The School Standards and Framework Act 1998 (section 48) requires the financial controls within which delegation works to be set out in an LMS Scheme prepared by the Local Authority and approved by the Secretary of State for Education.
The LMS Scheme is the funding framework for schools. It sets out the financial relationship between the Local Authority and the maintained schools it funds. Within it are requirements relating to financial management and associated issues which are binding to both the Local Authority and the schools. The Scheme is revised in line with Governmental directions.
The LMS Procedure Rules form part of the overall control framework. They aim to facilitate service delivery by setting out best practice for the administration of all financial matters within schools. This, then, ensures a high quality of financial information thereby enabling better decision making. They should not be viewed as a barrier to executive action and are constantly kept under review to ensure that they remain relevant to the day to day activities of the school.
The School Finance Manual contains both the LMS Scheme and the LMS Procedure Rules (Chapter 2). It provides schools with more detailed information in relation to particular areas such as budgets and forecasting, banking arrangements, purchasing, VAT and charging for school activities.
Click here to go to the School Finance Manual where you will find both the LMS Scheme and the Procedure Rules.
