Bringing Internal Scrutiny In-House: How Venn Academy Trust Made It Work
The Challenge: Moving Beyond “Tick-Box” Audits
When I became Chief Financial Officer at Venn Academy Trust three and a half years ago, I inherited a challenge: our internal scrutiny processes were lagging behind. With 7 weeks until the end of the academic year no internal audits had been undertaken. After a year without a full-time CFO, trustees felt that internal auditors, though financially skilled, lacked the broader understanding our Trust needed. Internal auditors did not listen to the Trustees needs and wants and the relationship was fractured. Scrutiny had become a “tick-box” exercise, not a tool for real improvement. This frustration was a recurring theme in trustee meetings, and it was clear something had to change.
A Bold Solution: Bringing Audit In-House
The trustees proposed an unconventional and bold idea: employ our own internal auditor. Sounds easy, right! However, this delivery method of internal scrutiny, whilst acceptable in the Academies handbook, was rare in our sector, and I had my doubts. Could one person really cover all our needs? Despite having two years left on our contract, the relationship with our audit firm had broken down. When they terminated the contract early it provided an opportunity. With no plan for the new academic year, I arranged interim audits with individual specialist firms to cover the next 12 months and began researching how to build an internal scrutiny function from scratch.
I started by reaching out to recruitment agencies, audit firms, and other CFOs and trusts. Few had experience with in-house scrutiny, and some thought the idea was a little crazy. Still, I developed a job description, calculated the hours needed, and presented a business case to the trustees. Their idea, so naturally, they approved it.
We advertised the role and found the perfect candidate in an experienced school business manager from within our Trust, with a background in internal audit and a reputation for diligence. In September 2023, she became our Internal Scrutiny Officer (ISO- because we do love an acronym in education!) and together we built the role from the ground up.
Laying the Foundations for Success
In her first half-term, our ISO met with other auditors, reviewed government guidance and Trust policies, and helped devise a comprehensive three-year audit plan covering thirty areas. Importantly, our scrutiny extended beyond finance to every aspect of Trust life. The first year was intense. Scrutiny was always on my mind, and the ISO had many questions, some of which I couldn’t immediately answer. But as the year progressed, the impact became clear. Trustees gained the assurance they needed. They had someone who was happy to be challenged and could really drill down into the detal they wanted. We, as trust leaders, could focus on driving change.
Scrutiny as a Tool for Improvement
Over the past two years, we’ve reviewed a wide range of areas: financial controls, risk management, staffing structures, payroll, cyber security, budgetary controls, trips and visits, connected parties, marking and social media, staff wellbeing, work experience, due diligence, and performance management. Some areas are reviewed annually, others every three years. Our plan evolves each year, reflecting audit findings, the Trust risk register, and trustee priorities. The flexibility means that if a review uncovers something of concern we can undertake a deep dive on a specific area straight away.
Crucially, scrutiny is no longer seen as intimidating. School staff are now familiar with the process which is led by someone who understands their world. Processes are updated more quickly. We are striving to ensure consistency exists across our schools and scrutiny is becoming embedded in everything we do. We are no longer just ticking boxes; we’re using scrutiny as a tool for continuous improvement.
Lessons Learned: What Other Trusts Can Take Away
- Tailor Your Approach: Internal scrutiny can be shaped to fit your Trust’s unique needs and priorities and goes way beyond finance.
- Stay Flexible: an in-house function allow you to shift focus quickly when new issues arise.
- Engage Staff: Familiarity breeds trust. Staff are more open to scrutiny when it’s led by someone they know. Our staff know scrutiny is not about tripping them up, it’s to help them improve processes.
- Keep Learning: The process is ongoing. Plans should evolve based on findings and changing risks.
- Seek External Support When Needed: No one is an expert in everything. Find companies who offer specialist reviews and enhance your offer eg Cyber, Safeguarding. Lean on other trusts for peer-to-peer reviews.
Final Thoughts
Looking back, I can admit I was wrong about this approach not working (my CEO reminds me frequently how well it works!). Trustees now have the assurance they need, we have the flexibility to adapt, and scrutiny is a normal, valued part of school life.
As a CFO, I can’t finish this without mentioning cost. Yes, it is more expensive than the traditional audit function. However, not significantly. We achieve real value for money in the way we have modelled the offer when we consider the number of areas we cover each year and the confidence we have in the reports trustees now receive.
For any Trust considering a similar move, my advice is simple. Trustees must have a real passion for risk and scrutiny to make this worthwhile. If they do, be bold and go for it. Be prepared that the journey is a learning curve and keep in mind that meaningful scrutiny is about improvement, not just compliance.
Rebecca Broadbent– Director of Finance at Venn Academy Trust
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