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Tuesday 24 April 2012

Academy and charitable status

From Deptford Says No:

Does a newly formed Academy have to be registered as a charity or legally can it  be a Trust without having charitable status?

3 answers – add yours below

  1. Dr Andy Clayton said:

    All academies are companies limited by guarantee and exempt charities.

    Early, sponsored academies were companies limited by guarantee and registered charities and as such needed to be registered with the Charity Commission as well as Companies House. The 2010 Academies Act removed the need for academies to be registered with the Charity Commission, whilst keeping their charitable status.

    As academies are educational establishments, reporting to the DfE, it is the DfE that academies are accountable too in respect of their charitable status.

    Because of their charitable status academies must follow the accounting practices pertaining to charities rather than normal limited companies and therefore have to publish accounts in accordance with the requirements of the various Charities Acts.

    25 April 2012 at 2:56pm
  2. Deptfordsaysno said:

    If an academy is not registered as a charity, then legally the trustees can award themselves money from the trust at the end of the year?

    26 April 2012 at 5:45pm
  3. Dr Andy Clayton said:

    It is illegal for the trustees of ANY charity in England and Wales, whether the charity is required to be registered with the Charity Commission (the majority of charities) or not (i.e.exempt charities such as academies), to take any remuneration for the work that they do in relation to the running of that charity.

    They can, however, receive repayment for expenses incurred in the execution of their charitable duties. But in this case they would have to have met those expenses out of their own pocket before being able to make a claim.

    Academy trusts, which are companies limited by guarantee and exempt charities, have a legal obligation to submit an annual report together with a detailed statement of financial affairs (SOFA); i.e. their “accounts”, to both the DfE (by the 31 December each year and Companies House (by 31 May the following year). They also have a requirement in their Funding Agreement to publish the same documents on their website. Any expenses paid to any members of the Academy Trust or to any member of the Governing Body will necessarily need to be declared in the SOFA, as it would for any other charity.

    29 April 2012 at 1:07pm

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