CHURCH HILL INFANT SCHOOL

Transcription

1 Registered number: CHURCH HILL INFANT SCHOOL TRUSTEES' REPORT AND FINANCIAL STATEMENTS FOR THE PERIOD 17 AUGUST 2012 TO 31 AUGUST

2 CONTENTS Page Reference and administrative details of the academy, its trustees and advisers 1 Trustees' report 2-7 Governance statement 8-10 Statement on regularity, propriety and compliance 11 Trustees' responsibilities statement 12 Independent auditors' report Independent auditors' assurance report on regularity Statement of financial activities 17 Balance sheet 18 Cash flow statement 19 Notes to the financial statements 20-39

3 REFERENCE AND ADMINISTRATIVE DETAILS OF THE ACADEMY, ITS TRUSTEES AND ADVISERS FOR THE PERIOD 17 AUGUST 2012 TO 31 AUGUST Trustees K Mistry, Vice Chair of Trustees from 28/01/, Acting Chair of Trustees from 29/01/ and Chair of Trustees from 26/09/ (appointed 17 August 2012) 1 P Tadman, Chair of Trustees to 15/01/ (appointed 17 August 2012, resigned 15 January ) 1 R Ludlam, Acting Vice Chair from 29/01/ (appointed 30 October 2012) 2 P Beall (appointed 5 June ) 2 S Brady (appointed 17 August, resigned 5 February ) 1 M Bulsara (appointed 17 August 2012) 3 L Clarke (appointed 8 January ) 3 D Corcoran (appointed 27 September ) 3 K Doshi (appointed 17 August 2012, resigned 24 September 2012) 2 M Flamson (appointed 17 August 2012, resigned 22 May ) 1 D Hill (appointed 1 May ) 1 E Hollis (appointed 17 August 2012) 2 B Howie (appointed 17 August 2012, resigned 11 March ) 2 I Hubber (appointed 17 August 2012, resigned 27 June ) 1 N Karia (appointed 27 June ) 1 A Lad (appointed 17 August 2012, resigned 30 November 2012) 3 A Smith (appointed 17 August 2012, resigned 27 September 2012) 4 1 Community trustee 2 Parent trustee 3 Staff trustee 4 LA trustee Company registered number Registered office Senior management team Independent auditors Church Hill Infant School Thurmaston Leicester Leicestershire LE4 8DE M Bulsara, Headteacher Clear & Lane Chartered Accountants 340 Melton Road Leicester LE4 7SL Page 1

4 TRUSTEES' REPORT FOR THE PERIOD 17 AUGUST 2012 TO 31 AUGUST The Trustees (who are also directors of the charity for the purposes of the Companies Act) present their annual report together with the audited financial statements of Church Hill Infant School (the academy) for the period ended 31 August. The Trustees confirm that the Annual report and financial statements of the academy comply with the current statutory requirements, the requirements of the academy's governing document and the provisions of the Statement of Recommended Practice (SORP) "Accounting and Reporting by Charities" issued in March STRUCTURE, GOVERNANCE AND MANAGEMENT Constitution The school is a company limited by guarantee and a exempt charity. The Charitable Company s memorandum and Articles of Association are the primary governing documents of the academy trust. The Governors act as the Trustees for the charitable activities of school are also the directors of the Charitable Company for the purposes of company law. The Charitable Company is known as Church Hill Infant School. The charitable company was incorporated on 17 August The school converted to academy status on 1 November 2012 when its operations, assets and liabilities were transferred to the academy from the local authority. Details of the Trustees who served throughout the year are as noted 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. Method of recruitment and appointment or election of Trustees Trustees are appointed as follows: Parent Trustees Through open election for all eligible parents or guardians of pupils who attend the school. Staff Trustees Through open election for all eligible members of staff working at the school. Community Trustees Through Nomination by the board of Trustees with relevant background or experience to complement the existing Trustee qualifications. Policies and procedures adopted for the induction and training of Trustees We expect all Trustees to undertake training as appropriate to their work at the school. New Trustees will be provided with an induction programme delivered partly in house and partly through external sources as required. A log is kept of all Trustee training and reviewed on a regular basis. Page 2

5 TRUSTEES' REPORT (continued) FOR THE PERIOD 17 AUGUST 2012 TO 31 AUGUST Organisational structure The Trustees determine the general policy of the school. The day to day running of the school is delegated to the head, supported by her senior staff. The Headteacher undertakes the key leadership role overseeing educational, pastoral and administrative functions in consultation with other senior staff. The day to day administration is undertaken within the policies and procedures approved by the Trustees which provide for only significant expenditure decision and major capital projects to be referred to the Trustees for prior approval. The headteacher oversees the recruitment of all educational, non educational and administrative support staff. The headteacher is an ex officio Trustee, Principal Accounting Officer and attends all meetings. Other members of staff are invited to attend Trustee meetings as appropriate. Connected organisations, including related party relationships The headteacher is a member of a number of professional organisations which enable her to keep abreast of current educational matters and network with other outstanding schools to share expertise, knowledge and experience. As part of its work, the school has a formal partnership with 10 other convertor academies in the local area. This formal Partnership is known as STEP (Syston and Thurmaston Education Partnership). The schools in STEP are committed to working together as a collaborative group to raise achievement in the local community. These schools are Church Hill COE Junior School, Eastfield Primary, Broomfield Primary, The Merton, The Pochin, Thrussington COE Primary, St Michaels and All Angels Primary and Queniborough Primary. STEP is a legal entity. STEP also has links with local secondary schools, Roundhill and Wreake who are associate members of STEP. Risk management The Trustees are responsible for overseeing of the risks faced by the school. Detailed considerations of risk are delegated to the Senior Leadership team of the school. Risks are identified, assessed and controls established throughout the period. A formal review of the school s risk management processes will be undertaken on an annual basis. Risk is managed under the heading of financial sustainability (finance committee), school safety (health and safety committee), student welfare (safeguarding committee), employment (salaries and staffing committee) and school trips (Safeguarding Committee) Through the risk management processes established for the school, the Trustees are satisfied that the major risks identified have been adequately mitigated where necessary. It is recognised that systems can only provide reasonable but not absolute assurance that major risks have been adequately managed. Trustees' indemnities In accordance with normal practice the school has purchased insurance to protect the Trustees and officers from claims arising from negligent acts, errors or omissions whilst on school business. The cover under the policy is 3 million, and in the period of review the sum of 1,019 (1 Nov Aug 13) was paid. Principal activities Church Hill Infant School s purpose is to provide high quality learning activities to its pupils at the school and the wider community of which it serves. Page 3

6 OBJECTIVES AND ACTIVITIES Objects and aims TRUSTEES' REPORT (continued) FOR THE PERIOD 17 AUGUST 2012 TO 31 AUGUST Church Hill Infant School s object is specifically restricted to the following- To advance for the public benefit education in the United Kingdom, in particular but without prejudice to the generality of the foregoing by establishing, maintaining, carrying on, managing and developing a school offering a broad and balance curriculum. Objectives, strategies and activities The purpose of the school is to be a learning community where everyone has the highest expectations of themselves, our school and of others. At our school, we take pride in celebrating that we are all learners; and that every child has the potential to achieve the highest possible standards. Our belief, as communicated to the pupils and the school community is To be the best we can be and continually pursue excellence through offering a first class education. We aim to: Offer a rich, child centred 21st century curriculum which provides meaningful, relevant and authentic learning experiences which enable each child to be the best they can be. Work in harmony with parents and the community to establish positive and successful partnerships to maximise the learning potential of our pupils. Inspire children to acquire independence and to feel genuinely confident; equipping them with the skills to take responsibility for their own lives. Nurture our pupils to become co-constructors of their learning; enthusing a natural curiosity and passion for learning Celebrate and share achievement and success and ensure every child does matter irrespective of ability and background. Provide a safe environment for children to take risks and learn from their mistakes, developing positive attitudes to learning. Have the highest expectations of all our children, of ourselves and of others. Provide a happy, friendly and caring team of staff who are passionate and accountable for achieving the best possible outcomes for our pupils; academically, socially and morally. Embrace school improvement and innovative teaching and learning strategies which challenge, motivate and inspire all Value and champion the uniqueness of individuals Our main objective for the period was to enhance and improve the quality of education at the school. Strategies to achieve the above included; a staffing restructure, appointment of a new head, introduction of new technologies and focussed staff development. The headteacher, senior management team and governing body have worked throughout the period to ensure we moved forward on the above activities. Public benefit The school is a charitable Trust which seeks to benefit the public through the pursuit of its stated aims. The Trustees have complied with their duty to have due regard to the guidance on public benefit published by the Charity Commission. Page 4

7 ACHIEVEMENTS AND PERFORMANCE Review of activities TRUSTEES' REPORT (continued) FOR THE PERIOD 17 AUGUST 2012 TO 31 AUGUST Our Academic Results at the end of Key Stage One SATs Results show improvements compared to the previous year (2011/2012). Year 1 Phonics Screening More children at Church Hill Infants reached the expected level in Phonics compared to National figures and our school level has remained similar to last year. Our use of the Letters and sounds scheme and daily phonics sessions is having a positive impact on the children s ability to read new words. KS1 Headlines The school has had many successes for children at the end of KS1. Raiseonline data confirms what the school s internal data suggests; that achievement is good and in line with National comparisons for our children. We perform similarly in Reading to National figures at 2C and 2A + and better than National at levels 2B and 3. Our children make good progress in reading and achieve well. Our Math s results are above national figures at all levels apart from Level 3 this is something we will monitor and focus on next year. In writing we have made improvements at level 2C and 2B and level 3 we will continue to focus on writing in school and will particularly look to raising the number of children achieving level 3. Other key achievements and activities for the year 2012/ included; Receiving excellent reports from external moderators who quality assure provision and assessment of the Foundation Stage Curriculum Introduction of extra curriculum activities and provision of a range of sports including swimming for all pupils within the school. Provision of quality staff development, through accredited courses and training programmes for middle leaders Improving technology infrastructure to enhance the quality of education at the school Continuation of quality Family Learning sessions Enrichment of the curriculum through the introduction of after school clubs Going concern After making appropriate enquiries, the governing body 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 Accounting Policies. Investment policy and performance The school s investment strategy is Regularly monitor cashflow and current/fund account balances to ensure immediate financial commitments can be met (payroll) and that the accounts have adequate balances to meet forthcoming commitments. Identify surplus to the immediate cash requirements and transfer to the school's deposit account bearing a higher interest rate. Periodically review interest rates and compare with other investment opportunities. The school s current policy is to only invest in risk free and immediately accessible deposit accounts Any change in policy requires the approval of the Trustees via the finance committee. Page 5

8 TRUSTEES' REPORT (continued) FOR THE PERIOD 17 AUGUST 2012 TO 31 AUGUST FINANCIAL REVIEW Financial review Excluding received on conversion to academy status, the majority of the school's funding was provided by the Education Funding Agency (EFA). The school's incoming resources for the period 1 November 2012 to 31 August amounted to 2,456,770 of which 1,670,457 related to assets received on conversion and 724,411 related to EFA General Annual Grant (GAG). At the end of the period the school held free reseves (unrestricted ) of 113,477 which can be spend on any activities within the academy's charitable objects, and 19,544 restricted (excluding fixed assets and pension ) which can be spent in line with particular grant terms (being mainly General Annual grant carried forward to the next year to be spent on core educational activities or capital expenditure as decided by the Trustees). Financial and risk management objectives and policies The risks faced by the academy are outlined in the Risk Register agreed by the Trustees, who monitor risks and who will review the risk policy at least anually. Principal risks and uncertainties The academy has a Local Government Pension Scheme pension deficit as at 31 August of 231,000. The effect of this deficit on budgeting and cashflow is that pension contributions have to be paid in line with rates updated by the pension actuary every three years. There is now a government guarantee in place to ensure that government pays any outstanding pension scheme liabilities in the event of academy closure. Reserves policy The Trustees have developed a reserves policy for the school. This review to prepare the policy encompassed the nature of income and expenditure streams, the need to match income with commitments and nature of reserves. The Trustees have determined that the appropriate level of free reserves should be 10% of the income, approximately 85,000. The reason for this is to provide sufficient working capital to cover delays between spending and receipts of grants and to provide resources to deal with unexpected emergencies such as emergency maintenance. The school s current level of free reserves is 113,477, the difference of 28,477 is intended for the development of the school building due to increasing numbers on role. The school also has unspent GAG available as at 31 August of 18,991 included in restricted (note 18 to the accounts) which the Trustees intend to use for current pupil spending or capital projects to be decided upon. PLANS FOR THE FUTURE Future developments The school believes in investing in staff development and succession planning to develop the potential of its entire workforce. A systematic programme which is in line with the ongoing priorities of the school is in place to ensure continued improvements in the quality of teaching. We have a planned programme of maintenance and investment for the school site. Each year the school invests heavily on computer equipment and infrastructure to ensure our students and staff have the best technology that we can provide. Page 6

9 TRUSTEES' REPORT (continued) FOR THE PERIOD 17 AUGUST 2012 TO 31 AUGUST Maintaining, and where necessary, improving the infrastructure of the school to ensure the school community can maximise from educational resources, (afterschool/ breakfast clubs/ parent and community rooms/ areas for small group work). Funds held as custodian There are no such assets held by the Academy Disclosure of information to auditors Each of the persons who are Trustees at the time when this Trustees' report is approved has confirmed that: Auditors so far as that Trustee is aware, there is no relevant audit information of which the charitable company's auditors are unaware, and that Trustee has taken all the steps that ought to have been taken as a Trustee in order to be aware of any information needed by the charitable company's auditors in connection with preparing their report and to establish that the charitable company's auditors are aware of that information. The auditors, Clear & Lane, have indicated their willingness to continue in office. The Designated Trustees will propose a motion re-appointing the auditors at a meeting of the Trustees. This report was approved by order of the governing body on 28 November and signed on its behalf by: K Mistry Chair of Trustees Page 7

10 GOVERNANCE STATEMENT Scope of Responsibility As trustees, we acknowledge we have overall responsibility for ensuring that Church Hill Infant 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 governing body 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 Church Hill Infant School and the Secretary of State for Education. They are also responsible for reporting to the governing body 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 Trustees' responsibilities statement. The governing body has formally met 10 times during the period. Attendance during the period at meetings of the governing body was as follows: Trustee Meetings attended Out of a possible K Mistry, Acting Chair 8 10 P Tadman 3 4 R Ludlam, Acting Vice Chair 8 9 P Beall 1 1 S Brady 0 5 M Bulsara L Clarke 6 6 D Corcoran 9 9 K Doshi 1 1 M Flamson 4 9 D Hill 3 4 E Hollis B Howie 4 6 I Hubber 7 10 N Karia 1 1 A Lad 2 4 A Smith 0 1 Despite key changes in the structure and composition of the Governing Body; rigorous training, refined committee schedules, improved monitoring procedures have overall enhanced the strategic leadership of the Governing Body. The Governing Body are also committed to developing and refining skills associated with governance through training programmes and networking with other Trustees within the Syston and Thurmaston Education Partnership (STEP) Schools. The Finance Committee is a sub-committee of the main governing body. Its purpose is to assist the decision making of the governing body, by enabling more detailed consideration to be given to the best means of fulfilling the Full Governing Body s responsibility to ensure sound management of the Academy's finances and resources during the year. The overarching responsibilities include: 1. To carry out its functions in accordance with statutory requirements and the guidance set out in the Academies Financial Handbook (EFA, September ). 2. To have delegated powers to make decisions relating to finance, in accordance with the school's Scheme of Delegation and Financial Regulations. 3. To provide advice and assistance to the Headteacher and the Governing Body on matters relating to the finances of the school. 4. To work with the Headteacher and other committees to consider each year's School Development Plan, identify priorities and recommend an annual budget, which must be balanced, to the Full Governing Body for approval. Page 8

11 GOVERNANCE STATEMENT (continued) 5. To receive financial reports at least once each half of term and keep under review the school's actual financial performance, compared with budgeted performance, reporting any significant changes to the Full Governing Body. 6. To prepare Financial Regulations for the school, for approval by the Full Governing Body, and regularly review and update these. 7. To ensure that long-term financial plans are prepared for the school. 8. In conjunction with the Headteacher, to maintain an awareness of opportunities to develop new sources of revenue. 9. In conjunction with the Headteacher and relevant committee(s), to oversee funding bids. 10. To maintain a register of risks arising from the school's operations, showing how they are being managed or mitigated, and review it annually. 11. To prepare a contingency and business continuity plan, for approval by the Full Governing Body, and review it annually. 12. To ensure that an annual audit of the School Fund is carried out and the outcome is reported to the Full Governing Body. 13. To ensure that the school has adequate insurance cover. 14. To receive reports from Local Authority Internal Audit. Expertise and skills which enhance the work of the committee are always considered when agreeing committee membership. During the year, Paul Tadman resigned from the committee. Current committee members include; D Hill and R Ludlam. The Head Teacher (Accounting Officer) and the Bursar (Principle Finance Officer) also attend each meeting. Attendance at meetings in the year was as follows: Attendance at meetings in the period was as follows: Trustee Meetings attended Out of a possible P Tadman, Chair to 15/01/ 2 2 I Hubber 5 5 M Bulsara 5 5 R Ludlam, Acting Vice Chair from 29/01/ 3 3 D Hill 1 1 M Norton, Bursar (Invited/PFO) 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 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 Church Hill Infant School for the period 17 August 2012 to 31 August and up to the date of approval of the annual report and financial statements. Capacity to Handle Risk The governing body 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 governing body 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 period 17 August 2012 to 31 August and up to the date of approval of the annual report and financial statements. This process is regularly reviewed by the governing body. Page 9

12 The Risk and Control Framework GOVERNANCE STATEMENT (continued) The academy trusts 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 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 governing body has considered the need for a specific internal audit function and has decided to appoint Leicestershire County Council as internal auditor for a period of 3 years from the date of conversion. During this time the academy will benefit from one 2-day visit and two 1-day visits, during which the internal auditors will give advice on financial matters and perform a range of checks on the academy trust's financial systems. Following each visit the internal auditors will provide a report for 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, the Headteacher has responsibility for reviewing the effectiveness of the system of internal control. During the period in question the review has been informed by: the work of the internal auditor; the work of the external auditors; the financial management and governance self-assessment process; 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 governing body on 28 November and signed on their behalf, by: K Mistry Chair of Trustees M Bulsara Accounting Officer Page 10

13 STATEMENT ON REGULARITY, PROPRIETY AND COMPLIANCE As Accounting Officer of Church Hill Infant School I have considered my responsibility to notify the academy governing body 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 and the Secretary of State. As part of my consideration I have had due regard to the requirements of the Academies Financial Handbook (2012). I confirm that I and the academy governing body are able to identify any material, irregular or improper use of by the academy, or material non-compliance with the terms and conditions of funding under the academy's funding agreement and the Academies Financial Handbook (2012). I confirm that no instances of material irregularity, impropriety or funding non-compliance have been discovered to date. M Bulsara Accounting Officer Page 11

14 TRUSTEES' RESPONSIBILITIES STATEMENT FOR THE PERIOD 17 AUGUST 2012 TO 31 AUGUST The Trustees (who act as governors of Church Hill Infant School and are also the directors of the charitable company for the purposes of company law) are responsible for preparing the Trustees' report and the financial statements in accordance with the Annual Accounts Direction issued by the Education 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; make judgments and accounting estimates that are reasonable and prudent; 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 governing body on 28 November and signed on its behalf by: K Mistry Chair of Trustees Page 12

15 INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CHURCH HILL INFANT SCHOOL We have audited the financial statements of Church Hill Infant School for the period ended 31 August 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 Academies Accounts Direction 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 Trustees' responsibilities statement, 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. 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 period 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 Academies Accounts Direction 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 for the financial period for which the financial statements are prepared is consistent with the financial statements. Page 13

16 INDEPENDENT AUDITORS' REPORT TO THE MEMBERS OF CHURCH HILL INFANT 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. Luke Turner ACA FCCA (Senior statutory auditor) for and on behalf of Clear & Lane Chartered Accountants Statutory Auditors 340 Melton Road Leicester LE4 7SL 20 December Page 14

17 INDEPENDENT REPORTING AUDITORS' ASSURANCE REPORT ON REGULARITY TO CHURCH HILL INFANT SCHOOL AND THE EDUCATION FUNDING AGENCY In accordance with the terms of our engagement letter dated 11 September and further to the requirements of the Education Funding Agency (EFA) as included in the Academies Accounts Direction, we have carried out an engagement to obtain limited assurance about whether the expenditure disbursed and income received by Church Hill Infant School during the period 17 August 2012 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 Church Hill Infant School and the EFA in accordance with the terms of our engagement letter. Our work has been undertaken so that we might state to Church Hill Infant School 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 Church Hill Infant School and the EFA, for our work, for this report, or for the conclusion we have formed. Respective responsibilities of Church Hill Infant School's accounting officer and the reporting auditors The accounting officer is responsible, under the requirements of Church Hill Infant School's funding agreement with the Secretary of State for Education, and the Academies Financial Handbook extant from 2006, 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 17 August 2012 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 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's income and expenditure. Page 15

18 INDEPENDENT REPORTING AUDITORS' ASSURANCE REPORT ON REGULARITY TO CHURCH HILL INFANT 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 period 17 August 2012 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. Luke Turner ACA FCCA (Senior statutory auditor) for and on behalf of Clear & Lane Chartered Accountants Statutory Auditors 340 Melton Road Leicester LE4 7SL 20 December Page 16

19 STATEMENT OF FINANCIAL ACTIVITIES (incorporating income and expenditure account and statement of recognised gains and losses) FOR THE PERIOD 17 AUGUST 2012 TO 31 AUGUST INCOMING RESOURCES Unrestricted Note Restricted Restricted fixed asset Total Incoming resources from generated : Voluntary income - transfer from local authority on conversion 2 101,805 (206,000) 1,774,652 1,670,457 Activities for generating 3 5, ,867 Investment income Incoming resources from charitable activities 5 26, ,049 6, ,432 TOTAL INCOMING RESOURCES 133, ,049 1,780,835 2,456,770 RESOURCES EXPENDED Charitable activities 10 17, ,526 42, ,040 Governance costs 6 2,500 24,979-27,479 TOTAL RESOURCES EXPENDED 9 20, ,505 42, ,519 NET INCOMING RESOURCES / (RESOURCES EXPENDED) BEFORE REVALUATIONS 113,477 (195,456) 1,738,230 1,656,251 Actuarial gains and losses on defined benefit pension schemes 25 - (16,000) - (16,000) NET INCOME/(EXPENDITURE) FOR THE PERIOD 113,477 (211,456) 1,738,230 1,640,251 Total at 17 August TOTAL FUNDS AT 31 AUGUST 113,477 (211,456) 1,738,230 1,640,251 All of the academy's activities derive from acquisitions in the current financial period. The Statement of Financial Activities includes all gains and losses recognised in the period. The notes on pages 20 to 39 form part of these financial statements. Page 17

20 REGISTERED NUMBER: BALANCE SHEET AS AT 31 AUGUST FIXED ASSETS Note Tangible assets 14 1,716,693 CURRENT ASSETS Stocks 15 2,009 Debtors 16 27,734 Cash at bank 154, ,526 CREDITORS: amounts falling due within one year 17 (29,968) NET CURRENT ASSETS 154,558 TOTAL ASSETS LESS CURRENT LIABILITIES 1,871,251 Defined benefit pension scheme liability 25 (231,000) NET ASSETS INCLUDING PENSION SCHEME LIABILITIES 1,640,251 FUNDS OF THE ACADEMY Restricted : Restricted 18 19,544 Restricted fixed asset 18 1,738,230 Restricted excluding pension liability 1,757,774 Pension reserve (231,000) Total restricted 1,526,774 Unrestricted ,477 TOTAL FUNDS 1,640,251 The financial statements were approved by the Trustees, and authorised for issue, on 28 November and are signed on their behalf, by: K Mistry Chair of Trustees The notes on pages 20 to 39 form part of these financial statements. Page 18

21 CASH FLOW STATEMENT FOR THE PERIOD 17 AUGUST 2012 TO 31 AUGUST Note Net cash flow from operating activities 20 31,427 Returns on investments and servicing of finance Capital grants unspent at the period end 21 6,183 Cash transferred on conversion to an academy trust ,159 INCREASE IN CASH IN THE PERIOD 154,783 All of the cash flows are derived from acquisitions in the current financial period. RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS FOR THE PERIOD 17 AUGUST 2012 TO 31 AUGUST Increase in cash in the period 154,783 MOVEMENT IN NET FUNDS IN THE PERIOD 154,783 NET FUNDS AT 31 AUGUST 154,783 The notes on pages 20 to 39 form part of these financial statements. Page 19

22 1. ACCOUNTING POLICIES NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD 17 AUGUST 2012 TO 31 AUGUST 1.1 BASIS OF PREPARATION OF FINANCIAL STATEMENTS The financial statements have been prepared under the historical cost convention, with the exception of investments which are included at market value. The financial statements have been prepared in accordance with the Statement of Recommended Practice (SORP), 'Accounting and Reporting by Charities' published in March 2005, the Academies Accounts Direction issued by the EFA, applicable accounting standards and the Companies Act FUND ACCOUNTING Unrestricted income represent those resources which may be used towards meeting any of the charitable objects of the academy at the discretion of the Trustees. Designated comprise unrestricted that have been set aside by the Trustees for particular purposes. The aim and use of each designated fund is set out in the notes to the financial statements. Restricted fixed asset are resources which are to be applied to specific capital purposes imposed by Education Funding Agency where the asset acquired or created is held for a specific purpose. Restricted general comprise all other restricted received and include grants from Education Funding Agency. Transfers between and between categories of i.e. restricted, designated and unrestricted are only processed with due regard to grant terms, agreements of funders (where applicable) and due process where formal trustees resolutions are required. Full disclosures are given within the notes to the accounts for any transfers processed. Investment income, gains and losses are allocated to the appropriate fund. Page 20

23 1. ACCOUNTING POLICIES (continued) 1.3 INCOMING RESOURCES NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD 17 AUGUST 2012 TO 31 AUGUST All incoming resources are included in the Statement of financial activities when the academy has entitlement to the, certainty of receipt and the amount can be measured with sufficient reliability. 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 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. General Annual Grant is recognised in full in the year for which it is receivable and any unspent amount is reflected as a balance in the restricted general fund. Capital grants are recognised when receivable and are not deferred over the life of the asset on which they are expended. Unspent amounts of capital grant are reflected in the balance in the restricted fixed asset fund. The value of donated services and gifts in kind provided to the academy are recognised at their open market value in the period in which they are receivable as incoming resources, where the benefit to the academy can be reliably measured. An equivalent amount is included as expenditure under the relevant heading in the Statement of financial 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's policies. Donations are recognised on a receivable basis where there is certainty of receipt and the amount can be reliably measured. Other income, including the hire of facilities, is recognised in the period in which it is receivable and to the extent the goods have been provided or on completion of the service. 1.4 RESOURCES EXPENDED All expenditure is recognised in the period in which a liability is incurred and has been classified under headings that aggregate all costs related to that category. Where costs cannot be directly attributed to particular headings they have been allocated on a basis consistent with the use of resources, with central staff costs allocated on the basis of time spent, and depreciation charges allocated on the portion of the asset's use. Other support costs are allocated based on the spread of staff costs. Charitable activities are costs incurred in the academy's educational operations. Governance costs include the costs attributable to the academy's compliance with constitutional and statutory requirements, including audit, strategic management and Trustees' meetings and reimbursed expenses. All resources expended are inclusive of irrecoverable VAT. 1.5 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 one year from the date of approval of the financial statements. Page 21

24 1. ACCOUNTING POLICIES (continued) NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD 17 AUGUST 2012 TO 31 AUGUST 1.6 TANGIBLE FIXED ASSETS AND DEPRECIATION All assets costing more than 1,000 are capitalised. Where tangible fixed assets have been acquired with the aid of specific grants, either from the government or from the private sector, they are included in the Balance sheet at cost and depreciated over their expected useful economic life. The related grants are credited to a restricted fixed asset fund in the Statement of financial activities and are carried forward in the Balance sheet. Depreciation on such assets is charged to the restricted fixed asset fund in the Statement of financial activities so as to reduce the fund over the useful economic life of the related asset on a basis consistent with the academy's depreciation policy. A review for impairment of a fixed asset is carried out if events or changes in circumstances indicate that the carrying value of any fixed asset may not be recoverable. Shortfalls between the carrying value of fixed assets and their recoverable amounts are recognised as impairments. Impairment losses are recognised in the Statement of Financial Activities. Tangible fixed assets are stated at cost less depreciation. Depreciation is not charged on freehold land. Depreciation on other tangible fixed assets is provided at rates calculated to write off the cost of those assets, less their estimated residual value, over their expected useful lives on the following bases: 1.7 STOCKS Leasehold buildings - 3% Straight line Leasehold land - over 125 years Motor vehicles - 25% Reducing balance Computer equipment - 25% Straight line Stocks are valued at the lower of cost and value in use. 1.8 TAXATION The academy is considered to pass the tests set out in Paragraph 1 Schedule 6 of the Finance Act 2010 and therefore it meets the definition of a charitable company for UK corporation tax purposes. Accordingly, the academy is potentially exempt from taxation in respect of income or capital gains received within categories covered by Chapter 3 Part 11 of the Corporation Tax Act 2010 or Section 256 of the Taxation of Chargeable Gains Act 1992, to the extent that such income or gains are applied exclusively to charitable purposes. 1.9 PENSIONS Retirement benefits to employees of the academy are provided by the Teachers' Pension Scheme ("TPS") and the Local Government Pension Scheme ("LGPS"). These are defined benefit schemes, are contracted out of the State Earnings-Related Pension Scheme ("SERPS"), and the assets are held separately from those of the academy. The TPS is an unfunded scheme and contributions are calculated so as to spread the cost of pensions over employees' working lives with the academy in such a way that the pension cost is a substantially level percentage of current and future pensionable payroll. The contributions are determined by the Government Actuary on the basis of quinquennial valuations using a prospective benefit method. As stated in note 25, the TPS is a multi-employer scheme and the academy is unable to identify its share of the underlying assets and liabilities of the scheme on a consistent and reasonable basis. The TPS is therefore treated as a defined contribution scheme and the contributions recognised as they are paid each year. Page 22

25 1. ACCOUNTING POLICIES (continued) NOTES TO THE FINANCIAL STATEMENTS FOR THE PERIOD 17 AUGUST 2012 TO 31 AUGUST The LGPS is a funded scheme and the assets are held separately from those of the academy in separate trustee administered. Pension scheme assets are measured at fair value and liabilities are measured on an actuarial basis using the projected unit method and discounted at a rate equivalent to the current rate of return on a high quality corporate bond of equivalent term and currency to the liabilities. The actuarial valuations are obtained at least triennially and are updated at each balance sheet date. The amounts charged to operating surplus are the current service costs and gains and losses on the settlements and curtailments. They are included as part of staff costs. Past service costs are recognised immediately in the Statement of financial activities if the benefits have vested. If the benefits have not vested immediately, the costs are recognised over the period vesting occurs. The expected return on assets and the interest cost are shown as a net finance amount of other finance costs or credits adjacent to interest. Actuarial gains and losses are recognised immediately in other gains and losses CONVERSION TO AN ACADEMY TRUST 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 [name of predecessor school] 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 Church Hill Infant School. The amounts have been recognised under the appropriate balance sheet categories, with a corresponding amount recognised in the Statement of financial activities and analysed under unrestricted, restricted general and restricted fixed asset. On conversion to an academy trust, the academy was gifted property from Leicestershire County Council. This was valued at depreciated replacement cost by the Education Funding Authority. The amount is included in the appropriate fixed asset category and depreciated over the useful economic life in accordance with the academy's policies. Other Fixed Assets have been valued on a the basis of open market value as at the date of conversion, by the trustees. The pension liability inherited on conversion has been included at the valuation determined by the pension scheme actuary at the date of the conversion. Further details of the transaction are set out in note VOLUNTARY INCOME Unrestricted Restricted Total Voluntary income - transfer from local authority on conversion 101,805 1,568,652 1,670,457 Voluntary income 101,805 1,568,652 1,670,457 Page 23