Getting ready for year end

2 Jul 2019 | by Sarah Chambers

Soon it will be the end of term, and the teachers will be heading off and wishing everyone a happy holiday. How can you make sure that you can smile graciously and are ready for your holiday, so that you too can take a well-earned break and yet still be ready for your academy audit in the autumn term? 

My top tips: 

  • Start now
  • Opening balances
  • Scrub your accounts
  • Liaise with your auditors
  • Communicate and delegate
  • Close August
  • File it

Start now: there’s lots that can be done now and even a little preparation will take the pressure off in the autumn term. Take advantage of the relative peace of the holidays to get ahead.

Opening balances: if you had any audit adjustments last year, your auditors should have given you a list so that you can reflect them in your accounting system. If not already done, book the journals and roll forward your year-end, if required by your system. Make sure that the balances at the end of 2018 agree back to the audited and adjusted final TB. Ask your auditors for help if not sure; it will make their life easier and should be part of the service.

Scrub your accounts: Ensure nothing is lurking in your accounts that will need adjusting at year end.

  • Check key income and expenditure codes: are the amounts reasonable, have they been posted to the correct code?
  • Look at restricted funds and make sure income and expenditure is reflected accurately.
  • Review your balance sheet: especially accrued/deferred income, accruals, prepayments and aged debts.
  • Reconcile control accounts i.e. bank recs up-to-date, amounts on payroll control accounts agree back to what you owe to HMRC/TPS/LGPS at month end, the VAT debtor agrees back to what you’ve claimed plus anything yet to be claimed, and the purchase ledger looks reasonable for all your suppliers.

The quieter summer months can be a good time to get some focused time to unpick any mis-postings and make any adjustments required.

Liaise with your auditors: I’d suggest keeping in regular contact but if you haven’t heard from them, now is a good time to catch up.

  • Audit timetables: will be being planned now, so if you prefer a specific week for your visit, let them know.
  • Information: ask what they need before the audit and when, now and make a start over the summer.
  • Template for the Trustee’s report: ask for one (see below).
  • Interim visits: can help with year-end timing.
  • Set dates now: get sign-off meetings in auditors’ and Trustees’ diaries.

Communicate and delegate: let everyone at school know when the audit will be and that you will be busy in September.

  • Set a deadline this term for purchase orders, if not already done, so that you don’t have a lot of orders and invoices arriving at the beginning of term, which can cause cut-off errors.
  • Ask staff and suppliers to be considerate of your team in September.
  • Make everyone aware of when you expect to close August month and ask them to chase invoices due and income owed.
  • Delegate as much as you can – give the Accounting Officer, the Chair of Trustees and Company Secretary the Trustees report template and ask them to complete it over the summer. Most of the information will already be available – it will just be the figures in the financial review that need finalizing.

Close August: if you’ve done all the above, closing August should be straightforward…!  

  • Get all the purchase and sales invoices booked
  • Post payroll and other regular journals
  • Reconcile the bank and any control accounts
  • Accrue/defer any income/expenditure – think about things that go over the year end – again, ask auditors for help if needed as it’s in their interests to have the TB as final as possible.
  • Once you have a final TB, close it, give a copy to your auditors and don’t let anyone post anything to it. Complete any information requests to agree to the TB and send them off.

File it: collate all the information in a file (electronic or paper) to hand over to the auditors. This minimizes interruptions and helps to makes the audit go smoothly. Include supporting documents and update with any adjustments. Sit back and look serene! 

Good luck and enjoy your summer!