Part 1: Roles and responsibilities
The duties of key people responsible for running colleges.
Who is the accounting officer
1.1. In compliance with the college’s accountability agreement, the board of governors must appoint, in writing, a named individual as accounting officer. This should be the senior executive leader (principal or chief executive) and must be a suitable person for the role. The accounting officer should be employed by the college or college group and may be a member of the board. The college must obtain prior approval from the Department for Education (DfE) if it is proposing, in exceptional circumstances, to appoint an accounting officer who will not be an employee. The accounting officer of the parent college must discharge their responsibilities as accounting officer in respect of all entities within the college group, including any subsidiary companies.
1.2. The appointment of an accounting officer does not remove the governors’ ultimate legal responsibility for the proper conduct and financial operation of the college.
Find out about the automatic disqualification rules for individuals acting as senior managers or charitable trustees.
What does the accounting officer do
1.3. The accounting officer role carries specific responsibilities for financial matters. It includes a personal responsibility to Parliament, and to the Education and Skills Funding Agency’s (ESFA’s) accounting officer, for the college’s financial resources.
1.4. Accounting officers must be able to assure Parliament, and the public, of high standards of probity in the management of public funds, particularly regularity, propriety and value for money.
1.5. Accounting officers must adhere to The Seven Principles of Public Life.
1.6. The accounting officer must have oversight of financial transactions, by:
- ensuring that the college group’s property and assets are under the governors’ control and measures exist to prevent losses or misuse
- ensuring bank accounts, financial systems and financial records are operated by more than one person
- keeping full and adequate accounting records to support the college’s annual report and accounts
The accounting officer’s annual statement
1.7. The accounting officer must complete and sign a statement of regularity, propriety and compliance each year and submit this to ESFA with the college’s audited annual report and accounts, as set out in the College accounts direction.
The accounting officer’s duty to raise concerns
1.8. The accounting officer must take personal responsibility (which must not be delegated) for assuring the board that there is compliance with the accountability agreement and this handbook, though it should be noted that this obligation on the part of the accounting officer does not remove or reduce the responsibility of the governors for oversight of compliance.
1.9. The accounting officer must formally advise board members in writing if action the board is considering is incompatible with the governing document (for example, instrument and articles of government or articles of association), accountability agreement or this handbook. The accounting officer must also formally advise board members in writing if the board fails to act where required by the instrument and articles, accountability agreement or this handbook. Where the board is nevertheless minded to proceed, the accounting officer must consider the board’s reasons as provided in writing. If the accounting officer is required to implement the board’s decision, but still considers the action proposed by the board is in breach of the instrument and articles of government, the accountability agreement or this handbook, the accounting officer must notify ESFA’s accounting officer as soon as practical in writing.
Find out more about the accounting officer role in chapter 3 of Managing public money.
Who is the chief financial officer
1.10. The college must appoint a named individual to whom authority for financial management is delegated. This may be a chief financial officer (CFO) or finance director (FD), though the college may combine the financial leadership role with responsibility for other support functions and the job title itself may vary. The CFO should play both a technical and leadership role. The CFO should be employed by the college, and the college should notify DfE in advance if it proposes, in exceptional circumstances, to appoint a CFO who will not be an employee (even if the contract is temporary).
Skills and experience
1.11. The CFO and their finance staff must be appropriately qualified or experienced. Colleges must assess whether the CFO, and others holding key financial posts, should have a business or accountancy qualification and hold membership of a relevant professional body, dependent on the risk, scale and complexity of financial operations.
1.12. The college must appoint a governance professional to support the board who is someone other than a governor, principal or chief executive of the college. This position need not be held by an employee of the college, and the responsibilities may be undertaken by a third party provider of professional services, if such an arrangement provides a more effective service or better value. The governance professional provides advice to the board with regards to:
- the operation of its powers
- procedural matters
- the conduct of its business
- matters of governance practice
1.13. College accountability agreements require that individuals appointed to the position of governance professional must have a relevant qualification or equivalent experience.
1.14. Colleges must not appoint or retain in post trustees or senior managers who are disqualified under the Charity Commission’s automatic disqualification rules. For the avoidance of doubt, these rules apply to (but are not limited to) the positions of accounting officer, CFO and governance professional.