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Online Payment Systems: An End to Dinner Money Debt?

Jane Monaghan is a senior review consultant in the Education Finance Support team. Jane has a degree in accounting and conducts independent reviews for academy trustees and school governors concerning the appropriateness of financial controls in operation, providing the audit committee and governors with an informative report and recommendations to strengthen controls. Jane also assists in ensuring the annual reviews are compliant with current DfE policy and best practice guidelines.

With countless administrative hours and staff resource spent counting, handling and recording cash, schools and academies are looking to introduce efficiencies, primarily redirecting valuable staff resource away from counting cash and tracking income, as well as reducing the risk of money being lost. It is not a surprise therefore that an increasing number of schools and academies are starting to utilise online payment systems.

But internal controls reviews that we have carried out have shown that the use of these systems does not necessarily mean an end to dinner money debt.

Key to reducing or eliminating dinner money debt is a robust process for monitoring and recovering all income due. Schools and academies often fail to use the functionality within the online payment systems to identify arrears balances outstanding and take the appropriate action.

Our Internal Controls Evaluation reviews carried out at schools and academies who use online payment systems in Essex and outer London in the past 12 months have revealed varying levels of dinner money debts, with one academy’s debts amounting to £19,000! This is an expensive consequence due to the absence of processes in place to recover arrears balances.

In addition, these reviews have shown that, often, not all meals served to pupils are recorded in the systems. There is often no reconciliation between the number of meals ordered and those actually served. Differences identified should be investigated and reflected retrospectively in the systems to ensure that all income due from meals served is received. Some schools and academies have started to operate a band or ticket system to make it possible for kitchen staff to identify the individual children that have actually ordered a meal.

The charge for one school meal is relatively small so the prospect of introducing new systems of monitoring may seem futile but a couple of extra meals per day multiplied across the whole school year can amount to a large hole in the budget. Dinner money income arrears are a debt to the school; therefore ensuring those debts are recovered should be a routine activity in the financial management of the school or academy.