SIGNIFICANT weaknesses have been identified in the financial management of Abbey College, according to a county council report. Council officers writing Cambridgeshire County Councils Internal Audit Report to June 2010 said they could only provide limited assurance over the financial arrangements in place at the Ramsey secondary school. It follows the councils decision late last year to hold an independent review into Abbey Colleges finances which itself followed the issuing of a notice of concern to the college. The review, requested by the service director of the Children and Young Peoples Services, aimed to identify the adequacy of plans to manage the colleges budget, which had been forecast to be in deficit. The review identified two major factors that led to the colleges deficit: budget overspends, particularly relating to staffing, and a falling roll, leading to reduced funding. The internal audit report, due to be discussed by councillors at a meeting on June 28, said: The key issue arising throughout the review was a lack of adequate forward financial planning to ensure that the colleges aim for improved academic achievement is matched with a balanced and sustainable budget. Based on our testing and discussions with relevant personnel, we could only provide limited assurance over financial management arrangements at the college. Limited assurance is defined in the report as meaning There are significant weaknesses in key areas in the systems of control, which put the system objectives at risk. A spokesman for Abbey College said: While Abbey College remains a large and improving school, a falling local birth rate has reduced the number of secondary aged students and since amalgamation in 2006 the school has been reducing its costs as prudently as possible without jeopardising its ongoing success in raising standards. In line with other local schools in recent years, reduction of cost in the light of falling income can only be effectively be dealt with over the medium term and therefore working in close partnership with the local authority, Abbey College has produced a deficit recovering plan to meet the demographic challenges it faces. The school is on target to return to a surplus position in line with the recovery plan agreed with the local authority and this is being helped by a further increase in post 16 student numbers as standards continue to rise. A spokesman for the county council added: Abbey College submitted a deficit recovery plan in December 2009 identifying a range of actions to be taken by the college over the next three years to address the deficit. The college is in the process of updating that plan. The county council expects to be able to remove the Notice of Concern on receipt of the revised plan. The continuing reduction in the number of pupils due to a falling birth rate presents on-going challenges as funding is directly linked to pupil numbers.