The Optimus blog

The blog that inspires leaders in the UK education sector

The Optimus blog

The blog that inspires leaders in the UK education sector

Lisa Griffin

Could you be a MAT CFO?

We speak to financial experts about the crucial role played by finance directors in multi-academy trusts.

Stephen Morales, executive director of the Institute of School Business Leadership (ISBL)

What are the key skills that a finance director (FD) or chief finance officer (CFO) in a MAT needs? 

If you’re going to become FD or CFO of a multi-academy trust (MAT), looking after three, four or five thousand children, taking care of all kinds of complexity, then you need the right skills.

Firstly, they need a strong understanding of the appropriate financial frameworks. They need to be able to navigate and interpret the accounts, and they need an appreciation of their responsibilities, accountabilities and statutory duties. Both technical knowledge and strategic leadership skills are needed.

Not everyone would agree with me, but I don’t think you necessarily have to be an accountant. You do need the technical knowledge, but you could access this via your audit company or an accountant on your team.

What’s the better route into being a CFO: promotion through the school ranks, or coming in from the outside? 

This is an interesting debate across the sector! Personally, I believe it’s harder to acquire the deep technical knowledge and strategic leadership capability needed for the role, than it is to learn the context in which you’re coming into. But maybe I would say that because that was my journey! Others would argue the other way.

I don’t think you necessarily have to be an accountant

However, you certainly cannot come in from outside education and not be sensitive to the needs of the people you’re serving and your stakeholders. There has to be a complete commitment to the optimisation of resources, above the bottom line. The bottom line is only a means to an end.

If you came into a school environment and your sole goal was to run a surplus, irrespective of the needs of the children, then that would be a huge mistake. But coming in and saying: ‘how can we work differently, more innovatively, more efficiently, ensuring that we get more resources to the front line, and can serve our community of children over a sustained period?’– that has merit.

What advice would you give to aspiring school business managers?

What I’ve been saying to our members and the community at large, is that you’ve got to understand the current landscape. We may wish there was more support at local authority level but there isn’t – we’ve got to be more self-sufficient.

Ask yourself: how do I want to position myself for the future? Do I want to be a generalist? Do I want to specialise and go down an HR route, or procurement, or finance? Do I want to take on a broader strategic remit and go for a chief operating office role?

You need to understand where you are, the landscape, and where you want to be. What you don’t want to do is ignore what’s happened and hope for a change of government that will take us back to where we were before. I think that’s a huge mistake.

If we regard ourselves as professionals, I think there is an imperative for continuous improvement: engaging in study, gaining new knowledge – so that you can perform to the best of your ability. 

Speaking of professionalism, some MATs have hit the headlines for financial mismanagement. What’s ISBL’s role in avoiding such situations?

When it comes to impropriety and fraud, there is little ISBL can do – and fortunately such situations are rare. You need robust controls and clear lines of responsibility; power should never reside with just one or two individuals.

I think fraud and misappropriation are rare, despite the headlines. But financial mismanagement is another matter.

Firstly, the role of the accounting officer and the CFO need to be clearly understood. There needs to be a dotted line between the CFO and the board of trustees or directors, so that you don’t end up in a situation where the CFO is articulating risk and the CEO vetoes that position.

Sometimes our members find themselves in an untenable position where they are saying: ‘you can’t continue to spend at this rate’ and the headteacher takes the moral high ground and says: ‘I don’t care about budgets, this is about the children, it’s about standards’.

There needs to be a dotted line between the CFO and the board of trustees or directors

If our members can say ‘my professional integrity depends on you taking this advice’, that’s helpful for them. Having the institute status gives people a way of depersonalising an issue. ‘It’s not me being awkward, this is what my institute requires me to do’. 

Andy Collings, consultant CFO and COO, Challenger Multi-Academy Trust

What are the key skills that a FD or CFO in a MAT needs?

Relationship building is key. The ability to build relationships and trust with senior management and staff at schools is crucial to being able to deliver targets and deadlines.

Listening is another one. Often schools joining MATs have operational, structural or financial issues. An FD who listens and empathises, while helping formulate a solution, will make progress.  

Being organised and flexible are also important. Being able to plan ahead, but also adjust plans swiftly to deal with issues is key to success in a MAT. On an underlying basis, being able to forward plan to ensure key compliance deadlines are met and there is a clear visibility of cash flows for the next six-12 months is vital. Day to day, the ability to change tack and deal with an urgent issue with clarity and quick decision making is important.

An FD who listens and empathises, while helping formulate a solution, will make progress

Each school has its own unique culture, environment, financial position and educational standards. An FD needs to be able to read the 'mood' music and flex their style accordingly to be able to build the relationships and trust needed to help deliver any required financial changes.

Finally, financial astuteness is crucial. Being proactive in spotting issues and finding solutions which will allow a positive cash flow to be maintained and targets to continue to be tracked. 

How has your career led to you working in with MATs? Have you always been in the education sector?

I worked for one the 'Big 4' accounting firms for around 17 years covering audits, teaching, running a large audit team and for the last five years carried out financial due diligence.

My last client was in the higher education sector and I joined them to complete the deal we had been working on together. I then joined a large K12 independent schools’ business before moving in to the multi-academy trust sector where I feel we can make more of a contribution to society. I've been working in the education sector for nearly six years now.

What advice would you give to an aspiring FD/CFO working in a trust?

  • Create and develop good relationships with schools and central teams and key external stakeholders such as the audit team.
  • Build a good peer network of MAT CFOs/FDs.
  • Ensure you are fully up to date with the funding situation and the impact on your schools and overall business.
  • Try to stay involved at a strategic level to ensure you're aware of the key risks and opportunities that your MAT faces and the potential impact on cash flow.
  • Plan ahead for key DfE and other deadlines and build in sufficient contingency time for gathering data and delays in systems.

More from Optimus

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Could you be a MAT CEO?

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