UHY Calvert Smith Statutory Auditor Chartered Accountants 31 St Saviourgate York North Yorkshire YO1 8NQ

Transcription

1 REGISTERED COMPANY NUMBER: (England and Wales) REPORT OF THE TRUSTEES AND FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 AUGUST 2013 FOR EVOLUTION SCHOOLS LEARNING TRUST (A Company Limited by Guarantee) UHY Calvert Smith Statutory Auditor Chartered Accountants 31 St Saviourgate York North Yorkshire YO1 8NQ

2 CONTENTS OF THE FINANCIAL STATEMENTS Page Reference and Administrative Information 1 Report of the Trustees 3 Governance Statement 10 Statement on Regularity, Propriety and Compliance 12 Statement of Trustees Responsibilities 13 Report of the Independent Auditors 14 Independent Reporting Accountant s Assurance Report on Regularity 16 Statement of Financial Activities 18 Balance Sheet 20 Cash Flow Statement 21 Notes to the Cash Flow Statement 22 Notes to the Financial Statements 23

3 REFERENCE AND ADMINISTRATIVE DETAILS OF THE ACADEMY Registered Company Number: Registered Office: (England and Wales) Langton Road Norton Malton North Yorkshire YO17 9PT Directors/Trustees of the Academy Trust: Mr J Hudson Mr R C S Hall (Chairman of Trustees) Mr A G Rawdin (Accounting Officer) Resigned 31/08/13 Mr P Loftus Appointed 01/09/13 Ms M Stephenson Mr M Callaghan Appointed 04/10/12 Mr A Judson Appointed 12/09/13 Governors of Norton College: Mr J Hudson (Chair of Governors) * Resigned 12/09/13 Mr A Judson (Chair of Governors) Appointed 04/11/12 Mr C Marlowe * Mr N Cullis * Mrs J Dawson Mr S Keyworth (Vice-Chair of Governors) * Resigned 12/09/13 Mrs J Adair Appointed 31/12/12 Mrs C Twamley (Parent Governor) Resigned 17/10/12 Mr D Mason (Parent Governor) * Dr J Lane (Parent Governor) Mr P Loftus (Headteacher) Mrs E Hinde (Staff Governor) Mr S Layton (Staff Governor) * Appointed 23/09/12 Mrs K Young (Vice-Chair of Governors) Appointed 30/09/12 Mrs D Farmer (Staff Governor) Appointed 30/09/12 * Members of the Finance Committee Clerk to the Governors: Mrs J McGibbon Resigned 18/10/12 Mrs T Douglas Appointed 18/10/12 Senior Leadership Team: Executive Headteacher Mr A G Rawdin (resigned 31/08/13) Headteacher Mr P Loftus Deputy Headteacher Dr S Carson Deputy Headteacher Mrs K Rothenburg Assistant Headteacher Mrs T Huntley Assistant Headteacher Mrs K Walsh Business Manager Mr D MacPhee - 1 -

4 REFERENCE AND ADMINISTRATIVE DETAILS OF THE ACADEMY Company Secretary: Auditors: Bankers: Solicitors: Mr D MacPhee UHY Calvert Smith Statutory Auditor and Chartered Accountants 31 St Saviourgate York North Yorkshire YO1 8NQ Lloyds TSB Bank PLC 2 Pavement York YO1 9LB Wrigley s Solicitors LLP 19 Cookridge Street Leeds LS2 3AG - 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 INTRODUCTION Evolution Schools Learning Trust was established on 7 April 2011 as a Multi-model Academy Trust. This is the second report and accounts for the Trust. Currently the only school in its care is Norton College, Norton, North Yorkshire. This accounting period has been dominated by a drive to improve standards and this will continue in future periods as the College seeks to progress to Outstanding status. The Trust is still focussed on a longer term aim to develop future external activity. STRUCTURE, GOVERNANCE AND MANAGEMENT Constitution The Academy Trust was incorporated on 7 April 2011 as a company limited by guarantee and as an exempt charity. The Charitable Company's memorandum and articles of association are the primary governing documents of the Academy Trust. In addition to acting as trustees for the charitable activities of Evolution Schools Learning Trust, the trustees are also directors of the Academy Trust for the purposes of company law. Details of trustees and governors who have served throughout the period, except as noted, 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 Academy Trust maintains trustees, governors and officers liability insurance which gives appropriate cover for any legal action brought against its trustees, governors or officers. The Academy Trust has also granted indemnities to each of its trustees, governors and other officers to the extent permitted by law. Qualifying third party indemnity provisions (as defined by section 234 of the Companies Act 2006) were in force during the period and remain in force, in relation to certain losses and liabilities which trustees, governors or other officers may incur to third parties in the course of acting as trustees, governors or officers of the Academy Trust. Details of the insurance cover are provided in note 11. Principal activities The Academy Trust s principal object and activity is to manage the Academy Trust s provision of education to pupils between the ages of 11 and 19. Method of recruitment and appointment or election of trustees The number of trustees shall not be less than three but (unless otherwise determined by ordinary resolution) shall not be subject to any maximum. Trustees term of office is four years but they are eligible for re-election at the meeting at which they retire. At each Annual General Meeting the trustees will elect a chairman and a vice-chairman

6 TRUSTEES REPORT Policies and procedures adopted for the induction and training of trustees The training and induction provided for new trustees will depend on their existing experience. Where necessary an induction will provide training on company, educational, legal and financial matters. All new trustees will be given a tour of the Academy Trust site and the chance to meet with staff and students. New trustees will be given access to copies of policies, procedures, minutes, financial statements, budgets, plans and other documents that they will need to undertake their role as trustees. Induction tends to be done informally and is tailored specifically to the individual. Organisational structure The existing structure of Norton College, prior to academy conversion has been enhanced to ensure the effective and efficient running of the Academy Trust. In addition to the trustees the structure consists of three levels: 1. the governors; 2. the senior leadership team; 3. the middle leadership team. The aim of the management structure is to devolve responsibility and encourage involvement in decision making at all levels. The Governing Body is responsible for: setting general policy; adopting an annual plan and budget; monitoring the delegated budget; making major decisions about the strategic direction of the College; making decisions on capital expenditure; making decisions on the most senior staff appointments in consultation with the headteacher. The senior leadership team is led by the Headteacher and in addition comprises two deputy Headteachers, two assistant Headteachers, 3 associate leaders and the business manager. These senior leaders manage the College by implementing the policies agreed by the governors and reporting back to them on progress. The Headteacher and other key senior leaders are responsible for the authorisation of spending within agreed budgets and the appointment of staff, though appointment boards for posts in the senior leadership team always contain a governor. Some spending responsibility is delegated to other managers in senior positions. Risk management The trustees have assessed the major risks to which the Academy Trust is exposed, in particular those relating to the specific teaching, provision of facilities and other operational areas of the Academy Trust, and its finances. Systems have been implemented to assess risks that the school faces, especially in the operational area such as teaching, health and safety, bullying and school trips, control of finance, vetting of new staff and visitors, supervision of school grounds and internal financial controls in order to minimise risk. Where significant financial risk still remains they have ensured they have adequate insurance cover. The Academy Trust has an effective system of internal financial controls and this is explained in more detail in the statement of internal controls. Connected organisations including related parties There are no officially connected organisations or related parties of the Academy Trust

7 TRUSTEES REPORT OBJECTIVES AND ACTIVITIES Objects and aims The principal objects and activity of the Company is the operation of Evolution Schools Learning Trust to provide an appropriate education for students of different abilities between the ages of 11 and 19. Norton College s specialism is humanities. In setting the objectives and planning the activities the trustees have given careful consideration to the Charities Act 2011 general guidance on public benefit and in particular to its supplementary public benefit guidance on advancing education. In accordance with the articles of association Evolution Schools Learning Trust has adopted a Funding Agreement approved by the Secretary of State for the Department for Education. The Funding Agreement specifies, amongst other things, the basis for admitting students to the Academy Trust, the catchment area from which the students are drawn and the arrangements made for special educational needs and disabilities. The Academy Trust aims to provide a diverse educational offer across all three key stages and this will contribute to students being drawn from further afield. The Academy Trust is proud to welcome pupils from all backgrounds. Objectives, strategies and activities Objectives: The main objectives of the Academy Trust during the period ended 31 August 2013 are summarised below: to deliver high quality education and care to all pupils within the Academy Trust; to raise standards and achievement; to improve the effectiveness of the Academy Trust by keeping the curriculum and organisational structure under continual review; to provide value for money for the funds expended; to comply with all appropriate statutory and curriculum requirements; to maintain close links with industry and commerce; to conduct the Academy Trust s business in accordance with the highest standards of integrity, probity and openness. Strategies and activities: The Academy Trust s main strategy is encompassed in its mission statement which is Support and Challenge for All. The Academy Trust produces an annual Academy Development Plan, which details how it intends to achieve the aims and objectives for the year. The activities provided include: tuition and learning opportunities for all students to attain appropriate academic qualifications; training opportunities for all staff; secondments and placing of students with industrial and commercial partners; a programme of sporting and after school leisure activities for all students; co-operation and sharing resources with local schools; a system of lunchtime and after school clubs, trips and visits to allow students to explore new areas of interest; a pastoral programme designed to focus on the personal development of all students

8 TRUSTEES REPORT Public benefit The trustees confirm that they have complied with the requirement in section 2 (1) (b) of the Charities Act 2011 to have due regard to the Charity Commission's general guidance on public benefit and, in particular, to its supplementary public benefit guidance on advancing education. Additionally the trustees confirm that reference has been made to the guidance in the Charity Commission's general guidance on public benefit when reviewing the aims and objectives and in planning our future activities. In particular, the trustees consider how planned activities will contribute to the aims and objectives they have set. Equal opportunities The trustees recognise that equal opportunities should be an integral part of good practice within the workplace. The Academy Trust aims to establish equal opportunity in all areas of its activities including creating a working environment in which the contribution and needs of all people are fully valued. Disabled persons The policy of the Academy Trust is to support recruitment and retention of students and employees with disabilities. The Academy Trust does this by adapting the physical environment, by making support resources available and through training and career development. Lifts exist in both the main building and in the Sixth Form building. Where necessary the main building has been adapted with ramps and door widths have been brought up to the necessary standard. ACHIEVEMENT AND PERFORMANCE Since the summer results of 2011 (33% 5 A*CEM), the College has been addressing a number of issues to raise standards swiftly and securely. Results have improved significantly for two years running both in terms of progress and achievement. (In 2012 the college achieved 57 % A*CEM). In A*CEM headline figure (68%) would place the school on the 5 percentile point compared to other schools. The sixth form has improved consistently too and 2013 Year 13 results are graded according to an external measure of achievement (ALPS 2) as Good. Overall effectiveness and provision is rated by the College as Good. The College has made such gains by focussing sharply on improving teaching. The results in 2011 gave the newly appointed Headteacher a mandate to re-evaluate all existing practices. This was supported by the return to full time from National Support School work of the Deputy and Executive Headteachers. Since % of staff have moved on or retired. The new staff, in the main, replaced staff who were underperforming and they have been effectively inducted so that they have already had a significant impact on students enjoyment and engagement in learning. Only three staff moved on this year and these were replaced with stronger individuals. Allied to rigorous monitoring, leaders at all levels within the College have ensured all staff have received appropriate professional development to enable them to teach good lessons. 80% of staff are now good on a day to day basis. This is supported by a rigorous appraisal and a pay policy where progression is linked to being graded good by the school and the expectation that staff will set increasingly challenging appraisal targets as they progress. The appointment in 2012 of a second Deputy Headteacher led to a review of systems and structures linked to behaviour, intervention and ethos. A new team of 6 Progress Leaders quickly re-enforced a culture of high expectations articulated through a set of values called ASPIRE. Perception and pride at Norton have shifted significantly, supported by the successful introduction of a new uniform. In 2012 the College returned to the horizontal mentoring system and this change has been uniformly well received by students and staff. The senior and middle teams are now strong and committed to the pursuit of excellence. They have begun to articulate a new set of expectations linked to raising aspirations beyond what has previously been thought possible. Succession planning at governor level has resulted in a new chairman and vice chairman being appointed and has begun to shape, with senior leaders, a new vision for the College to take it to Outstanding as soon as possible. The College was graded Good by a HMI led Ofsted team in October

9 TRUSTEES REPORT ACHIEVEMENT AND PERFORMANCE - continued The Executive Headteacher left Norton College in August No replacement appointment has been made to date although the trustees believe that an appointment should be made at some time in the future. Going concern After making appropriate enquiries, the trustees of Evolution Schools Learning Trust have a reasonable expectation that the Academy 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 of Accounting Policies. Key performance indicators The organisation has chosen to set and monitor its performance against a number of Key Performance Indicators: KPI 1 - % Student Attendance 2012/ /12 Key Stages 3 and % 94.1% Key Stage % 93.6% KPI 2 Direction of Post 16 Students on completion 2012/ /12 Moved to university 50% 54% Moved into work and other training 42% 42% Forces 5% 2% Not in employment, education or training 3% 2% KPI 3 - Out-turn surplus as a % of GAG Funding 2012/ /12 1.3% 8% FINANCIAL REVIEW Most of the Academy Trust s income is obtained from the EFA in the form of recurrent grants, the use of which is restricted to particular purposes. The grants received from the EFA during the period ended 31 August 2013 and the associated expenditure are shown as restricted funds in the statement of financial activities. Financial and risk management objectives and policies During the year ended 31 August 2013, total expenditure of 5,754,046 exceeded recurrent grant funding from the EFA together with other incoming resources. The excess of expenditure over income for the year was 511,522. The Trustees have taken the necessary action to deal with the in-year deficit that occurred during the financial year. Going forwards an effective financial plan is in place and approved for the next three years showing a balanced picture overall. Improved monitoring systems have been developed in conjunction with the Governors Business Committee. At 31 August 2013 the net book value of fixed assets was 7,368,659 and movements in tangible fixed assets are shown in note 13 to the financial statements. The assets were used exclusively for providing education and the associated support services to the pupils of the Academy Trust. The Academy Trust uses various financial instruments including cash and various items such as trade debtors and trade creditors that arise directly from its operations. The main purpose of these financial instruments is to raise finance for the Academy Trust s operations. The existence of these financial instruments exposes the Academy Trust to a number of financial risks which are described in more detail below. The main risks arising from the Academy Trust s financial instruments are liquidity risk and cash flow interest rate risk

10 TRUSTEES REPORT FINANCIAL REVIEW - continued Liquidity risk the Academy Trust manages its cash resources, including sufficient working capital, so that all its operating needs are met without the need for short-term borrowing. Surplus cash is invested so to maximise interest income; Interest rate risk the Academy Trust earns interest on cash deposits and with interest rates currently low, the trustees take appropriate action to ensure they maximise the income from these deposits; and Credit risk - this is managed through regular contact with funders. Liquidity and cash flow risks are managed through the appropriate and carefully managed use of financial instruments with our principal bankers. Principal risks and uncertainties The trustees have considered the risks presented to the Academy Trust and have implemented policies and systems to mitigate these risks. The Academy Trust will continue to manage these risks, through a series of performance reviews, monitoring and efficiency evaluation, to ensure that any future annual deficit can be met by reserves. The trustees have deemed the following risks to be of most serious consequence to the Academy Trust: 1. Failure to successfully recruit and retain pupils; 2. Changes to government policy on education funding; 3. Changes to education priorities by the government; 4. Loss of a key member of the Senior Leadership Team; 5. Impact of an uncontrollable event e.g. fire or flood; 6. Major injury or a health and safety issue or environmental incident; 7. Changes to pension policy or funding for the TPS and LGPS. Reserves policy The trustees review the reserve levels of the Academy Trust annually. This review encompasses the nature of income and expenditure streams, the need to match income with commitments and the nature of the reserves. The Academy Trust plans to spend the majority of its revenue income each year on the students in its care however the trustees have determined to carry forward reserves at a prudent level and these reserves are designated to meet the long term cyclical needs of renewal and any other unforeseen requirements whilst taking into consideration the constraints set by the Education Funding Agency. The current free reserves are 58,706. Financial position The Academy Trust held fund balances at 31 August 2013 of 6,070,823 comprising 7,368,659 of restricted fixed asset funds, 2,458 of other restricted funds, 58,706 of unrestricted funds and a pension deficit of (1,359,000). The only fund in deficit at 31 August 2013 is the Local Government Pension Scheme (LGPS) reserve. Employer contributions are reviewed every three years in consultation with the scheme s administrators and employer contributions due by the Academy Trust have been fixed for three years from 1 April The deficit on the LGPS does not mean that an immediate liability crystallises. The deficit results in a cash flow effect for the Academy Trust in the form of possible future increases in pension contributions which, if required, will be met from budgeted annual income. There is therefore no direct impact on the free reserves of the Academy Trust because of recognising the deficit

11 TRUSTEES REPORT Investment policy Surplus funds held by Evolution Schools Learning Trust will be held by the Lloyds TSB or placed on the money markets on a fixed term basis. The decision to invest will have due regard to the liquidity requirements of the Organisation and will depend upon the amount, the return being offered and the associated risk. All funds invested on the money market will be agreed by the trustees and Finance Governors Committee. PLANS FOR FUTURE PERIODS Norton College will continue to focus on improving learning and achievement at all levels and will continue its efforts to ensure that all students find employment or a place in higher education once they leave. Its stated objective is to be able to grade itself Outstanding and have this ratified by an external review during the academic year 14/15. The senior leadership team is also looking to increase participation rates at Post-16 across the whole of Ryedale and towards the Yorkshire coast area. Following the Ofsted inspection in October 2013 where the College was graded as good the College will look to embed the quality of teaching and further improve the results in the Sixth Form. In an environment of reduced funding and falling roles the College will focus on becoming more efficient across the board over the next twelve months. In the longer term, having secured a sustainable level of provision for Norton College, an effective financial plan, and achieved outstanding status, it is anticipated that the Academy Trust will be in a position to offer school improvement services either as a partner institution or as a potential academy sponsor. The College is continuing to focus on building capacity across the senior and middle leadership teams so that it will become a selfsustaining, outstanding school. A range of partnerships with other schools will, in the future, provide development opportunities for staff at various levels. Specifically, the Academy Trust over the longer term will have built up a strong reputation for leading schools out of inadequate/requires improvement and onwards to a position of strength; experience in coaching teachers to improve their performance; outstanding success in developing leadership and management; an ability to provide excellent "back-office" services for other schools including ICT, finance, HR, site and grounds maintenance. However due to the critical financial situation and the primary task of leading the College back to outstanding status, some of these objectives will have to wait until there is a firmer financial footing within the Trust. The College will continue to offer strong support to local primary schools within the community and beyond. STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS So far as the trustees are aware, there is no relevant audit information of which the charitable company`s auditor is unaware, and the trustees have taken all the steps that they ought to have taken in order to make them aware of any relevant audit information and to establish that the auditor is aware of that information. Auditor The auditor, UHY Calvert Smith, will be proposed for re-appointment at the forthcoming Annual General Meeting. ON BEHALF OF THE BOARD: Mr R C S Hall Chairman of Trustees Date: 29 November

12 GOVERNANCE STATEMENT Scope of Responsibility As trustees, we acknowledge we have overall responsibility for ensuring that Evolution Schools Learning 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 trustees, via the Governing Body of Norton College have delegated the day-to-day responsibility to the 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 Evolution Schools Learning Trust and the Secretary of State for Education. During the year ended 31 August 2013 the Accounting Officer was Mr A G Rawdin who resigned on 31 August Mr P Loftus was appointed Accounting Officer on 1 September The Accounting Officer is also responsible for reporting to the Board of Trustees of the Academy Trust and the Governing Body of Norton College 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 6 times during the period. Attendance during the year at meetings of the Board of Trustees was as follows: Meetings attended Out of a possible Directors/trustees Mr R C S Hall 5 5 Mr J Hudson 5 5 Mr A G Rawdin (resigned 31/08/13) 3 5 Ms M Stephenson 3 5 Mr M Callaghan (appointed 04/10/12) 4 4 Mr P Loftus (appointed 01/09/13) - - Mr A Judson (appointed 12/09/03) - - Company secretary Mr D MacPhee 5 5 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 s 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 Evolution Schools Learning Trust for the period ended 31 August 2013 and up to the date of approval of the annual report and financial statements. Capacity to Handle Risk The Academy Trust Board of Trustees and Governing Body of Norton College 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 Governing Body is of the view that there is a formal ongoing process for identifying, evaluating and managing the Academy Trust s significant risks that has been in place for the period ended 31 August 2013 and up to the date of approval of the annual report and financial statements. This process is regularly reviewed by the Governing Body.

13 GOVERNANCE STATEMENT (continued) The Risk and Control Framework The Academy Trust s system of internal financial control is based on a framework of regular management information and administration 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 agreed by the Governing Body; 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 governors have appointed Veritau Ltd, as Responsible Officer (RO). The RO s role includes giving advice on financial matters and performing a range of checks on the Academy Trust s financial systems. The RO reports to the Governing Body on the operation of the systems of control and on the discharge of the Governing Body s financial responsibilities. Review of Effectiveness As Accounting Officer, Mr P Loftus has responsibility for reviewing the effectiveness of the system of internal control. For the period in question the review has been informed by: the work of Mr A G Rawdin who was Accounting Officer for the year ended 31 August 2013; the work of the responsible officer; 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 Finance and General Purposes Committee and a plan to address weaknesses and ensure continuous improvement of the system is in place. Approved by the Board of Trustees on 29 November 2013 and signed on its behalf by: Mr R C S Hall Chairman of Trustees Mr P Loftus Accounting Officer

14 STATEMENT ON REGULARITY, PROPRIETY AND COMPLIANCE As Accounting Officer of Evolution Schools Learning Trust I have considered my responsibility to notify the Academy Trust Board of Trustees, Norton College Governing Body and the Education Funding Agency (EFA) 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. 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 and Norton College Governing Body 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. Mr P Loftus Accounting officer Date: 29 November

15 STATEMENT OF TRUSTEES' RESPONSIBILITIES The trustees (who are also directors of Evolution Schools Learning Trust for the purposes of company law) are responsible for preparing the Trustees Report and the financial statements in accordance with the Annual Requirements issued by the Education Funding Agency, United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice) and the Annual Accounts Direction issued by the Education Funding Agency. Company law requires the trustees to prepare financial statements for each financial period, which give a true and fair view of the state of affairs of the Academy Trust and of the incoming resources and application of resources, including the income and expenditure, of the Academy Trust for the 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 in the Charities SORP; make judgements and estimates that are reasonable and prudent; state whether applicable UK Accounting Standards 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 Academy Trust will continue in operation. The trustees are responsible for keeping adequate accounting records that are sufficient to show and explain the Academy Trust s transactions and disclose with reasonable accuracy at any time the financial position of the Academy Trust and enable them to ensure that the financial statements comply with the Companies Act They are also responsible for safeguarding the assets of the Academy Trust 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 Academy Trust applies financial and other controls which conform to the requirements both of propriety and good financial management. They are also responsible for ensuring that grants received from the DfE/EFA have been applied for the purposes intended. In so far as the trustees are aware: there is no relevant audit information of which the Academy Trust s auditor is 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 auditor is aware of that information. The trustees are responsible for the maintenance and integrity of the corporate and financial information included on the Academy Trust 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 trustees on 29 November 2013 and signed on its behalf by: Mr R C S Hall Chairman of Trustees

16 REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF EVOLUTION SCHOOLS LEARNING TRUST We have audited the financial statements of Evolution Schools Learning Trust for the year ended 31 August 2013 which comprise the Statement of Financial Activities, the Balance Sheet, the Cash Flow Statement 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) and the Annual Accounts Direction 2013 issued by the Education Funding Agency. This report is made solely to the Academy Trust 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 Trust s members those matters we are required to state to them in an auditor s 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 Trust and its members as a body, for our audit work, for this report, or for the opinions we have formed. Respective responsibilities of trustees and auditor As explained more fully in the Statement of Trustees Responsibilities set out on page 13, the trustees 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 company 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. 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 Trust s affairs as at 31 August 2013, 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 and the Annual Accounts Direction 2013 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 Annual Report for the financial period for which the financial statements are prepared is consistent with the financial statements. (Continued)

17 REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF EVOLUTION SCHOOLS LEARNING TRUST 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. Hayden Priest (Senior Statutory Auditor) For and on behalf of UHY Calvert Smith Statutory Auditor Chartered Accountants 31 St Saviourgate York North Yorkshire YO1 8NQ Date: 9 December

18 INDEPENDENT REPORTING ACCOUNTANT S ASSURANCE REPORT ON REGULARITY TO EVOLUTION SCHOOLS LEARNING TRUST AND THE EDUCATION FUNDING AGENCY In accordance with the terms of our engagement letter dated 27 April 2011 (updated in our letter dated 9 November 2012) and further to the requirements of the Education Funding Agency (EFA) as included in the Academies: Accounts Direction 2013, we have carried out an engagement to obtain limited assurance about whether the expenditure disbursed and income received by Evolution Schools Learning Trust during the year to 31 August 2013 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 Evolution Schools Learning Trust and the EFA in accordance with the terms of our engagement letter. Our work has been undertaken so that we might state to Evolution Schools Learning Trust and the 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 the Evolution Schools Learning Trust and the EFA, for our work, for this report, or for the conclusion we have formed. Respective responsibilities of Evolution Schools Learning Trust s accounting officer and the reporting accountant The accounting officer is responsible, under the requirements of Evolution Schools Learning Trust s funding agreement with the Secretary of State for Education dated 26 April 2011 and the Academies Financial Handbook, extant from 1 September 2012, 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 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 period 1 September 2012 to 31 August 2013 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 2013 issued by the 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 Trust s income and expenditure

19 INDEPENDENT REPORTING ACCOUNTANT S ASSURANCE REPORT ON REGULARITY TO EVOLUTION SCHOOLS LEARNING TRUST AND THE EDUCATION FUNDING AGENCY Our work has included the following: an assessment of the risk of material irregularity, impropriety and non-compliance relating to the Academy Trust s activities; reviewing the Financial Management and Governance Evaluation completed by the Academy Trust during the period; a review and assessment of internal controls, systems and policies in place at the Academy Trust; holding discussions with the accounting officer to determine how he has been able to make his declaration with regard to regularity and impropriety; substantive testing and analytical review procedures, as deemed necessary and as part of our audit engagement and which can also be relied upon for this report on regularity; and requesting and receiving confirmation from EFA that there is no information that they are aware of that may impact upon the planning and subsequent delivery of the regularity assurance engagement. 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 period 1 September 2012 to 31 August 2013 has not been applied to purposes intended by Parliament and the financial transactions do not conform to the authorities which govern them. UHY Calvert Smith Chartered Accountants 31 St Saviourgate York North Yorkshire YO1 8NQ Date: 9 December

20 STATEMENT OF FINANCIAL ACTIVITIES (including Income and Expenditure Account and Statement of Total Recognised Gains and Losses) Restricted Restricted months Unrestricted general fixed asset Total Total funds funds funds funds funds Notes INCOMING RESOURCES Incoming resources from generated funds Voluntary income 2 2, ,598 12,186 Transfer from local authority on conversion ,635,365 Activities for generating funds 3 347,160 37, , ,563 Investment income 4 4, ,181 5,621 Incoming resources from charitable activities 5 Funding for academy s educational operations - 4,832,153 18,732 4,850,885 6,879,669 Total incoming resources 353,939 4,869,853 18,732 5,242,524 14,170,404 RESOURCES EXPENDED Costs of generating funds Costs of activities for generating funds 6 243,663 37,700 4, , ,024 Charitable activities 7 Academy s educational operations - 5,319, ,176 5,427,212 6,952,115 Governance costs 9-41,140-41,140 50,920 Total resources expended 243,663 5,397, ,507 5,754,046 7,503,059 Net incoming/(outgoing) resources before transfers 110,276 (528,023) (93,775) (511,522) 6,667,345 Gross transfers between funds 20 (510,000) 427,154 82, Net income/(expenditure) for the period (399,724) (100,869)) (10,929) (511,522) 6,667,345 Other recognised gains/losses Actuarial gains/losses on defined benefit pension schemes - 42,000-42,000 (127,000) Net movement in funds (399,724) (58,869) (10,929) (469,522) 6,540, (Continued)

21 STATEMENT OF FINANCIAL ACTIVITIES CONTINUED (including Income and Expenditure Account and Statement of Total Recognised Gains and Losses) Restricted Restricted months Unrestricted general fixed asset Total Total funds funds funds funds funds Notes Net movement in funds (399,724) (58,869)) (10,929) (469,522) 6,540,345 Reconciliation of funds Total funds brought forward at 1 September ,430 (1,297,673) 7,379,588 6,540,345 - Total funds carried forward at 31 August ,706 (1,356,542) 7,368,659 6,070,823 6,540,345 CONTINUING OPERATIONS All incoming resources and resources expended arise from continuing activities. A Statement of Total Recognised Gains and losses is not required as all gains and losses are included in the Statement of Financial Activities

22 Registered company number: BALANCE SHEET AT 31 AUGUST Notes FIXED ASSETS Tangible assets 13 7,368,659 7,379,588 CURRENT ASSETS Stocks 14 21,207 12,077 Debtors , ,398 Cash at bank 551, , , ,836 CREDITORS Amounts falling due within one year 16 (718,011) (299,079) Net current assets/(liabilities) 61, ,757 Total assets less current liabilities 7,429,823 7,870,345 Pension liability 18 (1,359,000) (1,330,000) NET ASSETS 6,070,823 6,540,345 FUNDS 20 Unrestricted funds 58, ,430 Restricted general funds 2,458 32,327 Pension reserve (1,359,000) (1,330,000) Restricted fixed asset funds 7,368,659 7,379,588 TOTAL FUNDS 6,070,823 6,540,345 The financial statements were approved by the Board of Trustees on 29 November 2013 and were signed on its behalf by: Mr R C S Hall Chairman of Trustees The notes form part of these financial statements -20-

23 CASH FLOW STATEMENT months Notes Net cash inflow from operating activities 1 112, ,430 Returns on investments and servicing of finance 2 4,181 5,621 Capital expenditure and financial investment 2 (143,526) - Cash received on conversation 2-297,310 (Decrease)/increase in cash in the period (26,715) 578,361 Reconciliation of net cash flow to movement in net debt 3 (Decrease)/increase in cash in the period (26,715) 578,361 Change in net debt resulting from cash flows (26,715) 578,361 Movement in net debt in the period (26,715) 578,361 Net debt at 1 September ,361 - Net debt at 31 August , ,361 The notes form part of these financial statements -21-

24 NOTES TO THE CASH FLOW STATEMENT 1. RECONCILIATION OF NET (OUTGOING)\INCOMING RESOURCES TO NET CASH INFLOW FROM OPERATING ACTIVITIES months Net (outgoing)\incoming resources (511,522) 6,667,345 Depreciation charges 112, ,415 Interest received (4,181) (5,621) Net assets transferred in on conversion - (6,635,365) Increase in stocks (9,130) (12,077) Increase in debtors (6,924) (199,398) Increase in creditors 460, ,131 Difference between pension charge and cash contributions 71,000 70,000 Net cash inflow from operating activities 112, , ANALYSIS OF CASH FLOWS FOR HEADINGS NETTED IN THE CASH FLOW STATEMENT months Returns on investments and servicing of finance Interest received 4,181 5,621 Net cash inflow for returns on investments and servicing of finance 4,181 5,621 Capital expenditure and financial investment Purchase of tangible fixed assets (143,526) - Net cash outflow for capital expenditure and financial investment (143,526) - Acquisitions and disposals Cash received on conversion - 297,310 Net cash inflow for acquisitions and disposals - 297, ANALYSIS OF CHANGES IN NET DEBT At 1/9/12 Cash flow At 31/8/13 Net cash: Cash at bank 578,361 (26,715) 551,646 Total 578,361 (26,715) 551,

25 NOTES TO THE FINANCIAL STATEMENTS 1. ACCOUNTING POLICIES Accounting convention The financial statements have been prepared under the historical cost convention in accordance with applicable United Kingdom Accounting Standards, the Charity Commission 'Statement of Recommended Practice: Accounting and Reporting by Charities' ('SORP 2005'), the Academies Accounts Direction issued by the EFA and the Companies Act A summary of the principal policies, which have been applied consistently, except where noted, is set out below. 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 company to continue as a going concern. The trustees make this assessment in respect of a period of one year from the date of approval of the financial statements. Incoming resources All incoming resources are included on the Statement of Financial Activities when the Academy Trust is legally entitled to the income and the amount can be quantified with reasonable accuracy. Grants receivable Grants are included in the Statement of Financial Activities on a receivable basis. The balance of income received for specific purposes but not expended during the period is shown in the relevant funds on the Balance Sheet. Where income is received in advance of entitlement of receipt its recognition is deferred and included in creditors as deferred income. Where entitlement occurs before income is received, the income is accrued. Donations Donations are recognised on a receivable basis where there is certainty of receipt and the amount can be reliably measured. Other Income Other income, including the hire of facilities, is recognised in the period it is receivable and to the extent the goods have been provided or on completion of the service. Donated services and gifts in kind The value of donated services and gifts in kind provided to the Academy Trust are recognised at their open market value in the period in which they are receivable as incoming resources, where the benefit to the Academy Trust can be reliably measured. An equivalent amount is included as expenditure under the relevant heading in the Statement of Activities, except where the gift in kind was a fixed asset in which case the amount is included in the appropriate fixed asset category and depreciated over the useful economic life in accordance with the Academy Trust's policies. The conversion from a state maintained school to an Academy Trust involved the transfer of identifiable assets and liabilities and the operation of the school for nil consideration and has been accounted for under the acquisition accounting method. The assets and liabilities transferred on conversion from Norton College to an Academy Trust have been valued at their fair value being a reasonable estimate of the current market value that the trustees would expect to pay in an open market for an equivalent item. Their fair value is in accordance with the accounting policies set out for Evolution Schools Learning Trust. The amounts have been recognised under the appropriate balance sheet categories, with a corresponding amount recognised in voluntary income as net income in the Statement of Financial Activities and analysed under unrestricted funds, restricted general funds and restricted fixed asset funds. -23-