A troubled FE college has settled a claim over an unpaid £426,000 bill from its former internal auditor, FE Week understands.
Bath College faced legal action from Birmingham-based Icca (Holdings) Ltd over the alleged debt.
But the two parties are understood to have settled for an undisclosed amount days before the dispute was to be heard at Birmingham County Court.
The college confirmed legal proceedings had concluded but refused to confirm its link to the company, or how much it agreed to pay.
However, the college’s annual accounts list Icca Education, Training and Skills Ltd, part of the Icca (Holdings) group, as its internal auditor from 2019 to 2022.
Accounts for the year to July 2023 reveal Bath College bosses judged the company’s chance of success were “not greater than 50 per cent” so they failed to set aside the £426,000.
Icca – classed as an “education support company” in Companies House records – runs several firms including the Finance and Management Business School, KHL Transport Training and Skills College UK.
Icca owner Scott Winter did not respond to requests for comment.
Leadership challenges continue
Bath College has been run on an interim basis by FE Commissioner special adviser Martin Sim since former principal Jayne Davis resigned in February for “personal reasons”.
Her exit came shortly after Ofsted downgraded the college from ‘good’ to ‘requires improvement’.
Bath’s most recent accounts published last year said its Education and Skills Funding Agency rating fell from ‘good’ to ‘inadequate’ due to “financial underperformance” that breached the terms of a loan from Barclays bank.
Due to the breach the loan was reclassified to “due in less than one year” which increased net liabilities by £2.5 million.
Had the loan not been reclassified, the college claimed its financial health would have been rated as ‘requires improvement’.
The college’s deficit doubled from £1.1 million to £2.3 million from 2022 to 2023, and its education-specific EBITDA (earnings before interest, taxes, depreciation, and amortization) plunged from 4.28 to -4.1 per cent. The FE Commissioner’s benchmark for a healthy education-specific EBITDA is 6 per cent or more of total income.
Bath College’s deficit was reportedly due to higher operating costs and lower than predicted student numbers.
The college teaches around 8,900 students, including 5,000 adult learners, 2,200 16 to 18 year olds and 650 apprentices.
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