Bursar’s Review

Summer 2022 www.theisba.org.uk 12 Finance The changes can be obvious and thus easily dealt with or they can be insidious, more difficult to identify, and, therefore, demand a more thoughtful remedy or amelioration. Scenario planning will be key in the governance process. There is a danger that the scenario becomes, in the minds of those working on it, a forecast. This should be resisted as it can be dangerous to assume that all the factors identified in the building of a good scenario will be accurate and will happen within the timescale that the scenario identifies. It is also worth noting that three scenarios will be required; one optimistic, one pessimistic, and one realistic to apply simplistic titles to these major pieces of work. The point is that none of them will be entirely correct and the answer will lie somewhere between the optimistic and pessimistic extremes and, if well judged, the realistic scenario will prove, over time, to be almost correct. It has never been more necessary to make sure the relationship between the board and the executive is transparent, trusting and well-founded on a good set of policies and delegations. Any deficiencies will be very rapidly shown up as the pressure comes onto schools to make some of the complex decisions that will be required in the next 24 months. Managing the school The executive, while managing the school on the board’s behalf, will need to be alert for any changes in the school’s circumstances or in the circumstances of the parent body that begin to reveal a change in the risk profile, which may mean that action is required. School leadership teams will need to stay close to the parent body to ensure that the school’s unique selling points (USPs) are those that the parents still need for their children and that the school is still fulfilling its promise on delivery. It may be worth considering a revision of the school’s marketing and communication strategies to make sure that the messages that surround the USPs are clear to the existing parent body and to any prospective parents. The school’s reputation is always a key factor when attracting and retaining parents. Great care should be taken to ensure that nothing adversely affects this vital selling point. Fee rises There will be an increased sensitivity in the parent body to any fee rise. It is therefore incumbent on the school to make sure that money is not being wasted and any area that may appear unnecessary in terms of expenditure is trimmed at the first opportunity. If this is obvious to the parent body it will be clear that the school is to be trusted with parents’ money and is not inflating fees to cover poor management, profligate decisions or an inefficient staff structure. If that relationship, often unspoken but clearly understood, can be established with the parent body then the school is in a particularly advantageous position to communicate clearly on fee rises and the necessity for them. Capital expenditure Capital expenditure plans are an area that should be scrutinised by both the board and the school executive. It is very tempting to cut all capital expenditure, preserve cash and live from day-to-day, trimming costs wherever possible. However, the economic crisis will pass, and scenario planning will help to identify when the recovery will happen. So, whilst prudence in capital expenditure is both wise and necessary, a complete stop, unless there is no other alternative, will not generate confidence amongst the parent body. They may conclude that the school is uncertain about its future and its ability to survive the economic crisis. It has never been more necessary to make sure the relationship between the board and the executive is transparent, trusting and well-founded on a good set of policies and delegations. Prudence in capital expenditure is wise and necessary, a complete stop, unless there is no alternative, will not generate confidence amongst the parent body