This update clarifies the position for you as employers and highlights the changes for your 'auditors'. All independent schools with teachers in the Teachers' Pension Scheme (TPS) are required to submit annually an End of Year Certificate (EOYC). You must also arrange for an independent report on this to provide assurance to the Secretary of State that all contributions due have been correctly paid over to the TPS.
Schools will be aware that the TPS has undergone significant changes over recent years, moving from single employee and employer contribution rates to the tiered employee rates and higher levels of employer contributions which schools now have to manage. The level of complexity has been further increased with the introduction of the career average scheme for some members together with the increase in the available flexibilities including faster accruals, actuarial reduction buy-outs, additional pension benefits purchasing and AVCs.
At the same time there has been clarification and tightening on some of the rules and definitions, for example on what is pensionable and non-pensionable pay including areas such as bonuses, overtime, expenses, accommodation, salary sacrifice and payments that are not part of their duties as a teacher.
One area that has not changed is the timetable for the submission of the EOYC, although 2017 has seen further changes in the instructions and processes for the submission of this by independent schools. Schools will already have been made aware of the timetable by the Teachers' Pensions with the first deadline date being 31 May 2017 to submit an unaudited EOYC form. The EOYC is required to provide Teachers’ Pensions with details of contributions analysed within the relevant tiers and reconciled against the total amount of contributions paid during the year by the school.
For 2017, Teachers' Pensions have implemented a new online EOYC. which has been made available via the Employer Portal and on their website. There is also a facility to upload the form via the employer portal although Teachers' Pensions have confirmed that forms may also be submitted by post or email. They have acknowledged that at the end of May there have been issues with their website which has been showing the message "Please be aware our website is running slow and there are delays with emails and online forms" and have accordingly extended the filing deadline to Friday 9 June 2017.
Following the initial submission of the EOYC there is, as in previous years, a requirement to have the form independently checked and for a hard copy of the 'audited' form to be submitted separately before the later deadline date 30 September 2017. However, the reporting process is another area where the Teachers' Pensions have made changes with the requirements now being set out in a 26 page Reporting Accountant Guidance document TP05 (available on the Teachers' Pensions website forms page).
Whilst the specific testing suggested in this guidance is basically similar to 2016, a key change has been the inclusion of a pro-forma 'Reasonable Assurance Report'. which is significantly different to the form of report we, as auditors, have issued in past years.
The final version of this reporting guidance was only published in May 2017. We are currently looking at the potential implications for the work necessary for us to be able to meet the new report requirements and are also reviewing the implications for the contractual arrangements between ourselves, the Teachers' Pensions and our clients. We plan to resolve this over the next few weeks to ensure that any necessary changes are agreed to enable us to report within the 30 September 2017 deadline.
For any schools for which we carry out the independent reporting we will be contacting you to discuss the process and changes either as part of our general audit planning or separately if necessary. However, if you have any immediate concerns over your EOYC submission, please do get in touch with your audit team who will be happy to discuss this with you.