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(+ 353) 1 592 0850Why sticking with incumbent systems is costing you more than you realise.
Education finance leaders often assume that staying with their current system, whether a legacy solution or a piecemeal setup, is the safe and cost-effective choice.
But the reality is that inaction comes at a price. From inefficiencies and lost productivity to compliance risks and missed opportunities, standing still can be one of the most expensive decisions a CFO makes. This can be true of all business management systems in public sector organisations, not just education finance.
Moore Kingston Smith is a leading multi-disciplinary advisory, tax and audit firm, key strategic partners on the iplicit Advisory Council, and trusted outsourced finance function and accredited implementation partner for iplicit education, non-profit and mid-market organisations.
In this guest post, Marcus Lees-Millais delves into the true cost of doing nothing.
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MATs: Is your finance system costing you more than you realise?
Here at Moore Kingston Smith, we have the privilege of working with numerous multi-academy trusts. Within those MATs, over the years, we have seen a huge variety of financial systems, which we broadly categorise as: fit for purpose; outdated; or under-exploited.
The optimum scenario for your MAT’s finance system fit for purpose. It meets all your MAT’s needs and has effective and proportionate controls and processes. It saves you time on your everyday tasks, gives you good-quality management information in real time and guarantees increased security.
Surprisingly, most MAT finance systems don’t fall into the fit-for-purpose category. Sticking unquestioningly with your incumbent finance system is likely to be denting your bottom line without you even realising.
Which category does your MAT’s finance system fall into?
How to tell if your MAT's finance system is outdated
An antiquated finance system has clunky processes and obsolete functionality. In many cases, these old systems aren’t updated or patched by the software owner, meaning that they lay prone to attacks by malware and hackers.
They are not equipped to handle the nuance and complexity of MAT accounting. For example, can your finance system deal with the complexity of deposits and deferred income, accruals, and large volumes of staff costs and changes? These outdated systems are accompanied by old-fashioned and manual processes. A “we’ve always done it this way” approach could be costing you dearly.
How to tell if your MAT's finance system is under-exploited
You have invested in a new, state-of-the-art finance system. An external consultant installed the system for you and helped you migrate over to it, expecting you to then fathom it out for yourself. Time-poor, you manage to harness some of its functionality and fall back on your old familiar manual spreadsheet process.
Do you know how to set up automated real-time reporting? Can you modify the system to suit your MAT’s specific requirements? Does it capture the financial waterfall linked to pupil numbers and joiners and leavers?
Improved budgeting and transaction coding makes it simple to see what different parts of your MAT are costing. Financial monitoring enables more agile decision-making at every level in your MAT.
Is the rest of your MAT’s finance function in order?
Your finance system is one part of your MAT’s finance function as a whole. People and processes are also vital pillars of that function. Ultimately, it is the finance staff who are embedding those processes within your finance system.
Your processes should be robust and your finance team proficient to get the best out of your finance system. Then you will have the optimum scenario for your MAT’s finance system.
Don’t just ask yourself if you can afford to change your finance system. Ask yourself if you can afford not to. The cost of doing nothing may just be greater than you realise.
Help from the experts
Moore Kingston Smith’s Nonprofit Advisory experts understand the considerable challenges facing MAT’s finance people. Financial pressures are coupled with reduced resource and increased regulation, compliance and reporting.
Speak to us for help with upgrading your finance system or for training and support on a newly installed modern system. Additionally, we can help you overhaul your wider finance function.
Contact us for a no-obligation conversation to explore your MAT’s situation.
Tel: +44 (0)20 4582 1000
Email: pd@mks.co.uk
Marcus Lees-Millais, ACA
Connect with Marcus on LinkedIn
Marcus works for the Non-Profit Advisory team at Moore Kingston Smith providing a range of services from finance function reviews and cost recovery work to financial modelling and finance training.
In his spare time, Marcus is a co-opted governor of a primary school in Brentford.
Moore Kingston Smith has dedicated Education and Charity divisions.
WATCH!
The Active Learning Trust, Greenwood Academies Trust and HISP Multi Academy Trust share their insights on the wider costs of outdated EdTech.
"If you're always doing what you've always done, you'll always get what you've always got. And I think when you're an organisation that's ambitious and aspirational, and you can't just be satisfied with what you've got right now, you've got to push on to the next best thing."
