Education, as a sector, has come under considerable financial pressure in recent years. Most notably, there has been the imposition of VAT on private schools, which had previously been exempt. For a school or college to thrive, it will need a robust strategy to deal with a range of economic and regulatory challenges.
Let’s look at what these organisations might be considering.
Strengthening Budget Forecasting Under Spending Constraints
If you can anticipate problems, then you might stand a much better chance of avoiding them. Accurate, regular forecasting might therefore be critical. If you understand that there’s a reasonable risk of a funding shortfall in the coming year, for example, you might be better positioned to deal with it.
Embracing Digital Tools for Cost-Control
Modern educational institutions have access to an impressive range of technological tools. These can be leveraged to drive down costs. For example, you might deal with your payroll and student fees with the help of a specialised platform. This can help you to drive down your administrative costs, and to glean insights from all of the data being collected.
Reviewing Fee Structures and Diversifying Income Sources
If you’re earning your money from just a handful of sources, then you might be vulnerable to shocks. What if a portion of your income is suddenly snatched away by events beyond your control?
Educational establishments can diversify by offering extra services, and by partnering with local businesses. The right educational accountants can help you to optimise your fee structures, too, by poring through those structures and identifying potential changes.
Enhancing Transparency and Governance with Financial Oversight
If you are to remain compliant with regulation, and to retain the trust of the wider community, then you’ll need robust financial oversight and a system for transparent reporting. Financial irregularities can occur in any organisation, and they’re caused by incompetence as well as malice. Having systems in place to identify problems early can help you to avoid the legal and reputational damage that those problems can bring.
Embedding Risk Assessment and Contingency Frameworks
It’s important to keep one eye on the future, and to anticipate challenges as well as react to them. Given this, regular financial risk assessments are a necessity. Think about what could change in the world of education, when it comes to both economics and public policy. Then suggest how you might react to those changes.
For example, if public finances are weak, and the Chancellor needs to raise money in a budget, it’s sensible to consider how you might respond to a range of potential changes. It might be that you never need to put your plans into action – but having them there will allow you to act decisively when action is necessary.
