Perry Beeches broke funding rules in its final year as a school sponsor

Trustees at the scandal-hit Perry Beeches Academy Trust continued to break academy funding rules in the chain’s final year as a school sponsor, delayed accounts show.

Concerns highlighted in the latest accounts, including unauthorised credit card transactions, a lack of internal auditing and a failure to follow tendering procedures show that troubles continued to plague the trust in its last year as an academy sponsor.

In March 2016, a government investigation found the trust had funnelled £1.3 million to a private company without following proper procedures. The company then paid a “second salary” to superhead Liam Nolan.

Nolan, who received £160,000 over two years on top of his £120,000 salary, stepped down from the trust in May 2016 and was banned from teaching in November 2018. He can apply for the prohibition to be set aside in November 2020.

The trust’s five schools – all in Birmingham – were re-brokered in March 2018.

However, accounts for 2017-18 identify six breaches of the academies financial handbook during the year.

An assurance report from Perry Beeches’ independent reporting accountant found the trust could not provide supporting evidence for six of the ten credit card transactions that were selected for testing.

Of the four that did have evidence, three did not have the approval of the head.

The report also warned the trust did not always follow its internal procurement process, and did not ensure spending decisions “represent value for money”.

It did not maintain a risk register, did not appoint an internal audit service and its register of interests did not include “all relevant business and pecuniary interests”.

The independent auditor’s report said the trust had also decided not to commission an actuarial report, and so the auditor was unable to “obtain sufficient appropriate audit evidence” about staff costs or the value of the net defined pension liability, and warned that any figures relating to these may be “materially misstated”.

A statement from the trust’s acting chief executive and accounting officer, Pamela Garrington, confirmed the trust had committed six breaches of the academies financial handbook in 2017-18, including by failing to submit its audited accounts by December 31 2018.

She said they were delayed “pending the conclusion of certain matters pertaining to the rebrokerage of the schools and subsequent wind down of the trust”. Her statement is dated December 12 – almost a year after the deadline for the accounts.

Garrington also acknowledged that a “number of procurement transactions” were identified which had not followed “appropriate tendering procedures and internally set limits”.

The Teaching Regulation Agency report published for Nolan’s hearing last year confirmed the trust paid £1.3 million to Nexus Schools without a contract or adequate tendering. Nexus also took an eight per cent cut as a “management fee” of Nolan’s second salary.

The report also revealed Nexus provided services, including accountancy, payroll and HR support, for the Perry Beeches schools before they became academies without a written contract.

The trust’s 2016-17 accounts, published in June last year, revealed it had a £1.5 million deficit. These accounts also warned that procurement procedures were not being properly followed in all cases.

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