School. There are no sponsors or formal Parent Teacher Associations associated with the Academy. OBJECTIVES AND ACTIVITIES Objects and Aims The principal object and activity of the Academy is to advance for the public benefit education in the United Kingdom, in particular by establishing, maintaining, carrying on, managing and developing a school, offering a broad range of curriculum for pupils of different abilities. The aims of the Academy during the year/period ended 31 August are summarised below: to continue to raise the standard of educational attainment and achievement of all pupils. to provide a broad and balanced curriculum, including extracurricular activities. to develop students as more effective learners. to develop the Academy site so that it enables students to achieve their full potential. to ensure that every child enjoys the same high quality education in terms of resourcing, tuition and care. to improve the effectiveness of the Academy by keeping the curriculum and organisational structure under continual review. to provide value for money for the expended. to develop greater coherence, clarity and effectiveness in school systems. to comply with all appropriate statutory and curriculum requirements. to develop the Academy's capacity to manage change, and to conduct the Academy's business in accordance with the highest standards of integrity, probity and openness. At Hayes School we aim to get the best for, and from, each child. We intend to enable each child to realise his or her full academic, creative and physical potential and to develop positive social and moral values. Our Academy is a community in which children, staff and parents should be part of a happy and caring environment. Objectives, Strategies and Activities Key activities and targets were identified in the Academy Development Plan and were influenced by the significant challenges and opportunities arising from national changes in education policy and funding, including the conversion to Academy status. The activities included the following: review of numeracy, literacy and ICT capability. review of staffing levels in the light of budgetary pressure. Development of Parenting and Pastoral facilities - the school have appointed a dedicated welfare officer to perform this role as well as overseeing the school s attendance and dealing with persistent offenders of late arrival to the school. continued development of systems for tracking and monitoring pupil attainment. Public Benefit 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 Commission's general guidance on public benefit in exercising their powers or duties. They have referred to this guidance when reviewing the Academy's aims and objectives and in planning its future activities. Page 5

8 TRUSTEES' REPORT (continued) STRATEGIC REPORT Achievements and Performance The Academy is in its fourth year of operation and has exceeded the forecast number of students. The total number of students in the year ended 31 August was 459. SATS Writing achieved 68% Level 4 and above, compared with the National Average of 74% Reading is 68% Level 4 and above, compared with the National Average of 66% Mathematics achieved 62% level 4 and above, compared with the National Average of 70%. The Academy has managed to maintain small class sizes, with each year group having its 2 classes except for Year 6, which has a three way split. All classes have a teaching assistant, which is a valuable addition to the classroom. Volunteers have been helping in the Academy this year. Their commitment to the children and Academy is inspirational. They have helped with reading, writing, maths, drama and trips out of school. To ensure that standards are continually assessed, the Academy operates a programme of lesson observations, which are undertaken by the Department Heads and the Senior Leadership Team. The Academy was inspected by OFSTED in May 2013 and was judged to be Good. This year the school installed an astro-turf play area to the front of its nursery unit, this was to allow for a softplay area, as this area of the school was becoming a little hazardous due to the fact that it was concrete and tarmac and was quite uneven. The school has upgraded its core IT infrastructure, with the assistance of ScoMIS and by in-house IT staff, a new fully managed system made by Unifi networks was installed, this included a site wide Wi-Fi system. This allows the school to have segregated networks, a secure guest network for authorised visitors and increased capacity for its growing range of mobile devices in the classroom. Key Performance Indicators As funding is based on pupil numbers this is also a key performance indicator. Pupil numbers for were 459, an increase of 13 over It is anticipated that the school population will continue to increase in future years. Another key financial performance indicator is staffing costs as a percentage of GAG. For this was 86.92%, compared to 87.23% in Two teacher who were on maternity leave, chose not to come back to work at the end of their leave, the Deputy Head retired, who was to be replaced commencing September, three teachers were on long term sick leave and additional teaching staff were employed to not only cover absence but to provide intervention for pupils who require extra assistance in their studies Pupil to teacher ratio 26.2:1 27:1 Teaching Assistants:Teacher Ratio 1.86:1 1.64:1 Student attendance % 95.25% 95.4% Average Exam success (SATS) % 89% 66% Total income per pupil 4,524 4,410 Total GAG per pupil 3,467 3,375 GAG income % of total income 76.5% 76.5% Staff costs per pupil 3,431 3,554 Staff costs as a % of GAG income 1.3: % Total learning resources costs per pupil Property repair costs per pupil Cash balances at the year end 1, , Net assets at the year end 6,188,922 5,583,626 Page 6

9 TRUSTEES' REPORT (continued) Pupil to teacher ratio is lower than the year previous; this is due to additional teaching staff being employed for intervention purposes with less able learners. Attendance has improved, due to proactive intervention by school staff. Teaching Assistant to Teacher Level was also lower than the previous year due to additional teachers to cover intervention for pupils rather than this being the role of a Teaching Assistant. Going Concern After making appropriate enquiries, the Board of Trustees has a reasonable expectation that the Academy 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 Going concern policy. FINANCIAL REVIEW Financial Review Most of the Academy's income is obtained from the DfE via the EFA in the form of recurrent grants, the use of which is restricted to particular purposes. The grants received from the DfE during the year ended 31 August and the associated expenditure are shown as Restricted Funds in the Statement of Financial Activities. During the year ended 31 August, total expenditure of 2,152,357 was covered by recurrent grant funding from the DfE, together with other incoming resources of 1,967,061. The Academy has taken on the deficit in the Local Government Pension Scheme in respect of its non-teaching staff transferred on conversion, the current valuation of this is 949,000 The level of free reserves held by the Academy at 31 August was 89,516, the target level for free reserves being 100,000. The main purpose of this would be to cover unforeseen staff long term sickness cover costs. Key financial policies adopted or reviewed during the year include the Finance Policy which lays out the framework for financial management, including financial responsibilities of the Board, Head Teacher, managers, budget holders and other staff, as well as delegated authority for spending. Other policies reviewed and updated included Charges and Lettings, Asset Management and Insurance. Trustees have adopted a Responsible Officer Policy/internal audit policy and appointed David Waller to undertake a programme of internal checks on the financial controls. During the year, the Trustees received 3 reports from the Responsible Officer/internal audit, which contained no matters of significance. There is a development plan in place for repair, improvement and development to the school over the next 5 years. These include: Project Estimated Cost Refit of Girl s and Boy s Toilets 20,000 Alterations to Year 4 teaching space 5,000 Modernisation of school reception area 10,000 Replacement of Phone System 15,000 Old section of dinner hall potential subsidence 25,000 Upgrade CCTV to hi-def. system 20,000 This will be reviewed annually to ensure that the needs of the school are being met and to see if additional work/projects need to be allowed for. Page 7

10 TRUSTEES' REPORT (continued) Reserves Policy The Trustees review the reserve levels of the Academy annually. This review encompasses the nature of income and expenditure streams, the need to match income with commitments and the nature of reserves. The Trustees take into consideration the future plans of the Academy, the uncertainty over future income streams and other key risks identified during the risk review. The Trustees have reviewed the future plans of the Academy and have set designated reserves as follows: 112,000 towards capital works as detailed in the financial review The Trustees have planned to utilise GAG supluses as follows: A development plan for the school has been formulared by the SMB of potential works and school improvements that need attention over the next 5 years. 50,000 for staff sickness cover. 150,000 towards a new two year old provision which will include a building project. Investment Policy Due to the nature of funding, the Academy may at times hold cash balances surplus to its short term requirements. The Trustees have authorised the opening of additional short term bank investment accounts to take advantage of higher interest rates. No other form of investment is authorised. Principal Risks And Uncertainties The principal risks and uncertainties facing the Academy are as follows: Financial - the Academy has considerable reliance on continued Government funding through the EFA. In the last year 95% of the Academy's incoming resources was ultimately Government funded and whilst this level is expected to continue, there is no assurance that Government policy or practice will remain the same or that public funding will continue at the same levels or on the same terms. Failures in governance and/or management - the risk in this area arises from potential failure to effectively manage the Academy's finances, internal controls, compliance with regulations and legislation, statutory returns, etc. The Trustees continue to review and ensure that appropriate measures are in place to mitigate these risks. Reputational - the continuing success of the Academy is dependent on 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. 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. Staffing - the success of the Academy is reliant on the quality of its staff and so the Trustees monitor and review policies and procedures to ensure continued development and training of staff as well as ensuring there is clear succession planning. Fraud and mismanagement of - The Academy has appointed a Responsible Officer/internal audit to carry out checks on financial systems and records as required by the Academy Financial Handbook. All finance staff receive training to keep them up to date with financial practice requirements and develop their skills in this area. The Academy has continued to strengthen its risk management process throughout the year by improving the process and ensuring staff awareness. A risk register is maintained and reviewed and updated on a regular basis. Page 8

11 TRUSTEES' REPORT (continued) PLANS FOR FUTURE PERIODS The Academy will continue to strive to provide outstanding education and improve the levels of performance of its pupils at all levels. The Academy will continue to aim to attract high quality teachers and support staff in order to deliver its objectives. We plan to maintain small class sizes with a teaching assistant in each class which will reflect in academic outcomes being improved. FUNDS HELD AS CUSTODIAN TRUSTEE ON BEHALF OF OTHERS The Academy and its Trustees do not act as the Custodian Trustees of any other Charity. AUDITORS In so far as the Trustees are aware: there is no relevant audit information of which the charitable company's auditors are 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 auditors are aware of that information. The auditors, Bishop Fleming LLP, are willing to continue in office and a resolution to appoint them will be proposed at the annual general meeting. Trustees' report, incorporating a strategic report, approved by order of the Board of Trustees, as company directors, on 7 December and signed on the board's behalf by: C M Pagett Chair of Trustees Page 9

12 GOVERNANCE STATEMENT SCOPE OF RESPONSIBILITY As Trustees, we acknowledge we have overall responsibility for ensuring that Hayes School 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 Headteacher, 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 Hayes School 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 4 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 Peters, Vice Chair 0 4 M Hanbury, Head Teacher 4 4 J G E Frost, Director 2 3 C M Pagett, Chair 3 4 M Williams 1 4 H Warren 2 4 P Childs 3 4 K Roberts 1 1 C Mann 3 4 S Giles 4 4 K Grosvenor 4 4 A Howarth 4 4 J Palfrey 4 4 M Curtis 2 3 N Williams 1 2 The Finance Committee is a sub-committee of the main Board of Trustees. Its purpose is to: Ensure that the Academy s finances are being managed to a high standard, to approve funding for various projects that the Academy may have planned, to discuss how to best manage the Academy s and to ensure that procedures and policies related to finance are adhered to and followed. Attendance at meetings in the year was as follows: Trustee Meetings attended Out of a possible P Childs, Chair 3 3 A Howarth, Vice Chair 2 3 C M Pagett 2 3 J G E Frost 2 3 C Peters 2 3 N Williams 1 1 M Hanbury, Head Teacher 2 3 M Curtis 1 2 H Warren 1 3 Page 10

13 GOVERNANCE STATEMENT (continued) REVIEW OF VALUE FOR MONEY As Accounting Officer, the Headteacher has responsibility for ensuring that the Academy 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 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 appropriate. The Accounting Officer for the Academy has delivered improved value for money during the year by: Improving Educational Results We have a diverse curriculum to ensure that all pupils have the opportunity to raise their individual levels of attainment (e.g. we now have a dedicated interventions teacher to raise attainment with pupil premium children identified as not making good progress.) We have good tracking systems to records all aspects of student data through school to ensure that support is targeted to achieve Value for Money. We monitor the needs of particular pupils, and ensure the support they receive is relevant to their needs. The effectiveness of our strategies can be seen in the feedback from Ofsted following their inspection of the school on 23 May 2013, Parent View and through key stage 2 attainment & progress - in line with national average Financial performance The SBM has been influential in driving down costs through better procurement and negotiation throughout 2014/15. All SLAs are reviewed annually to ensure that they are delivering good value for money and are fit for purpose for the needs of the school. Financial management, governance and oversight is strong, with the use of several professional bodies to advise and provide support and monitor. Careful budgeting is used to ensure that Value for Money is achieved in all aspects of the school. Spending proposals are budgeted and presented to senior leaders / Governors who then challenge appropriately. We regularly review staffing to ensure that they are deployed efficiently and appropriately, with targeted support where necessary. We continue to generate income from catering and letting school premises and through the installation of solar panels. The school has a development plan in place to ensure that reserves are spent appropriately and sensibly, identifying where improvement is needed of where existing needs can be met. 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 policies, 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 Hayes School for the year 1 September 2015 to 31 August 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 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 a formal ongoing process for identifying, evaluating and managing the Academy's significant risks, that has been in place for the year 1 September 2015 to 31 August and up to the date of approval of the annual report and financial statements. This process is regularly reviewed by the Board of Trustees. Page 11

14 GOVERNANCE STATEMENT (continued) THE RISK AND CONTROL FRAMEWORK The Academy 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 Finance Committee 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; identification and management of risks. The Board of Trustees has considered the need for a specific internal audit function and has decided not to appoint an internal auditor. However, the Trustees have appointed: David Waller, a Trustee, as Responsible Officer (RO); Bishop Fleming LLP, the external auditors, to perform additional checks. The appointees' role includes giving advice on financial matters and performing a range of checks on the Academy's financial systems. On a semi-annual basis, the appointees report to the Board of Trustees on the operation of the systems of control and on the discharge of the Board of Trustees' financial responsibilities. REVIEW OF EFFECTIVENESS As Accounting Officer, the Headteacher 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 Responsible Officer; the work of the external auditors; the work of the executive managers within the Academy 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 Finance Committee and a plan to address weaknesses and ensure continuous improvement of the system is in place. Approved by order of the members of the Board of Trustees on 7 December and signed on their behalf, by: C M Pagett Chair of Trustees M Hanbury Accounting Officer Page 12

15 STATEMENT ON REGULARITY, PROPRIETY AND COMPLIANCE As Accounting Officer of Hayes School I have considered my responsibility to notify the academy trust board of trustees and the Education Funding Agency of material irregularity, impropriety and non-compliance with EFA 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 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 EFA. M Hanbury Accounting Officer Date: 7 December Page 13

16 STATEMENT OF TRUSTEES' RESPONSIBILITIES The Trustees (who act as governors of Hayes School and are also the directors of the charitable company for the purposes of company law) are responsible for preparing the Strategic report, the Trustees' report and the financial statements 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 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 2015 to ; 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 the EFA/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 on 7 December and signed on its behalf by: C M Pagett Chair of Trustees Page 14

17 INDEPENDENT AUDITORS' REPORT ON THE FINANCIAL STATEMENTS TO THE MEMBERS OF HAYES SCHOOL We have audited the financial statements of Hayes School for the year ended 31 August which comprise the Statement of financial activities, the Balance sheet, the Statement of cash flows and the related notes. The financial reporting framework that has been applied in their preparation is applicable law, United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice) including FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Academies Accounts Direction 2015 to issued by the Education Funding Agency. This report is made solely to the Academy's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act Our audit work has been undertaken so that we might state to the Academy's members those matters we are required to state to them in an Auditors' 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 Academy and its members, as a body, for our audit work, for this report, or for the opinion we have formed. RESPECTIVE RESPONSIBILITIES OF TRUSTEES AND AUDITORS As explained more fully in the Statement of Trustees' responsibilities, the Trustees (who are also the directors of the Academy for the purposes of company law) are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board's Ethical Standards for Auditors. SCOPE OF THE AUDIT OF THE FINANCIAL STATEMENTS An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the Academy's circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the Trustees; and the overall presentation of the financial statements. In addition, we read all the financial and non-financial information in the Trustees' report to identify material inconsistencies with the audited financial statements and to identify any information that is apparently materially incorrect based on, or materially inconsistent with, the knowledge acquired by us in the course of performing the audit. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report. OPINION ON FINANCIAL STATEMENTS In our opinion the financial statements: give a true and fair view of the state of the Academy's affairs as at 31 August 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; and have been prepared in accordance with the requirements of the Companies Act 2006, the Charities SORP 2015 and the Academies Accounts Direction 2015 to issued by the Education Funding Agency. OPINION ON OTHER MATTER PRESCRIBED BY THE COMPANIES ACT 2006 In our opinion the information given in the Trustees' report, incorporating the Strategic report, for the financial year for which the financial statements are prepared is consistent with the financial statements. Page 15

18 INDEPENDENT AUDITORS' REPORT ON THE FINANCIAL STATEMENTS TO THE MEMBERS OF HAYES SCHOOL MATTERS ON WHICH WE ARE REQUIRED TO REPORT BY EXCEPTION 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. William Hanbury FCA (Senior Statutory Auditor) for and on behalf of Bishop Fleming LLP Chartered Accountants Statutory Auditors 50 The Terrace Torquay Devon TQ1 1DD Date: Page 16

19 INDEPENDENT REPORTING ACCOUNTANTS' ASSURANCE REPORT ON REGULARITY TO HAYES SCHOOL AND THE EDUCATION FUNDING AGENCY In accordance with the terms of our engagement letter dated 7 April 2011 and further to the requirements of the Education Funding Agency (EFA) as included in the Academies Accounts Direction 2015 to, we have carried out an engagement to obtain limited assurance about whether the expenditure disbursed and income received by Hayes School during the year 1 September 2015 to 31 August 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 Hayes School and EFA in accordance with the terms of our engagement letter. Our work has been undertaken so that we might state to Hayes School and EFA 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 Hayes School and EFA, for our work, for this report, or for the conclusion we have formed. RESPECTIVE RESPONSIBILITIES OF 'S ACCOUNTING OFFICER AND THE REPORTING ACCOUNTANT The accounting officer is responsible, under the requirements of Hayes School's funding agreement with the Secretary of State for Education dated 31 March 2011, and the Academies Financial Handbook extant from 1 September 2015, 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 2015 to. 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 year 1 September 2015 to 31 August have not been applied to purposes intended by Parliament or that the financial transactions do not conform to the authorities which govern them. APPROACH We conducted our engagement in accordance with the Academies Accounts Direction 2015 to issued by EFA. 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's income and expenditure. Our work on regularity included a review of the internal controls policies and procedures that have been implemented and an assessment of their design and effectiveness to understand how the academy complied with the framework of authorities. We also reviewed the reports commissioned by the trustees to assess the internal controls throughout the year. We performed detailed testing based on our assessment of the risk of material irregularity, impropriety and noncompliance. This work was integrated with our audit on the financial statements where appropriate and included analytical review and detailed substantive testing of transactions. Page 17

20 INDEPENDENT REPORTING ACCOUNTANTS' ASSURANCE REPORT ON REGULARITY TO HAYES SCHOOL AND THE EDUCATION FUNDING AGENCY (continued) CONCLUSION In the course of our work, nothing has come to our attention which suggests that in all material respects the expenditure disbursed and income received during the year 1 September 2015 to 31 August have not been applied to purposes intended by Parliament and the financial transactions do not conform to the authorities which govern them. William Hanbury FCA (Reporting Accountant) Bishop Fleming LLP Chartered Accountants Statutory Auditors 50 The Terrace Torquay Devon TQ1 1DD Date: Page 18

21 STATEMENT OF FINANCIAL ACTIVITIES INCORPORATING INCOME AND EXPENDITURE ACCOUNT INCOME FROM: Unrestricted Note Restricted Restricted fixed asset Total Total 2015 Donations and capital grants ,482 11,390 20,471 18,092 Charitable activities 5 127,497 1,800,803-1,928,300 1,957,966 Other trading activities 3 16, ,760 17,551 Investments 4 1, ,530 1,527 TOTAL INCOME 146,386 1,809,285 11,390 1,967,061 1,995,136 EXPENDITURE ON: Raising 1, , Charitable activities 120,947 1,854, ,132 2,151,113 2,015,062 TOTAL EXPENDITURE 6 122,191 1,854, ,132 2,152,357 2,016,016 NET INCOME / (EXPENDITURE) BEFORE TRANSFERS 24,195 (44,749) (164,742) (185,296) (20,880) Transfers between Funds 17 - (47,479) 47, NET INCOME / (EXPENDITURE) BEFORE OTHER GAINS AND LOSSES 24,195 (92,228) (117,263) (185,296) (20,880) Actuarial losses on defined benefit pension schemes 23 - (420,000) - (420,000) (20,000) NET MOVEMENT IN FUNDS 24,195 (512,228) (117,263) (605,296) (40,880) RECONCILIATION OF FUNDS: Total brought forward 214,687 (41,392) 6,015,627 6,188,922 6,229,802 TOTAL FUNDS CARRIED FORWARD 238,882 (553,620) 5,898,364 5,583,626 6,188,922 The notes on pages 22 to 43 form part of these financial statements. Page 19

22 REGISTERED NUMBER: BALANCE SHEET AS AT 31 AUGUST FIXED ASSETS 2015 Note Tangible assets 13 5,941,730 6,061,528 CURRENT ASSETS Debtors 14 57,061 58,689 Cash at bank and in hand 692, , , ,250 CREDITORS: amounts falling due within one year 15 (158,313) (110,856) NET CURRENT ASSETS 590, ,394 TOTAL ASSETS LESS CURRENT LIABILITIES 6,532,626 6,661,922 Defined benefit pension scheme liability 23 (949,000) (473,000) NET ASSETS INCLUDING PENSION SCHEME LIABILITIES 5,583,626 6,188,922 FUNDS OF THE ACADEMY TRUST Restricted : General , ,608 Fixed asset 17 5,898,364 6,015,627 Restricted excluding pension liability 6,293,744 6,447,235 Pension reserve (949,000) (473,000) Total restricted 5,344,744 5,974,235 Unrestricted , ,687 TOTAL FUNDS 5,583,626 6,188,922 The financial statements were approved by the Trustees, and authorised for issue, on 7 December and are signed on their behalf, by: C M Pagett Chair The notes on pages 22 to 43 form part of these financial statements. Page 20

23 STATEMENT OF CASH FLOWS Cash flows from operating activities 2015 Note Net cash provided by operating activities 19 80, ,191 Cash flows from investing activities: Interest received 1,530 1,527 Purchase of tangible fixed assets (53,345) (87,975) Capital grants from DfE/EFA 11,390 8,731 Net cash used in investing activities (40,425) (77,717) Change in cash and cash equivalents in the year 39, ,474 Cash and cash equivalents brought forward 652, ,087 Cash and cash equivalents carried forward , ,561 Page 21

24 NOTES TO THE FINANCIAL STATEMENTS 1. ACCOUNTING POLICIES A summary of the principal accounting policies adopted (which have been applied consistently, except where noted), judgments and key sources of estimation uncertainty, is set out below. 1.1 BASIS OF PREPARATION OF FINANCIAL STATEMENTS The financial statements 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 2015 to issued by EFA, the Charities Act 2011 and the Companies Act Hayes School constitutes a public benefit entity as defined by FRS 102. In accordance with the Academies Accounts Direction 2015 to capital grants are now recognised in Income from Donations and Capital Grants instead of Charitable Activities. Capital grants recognised in 2015 have been reclassified. First time adoption of FRS 102 These financial statements are the first financial statements of Hayes School prepared in accordance with Financial Reporting Standard 102 The Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS 102) and the Charities SORP 2015 (SORP 2015). The financial statements of Hayes School for the year ended 31 August 2015 were prepared in accordance with previous Generally Accepted Accounting Practice ( UK GAAP ) and SORP Some of the FRS 102 recognition, measurement, presentation and disclosure requirements and accounting policy choices differ from previous UK GAAP. Consequently, the Trustees have amended certain accounting policies to comply with FRS 102 and SORP The Trustees have also taken advantage of certain exemptions from the requirements of FRS 102 permitted by FRS 102 Chapter 35 Transition to this FRS. Reconciliations to previous UK GAAP for the comparative figures are included in note GOING CONCERN 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 Academy 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 financial statements 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 financial statements. Page 22