Agenda item

Report of the Chamberlain.

Governors considered a report of the Chamberlain regarding the Charging of Administration Costs and External Audit Fees to the CLFS Charities from 2021/22 and Updates to the Reserves Policies of the Charities to Reflect this Change.

A Governor expressed concern about the external audit fees and queried whether the £4.5K costs should be borne by the charities, and if so whether another organisation could be selected that could conduct the audit at a reduced cost. A view was expressed that the school should have greater control over the process if the school is to bear the cost.

The Governors heard that notification of discussions around these charges had not filtered through to senior management at the school.

A Governor suggested that if the governing board did not exercise delegated trustee powers as delegated by the Court of Common Council, then a motion be arranged together with the other City schools to debate the issue. 

Governors heard that the fees covered a full audit and that the Corporation’s position was for charities to undergo a full audit, though that position is changing: the smaller charity will be listed as having no audit requirement (therefore likely to be attracting no charges) while the larger charity (the Bursary charity) will be required to undergo an independent examination, resulting in a reduction of fees in the future.

Governors heard that the Corporation’s position is that a single auditor handle all corporate entities because of the efficiencies and control mechanisms arising from that, and heard that the board does act in the capacity of trustee.

Governors heard that statutory deadlines were being complied with in respect of the current auditor.

A Governor expressed the view that the efficiencies that were likely to arise from a single auditor were helpful, and that the board should monitor the situation and review the process during 2022/23, as well as ensuring that the senior management team at the school be kept up to date.       

RESOLVED, that Governors:

·         Note that, following a change in policy approved by the Finance Committee, the City of London Corporation will begin recovering the external audit fees and administration costs incurred from those charities, including the School’s two charities, from 2021/22 onwards; and

·         Revise the reserves policies of each of the School’s two charities to provide for these costs going forwards