Prep school overspent

[Bestbatson]

Our prep school overspent last year
according to the charity commission website.
All previous years financial reports look fine.
fees will go up 5% in September.
would you be worried about financial viability of the school in view of impending VAT?
It’s currently over subscribed and in an affluent commuter town.
they are phasing out TPS.
Leaving affordability aside, if your kids were approaching a natural break point would you move them in anticipation of the school facing financial difficulty in a couple of years or would you stay?

What was the overspend on and how much was it?

could the school be investing in capital projects with a view to offsetting against VAT?

Was it due to increased expense or reduced income from previous accounts?

Fair points/Qs.
Income was up on previous years.
over spend very approx 300k.
Overspent on a project which has since been scrapped.

‘Only’ 5% rise (in this environment) suggests they feel like they can manage a one off overspend. If they are oversubscribed that is also a good sign.

i think VAT will really squeeze a sector that is already challenged by rising costs, but I think all private schools will feel that to a certain degree, and given dire situation in many state schools I wouldn’t change sectors preemptively unless I knew our finances required it.

if you have concerns about your school specifically, I would start to think about plan b , but based on what you have shared I don’t think there is any reason to make big changes.

I'd be concerned about the loss of teaching staff if they are phasing out TPS.