A two-year run of cash-strapped academy trusts eating into their reserves has come to an end, with the largest MATs recording gains of over 拢1 million. But the , a network of accountancy firms, has warned leaders not to 鈥減op the champagne鈥, as most trusts expect to dip into their saving by as much as 43 per cent by 2028. It comes after a Schools Week investigation last month revealed more trusts bolstered their reserves last year 鈥 with one registering a 900 per cent boost. Here鈥檚 what you need to know from Kreston鈥檚 academies benchmark report for 2026鈥 1. Reserves boost Only 37 per cent of trusts returned in-year deficits in 2024-25, down from 60 per cent 12 months earlier. The biggest MATs recorded in-year surpluses of 拢1.1 million on average. The figure stood at 拢28,000 the year before. This comes after Kreston had seen 鈥渁n ever-greater proportion鈥 of academy chains dipping into reserves in 2023 and 2024. The study 鈥 which involved 250 trusts running almost 2,500 schools 鈥 attributed this to the sector being given a 鈥減leasant surprise鈥 by government, which covered 鈥渁 little more of the [teacher] pay rise 鈥 than expected鈥. 鈥淚n a sector where the finances are so finely balanced then this can make all the difference,鈥 the report explained. Kreston also found 26 per cent of trusts are sitting on reserves that represent less than 5 per cent of income, down from 35 per cent in 2023-24. The Department for Education recommends trusts hold reserves of at least 5 per cent of total income. Twenty per cent above that level is considered too much. 2. 鈥ut don鈥檛 鈥榩op the champagne鈥 However, Kreston added it was 鈥渨orth emphasising that for the [single academy trusts] and small MATs these surpluses are still very modest鈥, ranging from 拢6,000 to 拢39,000, before 鈥渨e pop the champagne corks鈥. There also remains 鈥渁 great deal of uncertainty鈥. All trust types, except medium-sized MATs, are forecasting reserves to fall by up to 43 per cent over the next two years. Kevin Connor, a report author and head of academies at , said this shows 鈥渃ontinuing uncertainty are already weighing on confidence and limiting trusts鈥 ability to plan, invest and grow鈥. 鈥淥n the face of it, academy trusts have had their strongest financial year since 2022. 鈥淗owever, surpluses have been largely propped up by tighter budgeting and in-year funding trusts were not expecting when they set their budgets, rather than by any easing of underlying financial pressures.鈥 3. Call for forecast rethink Despite this, the report stressed trust forecasts 鈥渘eed to be taken with a large pinch of salt鈥. The 鈥渁ccuracy鈥 of budgeting 鈥渋s not particularly reliable鈥, with trusts tending to err on the side of caution. Kreston believes this raises questions over 鈥渨hether trusts are making poor decisions鈥 based on the projections and if there鈥檚 鈥渁ny real value鈥 in the forecasting process for schools or the DfE. 鈥淲e have had a number of conversations with our clients where they didn’t think they could afford to replace a teaching assistant but then went on to make a surplus for the year. 鈥淗ad they had reliable financial information then, in many cases, these roles could have been replaced.鈥 Kreston called on the DfE to provide leaders 鈥渨ith a longer-term income plan 鈥 on a timely basis鈥. This 鈥渨ould have the potential to transform the budgeting process and lead to better decisions鈥. 4. Growth stalls Thirty-six per cent of trusts are expecting to expand this year, down from 61 per cent 12 months ago, according to Kreston. Connor said that 鈥渓ow confidence across the sector has dampened growth predictions鈥, amid 鈥渟erious concerns鈥 over 鈥渨hether trusts have the funding and resources they would need to turn schools with complex challenges around鈥. 5. Investment gains The research shows trusts have also cashed in on 鈥渟ustained high interest rates over the past four years鈥. On average, trusts generated investment income of 拢33 per pupil last year, up from 拢29 per pupil in 2023-24. Large MATs returned the most (拢39 per pupil). Kreston said the figures reflect 鈥渢he sector鈥檚 ongoing commitment to maximising income and strengthening financial resilience鈥. 6. Staff cost pressures Just under 90 per cent of trusts responding to a Kreston survey listed staff costs as one of their top three concerns this year, up from 81 per cent. Its analysis shows teaching and support staff salaries now account for over 75 per cent of total income, a commonly used benchmark for financial health, for all trust types. 鈥淚t is interesting that there is also no meaningful gap between SATs and MATs in terms of this metric, which suggests that in absolute terms size is having little impact on this as everyone is in the same position.鈥 7. 拢200k CEO pay average The report shows the CEOs of the largest MATs are earning over 拢200,000 on average. This figure stood at 拢189,000 last year. But CEO pay for all types of trusts, except primaries, 鈥渉ave seen growth that is, on average, consistent鈥, with the range 鈥渘ot significantly different to previous years鈥. 8. Net zero target 鈥榠n doubt鈥 Kreston warned the 鈥渃urrent pace of change鈥 in school carbon emissions 鈥渞aises questions over how achievable鈥 the government鈥檚 2050 target for full net zero is for 鈥渕any鈥 in the sector. Trusts generated 0.184 tonnes of CO2 emissions per pupil last year, which only represents a slight improvement on figures last year.