Annual financial statements
All school boards must prepare and submit their annual financial accounts to the school's appointed auditor within 90 days of their balance date (December 31) each year.
The audited financial statements show how a board has used its funds to achieve its strategic goals.
They form part of the annual report submitted to the Ministry of Education each year and are made available to the public.
Who prepares the annual financial statements?
Although boards are responsible for ensuring their financial statements are prepared on time, the task is typically delegated to principals to arrange.
Principals don't usually prepare financial statements themselves; instead, they enlist the skills of one of the following.
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A financial service provider
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Chartered accountant
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Appropriate school staff, such as the business or office manager.
Once the draft financial statements are complete, the principal must ensure they are presented to your board for approval.
How should the annual financial statements be prepared?
All state and state-integrated schools and kura must use public sector public benefit entity (PBE) financial reporting standards.
To comply with these standards, schools and kura must prepare annual financial statements in the same format as the Kiwi Park model financial statementsopen_in_new.
What information should the annual financial statements include?
Statement of responsibility
Signed by the principal and the presiding member, this acknowledges your school board is responsible for the preparation and accuracy of the financial statements and maintains a system of internal control to safeguard the assets of the school or kura.
Statement of comprehensive revenue and expense
Summarises the revenue (income) and expenditure (expenses) over the financial year.
It shows whether your school or kura has managed to operate within their funding.
Statement of changes in net assets/equity
Shows the value and movements of the government's investment in your school or kura over the financial year.
Statement of financial position
Shows everything your school or kura owns (assets) and everything it owes (liabilities) as of December 31 of that year.
Statement of cash flows
Shows all cash received and paid by your school or kura over the financial year.
Notes to the financial statements
Provides extra detail to support the information shown on the front of the financial accounts.
How do the annual financial statements get audited?
The Office of the Controller and Auditor General (OAG) appoints an auditor to each school for a three-year term.
All key information and supporting documentation for the audit must be provided to the auditor by March 31 of each year.
Please contact your appointed auditor for a list of audit requirements before starting the audit.
The key information that an auditor requires is:
A copy of the draft annual financial statements approved by your school board.
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Any supporting working papers and documents used to prepare the draft annual financial statements.
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Evidence that your school or kura has appropriate internal controls over payments and receipts throughout the year.
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Signed board meeting minutes and any other sub-committee and in-committee minutes for the financial year up to the date of sign-off of the annual report.
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A copy of your approved budget, general ledger, and trial balance.
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Any employment settlements.
Remember, while the board may delegate the task of providing the information to the auditor, it remains the responsibility of the whole board to ensure this occurs.
How do you get the results of your audit?
Once the audit is complete, your auditor will prepare an independent auditor's report.
This report provides an opinion on whether the financial statements comply with generally accepted accounting practices and fairly represent the financial position, financial performance, and cash flow of the school or kura.
It also details the process, findings, and recommendations from the auditor.
Your board should review and comment on the audit management letter and, where applicable, agree on the actions required to address any issues identified.
This should be recorded in your board meeting minutes.
What is the annual financial statement timeline?
Here are the key dates for ensuring that your annual financial statements are prepared and audited in time to submit with your annual report:
December 31
End of the financial year for all schools and kura.
February
When payroll end-of-year reports and error schedules are made available.
Schools and kura need this information for their draft annual financial statements to be prepared.
February/March
School boards prepare and approve their draft annual financial statements and submit these (along with any other supporting documentation required) to the school's appointed auditor. open_in_new
Section 135 of the Education and Training Act 2020open_in_new requires boards to submit the information to their auditor within 90 days of the balance date, so the deadline is March 31.
Please don't leave it to the last minute.
The Ministry recommends that you submit this information as soon as possible.
April/May
Once the audit has been completed, your school board adopts the annual report and signs the statement of responsibility.
The auditor then signs the independent auditor's report.
May 31
Your school board submits its annual report to the Ministry of Education.
Questions your board could ask
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Who prepares our draft annual financial statements?
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What is our process to ensure they are prepared and approved by the board in time to submit to our auditor by March 31?
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Who collects the other supporting documentation the auditor requires?
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Who is our auditor?
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Did we submit the information in our annual report to the Ministry by May 31?
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Did our last Independent Auditor's Report identify any issues?
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If yes, have we addressed these?
Templates, resources, and references
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Ministry of Education
Education and Training Act 2020