Must do better
Are you a bursar who has just taken over a failing school or of one that has been marking time for much too long? Clive Gutteridge sets out a step-by-step strategy to help reverse the school’s misfortunes
So you passed the interview and have started as the bursar of St ABC’s School. The chair of governors told you that the school was in a good financial state and you quite liked the headmaster, but you now find that the school hasn’t made a surplus for eight years: what do you do?
The first thing to do is to write a business plan for the current year, follow it and don’t deviate from it unless there is an unavoidably compelling reason to do so. Also, build up a cashflow.
Ins and outs
Identify the key drivers in your income (fees, lettings, debtors etc) and expenditure (salaries, PAYE/NIC, pensions contributions, maintenance, catering, audit, cost of borrowing, academic costs etc). Be hard-headed and reduce costs to a minimum. Be pessimistic about future pupil numbers.
Share the ownership of the business plan and cashflow with the chair of governors and headteacher. Don’t build, for instance, that costly sports hall, if you cannot afford it – don’t over-extend the business. Above all, it is important to know what the school’s financial aim is: such as “to make a surplus of X per cent before spending on capital expenditure this year”. You should also create a contingency fund for those little costs that crop up unexpectedly.
Produce monthly management accounts for the governors and SMT which show the true financial state of the school. Make sure you investigate variances and comment on how they have arisen. Show the income (termly income divided by four) and depreciation (annual depreciation divided by 12) on a monthly basis.
Focus on making a monthly surplus – if you make a surplus every month, you will make an annual surplus. Simple advice, but it is surprising how few schools follow this premise.
Establish a financial policy that sets out who has the financial authority to authorise payments to suppliers and stick to it. Watch the pennies, bank the income fast, chase debts hard (only write them off after you have exhausted all avenues), and pay suppliers on the due date. Above all, if your computerised accounting package won’t do what you want, discard it and get one that does.
Look around
Shop around for value for money in services: bank loans, food costs, insurance, heat and light and so on. In this age it is much easier to find and secure competitive prices on the internet.
Search for lower borrowing costs too. It may be that your bank manager will give you that elusive 1 per cent over base rate, but he hasn’t been asked. Make your business bank manager your friend; give him regular information about your performance, send him income and expenditure accounts and balance sheets every four months.
Look at how the school markets itself. Although this probably won’t be part of your remit, it is important to discuss it with the person responsible as this activity should provide a boost to your school’s income.
Ask to see the marketing plan, assess the impacts of the adverts, prospectus, parental contract and include the telephone manner of the school receptionist in the review.
The aim should be to improve everything, so that extra sales drop on to the bottom line. Make a plan and execute it; then monitor the plan and review it. Plan to succeed or you will plan to fail.
Clive Gutteridge has ten years’ experience as a bursar in independent schools. He has been a Recognised Advisor (Inspector) for the Independent Schools’ Inspectorate for four years. Clive can be contacted on bursar@appleford.wilts.sch.uk
