1. New Provider presentations

2. Testing eligibility of apprenticeship funding
This presentation will cover the Department’s approach to testing eligibility of apprenticeship funding.

3. Overview of our approach
Testing is overseen by the Provider Risk and Assurance (PRA) function which sits within the Department’s funding agency
We test on a sample basis at both provider level and apprentice level
We advise providers if they are selected for testing a few weeks prior to a visit and issue our apprentice level sample a few days prior to the actual visit
Our visits typically last between 3-5 days on site and we will work with you following our visits to correct any data errors and resolve any impact on funding
Our testing is complementary to other assurance work undertaken including market entry checks, data analytics and focused thematic reviews
Testing is overseen by the Provider Risk and Assurance function within the Department’s funding agency.
Some testing is completed by PRA staff directly whilst other testing is contracted to external audit firms. Regardless of who is completing the testing, we have a single standard approach.
We test for eligibility on a sample basis – both at provider level and at apprentice level.
If you are selected for audit, we will advise you a few weeks before our intended visit. In 2017/18, we plan to undertake our testing of apprenticeship levy funding between June and September In future years, we are likely to commence our testing earlier in the year.
If you are selected for audit, we will advise you of our apprentice level samples a few days before our visit. This will allow you a short period of time to collate the necessary evidence to support your data return. The number of apprentices selected for testing follows a sliding scale based on the number of apprentices on the programme.
We aim to complete our work on-site within 3-5 working days. We will spend some time up front arranging the visit and also time following our visit to support you in correcting any errors identified and to resolve any errors that may impact on the level of eligible funding. You should have a single dedicated audit lead throughout this process who will be able to handle any queries arising.
The funding audits complement a series of other assurance work. You will have already been subject to our market entry checks. We also perform sector-level data analytics to identify and specific concerns with providers’ data. Another strand of our work is focused thematic review for example where a particular risk is identified. There may be additional data requests to inform our thematic reviews however these will be planned and communicated in good time.

4. The funding audit
Subject matter
Evidence
Criteria
It is the responsibility of the Department to ensure that public money is being used for the purposes intended and in accordance with the funding rules, and it is this assurance that the funding audit provides.
The funding audit is made up of broadly three components.
The subject matter is what we are seeking assurance over. This is the data you submit to the Department within the Individualised Record, or ILR. This data supports your claim for funding.
The second component is the criteria, that is the rules that dictate what can be funded and so what data can be entered into the ILR. We have published a dedicated set of apprenticeship funding rules for providers on gov.uk. You’ll need to be very familiar with this document.
The third component is the evidence that you will need to collect and retain, supporting that the data you have submitted is accurate, with funding claimed in line with the criteria.
All three components are updated each year.
We’ll talk about each of these three components in more detail, including giving some examples of the evidence we would expect to see.

5. Subject matter: Individualised Record
The data you have submitted within the Individualised Record (ILR) must be correct
The specification of the ILR is available online
You must have controls in place to ensure the accuracy of data entered
See nt/publications/ ilr- specification-validation-rules- and-appendices-2017-to-2018
It is the responsibility of all providers to ensure that the data is accurate. We will check the data submitted within the Individualised Record, or ILR.
The specification for the ILR is available on gov.uk. The ILR itself is an XML file created from your underlying records.
It is important that the data in the ILR is accurate throughout the year.
You should consider the controls in place for entering the data, which should include competent and thorough review of the output report. You must not report inaccurate information even where you perceive that this would result in a more equitable claim for funding or accurate record of performance.
Where your data and the evidence you hold does not support the funding you have claimed, we will take action to get the data corrected and recover funds.
If you are selected for audit, we will advise which version of your ILR we will be selecting our sample from. We will also select our apprentice level sample following analysis of the ILR.

6. Criteria: Apprenticeship funding rules for providers
We will test eligibility against the funding rules published by SFA
We convert the funding rules into a series of audit tests set out within our published working papers
We will publish our working papers later in the year so that you can see specifically what we will be looking at
See enticeship-funding-and-performance- management-rules-2017-to-2018
We will test the eligibility of funding for each apprentice within our apprentice-level sample. We will also check to confirm if you have claimed the correct amount of funding.
The eligibility requirements are set out within the apprenticeship funding guidance. We covert the funding rules into a series of specific tests, against which we will seek evidence of compliance. We publish these tests so that you are clear on what we are looking for.
We are developing our working papers, and will publish these later in the year.
Broadly, our testing will cover the following:
Does evidence exist to confirm that the apprentice is eligible for SFA funding?
Are the apprentice and employer eligible and has the programme been correctly identified and coded on the ILR?
Is the programme as designed eligible for funding and is the correct funding being claimed?
Does the apprenticeship documentation meet the minimum requirements outlined in the funding rules and agree to the underlying data?
Is the apprentice’s programme and the apprentice's participation as recorded on the ILR consistent with the underlying records?
Are eligible cost correctly computed, including end-point assessments, and is the correct financial value of price agreed been recorded on the ILR?
Has the co-investment (where applicable) been paid by the employer, and is the value correctly recorded on the ILR?
Where the apprentice completes or leaves the programme, does the learning actual end date recorded on the ILR agree with underlying records?
Does evidence exist to confirm eligibility for additional payments to be made (where applicable)?
Do sub-contracting arrangements (where applicable) meet the requirements of the guidance?

7. Evidence: Expectations set out within the funding rules
You must collate and retain an evidence pack for each apprentice
Evidence requirements are set out in the funding rules
Government contributions (including additional payments) and payments from the digital account are driven by the underlying ILR data which must agree with the information and evidence you hold on record
See sfa-financial-assurance-funding-assurance- review-programmes
You are expected to hold sufficient and appropriate records to evidence compliance with the funding rules and support the data entries on the ILR. The funding rules set out what we expect so see within the evidence pack for each apprentice.
For example, you must retain evidence of the total price negotiated and agreed with the employer.
You must also hold and retain necessary financial records. Where applicable, you must retain evidence of the co-investment payments invoiced by you on the employer (and evidence that you have applied VAT as applicable) and evidence of the amount of co-investment that the employer has paid.
You must also retain evidence of any additional payments received from SFA that you should have passed on to the employer, where this applies.
Evidence comes from several different sources and you will be responsible for requesting and collating this evidence and storing it securely.
Where evidence isn’t available, or cannot be provided to a reasonable timescale, we will report an error and recover funding and also request that the data be corrected.
Over the next few slides we’ll look at some more examples of what specific evidence we require.

8. Examples of evidence we would look at
Eligibility of the apprentice
Each apprentice must meet the rules on who can be funded. The funding criteria include (but not limited to):
the age of the apprentice
at least 50% of their working hours being spent in England over the duration of the apprenticeship.
absence of any other apprenticeship enrolments
Your evidence pack should include evidence of the apprentice’s eligibility and a record of what evidence the apprentice has provided.
A genuine job:
Your evidence pack should contain information about the apprentice’s job role and details of the contracted employment.
There must be a genuine job, and they should be employed by that company and on a genuine PAYE.
They must be paid a legal wage and receive support from the organisation to carry out their role.

9. Examples of evidence we would look at (continued)
Subcontractor arrangements
You may subcontract the delivery of part of an apprenticeship to an approved external training provider, subject to specific criteria within the funding rules.
Your evidence pack should include details of any subcontractor, clearly identifying who they are. This must match the information reported to us in the ILR.
Off-the-job training
The apprentice must spend at least 20% of their time on off- the-job training, as defined in the funding rules.
Your evidence pack should include details of how the 20% off-the-job training will be quantified and delivered. An absence of this evidence will result in a significant funding error.

10. Examples of evidence we would look at (continued)
Qualifying days
Apprentices must be in learning for a minimum of 42 days between the learning start date and learning planned end-date before they qualify for funding.
Your evidence pack must include confirmation that learning has taken place and that relevant records are available to confirm that.
Additional payments
Additional payments will be made to meet the costs associated with training if any of the following criteria is met:
the apprentice is aged 16 to 18
aged 19 to 24 with EHCP
aged 19 to 24 and has been a child in care
from the most deprived areas of the country.
Your evidence pack should include evidence for any additional payments. For example, for learning support this will be a signed confirmation the apprentice is care leaver, or evidence of an EHCP, and evidence that the apprentice was in learning.

11. Examples of evidence we would look at (continued)
Commitment statement
For each apprenticeship there should be a commitment statement signed and dated. The commitment statement must include the relevant information as set out in the funding rules.
Your evidence pack should include a copy of the commitment statement for each apprentice.
Cost of training and assessment
You can claim the cost of activity directly related to the apprenticeship. You must only claim eligible costs.
You must evidence how the actual cost are calculated.

12. Examples of evidence we would look at (continued)
Start of learning
Funding can be claimed only from the date on which learning activity directly related to the apprenticeship, or learning aim (for English/maths), begins and can be evidenced.
Co-investment
You must retain financial evidence to show that the co-investment has been paid by the employer where relevant.
If you are claiming funds from the digital account, there must be appropriate evidence that the relevant employer is or is linked to the levy account holder (if different).
Any part of the price over and above the cap must also be evidenced as paid by the employer.

13. Data quality
Good understanding of the subject matter, criteria and evidence needed
Maintain quality data throughout the year
Adequate understanding of the data requirements
Day-to-day management of data and data quality
Regular review of funding monitoring reports and timely action to correct any issues
Challenge by management and sound data governance
With sufficient preparation throughout the year, our audit visits should not be onerous nor result in any significant follow up work.
We would advise that you hold sufficient knowledge within your organisation of the subject matter, criteria and evidence needed for a funding audit. You should ensure that relevant staff are familiar with the published documents and alert to any updates.
We also advise you to proactively manage the quality of your data. You should have clear systems and processes in place to share information on your apprenticeships quickly and efficiently. You should also regularly review your data quality, at an appropriate level of your organisation, and take steps to investigate and correct any issues as they arise.

14. Quality evidence Maintain quality audit evidence throughout the year
Adequate understanding of the evidence requirements
Obtaining sufficient appropriate evidence in a timely manner
Retaining evidence securely
Thank you for listening
And finally, we would advise you to have a robust process in place for collecting and retaining evidence in support of the data submitted in the ILR. You should be familiar with our expectations as set out within the funding rules.