Academies Accounts Direction 2019 to 2020 released

Published by on 16 June 2020

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The Education and Skills Funding Agency (ESFA) have released the Academies Accounts Direction (AAD) 2019 to 2020.

As we have highlighted in articles earlier this year there are some changes which mainly impact upon Academy Trusts’ reporting requirements in the Trustees Report. These requirements will, for those impacted, require some additional work to be completed which should be undertaken as soon as possible to avoid any delays in the critical reporting period.

A full copy of the new AAD can be obtained here.

So, what is new in the AAD 2019 to 2020?

Trustees Report – Key changes:

As mentioned above, our articles earlier this year highlighted that there would be some increased disclosures to be made in the Trustees Report for 2020 onwards. These are as follows:

  • engagement with employees (if the academy trust has more than 250 employees)
  • engagement with suppliers, customers and others in a business relationship with the trust such as beneficiaries, funders and the wider community (if the academy trust is ‘large’ as defined by the Companies Act 2006)
  • a statement describing how the trustees have promoted the success of the company under section 172(1) of the Companies Act 2006 (if the academy trust is ‘large’ as defined by the Companies Act 2006)
  • streamlined energy and carbon reporting (if the academy trust is ‘large’ as defined by the Companies Act 2006)

Further details covering these areas and what is expected to be disclosed can be found in our recent articles as follows:

Where academy trusts meet the “large company” definition, the ESFA encourages those trusts to make disclosure of the environmental reporting requirements on their trust websites in a readily accessible format as well.

The ESFA have also kindly produced a good practice guide on the environmental reporting and this can be found here.


Where trustees have reviewed and taken account of the guidance in the Governance Handbook and competency framework for governance, the AAD encourages this to be explicitly stated in the governance statement under the “scope of responsibility”.

The AAD also requires academy trusts to disclose how their internal audit/scrutiny function arrangements have been affected (if at all) by the new FRC Ethical Standard for Auditors.


Where instances of irregularity, impropriety or non-compliance are to be reported in both the Accounting Officer statement or auditor’s report on regularity, propriety and compliance, these should state the relevant monetary amounts (if known).

Accounts disclosures

Legal costs incurred by academy trusts should be clearly identified and disclosed in the notes to the financial statements. The Coketown example accounts show a split between “Legal costs – conversion” and “Legal costs – other”.

An analysis of net debt note is now required to comply with the SORP.

Where multi-academy trusts have academies with £nil fund balances at year end for both 2020 and 2019 some narrative should be included to explain why no balances are shown in the funds analysis note.

Accounting changes

Previously, where subsidiary entities are deemed to be immaterial their results are not be consolidated in the academy trust’s results. The AAD clarifies that where two or more subsidiaries exist then their materiality should be considered collectively.


As mentioned at the outset, the changes mainly impact upon academy trusts’ trustees reports. However, as we always recommend, these should not be left until the last minute during the reporting season, especially if your academy trust will have to make these disclosures.

However, if you are concerned or indeed unsure of any of the changes mentioned above, you should discuss these further with your advisors.

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