Understanding School Finances School Councils

What are school council’s major responsibilities with regard to finance? 1.To develop the school’s annual budget 2.To ensure that proper records are kept of all the school’s financial operations

Link with the school strategic plan Student outcomes: goals & targets  What we have to do: key strategies  How we will achieve the outcomes: people and money

The school’s Annual Budget The financial plan that makes sure that the school’s resources (people, programs, services, equipment etc) support its educational priorities and objectives How it will use these resources to produce the results aimed for in the strategic plan How it will maximise student outcomes through the most efficient and effective use of its limited resources

What funds are available to the school each year? Funds provided by the government in the annual Student Resource Package (both credit & cash) The funds held in all school council bank accounts Locally raised funds

What is the Student Resource Package - SRP ? It is the funding model for Victorian government schools since 2005 It is made up of: –Student-based funding –School-based funding –Targeted initiatives Most of the money is allocated on a per-student basis About 94% of the SRP is provided as credit, 6% as cash

The Student Resource Package … The principal uses the credit part of the SRP to pay for the school’s staff The cash component is paid into the school’s High Yield Investment Account and is referred to as the quarterly grant The cash helps to pay for operating /running costs

How does a principal keep track of the school’s Student Resource Package? DEECD has a special SRP website where a range of up-to-date management reports are available Access to these reports can be delegated by the principal The site includes a special ‘SRP Planner’ which can be used to model different enrolment and staffing scenarios

What bank accounts does a school have? Official Account High Yield Investment Account Others (optional) –e.g. Library Trust Fund, Building Fund All transactions should be processed through the Official Account This account must have at least two signatories

How is the annual budget created? The strategic plan is used as a starting point to determine the strategies to be funded Program leaders work out what they need to do, and how much money will be needed This is balanced against estimates of the total money available Finance sub-committee produces its recommended plan and submits it to council for approval

How are school finances managed? The principal is responsible for –setting up and managing the financial systems in the school according to DEECD rules & guidelines –ensuring that information about the school’s financial position is made available to council –ensuring that the annual budget process and its management is fully documented Support is provided by the school bursar / business manager and finance sub- committee

How does council get to know its financial position? CASES 21 Finance is the software program through which the school records all its financial transactions CASES 21 reports are provided at council meetings to show what money has been collected and spent This program also helps with the management of the annual budget

What should council do regularly? Keep informed about its financial position by carefully considering the financial reports provided at monthly meetings Monitor budget income targets against what has been collected “ensure that all money coming into the hands of the council is expended for proper purposes relating to the school” Education and Training Reform Act 2006

Other finance responsibilities … Council should: Monitor school accounts to decide if there are opportunities to invest surplus funds to earn interest income Minimise risk by creating and approving an annual investment policy … e.g. using the High Yield Investment Account

School finance Do: Make sure that resources are focused on student outcomes and school improvement Produce an indicative budget for the following year by November Consider updating this budget early in the year when enrolments are confirmed Regularly monitor budget progress

School finance Don’t: Forget the main aim is to fund your strategic plan Create your annual budget and look at it once a year at review time Fail to pass the overall budget because of concern about an individual item Ignore the risks of some financial activities

For more information schoolcouncils/financecommittees.htmhttp:// schoolcouncils/financecommittees.htm (DEECD school councils site-finance committees) (Student Resource Package Information site) (Financial Reporting for Schools)