The Academies Enterprise Trust (AET), England’s largest academy chain, has been sent a notice of financial concern by the Education Funding Agency (EFA).
In a letter to the AET, the regulator’s director Sue Baldwin raised “significant concerns” about the “volatility” in the financial projections provided by the trust and called on the organisation to strengthen its financial position.
The notice of financial concern sent by the EFA with the letter means the chain will lose some of its spending powers and forces it to meet a strict set of conditions before sanctions are lifted.
These include the creation of new arrangements to ensure better financial oversight at its schools and efforts to bring individual academies out of deficit.
The trust, led by its new chairman Rupert Gather, said that it was disappointed in being handed a notice of financial concern and said it was working with its academies to remedy problems and further strengthen its financial oversight.
“We recognise the challenges that some of our academies face financially, and are continually working with these academies to improve their financial projections and performance,” a spokesperson for the AET said.
“The EFA has recognised an improvement in our overall financial position, and the progress that has been made.”
This is the first time such a large trust has had sanctions imposed on it by the EFA and it acts as a warning to all trusts about the importance of having clear financial strategies and robust reporting procedures in place.