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FINANCIAL MANAGEMENT:Roles & responsibilities of Trustees (ROLES &…
FINANCIAL MANAGEMENT:Roles & responsibilities of Trustees
National Administration Guideline 4:requires a board of trustee
Monitor & control school expenditure
Allocate funds to reflect school priorities
Ensure that annual accounts are prepared & audited
Education Act 1989
Public Finance Act 1989
Replacement schedule 6 of the Education Act 1989
Setting strategies direction for the school
Allocate resources to achieve the schools goals
Establish & maintain financial policy/policies
Undertake key financial information of the school
Roles & responsibilities
Make significant decisions
Carefully document the desisions and decision making processes
Carefully document the decisions and decision making processes
Manage conflict appropriately
FINANCIAL DECISION MAKING
appropriate decision making
no extravagant or wastefull expenditure
Prudent financial management
appropriate spending for effective operation of the school
money is public funds
funds must be safe gaurded spent in the interest of the school
PROBITY:honesty/integrity/fairness
Highly sensitive:travel & board expenditure
Inappropriate Expenditure: Purchase of lifetime Club membership/Overseas trips/ Corporate box hire
Overseas Trips must be curriculum related
Gifts: must be prudent/Probity/ independent advise from a lawyer. Gift policies drawn up
Giving Gifts: Parents-small gifts/ employees can take small gifts for overseas hosts
Principal & financial provider involved in the budgeting process with the board
Boards responsibility to ensure it's prepared
BUDGET
Changes in budget must be recorded
Full board must check, refine & approve budget
New school year final check
Match budget with the roll expectations that have changed
Budget must align with schools annual plan
Allocate resources to be identified as educational priorities
Budget must be monitored throughout the year.
LOANS
No loans can be approved to any party
When a staff member wants a loan-refer to the Ministry of Education.
According to the Education Act 1989 a loan made to a staff member is illegal
Guideline: what is expected
Designed as clear outline for funds
Set out by the board
Help decision making by principal & staff
POLICIES & PROCEDURES
DELEGATIONS:
Formalising the delegation process reduces the risk of:overlooked tasks/duplicate tasks/conflicts
make staff appointments
The board communicates its views about school management to staff.
may retain the right to approve or veto any new appointments.
Delegations ensure that employees carry out responsibilities for governing schools.
Delegation: Formal tool to communicate the authority & responsibility vested in a group or individual.
Formalised in replacement schedule to (Clause 17)of the Education Act 1989
INDICATORS OF FINANCIAL HEALTH
Staffing information on track
Budgets are prepared annually and are being met
Cyclical maintenance obligations up to date
An unqualified audit report
Positive Equity
10 Year property plan in place
Operating surplus revenue is greater than expenses
Cash set aside for asset replacemet & cyclical maintenance provisions
Positive working capital
Steady/improving roll numbers
SCHOOLS AT RISK
Schools must: use expert assistance/develop an action plan/contact financial advisor/have a specialist audit/removal of board/ replacement with a commissioner
Letter sent to schools to get an action plan & fix the problem
Critical financial situation:MOE invokes provisions of the Education Act 1989
Ministry's financial advisor provide advise & support to schools
Boards-already noted problems and have situations under control
Government want MOE to review school's audited financial statements
High % of boards exercise robust levels of financial responsibility & effectiveness
PARENT/TEACHER ASSOCIATIONS
voluntary organisations of parents/teachers & students
Good communication between board & PTA
AIM: to help raise funds/parent involvement/ community involvement/other activities related to the welfare of the school
Two entities work together effectively for the school students
Must register under Charities Act 2005:Charitable & Tax free status
Trustees cannot use funds raised by PTA unless PTA is a delegated committee
PTA can gift funds to the board of trustees.
ROLES & RESPONSIBILITIES OF PRINCIPALS
Can delegate financial management
Appointed by the board
Comply with the board's general policy direction
Pay for external Accounting services
Responsible for day-to day financial management of the school
Retain full responsibility for financial records & reporting
Principal delegated authority from the board of trustees
Responsible for monitoring & controlling school expenditure
Section 76 of Education Act 1989:is the Chief Executive in relation to schools control & management
Report regularly to the school board of trustees in financial management
make sure money is carefully spent on school's priorities as planned & budgeted.
maintain sound financial systems
Understand key financial information about school
Provide appropriate reporting
Complete discretion to manage
LARGE OR LONG-TERM FINANCIAL COMMITMENTS
Consumables
EXAMPLES:stationary/sports equipment/canteen supplies
POSSIBLE OPTIONS INCLUDE:preferred supplier/ agreement/bulk order purchase
KEY CONSIDERATIONS:cost/ for for purchase/ delivery cost/loyalty discounts
Services
POSSIBLE OPTIONS INCLUDE: Preferred supplier/quotes or closed tender
KEY CONSIDERATIONS:Total cost/quality/previous experience/ reputation
EXAMPLES:Painting/Maintenance/plumbing/computer consultants
Assets:
POSSIBLE OPTIONS INCLUDE:Buy/Finance Lease
KEY CONSIDERATIONS:Cash discount/warranty/ongoing service/maintenance
EXAMPLES:computers/buildings/vehicles