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How SBLs can Sharpen their Bookkeeping Skills

March 25, 2019, 12:10 GMT+1
Read in about 8 minutes
  • Every SBL is required to demonstrate a certain level of expertise when it comes to bookkeeping – here, Hayley Dunn outlines some ways of handling the task more effectively...
How SBLs can Sharpen their Bookkeeping Skills

Finance is a key part of the business leadership and management function in schools and MATs, from processing day-to-day transactions to completing consolidated year-end accounts. It’s essential to get the basics right in order to enable provision of quality information, which will in turn allow for effective management of finances and timely reporting.

As I wrote in The School Business Manager’s Handbook, “The key to good financial management is leading and delivering a service to provide the resources needed for the organisation’s strategic objectives. It is essential to have a clear set of financial policies and a procedures manual that is followed, and which includes a scheme of delegation that is simple and easy to follow.”

Be thorough

Unlike some other areas of school business management, finance can follow a set schedule of tasks. Being organised, methodical and having an attention to detail are key attributes for good financial management.

Creating a checklist can help formalise a standard process for the whole team to follow. Splitting financial tasks down into a daily, weekly, monthly and annual timetable will help make the functions more manageable. Setting out key deadlines and who is responsible for which tasks in advance will help with workload planning and identifying potential pressure points when compared to other team planning schedules (see ‘Keeping things in check’).

If monthly management accounts are being produced, it’s useful to set cut-off dates for processing.

This will ensure each period can be closed down and prevent back posting, which could distort the figures and help you and your team set out clear expectations for any other staff involved in the process If you’re using a separate software system for recording daily income receipts – for trips, visits or wraparound provision, for example – ensure that a reconciliation of the two systems is completed regularly to ensure consistency and accuracy.

Always check your payroll reports thoroughly, as errors and omissions can be costly and cause considerable stress for those staff affected. If you do spot any mistakes, advise your payroll provider immediately.

Carefully checking draft run reports for new starters, leavers, changes in contract, deductions and additional payments should reduce the possibility of errors occurring. Keep a paper record of any correspondence to show the audit trail and provide specific details in the event of a query. Complete a month-end reconciliation, clearly identifying the month-end creditors.

Streamline your workflow

Time and cost efficiencies can be realised in financial processing by reviewing the workflow of each process. Your aim should be to identify and address any ‘waste’ in the system (when there’s duplication of effort, for example), ultimately smoothing the workflow and creating a leaner process.

In these times of financial austerity, we’re all looking to make the processes within our organisations as efficient as possible. The aim of the business finance lead is to make these processes more smooth and create steps that are easy for staff, customers and suppliers to follow. One way of achieving this is by automating processes where possible and reducing the need for manual intervention.

Working in this way, underpinned by strong financial management policies, can also help reduce the potential risk of fraud, by reducing the opportunities by which fraud can take place.

A common frustration for suppliers can be the process of ensuring documents reach the right person. A bottleneck can be created following changes in staff, or when key people are absent due to illness or parental leave – particularly when personal email accounts are used in dealings with suppliers. One way of addressing this is to have all members of the team use a shared email account, which will help alleviate issues caused by absences, different team allocations and job share arrangements.

Using a generic email account such as ‘[email protected]’ or ‘[email protected]’ can also allow for other efficiency improvements. Within Outlook, for example, it’s possible to categorise emails once they’ve been read by assigning them different colours and allocating them to specific team members.

Alternatively, you could split your purchase ledger and assign different team members to certain sections of the alphabet or specific document types, whether that be purchase orders, goods received notes, invoices and statements. You could also use Outlook’s ‘flags’ function to indicate different stages of processing.

Software solutions

Dedicated software solutions will allow you to further automate parts of your financial processing. Take your purchase ledger workflow – a purchase order requisition can posted by one user, then approved by the budget holder via the system. Once the goods have been received they can then be receipted and automatically matched to an electronic invoice.

Since the transaction was approved at the point of ordering, with a segregation of duties put in place for each successive stage, the invoice can be automatically matched and paid within a minimum and maximum matching range to the value of, say, 5%. Keeping manual intervention and processing to a minimum can therefore provide a more streamlined and workflow efficient-process.

Some of you may work in a small team or setting in which one person effectively does the majority of all finance processing as the school’s sole SBM or office manager, or you might deal with finance as part of a diverse role.

In this instance, allocating specific times for finance work and setting deadlines can help manage the workload involved and others’ expectations. When I worked as an SBM I found that Fridays were often a good day for doing finance tasks, as there tended to be fewer meetings and interruptions. Perhaps it’s time for you and your team to introduce a Finance Friday of your own…?


Keeping things in check

Here’s what a school finance team’s regular checklists might look like:

Daily checks:
  • Cash in hand
  • Cash inflows and outflows
Weekly checks:
  • Process sales invoices
  • Record income received
  • Update payroll file
  • Process orders, goods received notes, purchase invoices
  • Check supplier statements
  • Review forecasted cash flow
  • Reconcile bank account(s)
Monthly checks:
  • Review aged creditors and debtors
  • Review and process payroll
  • Make payroll payments
  • Record and reconcile charge card payments
  • Review month end reports
  • Review month end balance sheet
  • Produce and review a budget vs actual outturn report
  • Complete VAT or VAT 126 return (if applicable)
  • Review spending for the month, identifying transactions that should be recognised as fixed assets
  • Run month end reports; these should include a trial balance, nominal ledger report of all income and expenditure and a balance sheet (AKA statement of financial position)

Hayley Dunn is a school business leadership specialist and author of The School Business Manager’s Handbook, published by John Catt, which was recently shortlisted in the Specialist Book category at the 2019 Business Book Awards.

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