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                    AppppendixA

Appendix 3

Assignment of school surplus balances - Reasons for committed balances and timeframes

In accordance with Section 16.10 of the scheme each governing body has to inform the county council (EFS) of its assignment for specific purposes of any part of its surplus balance. Normally this will be a confirmation of the planned way that all funds held are assigned or committed in line with the individual School Improvement Plan.

The tables below gives the recognised specific purposes and the expected timescales within which the monies should have been used .

Specific purposes for holding revenue balances

    1. To meet a prior commitment from a previous year

    2. Any unspent Standards Fund grant for the current school year

    3. Revenue contribution to a capital building project

    4. An ICT project

    5. Any other capital project e.g. vehicle purchase

    6. Staffing Changes / Workforce Reform

    7. Changes in Number on Roll (NOR) both falling NOR and growing NOR- the forecast variations and the years to which they relate should be given

    8. Community and Adult Education Funds

    9. Specialist School Funds

    10. Money held on behalf of a Cluster, Collaboration or Federation

    11. Unofficial Funds (e.g. H code School Trip Money)

The purpose of this new provision is to ensure that revenue funding for current pupils is spent on current pupils.. However there will be a general assumption that most assigned funds will be used within a five year period. If funds are held for a greater period, then specific evidence as to the realism and reasonableness of the assignment will be needed. There will be a presumption that the funds are not held for a specific purpose and are therefore uncommitted and liable to be subject to these claw back provisions.

Recognised timeframes for using balances

    1. and 2. Prior Commitments and Standards Fund Grant - spending within one year.

    3. Capital Building Projects - spending within five years

    4. and 5. Other Capital Projects/ICT projects - at least 75% spent within two years

    6. Staffing changes - spending within two years

    7. NOR changes - at least 60% spent within 3 years

    8. Specialist School Status - spending within 3 years

    9. Community Funds/ Adult Education - spending within one year

    10. Cluster/Collaboration/federation money - spending within two years

    11. Unofficial Funds - balance stable and not growing, balances held earmarked.

Contingency Funds

All schools may wish to continue to hold contingency funds as part of financial planning to meet unforeseen events. But these are expected to be used in year and therefore not part of a growing year on year reserve. Guidance is that a sum of 2 or 3% would be a reasonable guide depending upon local circumstances. These contingency funds cannot count as assigned or committed funds.

Claw Back Provisions

The rules as set out in section 16 of the Hampshire Scheme for Financial Management will apply to any uncommitted surplus balances. Schools affected will be notified in writing as soon as possible.