I hadn't forgotten about his gambling problem, but I'd forgotten that Sophie knew all about it. I didn't know that she knew he had dipped his fingers into the school money - I thought that was a secret between him and his Dad.
Since Matthew is I think, pretty much over his gambling problem, and he'd paid all his debts, I don't think Jim really has cause to sack him over that. And since he was able to pay the school money when it was required (for a school trip), again, technically, I'm not sure if Jim really has grounds to sack him for that either. (Matthew had been on the point of confessing to Jim that he didn't have the money for the trip, when Philip walked into the office with enough money to replace it. He told a convincing enough story that Jim accepted (about Matthew having left the money at home, or something like that), and Matthew got away with it - well, until now.
Unsurprising that Llio wants to move, although I didn't think that teachers could normally change jobs at short notice.
She seems to have "flipped".
Edit: Maybe Matthew will now emigrate to Spain. That's where the Parry's seem to send people.