An insider’s guide to an ESFA audit

Many Bud customers have recently reached out to let us know they’ve received a 0% error rate in their recent ESFA audit – largely thanks to how Bud automatically captures and records learner progress.

We regularly hear from apprenticeship training providers who have gone through ESFA audits: the process, the challenges and what they wish they’d known in advance.

That’s why we’ve decided to put everything we’ve learnt from these conversations into this useful guide. In this, the first item in our series about ESFA audits, we explain how an ESFA audit works, from what you should do to prepare to the key areas auditors will look at.

You can read more in the series here:

• Checklist: Common ESFA errors and how to prevent them
• Case study: How Bud helped Raise the Bar achieve an ESFA audit with 0% errors
• How Bud can drive compliance for your next ESFA audit

How the ESFA notifies training providers

The Education and Skills Funding Agency (ESFA) will notify you by letter or email that they will be conducting an audit. These audits normally fall in the autumn and look at the previous year.

Once you’ve been notified, you’ll book a meeting with the lead auditor to confirm the process and discuss their expectations. The time between initial notification and this meeting can vary from a few weeks to up to two months.

The meeting gives you a chance to ask any questions and get a greater understanding of what will happen in the lead up and during the audit. You’ll also agree on key dates for the audit, and when the auditor will receive your sample data.

The sample data for ESFA audits

The sample data is 10% of the Individualised Learner Records (ILRs) from your most recent R14 submission. The auditors can select any learner on your ILR, regardless of their status.

Expect the selection to be a mixed bag. It’s likely that most will still be on programme, with a few completions and withdrawals. And, as our customers have told us, it’s the luck of the draw: there will inevitably be a few in the sample that you’d rather weren’t in there.

Once the sample has been chosen, you’ll need to provide greater depth of evidence on each of those learners.

Who needs to be involved in the audit

The number of people involved in the audit will depend on the size of your organisation.

For larger companies, an ESFA audit might involve the entire Management Information Systems (MIS) department. For smaller providers, it might be the Operations Director who takes the lead, with the Data Coordinator gathering the required evidence.

Either way, you’ll certainly need to have whoever is responsible for ILR submission, compliance and funding involved.

Your board should also be aware that an audit is taking place. It’s unlikely that they will have any direct involvement, unless the audit raises a risk or concern that needs to be escalated. That said, your board will still want to be informed because of the potential financial impact (more on this later).

Your protocol for informing relevant stakeholders of an audit is something that you can easily arrange in advance. It could be as simple as deciding whether to send an email or call a meeting – either way, it should be an alert that everyone can look out for.

The three areas of focus for ESFA auditors

ESFA auditors usually look at three key areas:

1. Enrolment: Sign-up, eligibility and required documentation, and correct start date
2. On programme: Evidence of monthly engagement, functional skills delivery and off-the-job (OTJ) training. OTJ training in particular is a key focus for both ESFA and Ofsted in the 23/24 apprenticeship funding rules
3. Completion: Withdrawals and breaks in learning captured with the correct end date

Prepare for auditors to ask lots of questions. For example, if you’ve registered that a learner attended an event but the learner hasn’t evidenced it, the auditors will query it. You’ll then need to get confirmation from that learner who may no longer be on programme.

If the auditors notice errors or inconsistencies with three or more learners, they’re likely to require more depth of evidence.

Case study: How MTD Training are ensuring ESFA compliance with Bud

How to prepare for an ESFA audit

When our customers go through an ESFA audit, we always ask them what they wish they’d done to better prepare in advance. Here’s their advice for other providers.

1. Make your board aware of the risks

It’s important to know the bigger risks of an ESFA audit. Board directors need to be aware of the financial impact of a bad audit and the potential risk to the business.

2. Run mock audits

Mock audits are the best way to make sure you’re on track and up to date on the key themes. You’ll also be able to identify potential risk areas early on and make improvements before the real auditors come in.

If you’re a Bud customer, you can be confident that you’ll have all the evidence you need for your audit. However, you can still do mock random sampling of the data in Bud as part of your preparation.

3. Review high-risk areas

If you’re not using Bud, review potential areas of concern like:

• Functional skills
• Ensuring start and end dates are correct
• OTJ hours: OTJ activity must be agreed in advance of delivery, completed during normal working hours and accurately tracked

Download now: Nine simple tips for preparing for an ESFA audit

What are your next steps?

If your compliance processes are robust and everyone is following them correctly, you should have nothing to worry about during an ESFA audit. However, if your organisation still relies on multiple systems, then compliance can be much harder to prove.

Bud’s apprenticeship and training management software was built to drive compliance, from enrolment right through to end-point assessment. Learn more about how Bud eases the worry of ESFA audits or book a demo now.