The DfE update their consistent financial reporting FAQs

The DfE update their consistent financial reporting FAQs

The consistent financial reporting (CFR) framework sets out how you should go about coding your income and expenditure into nationally comparable categories to support financial reporting and benchmarking. In these FAQs, you can find further detailed information on how to code balances.
How does CFR relate to balances on private funds?
CFR does cover private funds paid into the main school budget during the financial year, but does not ask for balances covering money that has remained in the school’s private accounts throughout the year.
What about opening balances or carry-forward balances?
Consistent financial reporting asks schools to report their opening revenue balance. Opening balances will also need to be taken into consideration within the schools’ accounting system in order to derive the balance headings, which are cumulative, rather than balances for just one financial year.
How should we record any deficit revenue balances at year end?
We want schools to have the mindset that they need to be committed to a strategic financial plan to get out of deficit. Several LAs have requested that B02 (uncommitted revenue balances) should now allow a deficit to be recorded as this makes it easier to identify a school’s true position. The Department looks at total revenue balances when analysing CFR data, so it is down to local decision how you report a revenue deficit. Schools have to agree deficit budgets with their LA.
How should schools account for licensed deficit (loans) for revenue purposes under CFR?
If the school does not receive additional funding to cover the deficit, it will have a negative balance in B01 – Committed revenue balances. In these circumstances, the school should include a note to the effect that the deficit has been licensed or authorised by the LA. If the school receives a revenue loan from the LA, the school should code the original expense and the matching loan from the LA to the same account, essentially netting off the purchase price. Then, when the loan is paid off in instalments, the principal repayment should be coded to the appropriate E heading, with the interest portion being allocated to E29. For example, if a school needed £2,000 to pay for a set of classroom books, the expenditure would be mapped to E19, as would the loan income from the LA. That way, the net effect on E19 is nil. In turn, when the school repays, for example, £520 per term, over 4 terms = £2000 principal, £80 interest, the £500 is coded to E19 and the £20 is coded to E29. Over the four terms, the effect is that the school has paid £2,000 on E19.
If any additional non-government funding is received, this should be recorded in I07- I13.
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