(a company limited by guarantee) · charity with the purpose of advancing public benefit education...
TRANSCRIPT
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Registered number: 08149829
EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
ANNUAL REPORT AND FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2014
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
CONTENTS
Page
Reference and Administrative Details of the Academy, its Trustees and Advisers 1 - 2
Trustees’ Report 3-11
Governance Statement 12-14
Statement on Regularity, Propriety and ComplIance 15
Trustees’ Responsibilities Statement 16
Independent Auditors’ Report 17-18
Independent Reporting Accountant’s Assurance Report on Regularity 19 - 20
Statement of Financial Activities 21
Balance Sheet 22
Cash Flow Statement 23
Notes to the Financial Statements 24 -43
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
REFERENCE AND ADMINISTRATIVE DETAILS OF THE ACADEMY, ITS TRUSTEES AND ADVISERSFOR THE YEAR ENDED 31 AUGUST 2014
Trustees
George Gyte1Kevin Crompton1Marihelen Esam (resigned 16 January 2014)1Pauline Waterhouse OREJames FairlieMartin Havelock (resigned 9 February 2014)Peter Ullathom (resigned 2 January 2014)Elinor Anderson (resigned 24 January 2014)Jan Marshall1Jane ThomasSarah Bennett (resigned 31 August 2014)Keith MarshallJulian Rivers (appointed 27 March 2014)Vanessa Wiseman (appointed 15 May 2014, resigned 29 August 2014)
1 Memberof the Finance Group
Company registered number
08149829
Principal and registered office
Bridge HouseBridge StreetOlneyBuckinghamshireMK46 4AB
Company secretary
Sheila Cowley
ChIef executive officer
Jan Marshall
Independent auditors
Peters Elworthy & MooreChartered AccountantsStatutory AuditorsSalisbury HouseStation RoadCambridgeCR1 2LA
Bankers
Lloyds BankFenlands HouseVicarage Farm RoadPeterboroughPEI 5UH
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
REFERENCE AND ADMINISTRATIVE DETAILS OF THE ACADEMY, ITS TRUSTEES AND ADVISERS
FOR THE YEAR ENDED 31 AUGUST 2014
AdmInistratIve detaIls (continued)
Solicitors
Winckwoñh SherwoodMinerva House5 Montague CloseLondonSE1 9BB
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
TRUSTEES’ REPORTFOR THE YEAR ENDED 31 AUGUST 2014
The Trustees (who are also directors of the charity for the purposes of the Companies Act) present their annual reporttogether with the audited financial statements of EMLC Academy Trust (the academy) for the year 1 September 2013 to 31August 2014. The Trustees confirm that the Annual Report and financial statements of the Academy Trust comply with thecurrent statutory requirements, the requirements of the Academy Trusts’ governing document and the provisions of theStatement of Recommended Practice (SORP) “Accounting and Reporting by Charities” issued in March 2005.
Structure, governance and management
Constitution
EMLC Academy Trust was incorporated on 19 July 2012 as a Trust, a company limited by guarantee and an exemptcharity with the purpose of advancing public benefit education in the United Kingdom by establishing, maintaining,managing and developing academies and free schools as world class centres of exellence.
The charitable company’s Memorandum and Articles of Association are the primary governing documents of the AcademyTrust. The Board of Trustees of EMLC Academy Trust is also the Trustees of the charitable company for the purpose ofcompany law.
Members’ liability
Each member of the charitable company undertakes to contribute to the assets of the charitable company in the event of itbeing wound up while they are a member, or within one year after they cease to be a member, such amount as may berequired, not exceeding £10, for the debts and liabilities contracted before they ceased to be a member.
The principal sponsor, EMLC (the charity), has appointed three members to the EMLC Academy Trust, who are GeorgeGyte, David Bateson and Jan Marshall.
Method of recruithient and appointment or election of Trustees
When new Trustees are appointed, the Board approves an appropriate process and criteria for recruitment based on areview of skills and capability.
Throughout this period, two Trustees were appointed to the Board, who were identified as providing a specific commercialand financial need for the Trust. Previously, when there have been a number of Trustee vacancies, EMLC Academy Trusthas advertised in a national newspaper for new Trustees and has been successful in attracting high quality Trustees.
Policies and procedures adopted for the induction and training of Trustees
Trustees are briefed regularly on educational and other EMLC Academy Trust matters by the executive team, throughbriefings at Board meetings, group meetings, other sessions, visits to schools and individual meetings. When newTrustees join the Board, tailored induction training is arranged to provide new Trustees with a comprehensiveunderstanding of the Trust and the wider context, EMLC Academy Trust’s mission, ethos and values, the operation networkand their governance responsibilities.
Organisatlonal structure
The Trustees set general policy, approve an annual Implementation Plan and budget, monitor performance against theplan and budget, and take major decisions about the Trustees of the Academies, growth of academies and senior staffappointments.
The Soard has established four groups to support the Board carry out its functions, which are:
- Performance Group- Finance Group- Development Group- Audit & Risk Group
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
TRUSTEES’ REPORT (continued)FOR THE YEAR ENDED 31 AUGUST 2014
The Board delegates a number of functions to Local Governing Bodies (LGB5) at each academy. Each LGB reviews
academy level policies, the academy improvement plans and budgets, and recommends these to EMLC Academy Trust:
monitors school performance and oversees parent and community liaison.
The Trustees delegate the day to day responsibility to the executive team led by the Chief Executive Officer, Jan Marshall.
The running of each individual academy is delegated to its Principal:
The following were members of the Academy Trust Board during the year::
George Gyte (Chair) — Sponsor TrusteeKevin Crompton (Vice Chair) — Sponsor TrusteePauline Waterhouse OBE — Sponsor TrusteeJames Faidie — Sponsor TrusteeJan Marshall — Chief Executive Officer (CEO)Jane Thomas — Staff TrusteeKeith Marshall OBE — Academy Trustee (nominated Chair of Governors)
Julian Rivers — Sponsor TrusteeSarah Bennett — Principal Trustee (Resigned on 31 August 2014)
Elinor Anderson — Sponsor Trustee (Resigned on 28 January 2014)
Marihelen Esam — Sponsor Trustee (Resigned on 28 January 2014)
Peter Ullathorn — Sponsor Trustee (Resigned on 10 January 2014)
Martin Havelock — Sponsor Trustee (Resigned on 9 December 2013)
Vanessa Wiseman — Sponsor Trustee (Resigned on 29 August 2014)
All Trustees have a term of office of four years, except the Staff Trustees and CEO, who serve while they remain in post.
The Trustees met eight times in the period 1 September 2013 to 31 August 2014.
Connected organlsations, Including related party relationships
EMLC Academy Trust works closely with Third Wave Enterprises and EMLC. The Chief Executive Officer for the Academy
Trust oversees all three organisaUons.
EMLC is a national charity that is expert in identifying, developing and assessing talented leaders for schools in the future.
Third Wave Enterprises works with the very best schools and academies as well as those in need of support in order to
bring them together to build capacity and capability at a pace, especially in teaching and learning, and to achieve
exceptional school improvement.
Service level agreements are in place between EMLC Academy Trust and EMLC, and EMLC Academy Trust and Third
Wave Enterprises (with services for both charged at cost’, following EFA guidance and approval). These set out the
agreement and use of services to ensure EMLC Academy Trust can deliver on its mission and be highly successful in
raising standards and running outstanding EMLC academies.
Trustees’ Indemnities
In line with normal commercial practice, EMLC Academy Trust insures its Trustees against errors, negligent acts or
omissions relating to their work for the EMLC Academy Trust for up to £2rn on any single claim:
Objectives and Activities
Objects and aims
EMLC Academy Trust was incorporated on 19 July 2012 as a Trust and a company limited by guarantee, with the purpose
of establishing, maintaining, managing and developing academies and free schools as world class centres of excellence
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EMLC ACADEMY TRUST(A Company Limited by Guarantee)
TRUSTEES’ REPORT (continued)FOR THE YEAR ENDED 31 AUGUST 2014
Our Vision: Every child deserves to be the best they can be
Key elements of our vision
• Establish world dass primary, secondary and special academies that are centres of
excellence for leadership, teaching and learning and are flagships and centres of learning
for other academies and schools
• Be driven by a moral purpose to transform opportunities and change life chances of
children and young people who live in challenging times as well as challenging places.
Work in partnership with learners, their families and communities to raise aspirations,
foster great expectations and achieve ambitious goals
In the first year of the academy Trust’s operation, EMLC Academy Trust was approved by the Department for Education tobecome the academy sponsor of an underperforming Junior School and an outstanding Infant School in Milton Keynes.Orchard (Junior) School had historic low attainment in a deprived part of Milton Keynes and was in a hard federation withShepherdswell (Infant) School. Both schools elected to join the EMLC Academy Trust and converted on 1 September2012.
In the current financial year, EMLC Academy Trust has grown to sponsor a total of 5 primary academies, with the additionof three academies in Northamptonshire. These academies are Castle Academy and Hardingstone Academy, which bothconverted in 1 January 2014 and Stimpson Avenue Academy, which converted on 1 April 2014. All three were judged byOISTED to be requiring special measures for either poor attainment or poor progress at the end of Key Stage 2.
The Trust has continued to expand its support for the academies it sponsors with an infrastructure supporting Finance, HR,capital, communications and legal along with setting up local governance arrangements to drive improvements to theschools at pace.
In the second year of successful operation, the Trustees have continued to adopt a strategy of sustainable growth in thenumber of academies the EMLC Academy Trust sponsors, seeking opportunities for expansion through regional clusterswithin 1 hour travelling time from Olney, head office.
In the current financial year, two academies have voted to join the EMLC Academy Trust, both secondary schools. Theywill be the first secondary schools sponsored by the Trust, if approved by the Department for Education. One of theschools is in Northamptonshire and the other is in Buckinghamshire, a third Local Authority region the Trust will operate in,if successful. Both schools are expected to convert in early 2015.
This will take EMLC Academy Trust to sponsoring 7 academies. The growth aspiration is regularly discussed atDevelopment Group meetings and in the strategic events held every term. It has been agreed that the Trust can grow to 5-7 academies by September 2014 and 6-8 academies by September 2015.
Sponsoring 5 academies in Milton Keynes and Northamptonshire, EMLC Academy Trust focuses on providing a highquality education provision to the 1,400+ pupils it educates along with specialist support for the 225 staff in theiracademies.
Orchard Academy continues to enjoy rapid improvement in attainment, particularly in Maths and Reading, with an overallincrease in attainment alongside significant improvement in behaviour in both schools with fewer unauthorised absences,fewer instances of bullying and no permanent exclusions.
At the same time the Trust has grown centrally with a number of staff appointments. A report was carried out looking at thegrowth strategy of the Trust and setting out the staffing model required to meet the need of the growth to provide
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
TRUSTEES’ REPORT (continued)
FOR THE YEAR ENDED 31 AUGUST 2014
improvements in the academies. This report has highlighted the need for a Strategic School Improvement Manager and
further administration staff, which have been appointed, along with a need to appoint a Chief Operating Officer, who will be
recruited in 2015.
As the Trust moves into sponsoring secondary academies, it has worked hard on recruiting the skills and expertise
required. The Board has significant secondary and post 16 experience, with former secondary and a college Principal
making up the membership of the Board. Employed by the Trust, both the Director of Operations and Strategic School
Improvement Manager have experience in working with secondary schools, the later being a successful deputy in an
academy that moved from special measure to Good in the centre of Northampton.
Third Wave Enterprises have experience of working in secondary schools, with case studies outlining programmes of
school that have had a significant impact in improving standards and supported one secondary in Northampton to become
an Outstanding School. Experienced education advisers and programmes of teacher training are available to EMLC
Academy Trust to support the required improvements at secondary level.
The Trust has worked hard over the two years to continue to develop an infrastructure that is effective in managing both
the school improvement requirements as well as providing rapid support for finance, KR, legal, capital and
communications.
At date of publication (December 2014), two new schools are on course to join the Trust in early 2015. As the Trust
increases the number of academies, so will the capacity and capability within the Trust grow to meet the growing demands
of these academies.
Public benefit
The Trustees have referred to the Charity Commission guidance on public benefit when reviewing the company’s
objectives and aims and planning future activities, and consider that the Academies’ aims are for the public benefit.
Strategic Report
Achievements and performance
Pupils in EMLC Academy Trust academies in Milton Keynes have continued to make exceptional progress. The strategy of
providing school to school support with an outstanding school in Milton Keynes that is also a Teaching School, has been
highly efctive. This two year contract finished on 31 August 2014 and provided a foundation of high quality improvement.
This was confirmed through an OfSTED inspection in June 2014, where inspectors judged Orchard Academy to be a Good
school with outstanding features. Formally judged to be a satisfactory school in 2010, inspectors noted that Strong
leadership and management have brought about considerable improvements to pupils’ achievement and to teaching since
the school opened. All groups of pupils make good progress from their starting points. Teaching has improved and is
securely good, with some that is outstanding and behaviour is good and sometimes outstanding in lessons and around the
school.”
Orchard Academy continues to improve in its attainment outcome. In 2014, 93% of pupils achieved a Level 4 or above in
Reading, Writing and maths — an increase of 11% from the previous year. This is from a historically low level, when just
37% of pupils achieving level 4 or above in both English and Mathematics in 2010.
This is the second year where attainment is above national average, with more pupils gaining a Level 5 or above in
Reading, Writing and maths — 18%, up from 6% - and the first year pupils have achieved a Level 6- 13%.
At Shepherdswell Academy, the pupils have made good progress in 2014, with attainment being above 2013 national
averages, except in maths at Level 2 or above. The table below demonstrates this point for pupils achieving the expected
level at the end of Key Stage 1 — a Level 2 or above and those that have exceeded it, by achieving a Level 3 or above.
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
TRUSTEES’ REPORT (continued)FOR THE YEAR ENDED 31 AUGUST 2014
At Orchard Academy, Key Stage 2 (7-11 year aids),mathematics continues to be above national average.
the proportion of pupils achieving level 4÷ in Reading, Writing and
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Year 2 attainment at Shepherdswell Academy in 2014,compared with the National Average in 2013
• Academy attainment
• National Average 2013
r rFJ+ +
‘Ir r rr’J Lu Lu
D
rLu+
In
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
TRUSTEES REPORT (continued)FOR THE YEAR ENDED 31 AUGUST 2014
The chart below shows that attainment continues to be above national average for the second year, with pupils exceeding
national expectations.
2010 to 2014 Orchard Academy 1<52 Performance
• % ol pupils achieving Level 4 orabovein Reading, Writing and Marl’s
Castle, Hardingstone and Stimpson Avenue Academies have only recently joined the Trust and their performance is being
closely monitored and aspirational targets have been set.
The table below sets out the Trust’s overall performance, with the results in 2014. The table also provides a Trust overall
average.
comparison
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
• National Average
2020 2021 2012 013 2014
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
TRUSTEES REPORT (continued)FOR THE YEAR ENDED 31 AUGUST 2014
The quality of teaching in all academies continues to improve. In the academies open more than a year, all teaching isGood or better. In the academies that opened during this academic year, on average 54% is Good or better, with themajority Requiring Improvement. Programmes for all these teachers have been arranged through Third Wave, with theacademy providing further wrap around support for these teachers.
Any inadequate teaching is being addressed through an intensive Teacher Support Programme and if there is noimprovement a capability process will be followed.
All the academies have a full complement of teaching staff, with the Trust using programmes like Schools Direct, TeachFirst and recruiting some overseas teachers. These strategies have had a positive impact on the staff profile of theacademies and are supporting improvement in standards. The aspiration and expectation of the Board of Trustees is thatall teaching in EMLC Academy Trust academies is good, with 50% outstanding after three years as an academy. All openEMLC academies are on track to achieve this target.
The popularity of our academies has grown significantly, with the number of pupils increasing in all cases. Overall, 93more pupils attend our academies compared to the same time last year.
Number of Roll perOrchard Shepherdswell Castle Hardingstone Sbmpsonacademy
2013 Pupil Census 180 130 437 185 4132014 Pupil Census 230 149 450 194 415Increase 50 19 13 9 2
100%
EMLC Academy Trust attainment 2014 compared to2013
80%
60%
40%
20%
0%
• % of pupils achieving Level
,
,.•
4.’
4 or above in Reading,Writir.gand Maths In 2013
• % of pupils achieving Level4 or above in Reading.
0 e
I
Writingand Maths in 2014
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
TRUSTEES’ REPORT (continued)
FOR THE YEAR ENDED 31 AUGUST 2014
Going concern
After making appropriate enquires, the Board of Trustees has 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 its financial statements. Further details regarding the adoption of the going concern
basis can be found in the Statement of Accounting Policies.
Financial Review
EMLC Academy Trust reported a revenue surplus, including available brought forward surpluses and after capital
expenditure, for the year ending 31 August 2014 of £165986 (2013: £6,958).
Most of the income came from the Department for Education (DfE) as recurrent grants for particular purposes. These
grants and the associated expenditure are shown as restricted funds in the Statement of Financial Activities.
Additional grants came from the DfE on a one-off basis for the start-up and conversion of the three newy converted
academies in the year.
During the year ended 31 August 2014, the overall surplus of £165,986 is broken down by a total income of £5,295,477,
less a total expenditure of £5,110,203 and less the shortfall to meet capital expenditure of £19,287.
EMLC, as the sponsor organisation, provided the initial start-up funding for the charity to enable trading. The drawdown of
this donation in this set of accounts is £121,074, mainly for senior appointments, with further funding available for the
2014/15 year of operation.
It is the Trustees objective that the Trust will be self-sustaining in 2014/15 and forecasts show that this will be achieved
with the addition of further academies in 2015.
Investment policy and performance
The Trust does not currently have sufficient reserves to warrant an investment policy and the small surplus is invested
through appropriate use of financial instruments with the Trust’s principal bankers, so any income can be achieved with
minimal risk.
Financial and risk management objectives and policIes
All major risks to which the academy trust is exposed are contained in a risk register that is reviewed annually by the
Finance Group. These risks are owned by the executive team or academy Principals with policies, systems and
procedures in place to manage these risks. Each academy has its own risk register, owned by the Principal and their
senior leaders, and reviewed by the LGBs, which informs the Trusts register. Both EMLC Academy Trust and its individual
academies have business continuity plans which are updated and practised regularly.
EMLC Academy Trust has cash balances and other working capital balances. The main risk arising from the use of
financial instruments is liquidity risk, with a low reserve of the Trust, in the initial years of operation.
The company manages its cash resources, including maintaining sufficient working capital, so that all its operating needs
are met without the need for shod-term borrowing.
Other risks that the Trust is exposed to include price risk although these are considered negligible because academies are
funded by the DfE on the same basis as maintained schools. The main financial risk is with potentially inaccurate financial
information received prior to the conversion of a school to become an EMLC academy. A robust due diligence process has
been adopted by Trustees to mitigate this risk with an external financial due diligence report being commissioned for every
project.
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
TRUSTEES’ REPORT (continued)FOR THE YEAR ENDED 31 AUGUST 2014
Principal risks and uncertainties
Trustees have assessed the major risks and uncertainties to which the EMLC Academy Trust is exposed. These arenamely school conversions with 1. inherited liabilities; 2. capital issues where there are limited funding available; 3,recruitment and 4. school finances with uncertainties for a new national funding formula. There are also changes to thecurriculum and qualifications, with national expectations increasing. EMLC Academy Trust works with underperformingschools which are often in disadvantaged communities, which makes the objectives even more challenging.
Reserves policy
At the end of the second year, EMLC Academy Trust’s reserves are beginning to grow. The Trustees have outlined a planfor growth and the level of reserves held takes account of current and future income and expenditure, with anacknowledgement that the majority of the Trusts funding is for the pupils who currently attend the academies. The level ofreserves is kept under review by the Trustees.
Future developments
EMLC Academy Trust opened two academies in September 2012 with a further three academies joining the Trust in thisreporting period. EMLC Academy Trust anticipates that two further secondary schools will join the Trust in 2014/15. TheTrustees have outlined a strategic plan to grow to between 6-8 academies in 2014/1 5, which the Trust is on course to do.
Disclosure of information to auditors
Each of the persons who are Trustees at the time when this Trustees’ Report is approved has confirmed that:
• so far as that Trustee is aware, there is no relevant audit information of which the charitable company’s auditors areunaware, and
• that Trustee has taken all the steps that ought to have been taken as a Trustee in order to be aware of any relevantaudit information and to establish that the charitable company’s auditors are aware of that information.
Auditors
The auditors, Peters Elworthy & Moore, have indicated their willingness to continue in office. The Designated Trustees willpropose a motion re-appointing the auditors at a meeting of the Trustees.
This report, incorporating the Strategic Report, was approved by order of the board of trustees, as the company directors,on 11 December 2014 and signed on the board’s behalf by:
George’kyteChair of Trustees
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
GOVERNANCE STATEMENT
Scope of ResponsIbility
As Trustees, we acknowledge we have overall responsibility for ensuring that EMLC Academy Trust has an effective and
appropriate system of control, financial and otherwise. However such a system is designed to manage rather than
eliminate the risk of failure to achieve business objectives, and can provide only reasonable and not absolute assurance
against material misstatement or loss.
The board of trustees has delegated the day-to-day responsibility to the Chief Executive Officer (CEO), 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 EMLC Academy
Trust and the Secretary of State for Education. The Accounting Officer is also responsible for reporting to the board of
trustees any material weaknesses or breakdowns in internal control.
Govemance
The information on governance included here supplements that described in the Trustees’ Report and in the Trustees’
Responsibilities Statement. The board of trustees has formally met 8 times during the year. Attendance during the year at
meetings of the board of trustees was as follows:
Trustee Meetings attended Out of a possible
George Gyte 6 8
Kevin Crompton 4 8
Marihelen Esam 3 3
Pauline Waterhouse OBE 5 8
James Fairlie 7 8
Martin Havelock 3 3
Peter Ullathom 3Elinor Anderson 2 4
Jan Marshall 8 8
Jane Thomas 5 8
Sarah Bennett 4 8
Keith Marshall 3 3
Julian Rivers 2 2
Vanessa Wiseman 0 0
All appointments in this report year are recorded with new appointment dates, where appropriate, in the table above.
The Finance Group is a sub-group of the board and its role is to support the board by overseeing financial activity of the
Trust along with other controls and risk management, in the context of planned growth. The group exists to ensure probity
and efficiency in the management and expenditure of EMLC Academy Trust income from the DfE, in compliance with the
Education Funding Agency’s (EFAs) Academies Financial Handbook. The group is chaired by Kevin Crcmpton, who is
currently Director for Children’s and Adult’s Services at Bedford Local Authority.
Governance reviews:
The board of trusteds was reconstituted during the year to achieve a greater separation between the Sponsor and Trust
boards. This resulted in a smaller, more focussed board of trustees which continuously reviews itself and its governance
processes
Attendance at the Finance Group meetings in the period 1 September 2013 to 31 August 2014 was as follows:
Trustee Meetings attended Out of a possible
Kevin Crompton 7 7
George Gyte 6 7
Marihelen Esam 3 3
Jan Marshall 3 3
Julian Rivers 3 3
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
GOVERNANCE STATEMENT (continued)
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 toachieve policies, aims and objectives; it can therere only provide reasonable and not absolute assurance ofeffectiveness. The system of internal control is based on an ongoing process designed to identify and priohtise the risks tothe achievement of Academy Trust policies, aims and objectives, to evaluate the likelihood of those risks being realisedand the impact should they be realised, and to manage them efficiently, effectively and economically.
Capacity to Handle RIsk
The Trustees have reviewed the key risks to which the Trust is exposed! together with the operating, financial andcompliance controls that have been implemented to mitigate those risks. The Trustees are of the view that there is aformal on-going process for identifying, evaluating and managing the Trust’s significant risks that has been in place for theperiod of this report to 31 August 2014 and up to the date of approval of the annual report and financial statements. Thisprocess is regularly reviewed by the Trustees at every board meeting.
The Risk and Control Framework
The EMLC Academy Trust system of internal financial control is based on a framework of regular management informationand administrative procedures including the segregation of duties and a system of delegation and accountability. Inparticular it includes:
• comprehensive budgeting and monitoring systems with an annual budget and periodic financial reports which arereviewed and agreed by the board of trustees;
• regular reviews by the finance group of reports which indicate financial performance against the forecasts and ofmajor purchase plans, capital works and expenditure programmes;
• selling 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 Trustees have considered the need for the external review of controls and procedures throughout the year.. A termlyaudit of internal controls is performed by EMLC Academy Trust central finance staff, with the results reported to theFinance Group. In discussions with our external auditors, a rolling programme is planned to start in 2015.
The Trust will review internal financial controls at the trust and its academies and agree a programme of work that willaddress these in order to inform the governance statement that accompanies the trust’s annual accounts. It will thenadvise the board on the adequacy and effectiveness of the systems of internal control and its arrangements for riskmanagement, control and governance processes, and securing economy, efficiency and effectiveness (value for money) inthe Trust and its academies.
A “dedicated Audit Committee” becomes a requirement when an academy trust reaches a turnover in excess of LiOm perannum as described in the EFA Academies Financial Handbook 2014.
EMLC Academy Trust did not reach this level between 1 September 2013 and 21 August 2014. With the likelihood ofgrowth of secondary academies in the next reporting year, the Trustees have established an Audit 8 Risk Group for thispurpose, along with managing the internal audit function as part of the terms of reference.
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
GOVERNANCE STATEMENT (continued)
Review of Effectiveness
As Accounting Officer, the Chief Executive Officer (CEO) has responsibility for reviewing the effectiveness of the system of
internal control. During the year in question the review has been informed by:
• the work of the external auditors;• 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 group and a plan to address weaknesses and ensure continuous improvement of the system is in place.
Approved by order of the members of the board of trustees on 11 December 2014 and signed on its behalf! by:
George Gyte Jan MarshallChair of Trustees Accounting Officer
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
STATEMENT ON REGULARITY, PROPRIETY AND COMPUANCE
As Accounting Officer of EMLC Academy Trust I have considered my responsibility to notify the Academy Trust board oftrustees and the Education Funding Agency of material irregularity, impropriety and non-compliance with EFA terms andconditions of funding, under the funding agreement in place between the Academy Trust and the Secretary of State. Aspart of my consideration I have had due regard to the requirements of the Academies Financial Handbook (2013).
I confirm that I and the Academy Trust board of trustees are able to identify any material, irregular or improper use offunds by the Academy Trust, or material non-compliance with the terms and conditions of funding under the AcademyTrust’s funding agreement and the Academies Financial Handbook (2013).
I confirm that no instances of material irregularity, impropriety or funding non-compliance have been discovered to date. Ifany instances are identified after the date of this statement these will be notified to the board of trustees and EFA,
Jan MarshallAccounting Officer
Date: 11 December 2014
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
TRUsTEES’ RESPONSIBILITIES STATEMENT
FOR THE YEAR ENDED 31 AUGUST 2014
The Trustees (who act as governors of EMLC Academy Trust and are also the directors of the charitable company for the
purposes of company law) are responsible for preparing the
Trustees Report (including the Strategic 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;
• 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
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 2006. 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 EFNDfE have been applied for the purposes intended.
The Trustees are responsible for the maintenance and integrity of the corporate and financial information included on the
charitable company’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial
statements may differ from legislation in other jurisdictions.
Approved by order of the members of the board of trustees on 11 December 2014 and signed on its behalf by:
Ltt1LGeorge GyteChair of Trustees
Page 16
EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
INDEPENDENT AUDITORS’ REPORT TO THE BOARD OF TRUSTEES OF EMLC ACADEMY TRUST
We have audited the financial statements of EMLC Academy Trust for the year ended 31 August 2014 which comprise theStatement of Financial Activities, the Balance Sheet, the Cash Flow Statement and the related notes. The financialreporting framework lhat has been applied in their preparation is applicable law, United Kingdom Accounting Standards(United Kingdom Generally Accepted Accounting Practice) and the Academies Accounts Direction 2013 to 2014 issued bythe 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 theCompanies Act 2006. Our audit work has been undertaken so that we might state to the academy’s members thosematters we are required to state to them in an Auditors’ Report and for no other purpose. To the fullest extent permitted bylaw, we do not accept or assume responsibility to anyone other than the academy and its members, as a body, for ouraudit 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 theacademy for the purposes of company law) are responsible for the preparation of the financial statements and for beingsatisfied 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 andIntemational Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing PracticesBoard’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 givereasonable 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 havebeen consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by theTrustees; and the overall presentation of the financial statements. In addition, we read all the financial and non-financialinformation in the Trustees’ Report to identify material inconsistencies with the audited financial statements and to identifyany information that is apparently materially incorrect based on, or materially inconsistent with, the knowledge acquired byus in the course of performing the audit. If we become aware of any apparent material misstatements or inconsistencies weconsider 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 2014 and of its incoming resourcesand 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 Academies Accounts
Direction 2013 to 2014 issued by the Education Funding Agency.
Opinion on other mailer prescribed by the Companies Act 2006
In our opinion the information given in the Trustees’ Report, incorporating the Strategic Report, for the financial year forwhich the financial statements are prepared is consistent with the financial statements.
Page 17
a
EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
INDEPENDENT AUDITORS’ REPORT TO THE BOARD OF TRUSTEES OF EMLC ACADEMY 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.
Laragh Jeanro enior Statutory Auditor)
for and on behalf of
Peters Etworthy & Moore
Chartered AccountantsStatutory Auditors
Salisbury HouseStation RoadCambridgeCB1 2LADate: 2 ,,ec..aa...$t) 201%..
Page 18
EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
INDEPENDENT REPORTING ACCOUNTANTS’ ASSURANCE REPORT ON REGULARITY TO EMLCACADEMY TRUST AND THE EDUCATION FUNDING AGENCY
In accordance with the terms of our engagement letter dated 14 October 2013 and further to the requirements of theEducation Funding Agency (EFA) as included in the Academies Accounts Direction 2013 to 2014, we have carried out anengagement to obtain limited assurance about whether the expenditure disbursed and income received by EMLO AcademyTrust during the year 1 September 2013 to 31 August 2014 have been applied to the purposes identified by Parliament andthe flnancial transactions conform to the authorities which govern them.
This report is made solely to EMLC Academy Trust and EFA in accordance with the terms of our engagement letter. Ourwork has been undertaken so that we might state to EMLC Academy Trust and EFA those matters we are required to statein a report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility toanyone other than EMLC Academy Trust and EFA, for our work, for this report, or for the conclusion we have formed,
Respective responsibilities of EMLC Academy Trust’s accounting officer and the reporting accountant
The accounting officer is responsible, under the requirements of EMLC Academy Trust’s funding agreement with theSecretary of State for Education dated 25 May 2012, and the Academies Financial Handbook extant from 1 September2013! for ensuring that expenditure disbursed and income received is applied for the purposes intended by Parliament andthe 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 andare to obtain limited assurance and report in accordance with our engagement letter and the requirements of theAcademies Accounts Direction 2013 to 2014. We report to you whether anything has come to our attention in carrying outour work which suggests that in all material respects, expenditure disbursed and income received during the year 1September 2013 to 31 August 2014 have not been applied to purposes intended by Parliament or that the financialtransactions do not conform to the authorities which govern them.
Approach
We conducted our engagement in accordance with the Academies Accounts Direction 2013 to 2014 issued by EPA. Weperformed 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 explanationsin 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 consequentlydoes not enable us to obtain assurance that we would become aware of all significant matters that might be identified in areasonable 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 theacademy’s income and expenditure.
Page 19
I
EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
INDEPENDENT REPORTING ACCOUNTANTS ASSURANCE REPORT ON REGULARITY TO EMLC
ACADEMY TRUST AND THE EDUCATION FUNDING AGENCY (continued)
Conclusion
In the course of our work, nothing has come to our attention which suggests that in all material respects the expenditure
disbursed and income received during the year 1 September 2013 to 31 August 2014 have not been applied to purposes
intended by Parliament and the financial transactions do not conform to the authorities which govern them.
Laragh Jeanroy nior Statutory Auditor)
Peters Elworthy & Moore
Chartered AccountantsStatutory Auditors
Salisbury HouseStation RoadCambridgeCBI 2LA
Date: 2.2 jcc.e.-.btS .201(1
Page 20
‘4nml
EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
STATEMENT OF FINANCIAL ACTIVITIES(Incorporating Income and Expenditure Account and Statement of Total Recognised Gains and Losses)
FOR THE YEAR ENDED 31 AUGUST 2014
INCOMING RESOURCES
Incoming resources fromgenerated funds:Transfer from LA on conversionOther funds on conversionOther voluntary incomeActivities for generating fundsInvestment income
Incoming resources from charitableactivities
TOTAL INCOMING RESOURCES
RESOURCES EXPENDED
Costs of generating funds:Costs of generating voluntaryincome
Charitable activitiesGovernance costsOther resources expended
TOTAL RESOURCES EXPENDED
NET INCOMING! (OUTGOING)RESOURCES BEFORETRANSFERS
Transfers between Funds 19
14,677
121,07415,286
5,62488,92831,009
176
98,965 4,819,066 2,330,226
(663,403) 5,108,925 4,460,199 3,422,376
(19,287) 19,287
NET INCOME FOR THE YEAR
Actuarial gains and losses ondefined benefit pension schemes 25
14,677 (682,690) 5,128,212
(172,000) -
4,460,199 3,422,378
(172,000) (120000)
NET MOVEMENT IN FUNDS FORTHE YEAR 14,677
Total funds at 1 September 2013 14,562
TOTAL FUNDS AT 31 AUGUST2014
(854,690) 5,128,212 4,288,199 3,302,378
(424,604) 3,712,420 3,302,378 -
29,239 (1,279,294) 8,840,632 7,590,577 3,302,378
All activities relate to continuing operations.The Statement of Financial Activities includes all gains and losses recognised in the year.The notes on pages 24 to 43 form part of these financial statements.
Note
RestrictedUnrestricted Restricted fixed asset Total Period ending
funds funds funds funds 31 August2014 2014 2014 2014 2013
£ £ £ £ £
2 - 342,235 5,227,315 5,569,550 3,650,1742 - -
2 12,408 - 133,4823 84,245 - 99,5314 128 - 128
5 - 4,720,101
96,781 5,1 98,696 5,326,280 10,621,757 6,106,135
82,104 6,724 - 88,828 13,240- 4,960,023 217,355 5,177,378 2,333.186
9 - 126,352 - 126,352 52,33110 - 769,000 - 769,000 285,000
6 82,104 5,862,099 217,355 6,161,558 2,683,757
Page 21
EMLC ACADEMY TRUST
(A Company Limited by Guarantee)REGISTERED NUMBER: 08149829
BALANCE SHEETAS AT 31 AUGUST 2014
2014 2013
Note £ £ £ £
FIXED ASSETS
Tangible assets 16 8,840,632 3712420
CURRENT ASSETS
Debtors 17 377,599 301,215
Cash at bank and in hand 417,262 39456
794,861 340671
CREDITORS: amounts falling due within oneyear 18 (621,916) (333,713)
NET CURRENT ASSETS 172,945 6,958
TOTAL ASSETS LESS CURRENT LIABILITIES 9,013,577 3,719,378
Defined benefit pension scheme liability 25 (1,423,000) (417,000)
NET ASSETS INCLUDING PENSION SCHEMELIABILITY 7,590,577 3,302,378
FUNDS OF THE ACADEMY
Restricted funds
Restricted funds 19 143,706 (7,604)
Restricted funds - pension 19 (1,423,000) (417,000)
Restricted fixed asset funds 19 8,840,632 3,712,420
Total restricted funds 7,561,338 3,287,816
Unrestricted funds 19 29,239 14,562
TOTAL FUNDS 7,590,577 3,302,378
The financial statements were approved by the Trustees, and authorised for issue, on 11 December 2014 and are signed
on t eir behalf, by:
George eChair of Trustees
The notes on pages 24 to 43 form part of these financial statements.
Page 22
‘I.1;
“‘ I
EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
CASH FLOW STATEMENTFOR THE YEAR ENDED 31 AUGUST 2014
Period ending 312014 August2013
Note £ £
Net cash flow from operating activities 21 65,797 (101293)Returns on investments and servicing of finance 22 128 176Capital expenditure and financial investment 22 10,450 (35,301)Cash transferred on conversion to an academy trust 23 251,431 175,874
INCREASE IN CASH IN THE YEAR 377.806 39,456
RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDSFOR THE YEAR ENDED 31 AUGUST 2014
Period ending 312014 August2013
£ £
Increase in cash in the year 377,806 39,456
MOVEMENT IN NET FUNDS IN THE YEAR 377,806 39,456Net funds at 1 September2013 39,456 -
NET FUNDS AT 31 AUGUST 2014 417,262 39,456
The notes on pages 24 to 43 form part of these financial statements.
Page 23
‘ rI !t
EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 AUGUST 2014
ACCOUNTING POLICIES
1.1 Basis of preparation of financial statements
The financial statements have been prepared under the historical cost convention. 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 2013 to 2014 issued by
EFA, applicable accounting standards and the Companies Act 2006.
1.2 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.
1.3 Company status
The Academy is a company limited by guarantee. The members of the company are the Trustees named on
page 1. In the event of the Academy being wound up, the liability in respect of the guarantee is limited to £10
per member.
1.4 IncomIng resources
All incoming resources are included in the Statement of Financial Activities when the Academy has entitlement
to the funds, certainty of receipt and the amount can be measured with sufficient reliability. For legacies,
entitlement is the earlier of the academy being notified of an impending distribution or the legacy being
received.
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
accwed
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.
Sponsorship income provided to the Academy which amounts to a donation is recognised in the Statement of
Financial Activities in the period in which it is receivable, where there is certainty of receipt and it is
measurable.
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.
Page 24
I ‘
EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 AUGUST 2014
ACCOUNTING POLICIES (continued)
1.5 Resources expended
Expenditure is recognised in the period in which a liability is incurred and has been classified under headingsthat aggregate all costs related to that category. Where costs cannot be directly attributed to particularheadings they have been allocated on a basis consistent with the use of resources, with central staff costsallocated 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.
Costs of generating funds are costs incurred in attracting voluntary income, and those incurred in tradingactivities that raise funds.
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 statutoryrequirements, including audit, strategic management and Trustees’ meetings and reimbursed expenses.
All resources expended are inclusive of irrecoverable VAT.
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 orfrom the private sector, they are included in the Balance Sheet at cost and depreciated over their expecteduseful economic life. The related grants are credited to a restricted fixed asset fund in the Statement ofFinancial Activities and are carried forward in the Balance Sheet. Depreciation on such assets is charged tothe restricted fixed asset fund in the Statement of Financial Activities so as to reduce the fund over the usefuleconomic life of the related asset on a basis consistent with the academy’s depreciation policy.
The buildings have been valued at depreciated replacement cost. The value of land has not been capitalised.Current insurance rebuild costs have been used less an impairment provision. The impairment provision hasbeen calculated using the insurance re-build values, less an estimated impairment provision.
A review for impairment of a fixed asset is carried out if events or changes in circumstances indicate that thecarrying value of any fixed asset may not be recoverable. Shortfalls between the carrying value of fixed assetsand their recoverable amounts are recognised as impairments. Impairment losses are recognised in theStatement of Financial Activities.
Tangible fixed assets are stated at cost less depreciation. Depreciation is provided at rates calculated to writeoff the cost of fixed assets. less their estimated residual value, over their expected useful lives on the followingbases:
Urerm Leasehold Property - 2% straight lineFixtures and fillings - 20% straight lineOffice I computer equipment - 33% straight line
1.1 Operating leases
Rentals under operating leases are charged to the Statement of Financial Activities on a straight line basisover the lease term.
Page 25
EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 AUGUST 2014
ACCOUNTING POLICIES (continued)
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 Pad 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 and the assets are held
separately from (hose 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.
The LGPS is a funded scheme and the assets are held separately from those of the academy in separate
trustee administered funds. 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 pad 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.
1.10 ConversIon to an academy trust
The conversion of Castle Primary School, Hardingstone and Stimpson Primary School from state maintained
schools and joining the Academy Trust involved the transfer of identifiable assets and liabilities and the
operation of the schools for £NIL consideration and have been accounted for under the acquisition accounting
method.
The assets and liabilities transferred on conversion from Northamptonshire County Council to the 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 EMLC Academy Trust. 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 funds, restricted general funds and restricted fixed asset funds.
Further details of the transaction are set out in note 23.
Page 26
1 •,
EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 AUGUST 2014
ACCOUNTING POLICIES (continued)
1.11 Fund accounting
Unrestricted income funds represent those resources which may be used towards meeting any of thecharitable objects of the academy at the discretion of the Trustees.
Restricted fixed asset funds are resources which are to be applied to specific capital purposes imposed byfunders where the asset acquired or created is held for a specific purpose.
Restricted general funds comprise all other restricted funds received and include grants from EducationFunding Agency.
Investment income, gains and losses are allocated to the appropriate fund.
2, VOLUNTARY INCOME
Unrestricted Restricted Total Period endingfunds funds funds 31 August2014 2014 2014 2013
£ £ £ £Transfer from Local Authority on conversion
(note 23) - 5,569,550 5,569,550 3,650174Other funds transferred on conversion - 5,624
- 5,569,550 5,569,550 3,655,798
Sponsorship income - 121,074 121,074 28,926Other voluntary income 12,408 - 12,408 -
Other capital income - - - 60,000
12,408 121,074 133,482 88,926
Total Voluntary income 12,408 5,690,624 5,703,032 3,744,724
3. ACTIVITIES FOR GENERATING FUNDS
Unrestricted Restricted Total Period endingfunds funds funds 31 August2014 2014 2014 2013
£ £ £ £Hire of facilities 15,319 - 15,319 10,499School trips 33542 - 33,542 -
Catering income 1,029 - 1,029 9,007Uniform sales 3,344 - 3,344 -
School clubs 13,680 - 13,680 -
Other income 11,331 17,331 11,503Staff consultancy 15,286 15,286 -
84,245 15,286 99,531 31,009
Page 27
I I”
EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2014
4. INVESTMENT INCOME
Unrestricted Restricted Total Period endingfunds funds funds 31 August2014 2014 2014 2013
£ £ £ £
Bank interest 128 - 128 176
5. FUNDING FOR AcADEMY’S EDUCATIONAL OPERATIONS
Restricted Total Period endingfunds funds 31 August
2014 2014 2013£ £ £
EFA Grants
Revenue grants 3,564,918 3,564,918 1,818276
Start up grants 117,500 117,500 117,500
EFA Capital Grants 26,479 26,479 16,522
3,708,897 3,708,897 1,952,298
Other EPA Grants
Pupil premium income 325,433 325,433 96,058
Other restricted income 199,906 199,905 137,040
Other EFA Grants 10,882 10,882 -
536,220 536,220 233,098
Other funding
Local authority grants (SEN) 367,185 367,185 10042
Other local authority grants 134,278 134,278 65,393
Other local authority capital grants 72,486 72,486 69,395
573,949 573,949 144,830
4,819,086 4,819,066 2,330226
Page 28
I I1,
EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 AUGUST 2014
6. RESOURCES EXPENDED
Period ended Period endingStaff costs 31 August 31 August
(note 12) Non Pay Expenditure Total TotalPremises Other costs
2014 2014 2014 2014 2013£ £ £ £ £
Costs of generating voluntaryincome 6,724 - 82,104 88,828 13,240
Costs of generating funds 6,724 - 82,104 86,828 13,240
Educational activities - directcosts 2,929,796 211,354 607,320 3,754,470 1,597,172
Educational activites - supportcosts 424,643 - 998,265 1,422,908 736,014
Charitable activities 3,354,439 211,354 1,605,585 5,177,378 2,333,186
Governance - - 126,352 126,352 52,331
Other resources expended - - 769000 169,000 285,000
3,361,163 211,354 2,583,041 6,161,558 2,683,757
7. DIRECT COSTS
PehodEducational Total ended 31
Activities 2014 August 2013£ £ £
Net pension finance cost - note 25 30,000 30,000 11,000Educational supplies 13,409 13,409 24,587Staff development 21,878 21,878 16,088Other direct costs 26,954 26,954 74,769Supply teaching casts 134,650 134,650 126,919Educational consultancy 302,726 302,726 186,361PFI costs 77,702 77,702 -
Wages and salaries 2,435,074 2,435,074 936,028National insurance 137,368 137,368 63,438Pension cost 357,354 357,354 125,979Depreciation 217355 217,355 32,003
3,754,470 3,754,470 1,597,172
Page 29
1 I’
EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 AUGUST 2014
8. SUPPORT COSTS
PeriodEducational Total ended 31
Activities 2014 August 2013£ £ £
Telephone / broadband 9,832 9,832 10,141
Maintenance of premises 78,278 78,278 122,970
Rent and rates 36,932 36,932 19,395
Insurance 40,544 40,544 24,831
Technology costs 139,453 139,453 61,653
Catering 66,331 66,331 42,318
Other support costs 85,094 85,094 100,809
Management and consultancy services 308,105 308,105 -
Payroll and HR services 37,249 37,249 20,604
Consultancy 53,997 53,997 117,567
Legal and professional fees 2,630 2,630 4,430
Heat and light 62,557 62,557 28,323
Start Up costs 77,263 77,263 -
Wages and salaries 352,831 352,831 163,831
National insurance 19,661 19,661 1,802
Pension cost 52,151 52,151 17,340
1,422,908 1,422,908 736,014
9. GOVERNANCE COSTS
Restricted Total Period endingfunds funds 31 August
2014 2014 2013£ £ £
Auditors’ remuneration 14,750 14,750 6,000
Auditors non audit fees 13,254 13,254 5,000
Legal and professional fees 96,149 96,149 39.247
Governance - Trustees travel reimbursed 2,199 2,199 2,084
126,352 126,352 52,331
10. OTHER RESOURCES EXPENDED
Unrestricted Restricted Total Period endingfunds funds funds 31 August
2014 2014 2014 2013
£ £ £ £
Pension deficits on conversion - 769,000 769,000 285,000
Page 30
1 AI I I (I
EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 AUGUST 2014
11. NET INCOMING! (OUTGOING) RESOURCES
This is stated after charging:
Period ended31 August
2014 2013£ £
Depreciation of tangible fixed assets:- owned by the charity 217,354 32,003
Auditors remuneration 14,750 6,000Auditors remuneration - non-audit 13,254 5,000Operating leases 15144 7,125
12. STAFF
a. Staff costs
Staff costs were as follows:
Period ended31 August
2014 2013£ £
Wages and salaries 2,794,213 1,099,859Social security costs 157,178 65,240Other pension costs (note 25) 409,772 143,319
3,361,163 1,308,418Supply teacher costs 134,650 126,919Severance payments 15,824 76,280Management and consultancy services 455,259 150,196
3,972,896 1,661,813
b. Staff severance payments
Included in severance payments is one amount for £15,058.
c. Staff numbers
The average number of persons (including the senior management team) employed by the Academy during theyear expressed as full time equivalents was as follows:
Period ending 3131 August 2014 August 2013
No. No.Teachers 60 17Administration and support 88 27Management 7 2
155 46
Page 31
S 4* I.
EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 AUGUST 2014
12. STAFF (continued)
d. Higher paid staff
The number of employees whose emoluments fell within the following bands was:
Period ending 3131 August 2014 August 2013
No. No.
In the band £ 60,001 - £ 70,000 2 0
The above employees participated in the Teachers’ Pension Scheme. During the year ended 31 August 2014,
pension contributions for these staff members amounted to £7,622 (period ended 31 August 2013: £nil)
13. CENTRAL SERVICES
The Academy Trust has provided the following central services to its academies during the year:
• Human Resources• Financial Services• Legal Services• Educational Support Services
The Academy Trust charges for these services on the following basis:
The Trust has charged for these services based on 8% of pupil based funding, excluding SEN funding for Schools
in a category requiring improvements and 5% of pupil based funding, excluding SEN funding for schools not within
a category.
The actual amounts charged during the year were as follows:
2014£
Orchard Primary School 39,443
Shepherdswell Primary School 28,848
Castle Primary School 138,959
Hardingstone Primary School 51,862
Stimpson Primary School 84,994
344,106
14. TRUSTEES’ REMUNERATION AND EXPENSES
The CEO is employed by the Academy Trust’s sponsor, EMLC. No trustee of the Trust received remuneration in
respect of their services as Trustees. Other Trustees did not receive any payments, other than expenses, from the
Academy Trust in respect of their role as Trustees.
During the year ended 31 August 2014, travel expenses totalling £2,199 (2013 - £2,084) were reimbursed to 10
Trustees (2013-6).
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 AUGUST 2014
15. TRUSTEES’ AND OFFICERS’ INSURANCE
In accordance with normal commercial practice the academy has purchased insurance to protect Trustees andofficers from claims arising from negligent acts, errors or omissions occurring whilst on academy business. Theinsurance provides cover up to £2000000 on any one claim and the cost for the year ended 31 August 2014 was£441 (2013 - £1680). The cost of this insurance is included in the total insurance cost.
16. TANGIBLE FIXED ASSETS
UTermLeasehold Fixtures and Office
Property fittings equipment Total£ £ £ £
Cost
At 1 September 2013 3,510,000 128,887 105,536 3,744,423Additions - 55,408 62,842 118,250Transfer on conversion 5,152,000 32,529 42,787 5,227,316
At 31 August 2014 8,662,000 216,824 211,165 9,089,989
Depreciation
At 1 September2013 - 10,515 21,488 32,003Charge for the year 120,134 36,623 60,597 217,354
At31 August2014 120,134 47,138 82,085 249,357
Net book value
At 31 August 2014 8,541,866 169,686 129,080 8,840,632
At31 August2013 3,510,000 118,372 84,048 3,712,420
Assets are used for the direct charitable pupose of the Academy Trust and the provision of education.
A formal valuation of the buildings inherited on conversion of Castle Primary School, Hardingstone Primary Schooland Stimpson Primary School was not available at the date of approval of the financial statements. The valuationshave been estimated using insured values less an estimated impairment provision of one third of the insured value.
No value has been placed on fixtures and fittings transferred on conversion of Stimpson Primary School as theTrustees are of the opinion that this would be immaterial.
17. DEBTORS
2014 2013£ £
Trade debtors 9,048 47,372Other debtors 146,601 195,661Prepayments and accrued income 221,950 58,182
317,599 301,215
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 AUGUST 2014
18. CREDITORS:Amounts falling due within one year
2014 2013£ £
Trade creditors 161,909 172,220
Other taxation and social security 63,460 21245
Other creditors 12,235 3278
Accruals and deferred income 364,312 136970
621,916 333,713
£
Deferred income
Deferred income at 1 September 2013 60,421
Resources deferred during the year 207,312
Amounts released from previous years (57,551)
Deferred income at 31 August 2014 210182
Deferred income relates to ringfenced capital grants and revenue funds as follows: Free School Meals funding of
£140,892, Devolved Capital funding of £16,704, Capital Maintenance funding of £20,525, Local Authority funding
£29,933 and trip income of £2,128.
19. STATEMENT OF FUNDS
Brought Incoming Resources Transfers Gains! Carried
Forward resources Expended iniout (Losses) Forward
£ £ £ £ £ £
Unrestricted funds
Academy Trust 12,086 93,358 (82,104) 5,899 - 29,239
School Fund 2,476 3,423 - (5,899) - -
14,562 96,781 (82,104) - - 29,239
Restricted funds
EFA Grants (7,604) 5,081,196 (4,910,599) (19,287) - 143,706
Start Up Grant - 117,500 (117,500) - - -
Pension Reserve (417,000) - (834,000) - (172,000) (1,423,000)
(424,604) 5,198,696 (5,862,099) (19,267) (172,000) (1,279,294)
Page 34
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 AUGUST 2014
19. STATEMENT OF FUNDS (continued)
Restricted fixed asset funds
EFA and other capitalgrants 202,420 174,280 (97,221) 19.287 - 298,766
Building Valuation 3,510,000 5,152,000 (120,134)- 8,541,866
3,712,420 5,326,280 (217,355) 19287 . 8,840632
Total restricted funds 3,287,815 10,524,976 (6,079,454) - (172,000) 7,561,338
Total of funds 3,302,378 10,621,757 (6,161,558) - (172,000) 7,590,577
The specific purposes for which the funds are to be applied are as follows:
i) Unrestricted Funds — represent funds available to the Trustees to apply for the general purposesof the Trust.
ii) School fund - represents the funds of the dedicated school funds.iW) General Annual Grant — to be used for the normal running costs of the Schools.iv) Start Up Grants - to be used specifically for costs incurred during the conversion process.v) Restricted Fixed Asset Funds — comprises fixed assets funded by government grants and other
funding bodies.vi) Transfer from restricted EFA grants to restricted EFA capital grants relates to the shortfall of
funding for capital expenditure.
Under the funding agreement with the Secretary of State, the Academy Trust was not subject to a limit on theamount of GAG that it could carry forward at 31 August 2014.
Analysis of academies by fund balance
Fund balances at 31 August 2014 were allocated as follows:
Total£
Restricted Orchard Primary School (9,038)Unrestricted Orchard Primary School 4,837Restricted Shepherdswell Academy (53,703)Unrestricted Shepherdswell Academy 16,886Restricted Castle Primary School 187,349Unrestricted Castle Primary School (6,990)Restricted Hardingstone Primary School (48,898)Unrestricted Hardingstone Primary School 10,837Restricted Stimpson Primary School 43,493Unrestricted Stimpson Primary School 3,674Restricted Trust 24,498Pension Reserve (1,423,000)
Total before fixed asset fund and pension reserve (1,250,055)
Restricted fixed asset fund 8,840,632
Total 7,590,577
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2014
19. STATEMENT OF FUNDS (continued)
The following academies are carrying net deficits on their portion of the funds as follows:
Name of academy Amount of deficit£
Orchard Primary School (4,202)
Shepherdswell Primary School (36,816)
Hardingstone Primary School (38,061)
The deficits arising within the academies detailed above arose through the School Improvement Plans to improve
standards and re-organisation changes required over the first year or so after conversion. The leadership team has
implemented a plan to ensure that all academies carry forward a cumulative surplus within the next two years.
Analysis of academies by cost
Expenditure incurred by each academy during the year was as follows:
Teachingand
educational Other Other costs
support staff support staff Educational excludingcosts costs supplies deprecIation Total
£ £ £ £ £
Orchard Primary School 776,260 111595 4,965 294,581 1,189,401
Shepherdswell Primary School 539,219 103,005 910 185,753 828,887
Castle Primary School 789,802 57,730 3,151 327,456 1,178,139
Hardingstone Primary School 350,818 82,445 1,331 71,775 506,369
Stimpson Primary School 453,497 83,673 3,052 206,503 746,725
Central Services - - - 727,050 727,050
2,911,596 438,448 13,409 1,813,118 5,176,571
20. ANALYSIS OF NET ASSETS BETWEEN FUNDS
RestrIctedUnrestricted Restricted fixed asset Total Period ending
funds funds funds funds 31 August2014 2014 2014 2014 2013
£ £ £ £ £
Tangible fixed assets - 8,840,632 8,840,632 3,712,420
Current assets 29,239 765,622 - 794,861 340,671
Creditors due within one year - (621,916) - (621,916) (333,713)
Provisions for liabilities andcharges - (1,423,000) - (1,423,000) (417,000)
29,239 (1,279294) 8,840,632 7,590,577 3,302,378
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 AUGUST 2014
21. NET CASH FLOW FROM OPERATING ACTIVITIES
2014 2013£ £
Net incoming resources before revaluations 4,460,199 3,422378Returns on investments and servicing of finance (128) (176)Depreciation of tangible fixed assets 217,354 32,003Capital grants and donations (98,969) (145,917)lnaease in debtors (128,454) (293,999)Increase in creditors 249,735 243,216Assets transferrred on conversion (4,678,944) (3,370798)FRS 17 adjustments 65,000 12000
Net cash inflow!(outfiow) from operations 85,797 (101,293)
22. ANALYSIS OF CASH FLOWS FOR HEADINGS NEHED IN CASH FLOW STATEMENT
2014 2013£ £
Returns on investments and servicing of financeInterest received 128 176
2014 2013£ £
Capital expenditure and financial investmentPurchase of tangible fixed assets (113,346) (234423)Capital grants and donations 123,796 199122
Net cash inflow!(aufflow) capital expenditure 10,450 (35,301)
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 AUGUST 2014
23. CONVERSION TO AN ACADEMY TRUST
On 1 January 2014 Castle Phmanj School and Hardingstone Primary School converted and on 1 April 2014,
Stimpson Primary School to academy trust status under the Academies Act 2010 and all the operations and assets
and liabilities were transferred to EMLC Academy Trust from Northamptonshire County Council for ENIL
consideration.
The transfer has been accounted for using the acquisition method. The assets and liabilities transferred were
valued at their fair value and recognised in the Balance Sheet under the appropriate headings with a corresponding
net amount recognised as net incoming resources in the Statement of Financial Activities as voluntary income.
The following table sets out the fair values of the identifiable assets and liabilities transferred and an analysis of
their recognition in the Statement of Financial Activities.
RestrictedUnrestricted Restricted fixed asset Total
funds funds funds funds
£ £ £ £
Tangible fixed assets
Leasehold land and buildings - - 5,152,000 5,152,000
- Other tangible fixed assets - - 75,316 75,316
Budget surplusl(deUcit) on LA funds - 342,234 - 342,234
LGPS pension surplus/(deficit) - (769,000) - (769,000)
Net assets - (426,766) 5,227,316 4,800,550
The above net assets include £281,431 transferred as cash.
24. CONTINGENT LIABILITIES
During the period of the Funding Agreement, in the event of the sale or disposal by other means of any asset for
which a Government capital grant was received, the Academy Trust is required either to re-invest the proceeds or to
repay to the Secretary of State for Education and Skills the same proportion of the proceeds of the sale or disposal
as equates with the proportion of the original cost met by the Secretary of State.
Upon termination of the Funding Agreement, whether as a result of the Secretary of State or the Academy Trust
serving notice, the Academy Trust shall repay to the Secretary of State sums determined by reference to:
(a) the value at that time of the Academy Trust’s site and premises and other assets held for the
purpose of the Academy Trust: and
(b) the extent to which expenditure incurred in providing those assets was met by payments by the
Secretary of State under the Funding Agreement.
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 AUGUST 2014
25. PENSION COMMITMENTS
The Trust’s employees belong to two principal pension schemes: the Teachers Pension Scheme for England andWales (TPS) for academic and related staff; and the Local Government Pension Scheme (LGPS) for non-teachingstaff, which are managed by Buckinghamshire County Council and Northamptonshire County Council. Both aredefined benefit schemes.
The pension costs are assessed in accordance with the advice of independent qualified actuaries. The latestactuarial valuation of the TPS related to the period ended 31 March 2012 and of the LGPS 31 March 2013.
There were no outstanding or prepaid contributions at either the beginning or the end of the financial year.
Teachers’ Pension Scheme
Introduction
The Teachers’ Pension Scheme (TPS) is a statutory, contributory, defined benefit scheme, governed by theTeachers’ Pensions Regulations (2010) and, from 1 April 2014, by the Teachers’ Pension Scheme Regulations2014. Membership is automatic for full-time teachers in academies and, from 1 January 2007, automatic forteachers in part-time employment following appointment or a change of contract, although they are able to opt out.
The TPS is an unfunded scheme and members contribute on a ‘pay as you go’ basis — these contributions alongwith those made by employers are credited to the Exchequer. Retirement and other pension benefits are paid bypublic funds provided by Parliament.
The Teachers’ Pensions Regulations require an annual account to be kept of receipts and expenditure (includingthe cost of pensions’ increases). From 1 April 2001, the account has been credited with a real rate of return, whichis equivalent to assuming that the balance in the account is invested in notional investments that produce that realrate of return.
Valuation of the Teachers’ Pension Scheme
The latest actuarial valuation of the TPS was carried out as at 31 March 2012 and in accordance with the PublicService Pensions (Valuations and Employer Cost Cap) Directions 2014. The valuation report was published by theDepartment for Education on 9 June 2014. The key elements of the valuation and subsequent consultation are:
employer contribution rates set at 16.48% of pensionable pay (including a 0.08% employer administration charge(currently 14.1%);
‘total scheme liabilities for service to the effective date of £191,500 million, and notional assets of £176,600 million,giving a notional past service deficit of £14,900 million; and
‘an employer cost cap of 10.9% of pensionable pay will be applied to future valuations
The new employer contribution rate is applicable from 1 April 2015 and will be implemented for the TPS fromSeptember 2015. A copy of the valuation report and supporting documentation is on the Teachers’ Pensionswebsite.
Teachers’ Pension Scheme Changes
Lord Hutton made recommendations in 2011 about how pensions can be made sustainable and affordable, whilstremaining fair to the workforce and the taxpayer. The Government accepted Lord Hutton’s recommendations as thebasis for consultation with trade unions and other representative bodies. In March 2012 the Department forEducation published proposals for the design for a reformed TPS.
The key provisions of the reformed scheme include: a pension based on career average earnings; an accrual rateof 1/57th; and a Normal Pension Age equal to State Pension Age, but with options to enable members to retireearlier or later than their Normal Pension Age. Pension benefits built up before 1 April2015 will be fully protected.
In addition, the proposed final agreement includes a Government commitment that those within 10 years of NormalPension Age on 1 April2012 will see no change to the age at which they can retire, and no decrease in the amount
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 AUGUST 2014
25. PENSION COMMITMENTS (continued)
of pension they receive when they retire. There will also be further transitional protection, tapered over a three and a
half year period, for people who would fall up to three and a half years outside of the 10 year protection.
In his interim report of October 2010, Lord Hutton recommended that short-term savings were also required, and
that the only realistic way of achieving these was to increase member contributions. At the Spending Review 2010
the Government announced an average increase of 3.2 percentage points on the contribution rates by 2014-1 5.
The increases have been phased in from April 2012 on a 40:80:100% basis.
The Department for Education has continued to work closely with trade unions and other representatives bodies to
develop the reformatted Teachers Pension Scheme and regulations giving effect to it came into force on 1 April
2014. Communications are being rolled out and the reformatted scheme will commence on 1 April2015.
Under the definitions set out in Financial Reporting Standard (FRS 17) Retirement Benefits, the TPS is a multi-
employer pension scheme. The Trust is unable to identify its share of the underlying assets and liabilities of the
scheme. Accordingly, the Trust has taken advantage of the exemption in FRS 17 and has accounted for its
contributions to the scheme as if it were a defined contribution scheme. The Trust has set out above the information
available on the scheme.
Local Government Pension Scheme
The LGPS is a funded defined benefit scheme, with assets held in separate trustee-administered funds. The total
contribution made for The year ended 31 August 2014 was £188000, of which employers contributions totalled
£146,000 and employees contributions totalled £42000. The agreed contribution rates for future years are 19.1%
for employers and a tiered rate of 5.5% upwards% for employees.
Parliament has agreed, at the request of the Secretary of State for Education, to a guarantee that, in the event of
academy closure, outstanding local government pension scheme liabilities would be met by the Department for
Education. The guarantee came into force on 18 July 2013.
The amounts recognised in the Balance Sheet are as follows:
2014 2013£ £
Present value of funded obligations (2.542,000) (836,000)
Fair value of scheme assets 1,119,000 419000
Net liability (1,423,000) (417,000)
The amounts recognised in the Statement of Financial Activities are as follows:
2014 2013£ £
Current service cost (151,000) (58,000)
Interest on obligation (73,000) (29,000)
Expected return on scheme assets 43,000 18,000
Members contribution 146,000 57,000
Total (65,000) (12,000)
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 AUGUST 2014
25. PENSION COMMITMENTS (continued)
Movements in the present value of the defined benefit obligation were as follows:
2014 2013£ £
Opening defined benefit obligation 836,000 579,000Current service cost 181,000 58,000Interest cost 73,000 29,000Contributions by scheme participants 42,000 17,000Actuarial Losses 212,000 153,000Defined benefit obligation on conversion 1,205,000Estimated benefits paid net of transfers (7,000) -
Closing defined benefit obligation 2,542,000 836,000
Movements in the fair value of the Trust’s share of scheme assets:
2014 2013£ £
Opening fair value of scheme assets 419,000 294,000Expected return on assets 43,000 18,000Actuarial gains and (losses) 40,000 33,000Contributions by employer 146,000 57,000Contributions by employees 42,000 17,000Fair value of assets on conversion 436,000 -
Estimated benefits paid net of transfers (7,000) -
1,119,000 419000
The cumulative amount of actuarial gains and losses recognised in the Statement of Total Recognised Gains andLosses was £292,000 (2013- £120,000).
The Trust expects to contribute £232,000 to its Defined Benefit Pension Scheme in 2015.
The major categories of scheme assets as a precentage of total scheme assets are as detailed below. The firstfour caegories relate to Northamptonshire County Council with the remaining relating to Buckinghamshire CountyCouncil.
2014 2013Equities 71.00 % 5.00 %Cash 3.00 % - %Property 7.00 % -
Bonds 19.00% - %Hedge funds 8.00 % - %Gilts 13.00 % 4.00 %Equities ( UK. overseas, private) 56.00 % 71.00 %Other bonds 13.00% 8.00%Property 8.00 % 7.00 %Cash 2.00 % 2.00 %Alternative Assets 8.00 %
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 AUGUST 2014
Principal actuarial assumptions at the Balance Sheet date (expressed as weighted averages). The first four
categories relate to Northamptonshire County Council with the remaining relating to BucRinghamshire County
Council.
Discount rate for scheme liabilitiesExpected return on scheme assets at 31 AugustRate of increase in salariesRate of increase for pensions in payment / inflationDiscount rateCPI increasesSalary increasesPension increases
2014 2013
The current mortality assumptions include sufficient allowance for future improvements in mortality rates. The
assumed life expectations on retirement age 65 are shown first for Nodhamptonshire County Council and secondly
for Buckinghamshire County Council.
2014 2013
Retiring todayMalesFemales
Retiring in 20 years
Amounts for the current and previous period are as follows:
Defined benefit pension schemes
2014 2013
Defined benefit obligation (2,542,000) (836000)
Scheme assets 1,119,000 419,000
Deficit
Experience adjustments on scheme assets
26. OPERATING LEASE COMMITMENTS
(1,423,000) (417,000)
40,000 33,000
£
At 31 August 2014 the academy had annual commitments under non-cancellable operating leases as follows:
Expiry date:
Within 1 year - - 9,126
Between 2 and 5 years - - 6,016
25. PENSION COMMITMENTS (continued)
3.70 %5.50 %4.50 %2.70 %3.50 %2.70 %4.50 %2.70 %
3.70 %2.90 %5.10%2.90 %
MalesFemales
22.3 / 23.624.3 I 26.0
24.0 I 25.826.6 I 28.3
20.124.1
22.126.0
Land and buildings2014 2013
£ £2014
£
Other2013
£
9,500
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EMLC ACADEMY TRUST
(A Company Limited by Guarantee)
NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 AUGUST 2014
27. RELATED PARTY TRANSACTIONS
During the year costs of £2,419, excluding VAT (2013: £134,547) were incurred from HGH Premises Maintenance,
a company owned by the spouse of the executive principal of Orchard and Shepherdswell academies.
Sarah Bennett, the executive principal of Orchard and Shepherdswell academies is employed as Principal by
another school, Two Mile Ash. The Trust was charged £150,154 (2013: £150154) by Two Mile Ash in relation to
support services provided by its Teaching School. Two Mile Ash charged Trust £14,546 (2013: £7,571) for other
services carried out in the year including staff training, catering supplies and set up costs. The Trust owed £nil
(2013: £18,870) at the year end.
Two trustees, Jan Marshall and Jane Thomas are directors of Third Wave Enterprises Limited (1WE), the preferred
provider of school improvements for the Trust. Third Wave Enterprises charged the Trust £278,255 (2013:
£198,735) for professional services throughout the year. At the year end the Trust owed Third Wave Enterprises
£8,108 (2013: £44,350). All transactions with 1WE were carried out at cost.
EMLC, a leadership charity, charged the Trust and primary schools £359,526 (2013: £70,894) for professional
services in the year. At the year end £35,464 (2013: £672) was owed to the charity. All transactions with EMLC
were carried out at cost.
EMLC sponsored the Trust during the year and not all costs have been recharged. This cost has not been
quantified in the accounts.
During the year, sponsorship income of £121,074 was received from EMLC Charity (2013: £28,926)
Page 43