north eastern education and library board annual … · · 2014-12-23north eastern education and...

North Eastern Education and Library Board

Annual Report and Accounts For the Year ended 31 March 2009

Laid before the Northern Ireland Assembly under Article 38(2) of the Education and Libraries (Northern Ireland) Order 2003

By the North Eastern Education and Library Board

3rd November 2009 3 November 2009

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CONTENTS

Chairperson's Statement

3

Directors Statement

4

Mission Statement

5

Strategic Themes

5

Equality Statement

6

Directors' Report

7-20

Management Commentary

21-31

Sustainability Report

32-34

Remuneration Report

35-38

Statement of Accounting Officer's Responsibilities

39

Statement on Internal Control

40-48

The Certificate and Report of the Comptroller and Auditor General to the Northern Ireland Assembly

49-50

Accounts for the Year ended 31 March 2009 51-91

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CHAIRPERSON'S STATEMENT I am delighted to be able to present to you the Annual Report and Accounts for the 2008/09 financial year. This has been a challenging year, one incorporating significant change and uncertainty, yet one in which the Board has maintained the quality of the services it delivers and indeed taken the opportunity, where possible, to enhance and improve these services. I was delighted when the expertise and creativity of our officers in technology was used to develop exciting new projects in media production and television. I have no doubt this will enable new ways of communicating with education stakeholders and delivering staff development. Once again we managed our finances effectively, living within our budget and directing resources to key priorities. Whilst the Board received approval to build a limited number of new schools, I am concerned that there are still many schools which require to be updated. At present there are sixteen economic appraisals linked with new school buildings awaiting the Department of Education’s approval. It is essential that a review is carried out of the procedures necessary to get new buildings on the ground. At present the bureaucracy and delays are seriously impacting on the quality of the environment in which children and young people are educated. During the year the Board worked to separate the Public Library Service from other services to enable the establishment of the Northern Ireland Library Authority (NILA). Over the past 36 years Board members have worked with officers to create an outstanding library service. I would want to pay tribute to the three Chief Librarians who served the Board during that period, as well as the staff and members for the work they have done and the success they achieved. I wish the Public Library Service well when it becomes part of NILA. With regard to the establishment of the Education and Skills Authority (ESA), the Board continued to assist in planning for 1 January 2010. However we would like to see greater certainty created so that this planning can take place in a stable, secure environment. I commend the Board staff for the excellent work they continue to do in these uncertain times. Finally I want to thank all the Board members who, throughout the year, have given so freely of their time and expertise to ensure that there are effective governance arrangements in place and that the services we provide are of the highest standard.

John R Beggs Chairperson North Eastern Education and Library Board

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DIRECTORS' STATEMENT The 2008–2009 year was dominated by two major issues – the establishment of the Northern Ireland Library Authority (NILA) and the creation of the Education and Skills Authority (ESA). The Board and its officers played a major role in both these developments. The legislation for the creation of the NILA passed through the Assembly early in the financial year, so much of the year involved implementing this decision. This required a substantial amount of additional work from key officers including the development of transfer schemes for staff and assets. Communication was key to this process and staff were kept informed as progress was made. By the end of the year over 200 staff were transferred to NILA along with valuable assets of buildings, stock, furniture and equipment. The whole process was an excellent example of co-operative working and tribute must be paid to all the staff who worked so hard to bring about a successful conclusion. Unfortunately progress towards the establishment of ESA was much less positive. The Minister announced a new implementation date – 1 January 2010, the third such date. Whilst welcoming the fact that the Education Bill began its passage through the Assembly, this further delay has created increased uncertainty, affected morale and created management challenges. 30% of the staff in the Board now occupy temporary positions due to the impact of the vacancy control policy. This is not sustainable in the longer term. It is to be hoped that progress will be made in the coming year to resolve this major issue. Despite this turbulent background during the year Board officers continued to deliver effective services. In particular officers supported the implementation of the revised curriculum through the CASS training programme, carried out consultations on school rationalisations, maintained and developed the school estate, ensured children with special needs received appropriate support and enhanced the youth service. It is also pleasing to report that exciting and innovative developments took place. NEELBTV is one such development where the skills and expertise of our staff have allowed us to stream television over ‘the web’ enhancing training opportunities for all staff 24/7. In partnership with Sky Television, educational programmes for teachers and parents have been produced and broadcast on the Information Television Channel. ‘The Truck’, our enhanced mobile television studio was a foundation for many of these developments and provided support to schools in a variety of ways. Finally we maintained the Board’s Investor in People status and began to develop towards Employer of Choice. This Annual Report provides information on these and many other significant developments throughout the 2008/09 year. I hope you find the report interesting and informative.

Gordon Topping OBE Chief Executive North Eastern Education and Library Board

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MISSION STATEMENT

In pursuing this aim we believe in the need to be People centred - valuing, motivating and developing all to their potential Creative and innovative - promoting new approaches to service delivery Committed to quality - monitoring, evaluating and improving service delivery Accountable - through open and accountable management Corporate in outlook - where staff understand how they contribute to meeting targets STRATEGIC THEMES The Board recognises that there is already a firm foundation of sound professional practice both centrally and within its institutions. In seeking to fulfil its mission and working within the context of an environment which is frequently subject to change, the Board developed the following key strategic themes to provide a comprehensive framework for the planning and delivery of services: MEETING NEEDS RAISING STANDARDS BROADENING HORIZONS ACQUIRING AND MANAGING RESOURCES The Board believes that these themes continue to provide an effective structure for corporate planning and represent a shared approach within which all services will focus their activities towards the key outcomes of our organisation.

The North Eastern Education and Library Board has a vision of developing and delivering world class

Education, Library and Youth Services.

In achieving this the Board will aim to help everyone

realise their potential and contribute to a caring, inclusive and

progressive society.

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EQUALITY STATEMENT The North Eastern Education and Library Board, in carrying out its functions has a statutory responsibility, to have due regard to the need to promote equality of opportunity:-

• Between persons of different religious belief, political opinion, racial group, age, marital status or sexual orientation;

• Between men and women generally; • Between persons with disability and persons without; and • Between persons with dependants and persons without.

In addition, without prejudice to the above obligation, the North Eastern Education and Library Board will also, in carrying out its functions, have regard to the desirability of promoting good relations between persons of different religious belief, political opinion or racial group.

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DIRECTORS' REPORT BRIEF HISTORY The North Eastern Education and Library Board was established in 1973 and its constitution as revised is laid down in the Education and Libraries (NI) Order 1986. The Board consists of 35 members, appointed by the Minister responsible for the Department of Education (DE), and representative of the following:- each District Council in the Board’s area

transferors’ interests

trustees of maintained schools

those with an interest in the services for which the Board is responsible, including the

Library Service, Youth Service and teachers.

A list of members of the Board for the period 2008/09 is included in Paragraph 3 of the Directors Report.

SOME FACTS AND FIGURES Local Government Districts included within the Board’s area:

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DIRECTORS' REPORT Population

Population of the Board’s area in the 2001 census 394,400

2008 mid-year population estimate 417,880

School Enrolment Figures

(i) Schools Controlled or Maintained by the Board

Category Number of Schools Enrolment Figures

Nursery Schools/Units 16 schools

37 units

1,376 1,555

Primary Schools (including Controlled Integrated and Irish Medium)

204 34,203

Secondary Schools 32 16,743 Special Schools 9 996 Grammar Schools 5 4,590 (ii) Voluntary and Grant Maintained Schools

Category Number of Schools Enrolment Figures

Grant Maintained Nursery Units

4 105

Grant Maintained Integrated Primary Schools

6 1,194

Grant Maintained Post Primary Schools

4 2,205

Voluntary Grammar Schools Preparatory Departments

11 1

8,988 144

Total number of children enrolled in schools within the Board’s area in the School Year 2008/09

72,099

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DIRECTORS' REPORT Library Service

Number of Branch Libraries 28 Number of Public Service Mobile Libraries (includes 4 dedicated to serving housebound library users)

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Schools Mobile Libraries 4(3 Primary &

1 Post Primary)

Number of registered members of the Public Library Service 243,186 Youth Service

Membership of youth organisations within the Board’s area (young people aged 4 – 25 years)

43,900

Number of Controlled Youth Clubs

28

Number of Voluntary Youth Organisations 478

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DIRECTORS' REPORT

FUNCTIONS OF THE BOARD

The functions of the Board in relation to the provision of education and library facilities are laid down primarily in the Education and Libraries (NI) Order 1986, the Education Reform (NI) Order 1989, the Education and Libraries (NI) Order 1993, the Education (NI) Order 1996, the Education (NI) Order 1997, the Education (NI) Order 1998, the Education and Libraries (NI) Order 2003 and the Education (NI) Order 2006. The system of public education is organised in two stages - Primary Education - for pupils aged 5-11 in Key Stage I and II Secondary Education - for pupils aged 11-18 in Key Stage III and IV and post 16 studies

The Board must also have regard to the need to provide nursery education and has a key role in delivering the pre-school expansion programme. Within this public education system it is the duty of the Board to - contribute towards the spiritual, moral, intellectual and physical development of the

community; ensure that there are sufficient schools for providing primary and secondary education;

secure special educational provision for those children who have been identified as

having special educational needs.

In fulfilling these functions the Board is required to draw up schemes which allocate finance and delegate responsibility to boards of governors of schools. In addition the Board must maintain a curriculum advisory and support service to provide support for staff and governors in schools. The Board is also required to - secure the provision for its area of adequate facilities for recreational, social, physical,

cultural and youth service activities and for services ancillary to education; and provide a comprehensive and efficient library service for persons living, working or

undertaking courses of education in its area.

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DIRECTORS' REPORT

BOARD MEMBERS The following served as Board members during the year: Mr J R Beggs (Chairperson) Mr J Reid (Vice-Chairperson) Mrs O M Church Mr T C Clarke Mrs J Crilly Mrs M W Crockett Mr J R Donaghy Mrs U Duncan Mr J F Finlay Mrs L Frazer Mr A Gilkinson Rev S Graham Mrs E M L Green Rev J T Jamieson Mr M J Johnston Mr J F Kerr Mr N S Macartney Mrs L Marsden Mr W McCartney Mr S A McCrea Mr O McMullan Mr N C Murray Mr H Nicholl Mrs U O'Kane Mr S Polley Dr J A Preston Mr W Raven Prof N Reid Birley Mr D Ritchie Rev T Scott Mr R Stirling Mr R J Thompson Mrs D Walker

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DIRECTORS' REPORT

BOARD STRUCTURE

In the period covered by this Report, the Board comprised five Departments providing services as follows:- Chief Executive's Department Chief Executive: Mr G Topping OBE BA (Hons) MSc MBA DipEd FRSA The Chief Executive’s Department provides services to Board members, other Board Departments, schools, Board staff and the general public. Its functions are carried out through two units - The Board Secretariat which provides administrative, organisational and secretarial support for the Board and its committees. Internal Audit which provides assurance to the Chief Executive as Accounting Officer on the adequacy and effectiveness of Board systems. Education Department Head of Department: Mr G Irwin DASE MEd The Education Department comprises six services which aim to make a specific contribution to the Board’s Strategic Themes as well as contributing to a multi-disciplinary approach at Board level. The Strategic Management Unit aims to provide effective management and administration for the primary and post primary sectors. The unit is responsible for the strategic planning of the schools estate. The Curriculum Advisory and Support Service aims to enhance the quality of education by providing a high quality, cost effective, proactive and responsive service to all principals, teachers and Boards of Governors. The Special Education Service aims to identify children with special educational needs and determine and secure the special education provision that should be made for them. The Educational Psychology Service aims to provide non statutory assessments and advice to schools, parents and other agencies as well as the provision of statutory assessments and advice on individual children. Specialist teaching services provide support and direct teaching for the benefit of individual children. The Education Welfare Service aims to ensure that parents fulfil their statutory obligations to secure suitable education for their children and seeks to provide support for children in liaison with schools, parents and other agencies. The Youth Service aims to support and provide opportunities in informal settings relating to the personal and social development of young people with emphasis placed on supporting adolescents in their developmental transition from childhood to adulthood.

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DIRECTORS' REPORT Administration Department Head of Department: Mr R Harper MA CertEd The Administration Department provides the Board, schools, parents and young people with a range of statutory and support services:- The Human Resources Branch is responsible for the provision of Personnel Services to schools and Board managers. The Pupil Student Services Unit is responsible for the provision of Transport, Student Support and Benefits and Open Enrolment/Transfer Services. The Equality and Human Rights Officer is responsible for managing the Board’s response to legislative requirements and for supporting other managers in dealing with equality and human rights education. The School Meals Service is responsible for providing a range of comprehensive catering services to a variety of schools including primary, secondary, nursery and special. The Property Services Division is responsible for providing the Board and schools with a wide range of professional and technical support services, for the maintenance of all Board properties and for the ongoing development of the Board’s estate to meet the ever changing needs of the Education Service. Besides the Direct Services Organisation, which is responsible for building cleaning, grounds maintenance and vehicle maintenance, the Property Services Division also includes the Claims and Legal Administration Service which is responsible for the investigation of Personal Injury Claims brought against the Board and its legal administrative function including acquisition and sale of property. Library and Corporate Services Department Head of Department: Mrs A Connolly, BA (Hons), Dip Reading Development, MA, MBA The Library and Corporate Services Department is responsible for Libraries; ICT; Corporate Development; Freedom of Information; Communications; and Training and Development. The Library Department aims to meet the reading and information needs of all NEELB residents by providing a library service which is readily accessible and responsive to the needs of its users. It carries out this function through the following services: The Lending Service allows all adults and children who live, work or are in education within the area to borrow from its libraries, books, videos, music and spoken word recordings and open learning materials. The Information Service aims to answer enquiries from any member of the public on any subject from a wide range of sources including books and on-line resources. The Local Studies Service preserves and makes available materials and information relating to the history of the area.

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DIRECTORS' REPORT The Stock Department is responsible for the purchase of all stock material for departments in the Library Service, has additional responsibility for the management of stock related contracts and the management of the 5 Board tendering process in conjunction with the NEELB Purchasing Department. The Community Support Service provides reading and listening materials in all formats for people who, because of illness, disability, frailty or restrictions on their freedom of movement, are not able to use mainstream library services. The Education and Youth Service provides resources to assist in teaching, together with advice, materials and assistance to schools in relation to their own school library provision. The Department supports the services to children and young people in public libraries and mobile libraries too. A fleet of mobile libraries provides a regular library service to rural areas. ICT Management Services manages the Board’s website, supports the Board’s use of computer technology to provide effective services and has responsibility for managing Freedom of Information. The Corporate Development Officer is responsible for supporting a programme of Best Value Reviews across all Departments, as well as contributing to inter-board Best Value Reviews. The Information and Communications Unit provides a means of collecting and disseminating information to internal and external publics. The Training and Development Officer is responsible for facilitating all in-house training for officers of the Board as well as for the monitoring, evaluation and record keeping with regard to all external courses. The Board’s training and development budget is managed by the Training and Development Officer in conjunction with the Corporate and Staff Development Committee. Finance Department Head of Department: Mr R H Taylor BA CPFA The Finance Department provides the Board with a wide range of financial services to assist the Chief Executive in the discharge of his responsibilities as an Accounting Officer. Its functions are carried out through the following service units: Financial Accounting Division

The service is responsible for the payment of salaries and wages (excluding payments to teachers and lecturers), the payment of creditors, the estimating and ordering of cash requirements from DE, DCAL and DEL and the reconciliation and analysis of monies received from other sources. Services are also provided in relation to the maintenance of the General Ledger system and Chart of Accounts, the reconciliation of bank accounts, the administration of, and accounting for, Trust and Endowment Funds and the compilation and recording of Losses and Special Payments.

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DIRECTORS' REPORT

Management Accounting Division This service unit is responsible for providing a financial planning and management information service to the Board in line with its Strategic Plan. This includes the preparation of short and medium term financial plans and the maintenance of a financial management information service to facilitate budgetary control and decision making by budget holders, including those responsible for the local management of schools. Purchasing Branch The Purchasing Branch is responsible for the procurement of goods and services for the Board, taking account of the Board’s Standing Orders, Government legislation and EU directives. The main activities of the section relate to: (i) Contracts, Quotations and Tendering (ii) Monitoring and Purchase Order Processing

REGISTER OF INTERESTS None of the Board Members, members of the key management staff or other related parties has undertaken any material transactions with the North Eastern Education and Library Board during the year other than those disclosed in emoluments of senior post holders and remuneration report.

A register of members' interests is available and can be inspected on application to the Chief Executive's office. BUSINESS REVIEW Financial Review The Board has continued to build upon the achievements of previous financial years and has once again contained expenditure within the totality of the resources, both recurrent and capital, made available during the curse of the 2008/09 financial year by the three sponsoring Departments of Education, Culture, Arts and Leisure and Employment and Learning in respect of the activities of Schools, Youth Services and Community Relations, Public Libraries and Student Support.

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DIRECTORS' REPORT Final accrued recurrent expenditure, excluding non-cash items, against total approved expenditure limits were as follows:

Department

Total Approved Expenditure

Limit £000s

Accrued

Expenditure £000s

Department of Education - Schools etc.

292,894 1

291,214

- Youth & Community Relations

5,777 5,768

Department of Culture, Arts & Leisure 9,546 9,474

Department for Employment & Learning 2,091 2,063

1 Excluding teachers' premature retirement costs Final accrued capital expenditure against approved expenditure limits were:

Department

Total Approved Expenditure

Limit £000s

Accrued

Expenditure £000s

Department of Education - Schools etc.

15,700

15,519

- Youth & Community Relations

573 573

Department of Culture, Arts & Leisure 1,232 1,232

Headquarters Administration Costs In 2008/09 the core Headquarters Administration costs of the Board were £6.807m which complies with the Department of Education's requirement of the Board to contain costs at 2005/06 budget levels, adjusted for increased employers' pension contribution rates but excluding any other adjustment. Procurement In 2008/09 through efficiency and value for money savings the Board achieved a further reduction of £290,000 in procurement costs on centre budgets and aggregated schools budgets in addition to the £280,000 achieved in 2007/08.

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DIRECTORS' REPORT Schools - Surplus Places Spare capacity in schools was reduced by 238 places in the 2008/09 year. A significant number of surplus places were removed by the redesignation of surplus teaching spaces for other purposes such as special needs, library and resource space. Schools – Management of Budgets The Board completed assessments for all schools' three year financial forecasts in the context of 2007/08 actual outturn positions and anticipated enrolments and agreed recovery/spending plans where possible. Recovery plans were not achieved for eight schools, three of which are in the maintained sector. The Board, with CCMS, is seeking to address the situation in these schools. Risks and Uncertainties The Board’s approach to the management of risk and uncertainties is formally documented in the Corporate Business Statement and the Corporate Risk Register, revised and updated in October 2008. In evaluating the inherent and residual risks associated with the core and support processes for Board functions the most significant risks relate to the security of information and the uncertainty and increased work demands caused by the Review of Public Administration and the subsequent effect on staff morale and staffing levels, as determined by the vacancy control policy. At a time of increasing financial stringency the Board also identified a significant risk to ensuring the delivery of all its essential and desirable services.

EMPLOYEE INVOLVEMENT During the year the policy of providing employees with information about the Board has been continued through regular distribution of circulars. Regular meetings are held between staff at different levels to allow a free flow of information and ideas. Team Briefing has improved communication to all employees within the Board. DISABLED EMPLOYEES The Board actively encourages applications for employment from disabled persons where the requirements of the job may be adequately performed by a disabled person. Where existing employees become disabled it is the Board's policy whenever possible to provide continuous employment under normal terms and conditions and to provide training and career development and promotion where appropriate.

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DIRECTORS' REPORT SICKNESS ABSENCE Teacher - Sickness Absence Statistics show an average of 7.88 days sickness per teacher in the NEELB area for the 2007/08 school year. Non-Teaching Staff - Sickness Absence Statistics show an average of 7.65 days sickness per non-teaching employee for the 2008/09 financial year. PERSONAL DATA RELATED INCIDENTS No personal data related incidents occurred in the Board in 2008/09. PENSION ACCOUNTING POLICY Pension liabilities are treated in the Accounts in accordance with Note 1.7 of the Statement of Accounting Policies. PAYMENTS TO SUPPLIERS Public Sector Payment Policy – Measure of compliance The Government requires that the Board pays its trade creditors in accordance with the Better Payment Practice Code and Government Accounting Rules. The Board’s payment policy is consistent with the Better Payment Practice Code and Government Accounting Rules and unless otherwise stated in the contract, payment is due within 30 days of the receipt of the goods and services, or presentation of a valid invoice or similar demand, whichever is later.

The measure of compliance is:

Based on Invoice Date

Number £ Total bills paid 157,943 127,444

Total bills paid within target 127,588 102,223

% of bills paid within target 80.8% During the year the North Eastern Education and Library Board paid no interest charges in relation to late payment of invoices.

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DIRECTORS' REPORT CHARITABLE DONATIONS

During the year the Board made no donations for charitable or political purposes. AUDITOR DETAILS The Principal Auditor is the Comptroller and Auditor General, Northern Ireland Audit Office, 106 University Street, Belfast, BT7 1EU.

COST OF AUDIT £000 Audit Services (notional cost) 36

Further Assurance Services -

Tax Services -

Other Services -

The services provided relate to the statutory audit of the financial statements. There were no non-audit services provided by the Principal Auditor. The Board confirms that: • so far as the Accounting Officer is aware, there is no relevant audit information of

which the Board's auditors are unaware; and • the Accounting Officer has taken all steps that he ought to have taken to make himself

aware of any relevant audit information and to establish that the Board's auditors are aware of the information.

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DIRECTORS' REPORT CORPORATE GOVERNANCE ARRANGEMENTS

The Board, through its Committees, maintains and reviews the system of internal control within the organisation by continually monitoring the service being provided to customers to ensure it meets objectives set in the respective Departmental plans. Updates on plans are provided to relevant Committees on a regular basis. The Chairperson of the Audit Committee reports annually to the Board on audit activity including risk management, and after each meeting. The Board has complied with the terms of the current relevant Dear Accounting Officer Letters (DAOs) issued by the Department of Finance and Personnel. In particular, grant and grant in aid received from the Departments has been used for the purposes intended; there was no novel or contentious expenditure for which the Department's or/and DFP's approval was not obtained; and all other financial transactions conformed to the authorities which governed them, including delegated authority to commit or incur expenditure and approvals sought from the relevant Department, where required. Registers of Board members and key staff interests have been established and are updated regularly. Conflicts of interest relating to Board members and key staff, actual or potential, were appropriately managed and controlled. The Board has referred the code of practice for Board members to the Department of Education for approval and a code of conduct for staff has been established. An anti-fraud policy and fraud response plan has been developed, updated and implemented. All suspected and proven frauds have been notified to the relevant Departments and other parties in accordance with agreed procedures and there are no suspected frauds that have not yet been notified. Complaints procedures for students, staff and the general public have been developed and implemented, including facilities under Whistleblowing arrangements to complain direct to outside agencies and sponsoring Departments and the Comptroller and Auditor General. Performance was monitored against both business objectives and the effectiveness of internal control arrangements. Throughout the 12 months ended 31 March 2009, internal control was adequate to provide reasonable assurance of: • effective and efficient operations • integrity and accuracy of management information • the safeguarding of assets; and • compliance with laws and regulations The Board via the Audit Committee receives periodic reports concerning internal control. There is a minimum of four Audit Committee meetings a year. Representatives of the Northern Ireland Audit Office (NIAO) attend the meetings and outline for the Committee their main findings and recommendations from their audits of the annual accounts and value for money reviews. Representatives from the Department of Education are also invited to attend the Audit Committee. The Board has an Internal Audit Section, which operates to the Government Internal Audit Standards defined by HM Treasury. Internal Audit issue reports regularly to the Committee, including the head of internal audit's opinion on the adequacy and effectiveness of the Board's system of internal control together with recommendations for improvement.

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MANAGEMENT COMMENTARY

STRATEGIES

In 2005 the Board revised its Corporate Plan producing a new Corporate Plan for the period 2006-2008. With the extension of the life of the Board until 31 March 2009 the Corporate Plan was revised and extended until this date. As the Minister recently announced a revised implementation date of 1 January 2010 for the establishment of ESA, the Corporate Plan has been further updated to reflect this. Based on the four strategic themes of – Meeting Needs, Raising Standards, Broadening Horizons and Acquiring and Managing Resources, the Corporate Plan took account of the Government's priorities for Northern Ireland as a region as well as the Board's priorities for its area. Using the Board's strategic themes, targets have been established for progress in key strategic areas. These major areas are listed below – Meeting Needs • Manage human resource issues to safeguard both service delivery and the welfare of

staff. • Develop and implement a Corporate Improvement Plan. • Support the roll-out of the revised curriculum. • Manage the implications of the establishment of NILA – Schools’ Library Service and

Service Level Agreements. Raising Standards • Raise Educational Achievement. • Demonstrate continuous improvement in Board services. • Improve the quality of leadership, management and communication at all levels. Broadening Horizons • Create an informed community. • Develop e-services. • Develop the Inclusion and Diversity Service. • Assist in the ongoing work to establish the Education and Skills Authority by 1 January

2010.

Acquiring and Managing Resources

• Manage and acquire resources effectively. • Manage the estate effectively. • Exploit funding opportunities from external sources and income generation. • Develop services to ensure best value is achieved. This document reports on the Board's activities in achieving progress in these key strategic areas.

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POLICIES The North Eastern Education and Library Board is committed to implementing policy in accordance with the government’s strategic vision for the education, youth and library services in Northern Ireland. In striving to realise this goal, the Board continues to take account in its policy development of the strategic direction laid down by the Department of Education, the Department for Employment and Learning and the Department of Culture, Arts and Leisure. The Board also takes account of emerging legislation and takes strategic action to ensure that its workforce and processes reflect this changing context. In its planning, the Board took into account the need to prepare for the introduction of the Education and Skills Authority with effect from January 2010. The Board is committed to working closely with its education partners to facilitate convergence in service delivery. The Board provided high quality support and advice to schools to assist them in raising educational attainment, with particular reference to examination results and standards in relation to literacy and numeracy. The Board prioritised manpower resources to support the implementation of the NI Literacy and Numeracy Strategies and assisted schools in the roll out of the Revised Curriculum. Increasing use was made of emerging technologies in the delivery of the continuing professional development of the teaching force. During the 2008/09 year, the NEELB also supported post primary schools in establishing learning communities to assist in the delivery of the Entitlement Framework. Board Officers also contributed to the Area Based Planning process. The Board also implemented the Extended Schools programme in over seventy-four schools as a part of the Children and Young People’s Funding Programme and contributed to the successful implementation of a range of other strands of this overall policy. As part of its commitment to inclusion, the Board through the Pre School Advisory Group continued to support pre school education and worked closely with statutory and voluntary partners as efforts were made to secure an integrated child centred approach, appropriate to the needs of children and parents. The Board also contributed to the province wide policy review of Special Educational Needs and awaits the outcomes of the review with a view to possible implementation of a revised SEN policy in 2009/10. The Board continued to implement an Action Plan on Promoting Cultural Diversity within the NEELB and seconded an Officer from NICIE to take forward a major initiative on integrating education. The Board also established the Inclusion and Diversity Service on behalf of the education service in Northern Ireland. The Board’s Youth Service continued to ensure equality of access to provision with an increasing percentage of the youth population participating in activities. The service plays a crucial role in promoting the personal and social well being of children and young people and assists them in gaining the knowledge, skills and experience to reach their full potential as valued individuals. The service also helps young people to develop a mutual understanding and respect for cultural diversity. In terms of the reshaping of the schools estate, the Board took strategic action in a number of areas of the Board and implemented an agreed strategy of school rationalisation in accordance with emerging government policy in this area.

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The Board recognises the intention of government to modernise the public sector and the drive towards “joined up service delivery”, the greater use of new technologies and the need for organisations to measure themselves against external validation of quality. SOCIAL AND COMMUNITY ISSUES This reporting period has brought opportunities and challenges to society in Northern Ireland generally. The Board is particularly conscious of its contribution to the local community, both as a major employer and as an educator of the employees of tomorrow, in the context of the current economic difficulties. The workforce is representative of the community in which it is based and its Headquarters services presently employ approximately 800 staff, comprising 72% Protestant, 22% Roman Catholic and 6% non-determined. It is also important to note that approximately 70% of the Headquarters workforce is female. As in previous years, the Board dealt with a wide range of specific enquiries from public representatives at local council, Northern Ireland Assembly and Parliamentary level. Mostly detailed written responses were provided but there were also personal meetings involving the Chief Executive and other officers as required. A systematic complaint monitoring procedure continued to operate including the presentation of quarterly reports to the Senior Management Team. Conscious of the importance of communication with stakeholders, the Board continued to measure press coverage in terms of press releases, number of publicity assignments, number of media and journalists serviced and the percentage of positive and negative publicity received on a monthly basis. These served as indicators of public perceptions. Work continued on the whole area of consultation with children and young people. The Equality Scheme was implemented throughout the period and quarterly reports were presented to the Senior Management Team and the Board, which included information regarding policy screening and impact assessment as well as training and data collection. The Board continued to develop relationships with other authorities and bodies in a geographical area which embraces a wide spectrum of society in both urban and rural settings and includes affluent localities as well as areas of social deprivation. The social issues facing this community are multi-faceted and require the adoption of a multi-agency approach to their solution and the Board embraced this strategy with the co-operation of key partners. The Board pursued one of its core objectives to support schools in their efforts to equip young people to participate in a global economy where flexibility and creativity will be vital strands in employability. This included supporting the wider educational community, through libraries and the youth service, in developing confident, informed citizens of tomorrow. Society shapes, and is shaped by, its education service, so it follows that significant social change and development must inevitably have an influence on the work of the Board. Thus work with other education partners continued in areas such as pre-school provision, integrating education and the provision of opportunities for young people beyond formal education. During the year the Children’s Charity Committee, representing Headquarters staff, agreed the distribution of £8,500, raised by voluntary contributions, to a number of charities focussing on the health and welfare of young people.

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MANAGEMENT COMMENTARY ENVIRONMENTAL ISSUES Throughout 2008/09, the Board continued to recognise its environmental responsibilities, both as an education service and as a manager of a large estate. Educational advice and support was available to schools through CASS and property services. Across the estate, large numbers of schools demonstrate their environmental credentials by registering and operating the eco schools environmental award programme and have achieved the following: • 71 Bronze awards • 47 Silver awards • 56, First Green flag • 33, Second Green flag • 21, Third Green flag • 17, Fourth Green flag In pursuit of public sector energy consumption and CO2 reduction targets a number of energy efficiency projects were undertaken. Investment of £460,000 in energy efficiency measures across a range of properties in 2008/09 included: • the installation of low energy ballasts in lighting fittings within 34 schools. • Natural Gas Conversion at two schools and Antrim Board Centre. • Cavity wall insulation improvements at 22 school buildings. • Boiler house valve cover installations at 42 school buildings. With respect to Government Renewable Energy targets, the Board continues to support schools in pursuit of renewable energy installations, enabling effective use of the energy data produced within the curriculum. Recently passed Energy Performance of Buildings Directive legislation requiring the introduction of Display Energy Certificates on all properties above 1000metres has now been initiated, and the proposed Carbon Reduction Commitment is included in short term planning.

In terms of wider environmental management the Board is working towards an Accredited ISO 14001 Environmental Management System at Antrim Board Centre. In benchmarking its position against other organisations the Board was placed in Quintile 2 in the Arena Network Environmental Survey of 200 leading companies and Local Authorities in Northern Ireland demonstrating a clear focus on continuous improvement. Where appropriate the Board continued to recycle materials such as books, furniture and other items of equipment. Paper collection and inkjet cartridge recycling continued to operate in Board premises. The Board has representation on the Schools Transport Advisory Board at the Department of Regional Development which promotes Travelwise and the Safer Routes to Schools programme. The Transport Branch continued to achieve fuel efficiency through an effective programme of vehicle maintenance, the provision of driver training and the ongoing promotion of good driving standards in partnership with the Institute of Advanced Motorists.

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MANAGEMENT COMMENTARY ESSENTIAL CONTRACTUAL ARRANGEMENTS

In accordance with the Board's Standing Orders contracts for the supply of goods and services and estate related services are publicly advertised (and where appropriate in the European Journal). While every contract is awarded on a value for money basis in the majority of instances this will also be at the lowest cost. The Board is also involved in the Public Private Partnership (PPP) approach to securing services, having been awarded the Electronic Libraries project for Northern Ireland, and a party to the establishment of the financial services contract for the Northern Ireland Education and Library Boards awarded by the South Eastern Board. Progress is also ongoing in respect of the provision of educational facilities for one controlled school and one maintained school, for which the Board is the funding authority, through the PPP route. All contracts awarded by the Board are a matter of public record. Through the Human Resources service all teaching and non teaching employees of the Board are issued with appropriate contracts of employment the terms and conditions of which are subject to negotiation and agreement with the recognised Trade Unions through the Joint Negotiating machinery. The Staff Commission for Education and Library Boards also exercises a general oversight of the terms and conditions of employment and other related matters for the recruitment, promotion and training of non-teaching staff employed in Boards.

TRENDS FOR THE FUTURE On 1 April 2009 the Northern Ireland Libraries Authority came into existence – separating the Public Library Service from the Education and Library Boards. This new organisation was part of the out-workings of the recommendations of the Review of Public Administration, as agreed by the local Assembly. For the Education sector there will be the creation of the Education and Skills Authority on 1 January 2010. Government continues to be concerned about the number of surplus places in schools. At the same time demand for high quality choices for education is a factor both for individuals and for economic prosperity. The challenge of meeting the needs of tomorrow’s generation from the financial resources of today is substantial. The Education service will continue to support schools in their efforts to equip young people to take their place in a global economy where flexibility and creativity will be vital strands in determining employability. We also recognise that the wider educational community has a pivotal role in developing confident, informed citizens of tomorrow. The vision of a shared future will continue to seek support from future Education services in bringing people together in a constructive manner to promote mutual understanding and respect for diversity. Problems of unemployment, poor living conditions, low incomes, family break-up, domestic violence, drug, alcohol and substance abuse, are often associated with under-performance at school. All contribute to the marginalisation of a significant number of young people. These problems are multi-faceted, multi-dimensional and complex and require the adoption of a multi-agency approach to their solution. The Board will therefore continue to work in partnership with other agencies to address these issues where they impact on the effectiveness of the services we provide.

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MANAGEMENT COMMENTARY The Education and Library Board now and in the Education and Skills Authority will continue to have an increasingly important role in the development of a skilled, knowledgeable and innovative workforce. Demands will be placed on future services to further support the development of the knowledge economy. As the change programme begins to roll out and challenge at national and local level, the Board’s commitment will be to maintain existing services to the people we serve whilst at the same time meeting the challenge of playing as full a part as possible in the transformational agenda. PERFORMANCE MEASURES Key Indicators of Success Performance in Academic Year ending 2008

Based on Teacher Assessments Key Stage 1

(% of pupils achieving Level 2 or above)

Key Stage 2 (% of pupils achieving

Level 4 or above)

Key Stage 3 (% of pupils achieving

Level 5 or above) Board NI Board NI Board NI English 94.7 94.0 78.4 78.8 77.9 79.2 Maths 94.9 94.6 80.9 80.6 74.1 74.1 Science - - - -

% of 16 yr olds achieving 5+ GCSEs at Grades A*-C (or equivalent) & Grades A*-G (or equivalent) Board NI A*-C 63.6 64.5 A*-G 90.3 91.5

% of 18 yr olds achieving 2+ GCSE A Levels at Grade A-E (or equivalent) Board NI A-E 98.0 97.0

% of 18 yr olds achieving 3+ GCSE A Levels at Grade A-C (or equivalent) Board NI A-C 63.4 62.4

Improved Performance in Schools The Board continued to support improved performance of schools and raise standards in English and Mathematics as demonstrated by pupil results. Continued support was provided to individual schools through the school based work of link officers and management development officers. An explanation of the process and sample materials were provided through NEELBTV and Learning Northern Ireland.

27

MANAGEMENT COMMENTARY Curriculum Advisory Support Service (CASS) During 2008/09 each school was visited by their CASS Link Officer. During this visit development needs identified in the school development plans were discussed and the areas in which Board support would be required were identified. The combined information from all schools was carefully analysed to construct the CASS school support programme. CASS continued to deliver support and training to all schools which have identified training needs. In accordance with school needs identified in 2008/09, centre based support, cluster group support and school based support was provided in support of the implementation of the Northern Ireland Curriculum and other developmental issues identified by schools. Over 80% of all support was provided through visits to schools. Evaluation was conducted in relation to all aspects of training through teacher scoring of the degree to which support objectives had been achieved and in relation to the quality of the support officers' performance. This shows that more than 95% of the participants rated CASS training as satisfactory or better and this is supported by the collation of teachers' comments. Revised Curriculum

An Education and Training Inspectorate Report of January 2009 indicated that CASS had been successful in collaborating across the five Boards to deliver a regional training programme for the revised curriculum. The majority of support was considered to be good or better in meeting the needs of schools. By the end of March 2009, 75% of the 2008/09 training programme for the revised curriculum was delivered for those teachers in Years 3, 4, 7 and 10. As part of this phase of training, over 3,000 teachers across Northern Ireland have engaged in an e-learning programme on Learning Northern Ireland. This provided the opportunity for differentiated continuous professional development as a number of routes were available to teachers within the e-learning environment. Entitlement Framework In conjunction with other school managing authorities, high quality, consistent support was made available to all schools to assist them to deliver the full Entitlement Framework by September 2013. An action plan was produced and key targets achieved. The Board has continued to develop its 11 Learning Communities and as a consequence the curriculum offer for pupils at key stage 4 has been broadened.

Partnerships with the Northern Regional College and other training providers have been expanded.

Drugs Education

In 2008/09 the Board supported 42 schools in delivering the Department of Education requirements relating to Drugs Education through centre based training and school based support. Board Officers continue to be involved in raising staff awareness on drugs through education lessons and team teaching with teachers to model good practice in planning and delivering lessons – during 2008/09, 403 teachers have been trained.

28


Inclusion and Diversity Service The Inclusion and Diversity Service was inspected by the Education and Training Inspectorate during 2008/09 and the report indicated that substantial progress had been made since the service was created to replace the former English as an Additional Language Service of the separate Boards. Positive findings emerged in terms of building the capacity of schools to work with newcomer pupils. Equality and Community Cohesion

During 2008/09 three events, aimed at promoting equality, diversity, human rights and community cohesion, were delivered in partnership and with input from Section 75 groups. These were as follows: • An Anti-Racism and Diversity Training workshop was provided to front-line Education

and Library staff. This was designed and facilitated by the Equality Manager and the Special Services Librarian. Input also came from an Ethnic Minorities Support Worker from the Ballymena Inter-ethnic Forum. Evaluations proved positive and it is hoped that another workshop can be facilitated later in 2009.

• The Ballymena Inter-Agency Support Group, of which the Board has been a leading player since its inception in 2001, marked Anti-racism in the Workplace Week with a business breakfast and presentation. The event showcased the award winning diversity work of 'All State' NI and sought to strengthen the links of the group with the local business sector. This was a joint event with the Equality Commission. A similar lunchtime event was organised for local businesses in Antrim by AWARE (Antrim Welcomes and Advocates Racial Equality) and the ECNI later in the week.

• The Board's Antrim Board Centre hosted the 'Spirit of Enniskillen' Fund's Sixth Forum

Conference which explored how young people can engage in progressive discussions around identity and diversity in the context of equality and a 'Shared Future'. The Chief Executive, Mr Gordon Topping welcomed over 100 young people to the centre from schools across the province. The exercise was very successful and will be repeated later in 2009.

As the Education and Skills Authority (ESA) and the Northern Ireland Library Authority (NILA) will be established by January 2010, priority for the remainder of 2009 will be given to ensuring a smooth transition of capacity to fulfil statutory functions to ESA whilst maintaining present consultation and partnership arrangements. The main focus will be on convergence and completion activities. In collaboration with other Education and Library Boards and the Staff Commission, the Board has developed its response to the Disability Discrimination Act 1995 (as amended by Article 5 of the Disability Discrimination (NI) Order 2006), resulting in the survey of children at Key Stages 2, 3 and 4+ with Disabilities in Education. Based on samples supplied by the Department of Education, two surveys were run in the December – March period, the first in Primary Schools for Key Stage 2 pupils with statements of special educational need and the second for Key Stage 3 and Key Stage 4+ pupils who had statements. The survey extended across all five Boards and involved staff from the Boards, CCMS and the Staff Commission. The survey, the first of its kind in Northern Ireland aims to provide a voice for children with disabilities in mainstream schools and to inform future policy and service provision.

29


In 2008/09, the Education and Library Boards and the Staff Commission hosted sessions of the Joint Consultative Forum for the Education Sector to inform Section 75 constituency on the development of ESA and its policies. The Board will continue to promote Equality, Good Relations and Cultural Diversity partnership with Sectors and other agencies.

The Board continues to work closely with the Equality Commission in Northern Ireland to consider the implications of the Fair Employment and Equality legislation on the Board's work. Advisory and Educational Psychology Services Education Audiology Service (EAS) A team of teachers of the Deaf and an Audiologist provide a service for approximately 93% of the hearing impaired children being educated within the NEELB. The remaining 7% are educated either out of the Board, in Units for Hearing Impaired Children or at Jordanstown School for the Deaf. The role of the service is a multi-faceted one, working in partnership with schools and Health professionals and ongoing collaboration with parents, teachers and classroom assistants. In responding to requests for educational advice, during 2008/09 the Board maintained 100% performance in providing services to newly diagnosed deaf children. Literacy Teaching Support Service (LTSS)

The LTSS staff comprise of teachers who are trained and experienced in the teaching of children with specific and/or severe Literacy difficulties. They provide the direct teaching of pupils and a valuable advice and support service to schools for identified pupils. During 2008/09 with the reduction in staffing levels due to the limited funding, the Board endeavoured to maintain its high performance achieved over the past years. Behaviour Support Service

The Behaviour Support Service continues to support schools to effectively develop their policies and practices for positive behaviour management. It also supports vulnerable children and young people at risk of underachievement, suspension or even exclusion through disengagement in learning. This is done through stepped support, advice and guidance to schools on managing pupils who are experiencing difficulties, outreach support to individual pupils in their schools, placements in Primary Referral Units or Educational Guidance Centres and provision of individual learning packages for those on tuition. The service also provides programmes for Education other than at School (EOTAS) for year 12 pupils. The Behaviour Support Team monitors and evaluates all pupils receiving support on an ongoing basis. During 2008/09, 98.5% of pupils have received support within six months of Stage 3 assessment. Library Service In 2008/09, the Library Service continued their rolling advisory visits programme. Staff visited 15 schools to give advice to Principals and Library staff on improving library provision within their schools. Library staff received training in establishing service Feedback Groups with school pupils. It is envisaged that the Groups will be established during 2009/10 and that the children will be encouraged to become involved in participation and decision making and to take ownership of their school libraries.

30


Another four understocked schools were brought up to the Department of Education recommended stock levels. The rolling programme to upgrade primary school central library collections also made further progress and libraries in 17 schools were upgraded. The Library Service continued its programme of support for self evaluation of school libraries by providing assistance for another four schools. Staff gave presentations at the Beginning Teachers Conference in October 2008 and the following training courses were held for library staff and teachers: - Display Skills - Comic design workshops - Reader development - "Sharing Stories – Shaping Minds" teacher training course A number of Parent and Story sack sessions were held in schools. During 2008/09, Bookstart Treasure Chests were delivered to 2,714 children in nurseries and to 1,357 children in playgroups. Library Service staff also organised a range of author visits to schools and public libraries throughout the year as part of various literary festivals such as the Childrens Books Ireland festival and World Book Day. Staff also contributed to the launch of the "Moneyville" website and organised the BBC "Off by Heart" poetry workshop. Robert Chestnutt from Dunseverick Primary School was the Northern Ireland winner and will represent the Northern Ireland region in London at the finals. In 2008/09, the Library Service succeeded in retaining the Chartermark Award for the fourth time. Youth Service The Youth Service surpassed the targets set as benchmarks with other Education and Library Board (ELB) Youth Services. The annual user survey was completed with the Youth Service receiving a total of 747 responses from three stakeholder groups which remained very positive to the service provided.

ELBs

Target NEELB

Achievement Participation ratio of young people 4-18 years, compared with the total youth population 4-18 years

38% 49%

Youth population aged 19-25 years who are involved in youth organisations including young people in leadership

10% 10%

Satisfactory rating for Education and Library Board youth work adult training

90% 99%

Satisfactory rating for Service Provision 80% 98.6% Satisfactory rating for Young People in Projects 80% 93%

11-18 year olds

Parents' satisfaction with Service 80% 98%

31


The Parental survey highlighted that the majority of young people (95%) do talk about the club and what happens there on club nights to their parents. The parents identified significant benefits to their young people through their participation in the club, particularly in their self confidence (92%), self esteem (92%), their ability to mix with others (93%) and their willingness to work and co-operate with others (93%). 97% of parents felt that the Youth Centre was a safe environment which enabled their young people to develop and were aware of appropriate child protection policies and procedures in place. Overall satisfaction rate from parents was 98%. The vast majority of those surveyed in the over 10s survey (99.6%) enjoyed going to the youth club, 96% felt safe and 93% enjoyed the activities it provided. Comments were extremely positive and enthusiastic about the club, the activities and the club environment. The majority view was that they enjoyed attending the centre and felt safe there. In the under 10s survey, the vast majority (98%) of the respondents stated they enjoyed going to the youth club. 96% were happy with the club leaders and 93% were happy with the activities provided. Special Education The Board caters for a wide variety of special educational needs – Autistic Spectrum Disorder (ASD), Severe Learning Difficulties (SLD), Moderate Learning Difficulties (MLD), Medical Difficulties and Speech and Language. To meet these needs, the Board ensures that arrangements for necessary training of teachers and classrooms assistants are in place when a school is named in a statement. In 2008/09, 99.5% of Statements were prepared within the timeframes set out in the SEN Code of Practice and Supplement, subject to permitted exceptions. The Board will continue to strive to meet stipulated targets. The Special Educational Needs and Disability Tribunal (SENDIST) is an independent Tribunal set up to consider parents'/guardians' appeals against decisions made by Education and Library Boards about a child's special educational needs, where parents cannot agree with the Board. The Tribunal also considers parents' claims of disability discrimination in schools. Following a hearing the Tribunal may make an Order against the Board obliging them to carry out actions or make provision as cited in the Order. The Special Educational Needs (Regulations) 2005 set out the time limits for Boards to comply with the Orders of a Tribunal. During 2008/09 there was full compliance with the Orders of SENDIST with 100% of all Orders complied with within the statutory time limits.

32

SUSTAINABILITY REPORT The Board’s mission statement refers to enabling people to “contribute to a caring, inclusive and progressive society”. As part of that overall mission, the Board is conscious of the responsibility to:

• develop sustainability in the projects and provision which it makes; • conduct its business in such a way that detriment to the environment is minimised; • support young people in developing transferable employability skills which can be

recycled and developed in the future; and • contribute to a sustainable society in Northern Ireland.

The Board actively promotes sustainability through the following:

Sustainable Consumption • Procurement – NEELB together with other Education and Library Boards are a Centre

of Procurement Expertise (CoPE) and CPD guidance is incorporated as standard practice within procurement decisions. For sustainable food procurement, the Board engages, where possible, with food producers and suppliers to secure capacity within the marketplace to deliver sustainable development priorities. The e-procurement initiative for catering establishments has been ongoing and successful.

• Construction – Project Managers are aware of the Sustainable Construction Group

guidance in respect of:

- Guidance Note 2 - Targets for Recycling - Guidance Note 3 - Construction Demolition and Excavation Waste Materials. - Guidance Note 4 - Bulk inert materials/aggregates - Guidance Note 5 - Considerate Constructor Scheme compliance. All new projects receive a sustainable design brief with appropriate design parameters and criteria with contracts requiring evidence of sustainable and legal timber sourcing; the need for site Waste Management Plans and promotion of the Achieving Excellence in Construction Initiative. All new construction projects are briefed as requiring the achievement of the British Research Establishment Environmental Assessment Method (BREEAM) excellent rating which sets the standard for best practice in sustainable design and is the measure used to describe a building's environmental performance.

• Transport – To help minimise adverse impacts on the environment, the Board compiles, on an annual basis, baseline data for business mileage together with fuel consumption and distance travelled in respect of the home to school transport provision. The data compiled is submitted to Arena Network when completing the Board's Annual Environmental submission which compares and benchmarks activity across the Public and Private sectors.

• Paper – The Board encourages maximum use of e-mail for in-house circulars, minutes

etc. In-house photocopying facilities are regularly reviewed with new multi-faceted machines facilitating double sided copying. Paper quantities procured are monitored and assessed in terms of quantities of virgin and recycled paper.

• Reuse and Recycling – Recycling systems operate across the estate for a wide range

of materials including paper, cardboard, glass, cans, toner cartridges and fluorescent tubes. The Board also has a recycling programme for oil, batteries and tyres employed at vehicle maintenance depots. Links established with Council waste

33

SUSTAINABILITY REPORT

managers have initiated a programme of better waste recovery across the education estate and waste monitoring across Council areas. During 2008/09 recycling rates have improved across a range of schools.

• Conservation of Water – Schools in the Board's area have had significant water

reduction measures installed including urinal controls and many have now invested in mains water filtration dispensers. Water cost data is utilised in the benchmarking process for targeted reduction.

Climate Change and Energy • Energy Efficiency and Renewable Energy Sources – The cross Government target

is to reduce energy emissions (CO2) by 1% from 1999-2000 level and each year thereafter. 93% of all electricity is from renewable sources and the Board has achieved 46% overall savings in CO2 emissions since the base year. The Board invested £460,000 in energy efficiency measures across a range of properties in 2008/09 with major renewable energy investment in solar water heating and photovoltaics. The Board has also replaced oil heating with Natural Gas in various schools and 28 Board properties now have Wind Turbines.

• Reducing consumption of electricity – the Board aims to reduce the consumption of

electricity and meet government targets. This is through the use of solar panels, energy efficient bulbs and the insulation of isolating valves.

• Reducing emissions from transport – all new and existing vehicles in NEELB

comply with European Standards for Co2 emissions.

Further information on the Board’s approach to environmental issues is set out in the Management Commentary Section, under the heading “Environmental Issues”. Protecting and Enhancing our Historic Environment The Causeway School is a Grade B1 listed building, which is defined by the Environment and Heritage Service as a building of local importance or good example of some period or style; it was used as a school from 1915 until 1962. The building transferred to the NEELB and was restored to its present condition. The school is now exactly as it was in 1962 and operates a "Living History" experience for primary school children in term time and as a museum, open to the public, at Easter, in July and August and on afternoons when there are no schools present. As well as all the original artefacts there are two sculptures and two drawings by the famous Ulster artist Rosamund Praegar. NEELB continues to maintain and conserve the building and has been successful in securing Heritage Lottery funding which is being used for conservation of the artefacts including the Praegar drawings and urgent repairs to the windows. The grant is also funding additional activities, extended opening hours and the use of the building by the local community. Sustainable Communities The Board’s geographical area embraces a wide spectrum of society in both urban and rural settings and contains localities, which are relatively affluent as well as those which suffer from social deprivation.

34

SUSTAINABILITY REPORT Problems of unemployment, poor living conditions, local income and associated family break-up, drug, alcohol and substance abuse, often allied to under performance at school, all contribute to the marginalisation of a significant number of young people. These complex problems are multi-faceted, multi-dimensional and require the adoption of a multi-agency approach to their solution such as through Local Strategic Partnerships and Neighbourhood Renewal. For 2008/09, in an attempt to address the employability potential of young people in the Ballykeel, Ballee and Harryville areas of Ballymena, the NEELB Youth Service provided the following training courses for Young People in the 17 to 25 Age Bands, under its 'Employability and Citizenship' Project through partnership funding provided by the Department of Social Development (DSD). Of the 90 young people originally targeted under the Scheme, 87 took up places at the start of the project. Of these 87 participants: • All 87 passed the Equal Skills ICT Course (National Accredited Course) • 25 were Awarded Certificates in the First Aid Course • 20 were Awarded Certificates in the Food and Hygiene Course • 29 were Awarded Certificates in the Basic Painting and Decorating Skills. The 87 young people have been provided with a basic package of 14 driving lessons with local Instructors. All 87 have applied for the Theory Test (81 were paid for by the project while 6 others had already completed the theory test using their own funding prior to joining the project). 45 have passed the theory test and 20 have passed the driving test. Sustainable Development – Learning and Communication As an Education service, the Board is committed to supporting schools in their efforts to equip young people to participate in a global economy where flexibility and creativity will be vital strands in employability. It is recognised that the wider educational community, including libraries and the youth service, has a pivotal role in developing confident, informed citizens of tomorrow. Education for Sustainable Development (ESD) is now one of the key elements in the Northern Ireland Curriculum and is therefore compulsory. ESD objectives can be delivered through learning areas such as The World Around Us and Personal Development and Mutual Understanding in the primary school and in subjects such as geography, science and citizenship in post-primary schools. However, ESD must also be delivered in a whole school context and in ways which allow pupils to be actively involved in objectives such as recycling, energy conservation, sustainable energy and bio-diversity. Many schools use an accreditation scheme such as Eco Schools to develop whole school activities and schools also work closely with local councils and NGOs such as Bryson House, RSPB, Northern Ireland Environment Link and Conservation Volunteers.

Gordon Topping Accounting Officer Date: 29 September 2009

35

REMUNERATION REPORT Board Members The Chairperson of the Board is paid by the Board for duties carried out as Chairperson at a rate and on such conditions as determined by the Department of Education with the approval of the Department of Finance and Personnel. The Board makes payments to Board members in relation to their functions as members, at such rates and on such conditions as determined by the Department of Education. Board members also receive travelling and subsistence allowances for expenditure incurred, at such rates and on such conditions as determined by the Board, subject to the approval of the Department of Education. No Board members receive or make pension contributions through their role as a Board member. Chief Executive and Second Tier Officers The remuneration of the Chief Executive and second tier officers is performance based. The Board Chairperson, with the Remuneration Committee of the Board, determines the performance of the Chief Executive, which is then subject to the approval of the Department of Education. The Chief Executive determines the performance of the second tier officers in accordance with an agreed performance related pay scheme. The Senior Management Pay Review Panel submits to the Department a recommendation on the appropriate percentage ceiling for performance related uplifts having regard to relevant information and other factors including pay movements in the public and private sectors and patterns of recruitment. The Department of Education considers the advice of the panel and determines the overall maximum percentage uplift to be applied. Remuneration Committee Members April 2008 – March 2009 Mr J R Beggs Rev S Graham Mr S A McCrea Mr N C Murray Mr H Nicholl Service Contracts Officer appointments are in accordance with the Joint Negotiating Council (JNC) for the Education and Library Boards terms and conditions and in particular are in accordance with the Staff Commission for Education and Library Boards Code of Procedures on Recruitment and Selection. Unless otherwise stated overleaf, the officers covered by this report hold appointments until their retirement. The normal period of notice is 3 months. Policy on termination payments in relation to premature retirement are in accordance with Local Government Regulations and the redundancy provisions. Salary including Allowances Salary includes gross salary and performance pay, excluding employer’s costs plus taxable travel payments and is based on actual salary earned for the year. Benefits in Kind Details of senior post holders who received non-cash benefits (benefits in kind), which relate to car loans, are detailed overleaf.

36

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37

REMUNERATION REPORT

EMOLUMENTS OF SENIOR POST HOLDERS AND MEMBERS Cash Equivalent Transfer Values A Cash Equivalent Transfer Value (CETV) is the actuarially assessed capitalised value of the pension scheme benefits accrued by a member at a particular point in time. The benefits valued are the member's accrued benefits and any contingent spouse's pension payable from the scheme or arrangement when the member leaves a scheme and chooses to transfer the benefits accrued in their former scheme. A CETV is a payment made by a pension scheme or arrangement to secure pension benefits in another pension scheme or arrangement when the member leaves a scheme and chooses to transfer the benefits accrued in their former scheme. The pension figures shown relate to the benefits that the individual has accrued as a consequence of their total membership of the pension scheme, not just their service in a senior capacity to which disclosure applies. The CETV figures, and from 2003-04 the other pension details, include the value of any pension benefit in another scheme or arrangement which the individual has transferred to the Board's pension arrangements and for which the Department of Finance and Personnel's Superannuation Scheme Vote has received a transfer payment commensurate with the additional pension liabilities being assumed. They also include any additional pension benefit accrued to the member as a result of their purchasing additional years of pension service in the scheme at their own cost. CETVs are calculated within the guidelines and framework prescribed by the Institute and Faculty of Actuaries and do not take account of any actual or potential reduction to benefits resulting from Lifetime Allowance Tax which may be due when pension benefits are drawn. Real increase in CETV This reflects the increase in CETV effectively funded by the employer. It takes account of the increase in accrued pension due to inflation, contributions paid by the employee (including the value of any benefits transferred from another pension scheme or arrangement) and uses common market valuation factors for the start and end of the period. EMOLUMENTS OF SENIOR POST HOLDERS AND MEMBERS BOARD MEMBERS

2009 £

The total emoluments (incl. honoraria) of the Chairperson serving during the year was

10,000

The highest payment for any other Board member was 1,714The aggregate amount of Board members emoluments was 30,735

No members waived emoluments. However, 4 members made no claim for emoluments

during the 2008/09 year.

38

REMUNERATION REPORT

The number of Board members who received emoluments falling within the range below: 2009 2008

£ Number Number1 - 4,999 28 28

5,000 - 5,999 6,000 - 6,999 7,000 - 7,999 8,000 - 8,999 9,000 - 9,999

10,000 - 10,999 1 1 11,000 - 11,999 12,000 - 12,999 13,000 - 13,999 14,000 - 14,999 15,000 - 15,999

J R Beggs Chairperson Date: 29 September 2009

G Topping Chief Executive Date: 29 September 2009

39

STATEMENT OF ACCOUNTING OFFICER'S RESPONSIBILITIES

Under Article 12 of the Education and Libraries (N.I.) Order 2003 the Board is required to prepare a statement of account in the form and on the basis directed by the Departments with the consent of the Department of Finance and Personnel. The accounts are prepared on an accruals basis and must give a true and fair view of the Board’s state of affairs at the year end and of its income and expenditure, total recognised gains and losses and cash flows for the financial year. In preparing the accounts the Chief Executive is required to: • Observe the Accounts Direction issued by the Departments including the relevant

accounting and disclosure requirements, and apply suitable accounting policies on a consistent basis;

• Make judgements and estimates on a reasonable basis; • State whether applicable accounting standards have been followed and disclose and

explain any material departures in the financial statements; and • Prepare the financial statements on the going concern basis, unless it is inappropriate

to presume that the Board's functions will continue in operation. The Accounting Officers of the Departments have designated the Chief Executive of the Board as the Accounting Officer for the Board. The Chief Executive’s relevant responsibilities as Accounting Officer, including responsibility for the propriety and regularity of the public finances and for the keeping of proper records, are set out in Managing Public Money Northern Ireland, issued by the Department of Finance and Personnel.

G Topping Accounting Officer Date: 29 September 2009

40

STATEMENT ON INTERNAL CONTROL Scope of Responsibility As Accounting Officer, I have responsibility for maintaining a sound system of internal control that supports the achievement of Board policies, aims and objectives, while safeguarding the public funds and the Board's assets for which I am personally responsible, in accordance with the responsibilities assigned to me in Managing Public Money (Northern Ireland). I provide assurance in respect of expenditure incurred by the Board on programmes and schemes funded by the Department of Education, the Department of Culture Arts and Leisure and Department for Employment and Learning. I also provide assurance in respect of the Board’s adjudication on entitlement to student loans and awards. In addition it is noted that the Department for Employment and Learning has commissioned external consultants to provide audit certifications in respect of entitlement to student loans and awards and other relevant expenditure. Relevant internal audit reports have also been forwarded to the Department for Employment and Learning. I am responsible for maintaining administrative structures which enable the Board to discharge its statutory duties which takes into account working with the Board's sponsoring departments, other Education and Library Boards and education, youth and library partners. The achievement of these responsibilities is discussed at regular Accountability Review meetings with the Permanent Secretary of the Department of Education and arrangements are in place to hold Accountability Review meetings with the Department of Employment and Learning and the Department of Culture, Arts and Leisure as required. On these occasions I normally accompany the Chairperson of the Board.

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 Board policies, aims and

objectives • 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 for the year ended 31 March 2009 and up to the date of approval of the Annual Report and Accounts, and accords with DFP guidance. Capacity to Handle Risk Leadership has been given to the risk management process by senior management ensuring that all service managers review and evaluate their key risks and controls on a regular basis. The Board has a Risk Management Strategy and Policy which are developed by the Risk Management Group and are endorsed by the Chief Executive and the Audit Committee. These documents specify the risk management process within the Board and set out the roles and responsibilities of officers and members.

41

STATEMENT ON INTERNAL CONTROL Internal Audit have provided assistance and written guidance to all service managers concerning the evaluation of risks and the completion of the required documentation. The Risk and Control Framework The Risk Management Strategy for the NEELB details a formal process for identifying, assessing, managing and monitoring risks faced by the Board, including a prioritisation methodology based on risk ranking of impact and likelihood.

Each service manager is responsible for

• identifying risks for their service • evaluating these risks in terms of impact and likelihood; and • establishing an adequate control mechanism, commensurate with the perceived level

of risk. This information is forwarded to the relevant Head of Department who determines whether the relationship between risk and control is appropriate. These risks are then incorporated into the Board risk register. Risk management is also a feature within the corporate and business planning process. The Senior Management Team have considered the Board’s objectives as detailed in the corporate plan and from these have identified corporate risks. Business managers, when completing their annual business plan, consider the risk impact of any proposed actions. Risk appetite is considered low when factors such as health and safety, delivery of major projects, government targets, budgetary control, data security and fraud are involved. The Board is very aware of the risks associated with Data Security, particularly following recent media coverage of major lapses in the secure handling and transmission of sensitive data by large public and private sector organisations. The Board has, in line with DE and DFP requirements, carried out a review of its Data Security policies and procedures to ensure all such processes are of an acceptable standard. This review has resulted in a number of additional measures being implemented across the Board with regard to security of physical and electronic data security and the development of an Action Plan aimed at ensuring all Data Security Measures within Board services are of the required standard and that all staff are aware of their responsibilities in this area. Board Officers continue to take steps to implement the Action Plan. Review of Effectiveness As Accounting Officer, I also have responsibility for reviewing the effectiveness of the system of internal control. My review of the effectiveness of the system of internal control is informed by the work of the internal auditors and the Heads of Department who have responsibility for the development and maintenance of the internal control framework, and comments made by the external auditors in their Report to those charged with Governance and other reports. I have been advised on the implications of the result of my review of the effectiveness of the system of internal control by the Board and the Audit Committee, and a plan to address weaknesses and ensure continuous improvement of the system is in place.

42

STATEMENT ON INTERNAL CONTROL

The Board, through its committees, maintains and reviews the system of internal control within the business divisions by continually monitoring the service being provided to customers to ensure it meets objectives set in the respective divisional Business Plans. Updates on Business Plans are provided to relevant committees on a termly basis. The Chairperson of the Audit Committee reports to the Board, on a regular basis, on Audit activity including risk management. The Chairman also presents the Committee's annual report to the Board. The Board continues to review its position in relation to the recommendations emanating from the Jack Report into the Financial Management Arrangements within BELB and SEELB and from the HELM Review of ELB Resource Budgeting, Accounting and Financial Control, Monitoring and Reporting Arrangements. Whilst it is noted that arrangements within the North Eastern Education and Library Board already, in the main, addressed the Jack and HELM Recommendations, Board officers continue to work with colleagues in other Boards, and within the sponsoring Departments, to ensure implementation of all recommendations. The Board has complied with the terms of the current relevant Dear Accounting Officer Letters (DAOs) issued by the Department of Finance and Personnel. In particular, grant and grant in aid received from the Departments has been used for the purposes intended; there was no novel or contentious expenditure for which the Department’s or/and DFP’s approval was not obtained; and all other financial transactions conformed to the authorities which governed them, including delegated authority to commit or incur expenditure and approvals sought from the relevant Department where required. Registers of Board members and staff interests have been established and are updated regularly. Conflicts of interest relating to Board members and staff, actual or potential, were appropriately managed and controlled. A Code of Conduct for Board staff has been established. A Code of Conduct for Board members has also been established and forwarded to the Department of Education for approval. An Anti-Fraud Policy and Fraud Response Plan have been developed and implemented. All suspected and proven frauds have been notified to the relevant Department in accordance with agreed procedures and there are no suspected frauds that have not yet been notified. Whistleblowing and Gifts and Hospitality policies are in place and have been issued to all staff in the Board. The Board's fraud risk analysis is also being developed. Appropriate complaints procedures for students, staff and the general public have been developed and implemented, including facilities under Whistle-blowing arrangements to complain direct to outside Agencies and sponsoring departments. Performance was monitored against both business objectives and the effectiveness of internal control arrangements. Throughout the 12 months ended 31 March 2009, internal control was adequate to provide reasonable assurance of: • effective and efficient operations; • integrity and accuracy of management information; • the safeguarding of assets; and • compliance with laws and regulations.

43

The Board via the Audit Committee receives periodic reports concerning internal control. There is a minimum of four Audit Committee meetings a year. Representatives of the Northern Ireland Audit Office (NIAO) attend each meeting of the Audit Committee and report the main findings and recommendations from their audits of the annual accounts and value for money reviews. Representatives from DE are also invited to attend each meeting. The Board has an Internal Audit Branch, which operates to the Government Internal Audit Standards defined by HM Treasury. Internal Audit submits regular reports to the Audit Committee, including the Head of Internal Audit's opinion on the adequacy and effectiveness of the Board's Risk Management, Control and Governance arrangements. In accordance with HM Treasury guidelines, the Audit Committee submitted its Annual Report to the Board in April 2009. Internal Audit was reviewed by the Department of Finance and Personnel during the year. A report of the Review was received during June 2008 and the overall opinion was that there is "partial compliance with minor areas of non-compliance with Government Internal Audit Standards requirements". The report and action plan was reviewed by the Audit Committee. It was agreed that the recommendations of the minor areas of non-compliance would be actioned as soon as possible. Significant Internal Control Problems Accounting Officer Authority As Accounting Officer I am responsible for expenditure, targets and controls concerning all activities within the NEELB. However, the level of direct authority or control that I have with regard to the Board's role in managing teacher absence, the planning and development of the school estate (including PPP Projects) and the implementation of salary policy for Principals, Vice-Principals and teaching staff is limited to those schools where the Board is the employing authority, i.e. the controlled sector. Establishment of ESA and NILA It has been decided, as part of the Northern Ireland Review of Public Administration, that the Board will cease to be responsible for Public Library Services with effect from 1 April 2009 upon the establishment of the Northern Ireland Library Authority (NILA). During 2008/09 Board officers have been working with the NILA Implementation Team to facilitate the transition of the relevant staff, assets, liabilities and responsibilities to the new authority on 1 April 2009. Board officers are currently developing a series of Service Level Agreements to support the continuing delivery of essential support services to NILA, e.g. Estates, Procurement and Payroll. In addition, it has been decided to defer the establishment of the Education and Skills Authority (ESA), subject to relevant legislation, until 1 January 2010 with the result that the North Eastern Education and Library Board will cease to operate on 31 December 2009. This is expected to include the transfer of responsibility for the sign off of the NEELB Annual Accounts for the year to 31 March 2010 to the Chief Executive of ESA. It is anticipated that, during the period to December 2009, Board Officers will be actively engaged with the ESA Implementation Team on convergence activity and in ensuring a smooth transition of staff, assets, liabilities and responsibilities to the new organisations. The Board has expressed concern that insufficient governance and project management structures are in place within the ESA Implementation Team to oversee a smooth transfer of responsibility from NEELB to ESA.

44

STATEMENT ON INTERNAL CONTROL Preparation for ESA The Board, in common with the education partners, is currently experiencing increased information demands arising from the preparatory work of establishing the ESA as a result of the Review of Public Administration. These increased demands, coupled with the Boards limited ability to fill vacant posts as a result of the RPA Vacancy Control Policy (which restricts the ability to make permanent appointments or to recruit externally), will result in increasing pressure on key staff that are also charged with meeting performance targets and maintaining business continuity during the period leading up to ESA. Child Protection Guidance The Board is committed to ensuring that arrangements are in place in relation to the adherence to Child Protection guidance, circulars and procedures. It is noted, that recent Department of Education Circulars are designed to ensure that all persons working in regulated positions as well as governors and volunteers are required to submit to revised vetting arrangements. From 1 April 2008 the Board has implemented revised procedures to comply with the new arrangements for vetting whereby the Board applies to AccessNI for Enhanced Disclosure Certificates for all persons working in regulated positions, volunteers and governors. The revised procedures also include the requirement to validate an applicant’s identity as part of the application process. In addition, the Board’s Designated Officers for Child Protection have made training available to Boards of Governors in relation to their specific roles and responsibilities in relation to Child Protection. Training has also been provided for newly appointed Designated Teachers as well as those staff who have been in post over an extended period of time. The Board has incorporated the guidance on safer recruitment practices into its Recruitment and Selection procedures and training provided to Boards of Governors emphasises the need to adhere to these procedures. It is noted, however, that the introduction of relevant legislation by the Department of Education is required to enable the Board to take the necessary steps to provide full assurance in relation to elements of the relevant circulars issued by the Department. End Year Flexibility – Funding Commitment On 27 November 2007 the Department of Education (DE) issued a direction to the Board to make a significant change to the 2006/07 Annual Accounts. This direction required the Board to change the Funding Commitment Disclosure Note (Note 35) of the Accounts as follows:

From:

“the year end position (2007) for DE and Youth represents a funding commitment/year end flexibility from the Department of a guaranteed resource which will be added to the Board’s approved spending limit in the next financial year.”

To: “the year end position (2007) for DE and Youth represents a funding commitment/year end flexibility from the Department of a guaranteed resource which will be added to the Board’s approved spending limit in future years.”

45

STATEMENT ON INTERNAL CONTROL This change carries significant risk for the Board in that it removes the Departmental Funding Commitment to allow full carry-over of Year End Balances into the next financial year. While DE continue to assure the Board that this funding will be available to Schools and Boards in future years, there is no commitment as to the particular financial year(s) in which this funding can be accessed or if access will be restricted to particular circumstances only as determined by the Department. While the Board has contained expenditure within the overall restriction on this Funding Commitment in 2008/09 as set out by DE it should be noted that the Board is faced with possible significant demands on the Job Evaluation Contingency which could crystallise during 2009/10 with obvious implications for the Board’s ability to live within the restricted funding available in the current financial year. It is essential, therefore, that Board access to this Funding Commitment is managed in such a manner as to ensure that there is no negative impact on the Board’s ability to meet its commitments and to deliver essential support services to schools during 2009/10. The Board is concerned that access to this funding commitment, created through prudent financial management in recent years, could be further restricted in 2009/10 at a time when the Board is likely to face significant financial pressures resulting from the continuing pace of the demographic downturn in the North Eastern area. It is essential that the Board has an early indication of access to this funding commitment in order that financial planning, and service delivery, decisions can be taken for the 2009/10 financial year on a fully informed basis. This is particularly important with regard to schools delegated budgets. It is essential that schools are assured they will have access to their delegated EYF when required, in accordance with their financial and development plans. Board officers will continue to address these issues with Departmental colleagues in an open and constructive manner and would hope that, through such an approach, the Board and Department can jointly manage the significant financial risks associated with this change of approach. Board Financial Systems The Board’s computerised financial systems do not easily facilitate in year completion of accounts on an accruals basis, leading to an increased risk of budget overspend due to in year revenue budget monitoring on a cash basis. Monthly management information, therefore, is based on cash expenditure adjusted for known material accruals (e.g. Job Evaluation Arrears, Pay Awards Outstanding, Prepayments). The Boards have developed a draft Business Case on e-procurement aimed at addressing these weaknesses utilising IT. It is felt, however, that this issue must be considered in the context of overall decisions to be taken forward by the ESA following implementation of the Review of Public Administration (RPA). Timing of Budget Allocations The current timescale for informing Boards of their initial allocation creates difficulties in ensuring corporate planning priorities adequately reflect the actual resources available to the Board. This delay also has implications for the timescale of the Board in setting budgets for the year and the availability of accurate budgetary information at the beginning of the financial year. In particular, allocation of earmarked funding is often delayed until well into the financial year, resulting in difficulties in planning the utilisation of resources. It is recognised that sponsoring departments have increased their engagement with Boards thus increasing the

46

awareness of all parties in forecasting the financial resources likely to be made available and the consequences on planning priorities. Data Security The Board is very aware of the risks associated with Data Security, particularly following recent media coverage of major lapses in the secure handling and transmission of sensitive data by large public and private sector organisations. The Board has, in line with DE and DFP requirements, carried out a review of its Data Security policies and procedures to ensure all such processes are of an acceptable standard. This review has resulted in a number of additional measures being implemented across the Board with regard to security of physical and electronic data security and the development of an Action Plan aimed at ensuring all Data Security Measures within Board services are of the required standard and that all staff are aware of their responsibilities in this area. In the 2008/09 financial year a review of Data Security arrangements at schools was completed and guidance will be issued to schools in 2009/10. Board partners will also be asked to provide an assurance on their arrangements to secure and protect data. Planned Maintenance The stringent budget allocation for 2008/2009 and the consequent continued reduction in the programme of planned maintenance have impeded the achievement of the Public Service Agreement (PSA) targets set by the Department of Education. Delegation to Schools NEELB continues to increase delegation of monies directly to schools, in line with Department of Education objectives to empower schools’ decision making and with ESA stated future policy to increase schools' autonomy. In the case of earmarked funding, this aim has to be balanced with my responsibility as Accounting Officer to ensure these funds are being used only for the purposes intended. NEELB continues to review and seek to improve our monitoring processes to ensure an appropriate balance between effective control of expenditure and imposition on schools of overly burdensome processes. Job Evaluation While the Board has completed the job evaluation process for the vast majority of staff over the last few years, the process is not yet finished and the Board is unable to ascertain with any certainty the value of the liability to the Board. Details of this are shown in the Contingent Liability note 28. Following the publication of a recent Public Accounts Committee Report, the Boards, through the Central Management Support Unit, have made significant progress in processing outstanding job evaluations and it is expected that the vast majority of evaluations and related payments will be complete by 31 December 2009. Common Funding Formula – EAL Pupils Funding is distributed to schools through the application of the Common Funding Formula. The data to populate the formula is collected for DE through the annual census return completed by each school and the Board is required to sign off on the accuracy of the data. The Board can only carry out a reasonableness check on the total data in the timeframe provided by DE before the funding is distributed but Internal Audit visit all schools annually to verify the accuracy of the census data. The funding to provide support for English as an

47

STATEMENT ON INTERNAL CONTROL Additional Language (EAL) is based on identifying those children who have “significant difficulties” with English for a number of specified reasons. Internal Audit can only verify that the pupil is properly enrolled and cannot verify that the criteria set out in the common scheme are being correctly interpreted by individual schools. Statutory Assessment Process As Accounting Officer, I am responsible for ensuring that 100% of statements of special educational need are drafted within the 18 week statutory timeframe, subject only to the exemptions outlined in the Code of Practice. This process is dependent on the advice of a range of professionals, including Health and Social Services as well as schools. Therefore the level of their resource and performance is not under my direct authority or control. The Board has worked with our statutory partners to assist them in relation to their statutory obligations. Teachers Premature Retirement Compensation Scheme Up to 2006/07 the PRCS scheme allowed teachers who retired prematurely to receive their pension early with no actuarial reduction and also to receive a discretionary award in the form of added years. This mechanism has allowed employing authorities to affect redundancies in a school arising, for example, from curriculum changes, rationalisation or falling enrolments. On 27 November 2007 the Boards were informed of a significant change to the operation of the Teachers Premature Retirement Compensation Scheme (PRCS) administered by the Department of Education. This letter informed Boards that this discretionary element of added years will no longer be funded by DE but must, if awarded, be met from Compensatory Authority (ELB) resources.

This guidance was further supplemented by the Department’s letter of 12 November 2008 which stated that regulations will be made to ensure that compensatory authorities are in future responsible for all costs associated with the premature retirement or enhanced severance of teachers. The Department have established a central fund in 2009/10 to allow Boards to offer some level of additional discretionary compensation in the case of bona fide redundancy arising from the abolition or suppression of a post due to: – School closure; – School amalgamation; – Falling enrolment; or – Deficit in school budget. This fund will be earmarked to meets demand across all employers.

In light of these funding changes this anticipated additional severance compensation fund will constitute the only affordable alternative for compensating redundant teachers and facilitating teacher reductions in schools in 2009. It is possible that these much delayed changes will inhibit the ability of Boards of Governors and Employing Authorities to secure voluntary redundancies with associated staff morale, governance, and financial implications in the declaration of Compulsory Redundancies.

48

STATEMENT ON INTERNAL CONTROL It is expected that over the coming months Boards will work with colleagues in DE and other education partners to manage the impact of the change to the enhanced redundancy compensation scheme. National Fraud Initiative (NFI) The Board, in conjunction with other public and private sector partners, is participating in NFI at the behest of the Audit Commission and Northern Ireland Audit Office (NIAO). The Audit Commission has recently presented the Board with a number of data matches for consideration and investigation. Based on the initial analysis of these matches it has been determined that the risk of a material fraud impacting upon the Board's annual accounts is low. However, until all matches have been considered and responses have been obtained from data match partners a full assurance on the outcome of this exercise cannot be given. NILGOSC Pension Fund

The Board’s non teaching employees belong to the Northern Ireland Local Government Officers Superannuation Scheme (NILGOSC). The latest actuarial valuation at 31 March 2007 identified a shortfall of £396m (in the whole scheme for all employers). In order to contain the growth of this deficit employer contribution rates increased from the 4.6% in 2004/05 to 13% in the current year with a commitment to increase further to 15%, 16% and 17% in 2008/09, 2009/10 and 2010/11 respectively. NEELB has, for the purposes of compliance with FRS17 “Retirement Benefits”, obtained an actuarial report based on the rolled forward value of the liabilities which indicated that as at 31 March 2009 the NEELB's net pension asset is an estimated liability of £82.8m.

G Topping Accounting Officer Date: 29 September 2009

49

THE CERTIFICATE AND REPORT OF THE COMPTROLLER AND AUDITOR GENERAL TO THE NORTHERN IRELAND ASSEMBLY I certify that I have audited the financial statements of the North Eastern Education and Library Board for the year ended 31 March 2009 under the Education and Libraries (Northern Ireland) Order 2003. These comprise the Operating Cost Statement, the Balance Sheet, the Cash Flow Statement and Statement of Recognised Gains and Losses and the related notes. These financial statements have been prepared under the accounting policies set out within them. I have also audited the information in the Remuneration Report that is described in that report as having been audited. Respective responsibilities of the Board, Chief Executive and Auditor The Board and Chief Executive as Accounting Officer are responsible for preparing the Annual Report, which includes the Remuneration Report, and the financial statements in accordance with the Education and Libraries (Northern Ireland) Order 2003 and Department of Education directions made thereunder and for ensuring the regularity of financial transactions. These responsibilities are set out in the Statement of Accounting Officer’s Responsibilities. My responsibility is to audit the financial statements and the part of the remuneration report to be audited in accordance with relevant legal and regulatory requirements, and with International Standards on Auditing (UK and Ireland). I report to you my opinion as to whether the financial statements give a true and fair view and whether the financial statements and the part of the Remuneration Report to be audited have been properly prepared in accordance with the Education and Libraries (Northern Ireland) Order 2003 and Department of Education directions made thereunder. I report to you whether, in my opinion, the information, which comprises the Directors’ Report and Management Commentary, included in the Annual Report is consistent with the financial statements. I also report whether in all material respects the expenditure and income have been applied to the purposes intended by Assembly and the financial transactions conform to the authorities which govern them. In addition, I report to you if the Board has not kept proper accounting records, if I have not received all the information and explanations I require for my audit, or if information specified by the Department of Finance and Personnel regarding remuneration and other transactions is not disclosed. I review whether the Statement on Internal Control reflects the Board’s compliance with the Department of Finance and Personnel’s guidance, and I report if it does not. I am not required to consider whether this statement covers all risks and controls, or form an opinion on the effectiveness of the Board’s corporate governance procedures or its risk and control procedures. I read the other information contained in the Annual Report and consider whether it is consistent with the audited financial statements. This other information comprises the Chairperson’s Statement, Directors’ Statement, Mission Statement, Strategic Themes, Equality Statement, Corporate Governance Arrangements, the Sustainability Report the unaudited part of the Remuneration Report. I consider the implications for my certificate if I become aware of any apparent misstatements or material inconsistencies with the financial statements. My responsibilities do not extend to any other information.

50

THE CERTIFICATE AND REPORT OF THE COMPTROLLER AND AUDITOR GENERAL TO THE NORTHERN IRELAND ASSEMBLY Basis of audit opinions I conducted my audit in accordance with International Standards on Auditing (UK and Ireland) issued by the Auditing Practices Board. My audit includes examination, on a test basis, of evidence relevant to the amounts, disclosures and regularity of financial transactions included in the financial statements and the part of the Remuneration Report to be audited. It also includes an assessment of the significant estimates and judgments made by the Board and Chief Executive in the preparation of the financial statements, and of whether the accounting policies are most appropriate to the Board’s circumstances, consistently applied and adequately disclosed. I planned and performed my audit so as to obtain all the information and explanations which I considered necessary in order to provide me with sufficient evidence to give reasonable assurance that the financial statements and the part of the Remuneration Report to be audited are free from material misstatement, whether caused by fraud or error, and that in all material respects the expenditure and income have been applied to the purposes intended by the Assembly and the financial transactions conform to the authorities which govern them. In forming my opinion I also evaluated the overall adequacy of the presentation of information in the financial statements and the part of the Remuneration Report to be audited. Opinions

In my opinion: • the financial statements give a true and fair view, in accordance with the Education

and Libraries Order (Northern Ireland) 2003 and directions made thereunder by the Department of Education, of the state of the Board’s affairs as at 31 March 2009 and of its net operating cost, recognised gains and losses and cash flows for the year then ended;

• the financial statements and the part of the Remuneration Report to be audited have been properly prepared in accordance with the Education and Libraries (Northern Ireland) Order 2003 and Department of Education directions made thereunder; and

• information, which comprises the Directors’ Report and the Management Commentary, included within the Annual Report, is consistent with the financial statements.

Opinion on Regularity In my opinion, in all material respects the expenditure and income have been applied to the purposes intended by the Assembly and the financial transactions conform to the authorities which govern them. Report I have no observations to make on these financial statements.

K J Donnelly Comptroller and Auditor General Northern Ireland Audit Office 106 University Street Belfast BT7 IEU Date: 30 September 2009

51

NORTH EASTERN EDUCATION AND LIBRARY BOARD

ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009

52

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009

OPERATING COST STATEMENT FOR THE YEAR ENDED 31 MARCH 2009 Notes

2009 £000

2008 £000

INCOME

Operating income 2 11,785 10,670

Grant income 3 126 118

TOTAL INCOME 11,911 10,788

EXPENDITURE

Staff costs 4 247,493 236,518

Other operating costs 5 77,350 72,557

Depreciation 6 & 13 15,492 23,063

Notional costs 7 540 531

TOTAL OPERATING COSTS 340,875 332,669NET OPERATING COST BEFORE FINANCING 328,964 321,881

Cost of capital charge 9 29,606 29,466

Interest payable 10 - 2

Interest receivable 11 - (1)

Other finance income 19 2,783 1,055

NET OPERATING COSTS AFTER FINANCING 361,353 352,403

Credit in respect of cost of capital and notional costs 7 & 9 (30,146) (29,997)

AMOUNT TRANSFERRED TO INCOME & EXPENDITURE RESERVE

21 331,207 322,406

All amounts above relate to continuing activities. The notes on pages 56 to 91 form part of these accounts

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NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 STATEMENT OF RECOGNISED GAINS AND LOSSES FOR THE YEAR ENDED 31 MARCH 2009

Notes

2009 £000

Restated2008£000

Net gain/(loss) on revaluation of fixed assets 23 (337,571) 438,229

Actuarial gain/(loss) on pension schemes 19 (29,899) 27,247

Prior year adjustment 22 - (664)

Recognised gains/(losses) for the year (367,470) 464,812

The notes on pages 56 to 91 form part of these accounts

54

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 BALANCE SHEET AS AT 31 MARCH 2009

Notes

2009 £000

Restated2008

£000Fixed Assets

Tangible assets 12 778,807 1,114,821Intangible assets 13 23 37 778,830 1,114,858

Debtors falling due after more than one year 15 - - Current Assets

Stocks 14 235 193Debtors 15 3,354 5,518Cash at bank and in hand 144 45 3,733 5,756

Current Liabilities

Creditors amounts falling due within one year 16 (32,680) (33,221)Net Current Assets (28,947) (27,465)

Total Assets Less Current Liabilities 749,883 1,087,393 Creditors amounts falling due after more than one year

16 - -

Provisions for liabilities and charges 18 (6,228) (4,772)Pension liability 19 (82,808) (50,977)Deferred income 20 (304) (416) Net Assets 660,543 1,031,228

Reserves Income & Expenditure Reserve 21 291,181 287,125Pension reserve 22 (82,808) (50,977)Other reserves 23 452,170 795,080 660,543 1,031,228

The Financial Statements on page 52 to 91 were approved by the Board on 29 September 2009 and were signed on its behalf by: Chairman: Date: 29 September 2009 Chief Executive: Date: 29 September 2009

The notes on pages 56 to 91 form part of these accounts.

55

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 CASH FLOW STATEMENT FOR THE YEAR ENDED 31 MARCH 2009

Notes

2009 £000

2008£000

Net cash inflow/(outflow) from operating activities

24(i) (309,782) (297,084)

Capital expenditure and financial investment 24(ii) (17,805) (13,676)

Net cash inflow/(outflow) before financing (327,587) (310,760)

Financing 24(iii) 328,381 309,156

Increase/(Decrease) in Cash 794 (1,604)

The notes on pages 56 to 91 form part of these accounts

56

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 1. STATEMENT OF ACCOUNTING POLICIES 1.1 Accounting Convention

These financial statements have been prepared in accordance with the Accounts Direction issued by the Department of Education on 19 November 2008 and in accordance with applicable Accounting Standards under the modified historic cost convention.

Without limiting the information given the financial statements comply with the accounting and disclosure requirements of the Companies (Northern Ireland) Order 1986, the accounting standards issued or adopted by the Accounting Standards Board and accounting and disclosure requirements issued by the Department of Finance and Personnel, insofar as those requirements are appropriate.

1.2 Recognition of Income

Grants and grants in aid to the extent of funds drawn-down from Departments (DE, DCAL, DEL, DHSS & PS) for revenue and capital purposes are treated as contributions from controlling parties giving rise to a financial interest in the residual interest of the body and hence should be accounted as financing i.e. by crediting them to the income and expenditure reserve. Revenue grant from other bodies received for specific purposes that is restricted income, are included in the operating cost statement to the extent of matching the relevant expenditure incurred during the period. Restricted income received but not matched to relevant expenditure during the period is shown as deferred income on the balance sheet. Income from services rendered is included in the operating cost statement to the extent of the completion of the contract or service concerned. All income from short-term deposits is credited to the operating cost statement in the period in which it is earned. On the basis of their immateriality within the total Board's Property Estate, capital funding received from the New Opportunities Fund (NOF) and European Union (EU) sources are treated as grant-in-aid. The unrealised element of the cumulative balance of indexation and revaluation adjustments is accounted for in the Revaluation Reserve. This treatment represents a departure from FReM which directs that they be treated as grant funding accounted for through the Government Grant Reserve.

1.3 Foreign Currency Transactions

Transactions in foreign currencies are recorded using the rate of exchange ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the rates of exchange ruling at the end of the financial period with all resulting exchange differences being taken to the operating cost statement in the period in which they arise.

57

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 1. STATEMENT OF ACCOUNTING POLICIES (cont'd …) 1.4 Taxation

The Board is exempt from corporation tax on income it receives. Items in the operating cost statement are net of recoverable VAT.

1.5 Fixed Assets

All spending on a fixed asset which yields a benefit for a period of more than one year is treated as capital expenditure in the accounts. This excludes expenditure on repairs and maintenance of fixed assets which only maintains the value of the asset.

1.5.1 Tangible Assets

1.5.1.1 Land and Buildings

All land and buildings are capitalised and stated in the balance sheet at valuation on the basis of depreciated replacement cost. Properties which are not in any operational use for the purposes of the Board have been valued on a market value basis. The five Boards have agreed a five year rolling programme of full valuations with the Land and Property Services (LPS). Full valuations are made by the Land and Property Services (LPS) every five years and in the intervening years these valuations are updated by the LPS using appropriate indices. Land and buildings acquired during the year are included in the balance sheet. Completed building projects will be capitalised but not depreciated until commissioned. On-going building projects are categorised as assets in the course of construction and shown separately. Project costs capitalised include design and related fees as well as construction costs. Where land and buildings are acquired with the aid of specific grants they are capitalised and depreciated as above. The related grants are credited to the Income and Expenditure Reserve.

1.5.1.2 Maintained Schools

Land and buildings shown in the financial statements do not include any maintained schools, the assets of which belong to their trustees, apart from school meals kitchens accommodation operating on these sites which are owned by Education and Library Boards (ELBs). The Board, however, is responsible for buildings and grounds maintenance at these schools, as well as providing them with certain other services and with 100% funding for general running costs under LMS. These costs are reflected in the Board’s operating cost statement.

1.5.1.3 Donated Asset

Donated tangible fixed assets are capitalised at their valuation on receipt. This value is credited to the donated asset reserve. Subsequent re-valuations are also taken to this reserve. Each year an amount equal to the depreciation charge on the asset is released from the donated asset reserve to the operating cost statement.

58

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 1. STATEMENT OF ACCOUNTING POLICIES (cont'd …) 1.5.1.4 Assets other than Land and Buildings

Assets other than land and buildings costing less than £3,000 per individual item are written off to the operating cost statement in the period of acquisition. Assets are valued each year using appropriate indices or professional valuations.

1.5.1.5 Depreciation

Depreciation is provided for all fixed assets with a finite useful life, by allocating the cost (or revalued amount) less estimated residual value of the assets as fairly as possible to the periods expected to benefit from their use. Useful lives are estimated on a realistic basis, reviewed annually and adjusted prospectively over the revised economic life where appropriate.

1.5.2 Intangible fixed assets

Intangible fixed assets are capitalised when they are capable of being used in the Board for more than one year; they can be valued; and they have a cost of least £3,000.

1.5.2.1 Software licences

Purchased computer software licences are capitalised as intangible fixed assets where expenditure of at least £3,000 is incurred. They are amortised over the shorter of the term of the licence and their useful economic lives.

1.5.2.2 Amortisation

Amortisation is provided for all intangible fixed assets with a finite useful life, by allocating the cost (or revalued amount) less estimated residual value of the assets as fairly as possible to the periods expected to benefit from their use. Useful lives are estimated on a realistic basis, reviewed annually and adjusted prospectively over the revised economic life where appropriate.

All assets are depreciated on a straight line basis over their expected useful lives. A full month’s depreciation is charged in the period of acquisition/commissioning and no depreciation charged in the month of disposal. Assets in the course of construction are not depreciated until brought into use. Depreciation will not normally be provided for on freehold land unless subject to depletion or on assets which are identified as surplus to requirements and held pending disposal.

59

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 1. STATEMENT OF ACCOUNTING POLICIES (cont'd …)

The following useful economic lives should where necessary be used as approximations to the levels estimated annually: Asset Class Asset Sub-Class Asset Life

Lands Land Not Depreciated

Buildings Permanent Buildings 50 years Temporary Buildings 15 years

Computers Hardware and Software 3 years

Plant and Equipment Reprographics 7 years Machinery 15 years Music 10 years Grounds Maintenance 7 years General and Other 10 years Cleaning 7 years

Vehicles Small Mini-buses 5 years 33 Seater Mini-buses 10 years > 33 Seater Mini-buses 14 years Vans 5 years Grounds Maintenance 7 years Mobile Libraries 10 years Cars 4 years

Miscellaneous Library Books – Books and Collections Not Depreciated

Intangible Assets Software licences 3 years 1.6 Stocks

It is policy to carry stock for the meals service and maintenance and central depots. Stocks are stated at the lower of current replacement cost and net realisable value. Where necessary, provision is made for obsolete, slow moving and defective stocks.

1.7 Pension Scheme

The Board’s employees belong to two principal schemes, the Teachers’ Superannuation Scheme (TSS), the Northern Ireland Local Government Officer’s Superannuation Committee Scheme (NILGOSC).

60

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 1. STATEMENT OF ACCOUNTING POLICIES (cont'd …)

The Teachers’ Superannuation Scheme is a contributory scheme administered by the Department of Education. The conditions of the Superannuation (NI) Order 1972, the Teachers’ Superannuation Regulations (NI) 1977 and subsequent amendments apply to the scheme. The scheme is presently notionally funded. The rate of the employer’s contribution is determined from time to time by the Government actuary and advised by the Department of Finance and Personnel. The scheme is administered by the Department of Education, Rathgael House, Balloo Road, Bangor. The Northern Ireland Local Government Officers’ Superannuation Committee Scheme is of the defined benefits type, the assets of the schemes being held in separate trustee administered funds. The Board’s contribution to the Northern Ireland Local Government Pension Scheme is determined by the fund’s actuary based on a triennial valuation. The scheme is administered by NILGOSC, Holywood Road, Belfast. In accordance with FRS 17 ‘Retirement Benefits’, changes in the defined benefit pension scheme asset or liability arising from factors other than cash contribution by the Board are charged to the operating cost statement or the statement of recognised gains and losses. The pension costs are assessed in accordance with the advice of independent qualified actuaries using the projected unit method.

1.8 Reserves

The Income and Expenditure Reserve represents the total assets less total liabilities of the Board to the extent that the total is not represented by other reserves. The Pension Reserve represents the cumulative balance on relevant pension funds.

Other Reserves

• The Government Grant Reserve represents the movement of fixed assets

in line with the accounting guidance within the Financial Reporting Manual (FReM).

• The Revaluation Reserve reflects the unrealised element of the cumulative balance of indexation and revaluation adjustments (excluding donated assets).

• The Special Book Reserve represents the valuation of the special library book collection.

• The Grant Reserve represents the surplus of grant income over expenditure.

61

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 1. STATEMENT OF ACCOUNTING POLICIES (cont’d…)

• The Private Finance Initiative (PFI) Reserve represents the balance of the sale proceeds that is available to offset against the recurrent PFI prepayment and the capitalised element of the residual value of the asset over the period of the PFI scheme.

• The Donated Assets Reserve and Revaluation reserve will depend on the application of the accounting guidance within the Financial Reporting Manual (FReM).

1.9 Finance and Operating Leases

Operating lease rentals are charged to the operating cost statement in equal annual amounts over the lease term. Leasing agreements which transfer to the Board substantially all benefits and risks of ownership of an asset, are treated as if the asset had been purchased outright.

The assets are included in fixed assets and the capital element of the leasing commitments is shown as obligations under finance leases. The lease rentals are treated as consisting of capital and interest elements. The capital element is applied to reduce the outstanding obligations and the interest element is charged against income in proportion to the reducing capital element outstanding. Assets held under finance lease are depreciated over the useful lives of equivalent owned assets.

1.10 Private Finance Initiative

The Board follows HM Treasury’s “Technical Note 1 (Revised) How to Account for PFI Transactions” which provides guidance for the application of the FRS 5 Amendment. The South Eastern Education and Library Board has responsibility on behalf of all 5 Boards for the Board’s Oracle financial IT system. This is a PFI scheme, the purpose of which is to provide an IT system to support the financial and management needs of the Boards in light of the requirements of Resource Accounting. The Western Education and Library Board has responsibility on behalf of all five Boards for the Classroom 2000 Project. This is a PFI scheme, the purpose of which is to design, develop and operate an ICT infrastructure to support the curriculum, management and information needs of the major bodies within the Education Service in Northern Ireland. The North Eastern Education and Library Board has responsibility on behalf of all five Boards for the Electronic Libraries for Northern Ireland (ELFNI) Project. This is a PFI Scheme to deliver public access to electronic information through the public library network and to provide new Library management systems.

62


1.11 Financial Instruments 1.11.1 Financial Assets

Financial assets are recognised on the balance sheet when the North Eastern Education and Library Board becomes party to the financial instrument contract or, in the case of trade receivables, when the goods or services have been delivered. Financial assets are derecognised when the contractual rights have expired or the asset has been transferred. Financial assets are initially recognised at fair value. Financial assets are classified into the following categories: financial assets at 'fair value through profit and loss'; 'held to maturity investments'; 'available for sale' financial assets, and 'loans and receivables'. The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition.

1.11.1.1 Available for sale financial assets

Available for sale financial assets are non-derivative financial assets that are designated as available for sale or that do not fall within any of the other three financial asset classifications. They are measured at fair value with changes in value taken to the revaluation reserve, with the exception of impairment losses. Accumulated gains or losses are recycled to the Operating Cost Statement on de-recognition.

1.11.1.2 Loans and receivables

Trade receivables, loans and other receivables are non-derivative financial assets with fixed or determinable payments which are not quoted in an active market. After initial recognition, they are measured at amortised cost using the effective interest method, less any impairment. Interest is recognised using the effective interest method, except for short-term receivables where the recognition of interest would be immaterial. The effective interest method is a method of calculating the amortised cost of a financial asset and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset. Receivables are assessed for indicators of impairment at each balance sheet date. Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the investment have been impacted. The amount of the impairment is the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. The carrying amount of the financial asset is reduced by the impairment loss directly for financial assets other than trade receivables, where the carrying amount is reduced through an allowance for irrecoverable debts, changes in which are recognised in the Operating Cost Statement. If, in a subsequent

63


period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed through the Operating Cost Statement to the extent that the carrying amount of the receivable at the date of the impairment is reversed does not exceed what the amortised cost would have been had the impairment not been recognised.

1.11.2 Financial Liabilities Financial liabilities are recognised on the balance sheet when the North Eastern Education and Library Board becomes party to the contractual provisions of the financial instrument or, in the case of trade payables, when the goods or services have been received. Financial liabilities are derecognised when the liability has been discharged, that is, the liability has been paid or has expired. Financial liabilities are initially recognised at fair value. Financial liabilities are classified as either financial liabilities 'at fair value through profit and loss' or other financial liabilities.

1.11.2.1 Other financial liabilities After initial recognition, all other financial liabilities are measured at amortised cost using the effective interest method. The effective interest rate is the rate that exactly discounts estimated future cash payments through the life of the asset, to the net carrying amount of the financial liability. Interest is recognised using the effective interest method.

64

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 2. OPERATING INCOME 2009

£000 2008

£000 Catering operations 6,518 6,069

Other income generating activities 2,060 1,931

Miscellaneous 3,207 2,670

11,785 10,670 3. GRANT INCOME 2009

£000 2008

£000 European funds 110 54

New Opportunities Fund/Big Lottery 12 64

Other Funds 4 -

126 118

65

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 4. STAFF NUMBERS AND RELATED COSTS

Staff Costs comprise: Permanently

employed 2009 £000

Temporary employed

2009 £000

Others 2009 £000

Total 2009 £000

Total 2008 £000

Teaching

Wages and salaries 120,753 13,477 44 134,274 128,885

Social Security costs 9,418 953 - 10,371 10,138

Pension costs 16,654 1,338 - 17,992 17,214

Other employee expenses

3,395 - - 3,395 4,587

150,220 15,768 44 166,032 160,824

Non Teaching (including Board Members)

Wages and salaries 56,223 11,824 1,208 69,255 65,011

Social Security costs 3,294 575 57 3,926 3,726

Pension costs 6,513 483 96 7,092 5,815

Other employee expenses

1,188 - - 1,188 1,142

67,218 12,882 1,361 81,461 75,694

TOTAL 217,438 28,650 1,405 247,493 236,518

Average Staff Numbers (FTE’s)

Permanently employed

2009 £000

Temporary employed

2009 £000

Others 2009 £000

Total 2009 £000

Total 2008 £000

Teaching 3,106 794 2 3,902 3,968

Non Teaching 3,309 523 60 3,892 3,733

TOTAL 6,415 1,317 62 7,794 7,701

The following additional staff costs were capitalised during the year £125,000 (2008: £120,000) and are included in note 12.

66

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 5. OTHER OPERATING COSTS

2009 £000

2008 £000

Premises, fixed plant and grounds 24,004 20,086

Supplies and services 25,937 24,334

Transport 19,309 17,743

Establishment 4,386 3,548

Grants to persons/bodies: DHSS&PS

441

428

Other 3,415 3,278

Pension Costs (Note 19) (851) 2,578

Permanent impairment of fixed assets - -

(Profit)/Loss on disposal of fixed assets 32 (16)

Miscellaneous 677 578

77,350 72,557 OTHER OPERATING COSTS INCLUDE: Operating leases – hire of plant and machinery 227 165

Operating leases – property 232 214

Hospitality 1 -

Private Finance Initiative (PFI) 3,899 3,652

4,359 4,031 6. DEPRECIATION 2009

£000 2008

£000 Owned tangible assets 13,349 13,885

Amortisation of intangible fixed assets 14 5

Assets held under finance leases and hire purchase agreements

- -

Deficit on revaluation 2,129 9,173

15,492 23,063

67

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 7. NOTIONAL COSTS 2009

£000 2008

£000 Auditors' remuneration 36 37

Land and Property Services 1 99

Teachers’ payroll 503 395

540 531 8. INTER BOARD TRADING

During the year the Board earned £nil from the selling of services and purchased £nil of services from the other Boards.

9. COST OF CAPITAL CHARGE 2009

£000 2008

£000 Use of capital 29,606 29,466

29,606 29,466 The Board bases the cost of capital calculation on the total assets less total liabilities. The cost of capital percentage for the year ended 31 March 2009 is 3.5% (31 March 2008: 3.5%). 10. INTEREST PAYABLE 2009

£000 2008

£000 On finance leases - -

Other - 2

- 2 11. INTEREST RECEIVABLE 2009

£000 2008

£000 Bank interest - -

Other - 1

- 1

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NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 12. TANGIBLE FIXED ASSETS Land &

Buildings Vehicles Computers Plant,

Equipment & Misc

Assets in course of

Construction

Total

£000 £000 £000 £000 £000 £000 Cost or Valuation At 1 Apr 2008

1,097,482

8,499

2,003

10,470

6,522

1,124,976

Additions - 710 125 1,200 15,462 17,497 Asset Transfer 7,949 - - - (7,949) - Disposals (391) (339) (22) (217) - (969) Revaluation (340,428) 1,108 94 (14) - (339,240) Permanent Impairment of value

-

-

-

-

-

-

At 31 Mar 2009 764,612 9,978 2,200 11,439 14,035 802,264 Depreciation At 1 Apr 2008 - 4,446 1,801 3,908 - 10,155 Disposals (2) (295) (22) (186) - (505) Backlog Depreciation

-

-

-

-

-

-

Charge for period 11,632 822 134 761 - 13,349 Deficit on revaluation

2,126

-

-

3

-

2,129

Revaluation (2,375) 621 89 (6) - (1,671) At 31 Mar 2009 11,381 5,594 2,002 4,480 - 23,457 Net Book value at 31 Mar 2009

753,231

4,384

198

6,959

14,035

778,807

Net Book value at 1 Apr 2008

1,097,482

4,053

202

6,562

6,522

1,114,821

Asset Financing

Owned 664,103 4,384 198 6,959 14,035 689,679

Short leasehold 340 - - - - 340

Long leasehold 88,788 - - - - 88,788

Net Book value at 31 March 2009

753,231

4,384

198

6,959

14,035

778,807

The Land and Property Services undertook a complete independent revaluation of all land and buildings as at 31 March 2008 on a depreciated replacement cost basis. Should fixed assets be sold, proceeds from the sale must be surrendered to the Departments.

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NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 12. TANGIBLE FIXED ASSETS (cont'd)

The net book value of tangible fixed assets includes an amount of £2,618,860 (2008: £3,787,596) in respect of assets held in Reversionary Trusts i.e. if properties cease to be used as specified in the deeds they will revert to the ownership of the trustees.

As described in note 1.5.1.2, the amount of land and buildings noted does not include maintained schools, apart from school meals kitchens accommodation operating on these sites which are owned by ELB’s. In 2008/2009 there were 90 such schools in the Board’s area.

Tangible fixed assets include £2,036,000 in relation to a special collection of library books which have been valued by De Burca Rare Books Ltd on 31 March 2006. The library books have been valued on an open market, existing use basis and have not been depreciated. The next revaluation is due to be carried out during 2010/11.

The net book value of tangible fixed assets includes an amount of nil (2008: nil) in respect of donated assets.

13. INTANGIBLE FIXED ASSETS 2009

£000 Cost of valuation At 1 April 2008 42Additions -Donations -Disposals -Revaluation -At 31 March 2009 42 Amortisation At 1 April 2008 5Charged in year 14Disposals -Revaluation -At 31 March 2009 19 Net book value at 31 March 2009 23

14. STOCK 2009

£000 2008

£000Catering 144 115

Maintenance and central depots 91 78

235 193

70

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 15. DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR 2009

£000 2008

£000

Trade debtors 702 973

Amount owed by boards 49 31

PFI prepayment - -

Other prepayments and accrued income 778 906

Recoverable VAT: HMRC 1,508 3,536

Other debtors 317 72

TOTAL 3,354 5,518 DEBTORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR 2009

£000 2008

£000

Trade debtors - -

Prepayments and accrued income - -

Other debtors - -

TOTAL - - 16. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR 2009

£000 2008

£000

Bank overdrafts 182 877

Trade creditors 8,945 7,466

Obligations under finance leases - -

Amount owed to Boards 200 187

Other taxation and Social Security: HMRC

1,671

1,401

Accruals 19,949 21,577

Other creditors 1,733 1,713

TOTAL 32,680 33,221 CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR 2009

£000 2008

£000

Obligations under finance leases - -

Other creditors - -

TOTAL - -

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NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 17. ANALYSIS OF BORROWINGS OF THE BOARD: FINANCE LEASES

2009 £000

2008£000

The net finance lease obligations to which the Board is committed are:

In one year or less - -

Between one and two years - -

Between two and five years - -

Over five years - -

- - 18. PROVISIONS FOR LIABILITIES AND CHARGES Employer &

Public Liability Claims £000

Premature Retirement

£000

Job

Evaluation £000

Other £000

Total £000

At 1 April 2008 1,453 3,285 - 34 4,772

Provided in the year

1,986 - - 192 2,178

Provisions not required written back

(198) (10) - - (208)

Provisions utilised in the year

(548) (244) - - (792)

Unwinding of discount

- 278 - - 278

At 31 March 2009 2,693 3,309 - 226 6,228 Employer and Public Liability Claims These are claims against the Board submitted by members of staff and/or the public in relation to accidents or incidents, which have happened before the balance sheet date. Claims which are not considered dormant or statute barred by the passage of time since being lodged, but have progressed sufficiently to allow an estimated “settlement” figure to be calculated, are included in the provision. Estimates are calculated by reference to analysis of previous claims of a similar type, the previous history of successful settlements and professional judgement.

72

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 18. PROVISIONS FOR LIABILITIES AND CHARGES (cont'd…)

The possible timing of payments in settlement of such cases is uncertain; it is plaintiff driven and the case’s progress is dependant on individual circumstances of that case. As a case progresses and more information becomes available the amount of the estimated “settlement” figure may in subsequent years be revised up or down. Premature retirement provision for non-teaching staff This provision refers only to those previous employees of the Board who have retired and are in receipt of current pension benefits augmented by compensatory added years of pensionable service. The provision is calculated by reference to their current age at the balance sheet date, and actuarial indexation factor which anticipates future life expectancy, and the actual current pension being paid in the current year. The product of this calculation is an estimate of the future liability of the Board in respect of these former employees. Payments in relation to this provision will be ongoing on a monthly basis. Job Evaluation This provision refers to employees, whose posts are due to be evaluated under the job evaluation scheme. As a result employees may be regraded to a higher grade and therefore entitled to a higher salary from the date additional duties were undertaken. The provision is made only in respect of those employee categories where it is probable that a liability will arise and where the Board is able to make a reasonable estimation of the arrears liability. The timing of such payments is likely to vary for the different categories of staff. However, the board makes every effort to progress payments as soon as possible, once union and individual agreement has been formally reached The level of information available on which to base estimates for arrears, increases the closer a staff category is to completion of the job evaluation process.

Other – Music Tutors Evaluation This provision relates to employer costs for restructuring of music tutors salaries and a business case has been forwarded to the Department of Education for approval.

Premature Retirement for teachers As directed by the Department of Education, with the consent of the Department of Finance and Personnel a provision has not been included in Board accounts for future liabilities in respect of existing teacher premature retirement cases. It is agreed that any assessment of future financial liabilities in this regard should be reflected in the Teacher’s Superannuation Account (part of the Departmental Accounting structure).

73

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 18. PROVISIONS FOR LIABILITIES AND CHARGES (cont'd…)

The in-year charge in respect of such cases as well as requisite employer superannuation contributions is charged to the Board’s income and expenditure account. In that respect the number of premature retirement compensation cases is as follows.

Numbers2008-2009 46

Cumulative to March 2009 1,693 19. PENSION AND SIMILAR OBLIGATIONS

As explained in the Accounting Policies (Paragraph 1.7) the Board participates in two principal schemes, the Teachers’ Superannuation Scheme (TSS) and the Northern Ireland Local Government Officers’ Superannuation Committee (NILGOSC).

The Board has included pension costs totalling £25.084m in relation to the two schemes.

For 2008/09 the employer’s contribution rates to the Teacher’s Superannuation Scheme was 13.6

For 2008/09 the employer’s contribution rate to the Northern Ireland Local Government Pension Scheme was 15%.

NILGOSC is a multi-employer defined benefit scheme in which it is possible for an employer to identify its share of the assets and liabilities on a consistent basis. The latest formal valuation of the fund for the purpose of setting employer’s actual contributions was at 31 March 2007, with the next formal valuation due at 31 March 2010. A valuation was carried out by a qualified independent actuary for the purposes of meeting the requirements of FRS17 for the North Eastern Education and Library Board for these accounts. The major assumptions used by the actuary were:

At 31 March 2009 At 31 March 2008 Rate of increase in salaries 4.6% 5.1%

Rate of increase in pensions 3.1% 3.6%

Discount rate 6.9% 6.9%

Inflation assumption 3.1% 3.6%

74


NOTES TO THE FINANCIAL STATEMENT FOR THE YEAR ENDED 31 MARCH 2009 19. PENSION AND SIMILAR OBLIGATIONS (cont’d…)

The assets in the scheme and the expected rate of return were:

Long term return at 31 March

2009 % per annum

Assets at 31 March

2009 £000

Long term return at 31 March

2008 % per annum

Restated Assets at 31 March

2008 £000

Equities 7.0% 92,965 7.7% 128,187

Bonds 5.4% 17,829 5.7% 18,840

Property 4.9% 8,914 5.7% 13,201

Cash 4.0% 7,641 4.8% 2,514

Total market Value of assets

127,349 162,742

Present value of funded liabilities

(205,880) (209,317)

Present value of unfunded liabilities

(4,277) (4,402)

Net pension asset/(liability)

(82,808) (50,977)

The Fund's objective of holding sufficient assets to meet the estimated current cost of providing members' past service benefits was not met at the last formal valuation date. The current funding level is 89% at 31 March 2007 (85% at 31 March 2004) leaving a funding shortfall of £396m. In order to contain the growth of the deficit, employer contribution rates increased from 4.6% in 2004/05 to 15% in the current year with a commitment to increase further to 16% and 17% in 2009/10 and 2010/11 respectively.

Amount charged to operating profit 2009

£000 2008

£000

Current service cost 6,039 8,330

Past service cost - -

Curtailments and settlements 175 79

Decrease in irrecoverable surplus - -

Total operating charge 6,214 8,409

75


NOTES TO THE FINANCIAL STATEMENT FOR THE YEAR ENDED 31 MARCH 2009 19. PENSION AND SIMILAR OBLIGATIONS (cont’d…)

Amount credited to other finance income 2009

£000 2008

£000

Expected return on employer assets 12,025 12,237

Interest on pension scheme liabilities (14,809) (13,292)

Net return (2,784) (1,055) Reconciliation of Defined Benefit Obligation

2009 £000

Restated2008£000

Opening Defined Benefit Obligation 213,719 244,650

Current service cost 6,039 8,330

Interest cost 14,809 13,292

Contributions by members 2,596 2,492

Actuarial Losses/(Gains) (20,209) (47,236)

Past Service Costs/(Gains) - -

Losses/(Gains) on curtailments 175 79

Liabilities extinguished on settlements - -

Liabilities assumed in a business combination - -

Exchange differences - -

Estimated unfunded benefits paid (268) (259)

Estimated benefits paid (6,704) (7,629)

Closing Defined Benefit Obligation 210,156 213,719

76

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 19. PENSION AND SIMILAR OBLIGATIONS (cont'd)

Reconciliation of Fair Value of Employer Assets

2009 £000

Restated2008£000

Opening Fair Value of Employer Assets 162,742 170,059

Expected return on assets 12,025 12,237

Contributions by members 2,596 2,492

Contributions by the employer 6,797 5,572

Contributions in respect of unfunded benefits 268 259

Actuarial Gains/(Losses) (50,107) (19,989)

Assets distributed on settlements - -

Assets acquired in a business combination - -

Exchange differences - -

Unfunded benefits paid (268) (259)

Benefits paid (6,704) (7,629)

Closing Fair Value of Employer Assets 127,349 162,742

Amounts for the current and previous accounting periods

2009 £000

Restated2008£000

Fair value of employer assets 127,349 162,742

Present value of defined benefit obligation (210,156) (213,719)

Surplus/(Deficit) (82,808) (50,977)

Experience Gains/(Losses) on assets (50,107) (19,989)

Experience Gains/(Losses) on liabilities (53) 9,041

Amounts Recognised in Statement of Recognised Gains and Losses (SRGL)

2009 £000

Restated2008£000

Actuarial Gains/(Losses) (29,899) 27,247

Increase/(Decrease) in Irrecoverable Surplus from Membership

- -

Actuarial Gains/(Losses) recognised in STRGL (29,899) 27,247

Cumulative Actuarial Gains and Losses (31,578) (1,679)

77


Prior Year Adjustment As a result of Quoted Securities being required to be valued at their bid price as opposed to the previous mid market price a prior year adjustment of (£664k) will be included in 2008 in the SRGL. Sensitivity analysis FRS17 valuation results depend critically on the principal assumptions used in the calculations. The sensitivity of the principal assumptions used to measure the liabilities is discussed below. The discount rate used to value the liabilities is prescribed under FRS17 and the results are particularly sensitive to the discount rate. If the yield used to discount each future benefit payment decreases, then the value placed on the liabilities increases. The results are also sensitive to unexpected changes in the rate of future mortality improvements. If longevity improves at a faster rate than allowed for in the assumptions then, again, a higher value would be placed on the Employer's liabilities. In addition, if pensionable pay increases more than allowed for in the assumptions, the active liability will increase. Similarly, if inflation (and therefore pension increases) is higher than assumed, this will increase the value of the liabilities. If the liabilities increase, the Employer's balance sheet position will worsen. The sensitivities regarding the principal assumptions used to measure the scheme liabilities as at 31 March 2009 are set out below.

Assumptions

Change in assumption

Approximate Impact on Employer FRS17

Liabilities as at 31 March 2009

Discount rate Rate of inflation Rate of real salary growth Rate of mortality

Increase/decrease by 0.5% p.a. Increase/decrease by 0.5% p.a. Increase/decrease by 0.5% p.a. Increase in life expectancy of 1 year

Increase/decrease by: c. 9%. Increase/decrease by: c. 10%. Increase/decrease by: c. 4% resp. Increase by: c. 3.5% - 4.5% resp.

Each factor is considered in isolation i.e. the "impact on liability" assumes all other factors are constant.

78


Commentary on mortality assumptions The mortality assumptions affect the length of time the benefits would be expected to be paid for. The mortality assumptions adopted are based on the PFA92 and PMA92 tables, projected to calendar year 2033 for non pensioners and 2017 for pensioners. Based on these assumptions, the average future life expectancies at age 65 are summarised below: Males Females Current pensioners Future pensioners

19.6 years

20.7 years

22.5 years

23.6 years

20. DEFERRED INCOME – DEFERRED GRANTS 2009

£000 2008

£000

External Funding Bodies 304 416

Other - -

304 416

79

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 21. INCOME & EXPENDITURE RESERVE 2009

£000 2008

£000

As 1 April 2008 287,125 325,592

Operating Cost Statement (331,207) (322,406)

Recurrent Funding:

DE Schools 293,534 280,860

DE Youth 5,345 4,800

DCAL 9,508 9,344

DEL 2,097 1,006

DHSS&PS 442 538

Capital Funding:

DE Schools 15,329 11,595

DE Youth 600 680

DCAL 1,262 333

Other [NOF] 264 319

Transfer to/from Pension reserve 1,932 3,633

Transfer to/from Grant Reserve - 150

Transfer to/from Revaluation Reserve 5,122 12,643

Transfer to/from General Reserve 126 (11)

Disposal of Fixed Assets (298) (752)

At 31 March 2009 291,181 287,125

80

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 22. PENSION RESERVE

2009 £000

Restated2008£000

At 1 April 2008 as previously stated (per audited accounts) (50,313) (74,591)

Prior year adjustment (664) -

Restated as at 1 April 2008 (50,977) -

In year actuarial gain/(loss) (29,899) 27,247

Transfer to/from Income & Expenditure Reserve (1,932) (3,633)

At 31 March 2009 (82,808) (50,977) Prior Year Adjustment As a result of Quoted Securities being required to be valued at their bid price, a Prior Year Adjustment of £664,000 has been accounted for in the Pension Reserve. This adjustment is also shown on the face of the SRGL.

23. OTHER RESERVES

Reval Reserve

£000

Special Book

Reserve £000

General Reserve

£000

Grant

Reserve £000

Total £000

At 1 April 2008 792,918 2,036 126 - 795,080

Revaluation of Tangible Fixed Assets

(339,242)

-

-

-

(339,242)

Backlog Depreciation 1,671 - - - 1,671

Disposal of Fixed Assets (91) - - - (91)

Transfer to/from Income & Expenditure Res.

(5,122)

-

(126)

-

(5,248)

At 31 March 2009 450,134 2,036 - - 452,170

81

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENT FOR THE YEAR ENDED 31 MARCH 2009 24. NOTES TO THE CASH FLOW STATEMENT (i) Reconciliation of operating surplus/(deficit) to cashflow from operating activities

Notes 2009 £000

2008£000

Total operating cost for the year (361,353) (352,403)

Adjust for:

(Profit)/loss on disposal of fixed assets 32 (16)

Depreciation 6 13,363 13,890

Deficit on revaluation of assets 6 2,129 9,173

Notional costs 7 540 531

Cost of capital charge 9 29,606 29,466

FRS17 Pension costs 19 1,932 3,633

(Increase)/decrease in stock 14 (42) -

(Increase)/decrease in debtors 15 2,035 (2,197)

(Increase)/decrease in prepayments & accrued income

15 128 312

Increase/(decrease) in creditors 16 2,153 (1,761)

Increase/(decrease) in accruals 16 (1,919) 4,088

Increase/(decrease) in other tax and Social Security

16 270 1,393

Increase/(decrease) in provisions 18 1,456 (2,945)

Increase/(decrease) in deferred income 20 (112) (248)

Net cash inflow (outflow) from operating activities

(309,782) (297,084)

(ii) Capital expenditure and financial investment

Purchase of tangible fixed assets (17,848) (13,692)

Proceeds from disposal of tangible fixed assets 43 16

(17,805) (13,676)

82

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENT FOR THE YEAR ENDED 31 MARCH 2009 24. NOTES TO THE CASH FLOW STATEMENT (cont'd …) (iii) Financing

2009 £000

2008£000

Recurrent grants received 310,926 296,548

Capital element of finance lease payments - -

Capital grants received 17,455 12,608

328,381 309,156 (iv) Analysis of net debt

1 April 2008£000

Cash flow £000

31 March 2009 £000

Cash 45 99 144

Bank overdraft (877) 695 (182)

Debt due within one year - - -

Debt due after one year - - -

Finance leases - - -

(832) 794 (38)

(v) Reconciliation of net cash to movement in net debt

2009 £000

2008£000

Increase/(Decrease) in cash 99 (727)

Cash inflow/(outflow) from increase/(decrease) in Debt

695 (877)

Change in net debt resulting from cash flows 794 (1,604)

Other non cash items - -

Movement in net debt 794 (1,604)

Net debt at 1 April 2008 (832) 772

Net debt at 31 March 2009 (38) (832)

83


NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 25. CAPITAL COMMITMENTS

2009 £000

2008£000

Contracted 36,089 41,949

Authorised but not contracted 233 251

36,322 42,200

26. FINANCIAL COMMITMENTS

At 31 March 2009 the Board had annual commitments under non-cancellable operating leases as follows: 2009

£000 2008

£000Expiring within one year 167 19

Expiring between one and five years inclusive 255 273

Expiring after five years 42 77

464 369 27. PRIVATE FINANCE TRANSACTIONS

PFI Schemes deemed to be off Balance Sheet 2009

£000 2008

£000Amounts included within other operating expenses in respect of PFI transactions deemed to be off Balance Sheet (note 5)

3,899 3,652

3,899 3,652

The Board is committed to make the following payments during the next year:

2009 £000

2008£000

Amounts included within other operating expenses in respect of PFI transactions deferred to be off Balance Sheet (note 5)

PFI scheme which expires within 1 year - -

PFI scheme which expires from 2 to 5 years (inclusive) 3,191 3,172

PFI scheme which expires from 6 to 10 years (inclusive) - -





3,191 3,172

84

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 27. PRIVATE FINANCE TRANSACTIONS (cont’d …)

£000 £000 Estimated capital value of the PFI scheme 36,000 36,000

Contract Start Date Contract End Date

May 2002 April 2012

The PFI Scheme relates to the installation, implementation and technical support of

hardware and software for the Electronic Libraries for Northern Ireland (ELfNI) project. ELfNI is being introduced to provide the five Education and Library Boards with systems to deliver public access to electronic information as part of the national implementation of the People's Network. The project also provides new library management systems.

28. CONTINGENT LIABILITIES

Job Evaluation Whilst the Board expects a liability could arise, until the relevant job descriptions and evaluations have been agreed, we cannot estimate, with any certainty, the value of the liability to the Board. We include below a table detailing the progress of various job categories currently at this stage in the job evaluation process. Description Est no

of officers

Status

General Assistants 127 A draft generic job description was sent to trade unions in January 2008. TU hoping to agree Job Description by end of June 2009.

Outstanding Appeals

11 Various posts have been evaluated and staff have lodged pre-appeals or notice to appeal against the outcome of the evaluations.

Outstanding HQ posts

3 Jobs at various stages of job evaluation process, prior to agreement.

Nursery Assistants

122 A Job Description has been sent to the trade unions along with a buyout offer based on the methodology used for Classroom Assistants. Effective date January 1995.

85

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 28. CONTINGENT LIABILITIES (cont'd …)

Non Job Evaluation Related

Description Est no of officers

Status

ASEOs 7 Business case forwarded to DE for approval

Voluntary Youth Workers Pension

180 These voluntary workers are funded by the Board but cannot join the NILGOSC scheme. Discussions are taking place to identify an appropriate pension scheme.

The potential total liability if all of these potential liabilities were to materialise is currently estimated at £945k.

Legal cases and public liability Proceedings against the Board have been initiated for a number of public, employers

liability and employment tribunal cases. The likelihood of the Board being found liable and the amount of any settlements cannot yet be estimated as the cases concerned have not progressed sufficiently to allow assessment by the Board’s solicitors.

Those amounts which are probable and ascertainable have been accrued within

provisions for liabilities and charges. 29. POST BALANCE SHEET EVENTS

On 1 April 2009 a merger of the five Public Library Services within the Education and Library Boards will take place, with the establishment of the Northern Ireland Library Authority (NILA). The Boards will be responsible for the library activities up until 31 March 2009. The assets and liabilities which will transfer out of the Board's Reserves are currently estimated at £14.4m. The job evaluation scheme operated by the 5 Boards may result in the posts of General/Domestic Assistants I and II being evaluated at a higher grade resulting in an entitlement to a higher salary from the date the duties were undertaken. When consideration of a particular category of staff has reached a point where it is expected such a liability will arise and an estimate of cost can be made, such liabilities are accrued. In the case of General/Domestic Assistants I and II it became possible to include an accrual only after 31 March 2009 when the Board received formal trade union agreement to their job descriptions on 1 June 2009 followed by the job evaluation questionnaires on 6 July 2009. These agreements allowed the Board to form an estimate of likely liability based on the final job descriptions. As a result the North Eastern Education and Library Board has redrafted its accounts and included an estimate of the cost of pay arrears for this group of staff from January 2002.

86

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 29. POST BALANCE SHEET EVENTS (cont'd …)

In mid July 2009 Whitehouse Primary School was completely destroyed in an arson attack. Due to the efforts of school and Board staff, the school was temporarily relocated to the Newtownabbey Community High School campus with minimum disruption to the pupils. The Board Accounts were authorised on (date) by the Chairperson and Chief Executive of the Board.

30. RELATED PARTY TRANSACTIONS

The North Eastern Education and Library Board is a Non-Departmental Public Body (NDPB) sponsored by the Department of Education, the Department of Culture, Arts and Leisure and the Department for Employment and Learning. The Departments are regarded as related parties. During the year, the North Eastern Education and Library Board has had various material transactions with the Departments and with other entities for which the Departments are regarded as the parent Department. These include:

• Belfast Education and Library Board; • Southern Education and Library Board; • South Eastern Education and Library Board; • Western Education and Library Board; • Staff Commission for Education and Library Boards; • Council for Catholic Maintained Schools; • Voluntary Grammar Schools; • Grant Maintained Integrated Schools; • Northern Ireland Council for the Curriculum Examinations and Assessment; and • Northern Regional College. In addition, the North Eastern Education and Library Board has had a small number of material transactions with other Government Departments and other Central Government bodies. Most of these transactions have been with the: (a) Department of Health and Social Services and Public Safety; (b) Health and Social Services Boards which are sponsored by the Department of

Health and Social Services and Public Safety; and None of the Board Members, members of the key management staff or other related parties has undertaken any material transactions with the North Eastern Education and Library Board during the year other than those disclosed in the Remuneration Report.

A register of members’ interests is available and can be inspected on application to the Chief Executive’s office.

87

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 31. THIRD PARTY ASSETS

The North Eastern Education and Library Board is responsible for the administration of Trust Funds which benefit the pupils of certain schools within its area. The Chief Executive, as Accounting Officer for the Board, is responsible for the propriety and regularity of the Trust Funds and for the keeping of proper records. These are not Board assets and are not included in the accounts. The assets, held at the balance sheet date to which it was practical to ascribe monetary values, comprised monetary assets, such as bank balances and monies on deposit, and listed securities. They are set out in the table immediately below.

2009 £000

2008 £000

Monetary assets such as bank balances and monies on deposit

52 41

Listed securities 67 67 119 108 32. FINANCIAL INSTRUMENTS As the cash requirement of the North Eastern Education and Library Board are met

through Grant-in-Aid provided by Departments (DE, DCAL, DEL, DHSS & PS), financial instruments play a more limited role in creating and managing risk than would apply to a non-public sector body. The majority of financial instruments relate to contracts to buy non-financial items in line with the North Eastern Education and Library Board's expected purchase and usage requirements and the North Eastern Education and Library Board is therefore exposed to little liquidity, interest rate, foreign currency, credit and market risk.

Liquidity Risk

The Board’s net revenue resource requirements are largely financed by grants from its sponsoring Departments, just as its capital expenditure is. The Board is not therefore exposed to significant liquidity risks. Interest Rate Risk The Board’s financial assets and liabilities carry nil or fixed rates of interest. The Board is not, therefore, exposed to significant interest rate risk. Foreign Currency Risk The Board’s exposure to foreign currency risk is not significant. Foreign currency income and expenditure are negligible. Credit Risk As the majority of the Board's income comes from contracts with other public sector bodies, the Board has low exposure to credit risk.

88

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 33. EUROPEAN UNION FUNDING

2009 Income

£000

2009 Expenditure

£000

2008 Income

£000

2008 Expenditure

£000

Recurrent Funding Applicant:

(a) Board (13) (13) (59) (59)

(b) Schools 8 8 24 24

(c) Other services - - - -

(5) (5) (35) (35)

Received from other services:

(a) Milk subsidy 115 115 89 89

(b) Others - - - -

115 115 89 89

110 110 54 54

Capital funding Applicant:

(a) Board - - 15 15

(b) Schools 39 39 218 218

(c) Other services - - - -

39 39 233 233

TOTAL 149 149 287 287

89

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 34. NEW OPPORTUNITIES FUND/BIG LOTTERY

2009 Income

£000

2009 Expenditure

£000

2008 Income

£000

2008 Expenditure

£000 Recurrent funding Applicant:

(a) Board (5) (5) 31 31

(b) Schools 17 17 33 33

(c) Public libraries - - - -

(d) Other services - - - -

12 12 64 64

Capital funding Applicant:

(a) Board 196 196 80 80

(b) Schools 29 29 6 6

(c) Public libraries - - - -

(d) Other services - - - -

225 225 86 86

TOTAL 237 237 150 150 35. STATEMENT OF LOSSES

No. of Cases

2009 £000

No.of Cases

2008 £000

(a) Cash losses 23 27 54 23(b) Claims abandoned 9 2 9 1(c) Fruitless payments - - - -(d) Stores losses 11 234 13 213 43 263 76 237

36. STATEMENT OF SPECIAL PAYMENTS

No. of Cases

2009 £000

No.of Cases

2008 £000

(a) Ex-gratia payments - -(b) Extra statutory payments - - - -

90

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 37. FINANCIAL TARGET - RECURRENT

The year end position for DE above includes school’s reserve of £6.904m (2008 £9.061m). Final Resource Allocation Plan Please note that the Final Resource Allocation Plan (RAP) includes Premature Retirement Compensation costs (PRC) and the portion of the previous years End Year Flexibility (EYF) allocated by DE in 2008/09 but excludes Annually Managed Expenditure (AME: non-cash costs).

Notes DE£000

Youth£000

DCAL £000

DEL £000

Total£000

Net Operating cost after financing OCS 342,485 6,497 10,357 2,558 361,897

Less

DHSS&PS recurrent grant expenditure 5 - - - 441 441

Permanent impairment of fixed assets 5 - - - - -

(Profit)/loss on disposal of fixed assets 5 33 - (1) - 32

Depreciation 6 14,239 645 595 12 15,491

Notional costs 7 540 - - - 540

Costs of capital charge 9 30,152 - - - 30,152

Increase/(decrease) in Provisions 18 1,361 72 22 1 1,456

FRS17 Pension Costs 19 1,612 12 267 41 1,932

Maintained Schools Improvement

19 - - - 19

Net expenditure 294,529 5,768 9,474 2,063 311,834

Final Resource Allocation Plan 295,536 5,777 9,546 2,091 312,950

Year end position (2009) 1,007 9 72 28 1,116

Add: Unallocated Funding Commitment

12,443

69

-

-

-

Funding Commitment (2009) 13,450 78 - - -

Funding Commitment (2008) 16,039 69 - - -

91

NORTH EASTERN EDUCATION AND LIBRARY BOARD ACCOUNTS FOR THE YEAR ENDED 31 MARCH 2009 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2009 37. FINANCIAL TARGET – RECURRENT (cont'd…) Year end position (2009) The Board’s financial targets for 2008/09 were to contain expenditure within the accrued limits approved by the Departments in Resource Allocation Plans (RAPs). These targets have been achieved. Unallocated Funding Commitment The unallocated funding commitment represents End Year Flexibility at 31 March 2009 which was not allocated in 2008/09 due to restrictions on access to End Year Flexibility imposed by HM Treasury. Funding Commitment (2009) The funding commitment (2009) for DE and Youth represents a guaranteed resource from the Department which will be added to the Board’s approved spending limit in future years.

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