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Chapter 6

FINANCIAL MATTERS

6.6 FINANCIAL CONTROL

6.6.1Legislative and Policy Framework

ACTS

  • South African Schools Act 84 of 1996, Section 42, 43 [SASA]Financial records and statements of public schoolsSection 42:     The Governing Body of a Public School must:
    1. keep records of funds received and spent by the public school and of its assets, liabilities and financial transactions; and
    2. as soon as practicable, but not later than three months after the end of each financial year, draw up annual financial statements in accordance with the guidelines determined by the Member of the Executive Council.

    Audit or examination of financial records and statements

    Section 43

    1. The Governing Body of a public school must appoint a person registered as an accountant and auditor in terms of the Public Accountants and Auditors Act 80 of 1991 to audit the records and financial statements referred to in Section 42.
    2. If the audit referred to in Subsection (1) is not reasonably practicable, the Governing Body of a public school must appoint a person to examine and report on the records and financial statements referred to in Section 42, who is:
      1. qualified to perform the duties of an accounting officer in terms of Section 60 of the Close Corporations Act 69 of 1984;  or
      2. approved by the Member of the Executive Council for this purpose.
    3. No person who has a financial interest in the affairs of the public school may be appointed under this section.  (This means that the Auditor may not be an SGB member.)
    4. If the Member of the Executive Council deems it necessary, he or she may request the Auditor-General to undertake an audit of the records and financial statements of a public school.
    5. A Governing Body must submit to the Head of Department, within six months after the end of each financial year, a copy of the annual financial statements, audited or examined in terms of this section.
    6. At the request of an interested person, the Governing Body must make the records referred to in Section 42, and the audited or examined financial statements referred to in this section, available for inspection.
  • The Public Finance Management Act, 1999 as amended by Government Gazette No. 38735 of 30 April 2015 (Act No 1 of 1999) [PFM]

6.6.2Framework for the Development Of School Policy on Financial Control

  1. Records
    According to Section 42(a) of SASA, records must be kept of all financial transactions.  All relevant source documents and books must be kept in a safe place or strong room and, if kept electronically, there must be backups stored separately and apart from the originals.
  2. Reporting
    • Monthly reporting
      • Financial statements should be prepared monthly for submission to the SGB or Financial Committee. The statements should be distributed at least three days before the monthly meetings of the SGB.
      • Monthly statements should provide information on the following:
        • income and expenditure for the month and for the year to date;
        • comparisons of income and expenditure with budgeted amounts and an analysis of any variance; projected income and expenditure for the year;
        • total amount of fees outstanding;
        • analysis of debtors and debts owed to the school;
        • status of all projects; and
        • details of money in the bank and funds invested.
      • Annual Financial Statements
        • Unaudited Annual Financial Statements should be presented to the SGB for consideration as early as possible after the end of each financial year.
        • Audited Annual Financial Statements should be presented to the SGB within three months after the end of each financial year.
        • The audited Annual Financial Statements should be tabled for noting at the Annual General Meeting. (AGM)
        • The audited Annual Financial Statements must be submitted to the Head of Education within 6 months after the end of each financial year, as required by SASA