Internal Scrutiny vs. Responsible Officer in MATs
Multi-Academy Trusts are required to implement robust oversight to ensure transparency, compliance, and efficiency in their operations. The role of responsible officer was initially introduced by the Academies Financial Handbook as a requirement for academy trusts to provide independent oversight of financial controls and risk management, aimed at strengthening governance and financial accountability within trusts. Trusts were required to appoint an independent person, typically a trustee, to carry out independent checks on the trust’s financial management and controls.
With each version of the Handbook since, the requirement for independent assurance over risk management and controls has evolved. The shift has been away from the responsible officer model to expand the scope of independent oversight needed, away from periodic financial checks to continuous risk-based scrutiny that covers the whole risk framework – financial and non-financial. This was accompanied by mandating a committee within each trust with a risk remit, and responsibility for overseeing and approving a risk-based programme of internal scrutiny and reporting to the board that financial and non-financial risks are appropriately addressed.
The requirement has also progressively shifted from reliance on individual trustees to the engagement of qualified professionals for all sizes of Trust. Download our Internal Scrutiny eBook for all the recent updates to the handbook.
What is Internal Scrutiny?
Internal Scrutiny is a mandatory requirement for MATs under the Academy Trust Handbook (ATH). It is designed to provide independent assurance that financial controls and risk management procedures are effective.
Key features of Internal Scrutiny:
- Independence: It must be conducted by an individual or organisation separate from day-to-day management. The Internal Scrutiny service team reports directly to the audit and risk committee.
- Ongoing Process: Rather than a one-off audit, Internal Scrutiny should be a continuous process, with termly and annual reports submitted to the Board of Trustees.
- Scope: The programme should be a risk-based proactive program, identifying risks and potential weaknesses in systems, internal controls, risk management, and governance before they become significant issues.
- Reporting: Findings and recommendations for improvement must be reported to the Audit & Risk Committee, which then submits the results to the Board and external auditors.
- Compliance: The Annual Summary Report summarises the outcomes of the internal scrutiny work carried out in the year and is required to be submitted to the ESFA with the audited financial statements annually.
- Continuous improvements: Internal scrutiny is not just about identifying issues but also reviews progress on previously agreed findings, verifying that recommended actions are implemented, driving continuous improvements in governance and risk management.
What is a Responsible Officer (RO)?
The Responsible Officer (RO) was previously a recommended governance role within MATs but is no longer a requirement under the current Academy Trust Handbook. Historically, the RO was a trustee appointed to provide independent financial oversight, ensuring the Trust adhered to financial regulations.
Key differences:
- Board-Level Role: The RO was typically a trustee who acted as an internal check, whereas Internal Scrutiny is conducted by an external expert or independent party.
- Limited Scope: The RO primarily focused on compliance and procedural checks, whereas Internal Scrutiny takes a broader view of financial risk, efficiency, and governance.
- Discontinued Requirement: The RO role has been phased out in favour of a more structured and professional Internal Scrutiny process.
Why Does This Matter for MATs?
MATs must ensure they meet ESFA (Education and Skills Funding Agency) requirements for Internal Scrutiny, as failing to do so could result in intervention or funding risks. Trusts should evaluate if their programme of internal scrutiny is structured, addresses both financial and non-financial risks, and is driven by the Audit and Risk Committee, with their internal scrutiny provider contributing their insights into emerging and sector risks.
How SBS Supports MATs with Internal Scrutiny
At School Business Services (SBS), we provide independent Internal Scrutiny services tailored to the needs of MATs. Our experienced qualified internal audit professionals conduct thorough reviews across a vast range of financial and operational areas from cyber and data security to pupil attendance, SEND, safeguarding, risk management, governance, HR and estates, ensuring compliance while also identifying opportunities for process improvements.
Talk to our Team
Get in touch to discuss how we can support your Trust with expert Internal Scrutiny services.
