Welcome to the CSBM workshop: Managing school finances 1

Session 1: Welcome and introduction to the workshop The purpose of session 1 is to introduce participants to aspects of the Managing school finances module and the rationale for the workshop.

Introductions Name School Position The first CD, tape or record you ever bought

Purpose The purpose of the workshop is to: outline the module content and assessment requirements, and clarify any emerging issues explore the significance of the Managing school finances module contents for the professional practice of SBMs introduce key concepts and techniques in managing finance in schools enable participants to relate these concepts and techniques to their own school setting

Rationale for the module With the introduction of new funding mechanisms which offer schools greater freedom to make their own decisions comes the responsibility to show that they are using sound financial procedures. School business managers are recognised as making a significant contribution to effective financial management in schools.

Module aim The module aims to equip participants with the skills to administer and manage school resources and financial management operations to promote an efficient and effective learning environment.

Units making up the module Unit 1: The principles of school financial management Unit 2: Planning and setting the budget Unit 3: Managing the budget Unit 4: Procurement and value for money

Session 2: Segregation of duties The purpose of session 2 is to raise participants’ awareness of issues relating to probity in school financial management.

The seven principles of public life Source: Committee on Standards in Public Life (1995)

Activity 1: Financial systems in schools What are the strengths of the financial systems in your school? What are the weaknesses of the financial systems in your school?

Activity 2: Segregation of duties Read the text ’Segregation of duties’ (Resource 3) and consider the following question: What are the implications for establishing viable procedures for the segregation of duties in a variety of settings?

Segregation of duties Trio activity Work in trios to discuss the principles behind the segregation of duties, and the challenges of implementing them in practice.

Functions that should be separated Authorisation: the authorisation of a transaction, such as a purchase order or payment Execution: placing an order, receiving goods and services, or charging and receipt of a fee Custody: holding goods or receipt of services Recording: checking the invoice and completion of accounting records

Session 3: Securing best value The purpose of session 3 is to help participants understand the general principles of value for money and best value.

SBM competency framework Managing self and personal skills (strand 3) Maintain professional values and ethics This strand states: The SBM will ‘act with integrity, honesty, loyalty and fairness, always within the limits of professional competence to safeguard the assets, financial probity and reputation of the school.’

SBM competency framework Providing direction (strand 3) Ensure compliance with legal, regulatory, ethical and social requirements This strand states: The SBM will ‘follow guidelines and instructions to ensure [he or she is] acting with probity and monitors compliance with legal, regulatory, ethical and social requirements across the school.’

Four aspects of spending public money Probity a fair and equitable process Accountability Being publicly responsible for actions Maintaining the integrity of public spending Best value in the use of public funds Appropriate procurement processes to ensure efficiency and effectiveness

3Es Definition Example Economy Minimising the costs of resources used within the school, but having regard to quality Were the supplies of the quality specified and purchased at the best price? Efficiency The relationship between output, in terms of goods, services or other results, and the resources used to produce them Were the costs of the school meals service minimised, whilst enhancing the nutritional quality of lunch provided to pupils? Effectiveness The extent to which objectives have been achieved; can be described as the relationship between the intended impacts and actual impacts of an activity Did the education programme improve examination success rates?

Activity 1: Worst buy? Work in pairs and consider the questions: What was your school’s best buy? And why? What was your school’s worst buy? And why?

Achieving value for money Are we sure our financial procedures are sound? Are we choosing the right things to spend money on, reflecting the school’s overall priorities and strategy? Are we making sure that the money we spend is spent well? Do we know whether it achieves the desired result?

4Cs of the best-value principle Challenge: requires schools to: review and question their performance, routines and processes challenge the school’s management and leadership probe key areas of performance and the processes that affect performance Comparison: involves schools in: analysis of performance data developing appropriate improvement actions based on analysis and benchmarking Consultation: helps schools to: better understand the needs of its pupils define clearer priorities forge more effective partnerships with external bodies Competition: ensures the school is: providing or buying the appropriate service at the best possible price

Activity 2: Best value in ICT Schools have invested an enormous amount of money in improving their ICT equipment/infrastructure. Pairs activity: Work with someone different than before. Focus on ICT equipment and infrastructure. Reflect on the procurement process in your schools. Identify how your schools can demonstrate the principles of best value.

Session 4: Budget planning for the school improvement plan The purpose of session 4 is to help participants understand there is a clear link between the budget-planning cycle and creating and implementing the school improvement plan.

SBM competency framework Providing direction (strand 2) Plan school improvement This strand states: The SBM ‘contributes to the strategic school improvement plan, considers resource allocation and leads some sections of its implementation.’

SBM competency framework Effective use of resources (strand 1) Manage financial resources This strand states: The SBM ‘manages budgets and maintains accurate financial information to assist effective monitoring to achieve the school’s educational goals and priorities, maximising income through lettings and extended services provision.’

The two aspects that a school budget supports Day-to-day operations Basic services and resources that the school requires: Rates, water and energy, grounds maintenance, cleaning, catering, administration services, sufficient staff to teach standard class sizes etc Savings can be made to these services to ensure efficiency, but the school cannot function without them. The in-year budget must be able to cover these costs. Development needs Services and resources required to support the school’s goals and priorities as laid out in the school improvement plan: Specialist/extra staff, new resources or equipment to meet changing curriculum needs etc Funding remaining after day-to-day operations have been allocated will be used to meet development needs. Prioritisation will probably be required as rarely does a budget meet all the aspirations of the school.

Activity 1: How the budget planning and improvement planning cycles are linked Working in trios, share with each other your understanding of how your school budget-planning and improvement planning cycle operates.

Activity 2: Factors affecting budget decisions Work in trios to identify some of the factors that are likely to affect budgetary decisions.

Factors to consider in the budgetary planning process Review of past performance Pupil number forecasts Curriculum requirements Staffing requirements Other resource requirements

Activity 3: Linking expenditure to the improvement plan Study your school improvement plan, identifying where mention has been made to financial implications and tracking them within the school budget. Discuss with your trio colleagues how school expenditure decisions are reached in your schools. Discuss whether measures for ensuring VfM and best value have been included within the plan. Decide what measures could be introduced to identify the impact of spending.

Session 5: Assessment requirements The purpose of session 5 is to ensure participants fully understand the module assessment requirements.