Auditor-General critical of education accounting

Press, 5 July 1978, Page 26

Auditor-General critical of education accounting

Parliamentary reporter The lack of financial accountability and the low Standard of financial management and reporting in many areas of the education system are matters of extreme concern to the audit office, according to the Controller and AuditorGeneral (Mr A. C. Shailes). In his latest report to Parliament, he said: “Not only has it been found that many of those handling funds in the education system are not properly trained to do so, but, because of the shortage of qualified personnel in this area, guidance and control from the Department of Education has not been as effective as it could have been.” The report criticised

opposition from some members of the teaching profession to the concept that they should be accountable for ail funds handled — whether Government funds or those collected from parents and pupils. The suggested remedy was regular accounting and the presentation of audited annual accounts. Included in the report were the results of a review of secondary school accounting systems. The review was carried out by a group of flnal-year Waikato University students, sponsored by the Audit Office. Cash accounting was suggested, rather than accrual accounting, as a means of simplifying accounting and budgeting. Individual school boards

were also criticised: “The Audit Office is firmly of the view that secondary school boards should not be permitted to provide their own accounting services but should combine into groups or use the District Education Board for this purpose." The Wanganui Boys College Board was cited as a particularly bad example of poor financial management. The report also named local authorities which had not met statutory restrictions on short-term borrowing. During the year to March 31, 1978, the Audit Office had issued 76 qualified audit reports for these breaches compared with 65 and 47 in the two previous years.