Part 5: Our audits of schools

Education sector: Results of the 2011 audits.

Results of the school audits for 2011

In the period from 1 December 2011 to 30 September 2012, nearly 2500 school audits, including subsidiaries of schools, were due for completion. This Part summarises the results of those audits, and others from previous years that were completed in the period.

Schools vary widely in size. The smallest have less than $200,000 expenditure a year, while the largest have more than $20 million and are 100 times larger than the smallest. Schools are governed by boards of trustees, mainly parents from the local community. There are about 18,000 trustees throughout the country.

Boards are required by the Education Act 1989 to prepare annual financial statements and have them audited. The annual cost of these audits for the period was about $10 million, an average of nearly $4,000 for each school, varying from $1,900 to $13,000. They took about 105,000 hours of audit time, which is the equivalent of 50 full-time people, and varied from 20 to 100 hours for each school.

The results of each school audit is contained in the audit report we issue, which is a public document attached to the annual financial statements of each school, and a management letter, which is addressed to each board of trustees.

Most schools receive standard audit reports – that is, the financial statements can be relied on for accountability purposes and the audit has not found anything that our auditors consider important enough to draw to the attention of the public.

Audit report issues

We have issued non-standard audit reports24 to some schools. A non-standard audit report can contain a modified opinion and/or an "emphasis of matter" or "other matter" paragraph. We express a modified opinion when there is a misstatement about the treatment or disclosure of a matter in the financial information or a limitation in scope because of insufficient appropriate evidence to support the audit opinion. We modify an opinion by expressing a qualified or an adverse opinion or disclaiming an opinion.

We express a qualified opinion when we are unable to obtain sufficient appropriate audit evidence on which to base the opinion, but conclude that the possible effects on the financial information of undetected misstatements, if any, could be material but not pervasive.

We express an adverse opinion when, having obtained sufficient appropriate audit evidence, we conclude that misstatements, individually or in the aggregate, are both material and pervasive to the financial information.

We disclaim an opinion when we are unable to obtain sufficient appropriate audit evidence on which to base the opinion (that is, a limitation in scope) and conclude that the possible effects on the financial information of undetected misstatements, if any, could be both material and pervasive.

In certain circumstances, we include additional comments in the audit report in an "emphasis of matter" paragraph, to draw readers' attention to a matter that is fundamental to a reader's understanding of the financial information, or in an "other matter" paragraph that is relevant to readers' understanding of the financial information.

Timeliness and statutory deadlines

Schools prepare their financial statements for the year ended 31 December. Schools are expected to send their draft financial statements to the auditor by 31 March in the following year and their audited financial statements to the Ministry of Education (the Ministry) by 31 May.

Of the 2494 audits, including school subsidiaries, due for completion in our reporting period, draft financial statements for 2309 (93%) were available for audit by the statutory date of 31 March 2012. There were 185 (7%) that did not achieve this deadline.

There were 2381 audits (95%) completed by the statutory deadline of 31 May 2012, leaving 113 (5%) that were not completed by this date. Twenty were exempt from the deadline because of the Canterbury earthquakes. Based on past experience, we expect less than 1% of school audits to remain outstanding more than a year after the balance date.

Seven school audit reports had not been issued at the time of writing this report, and had been outstanding more than a year after balance date (they were all for the 2010 financial year). The seven, and the reasons why the audit reports had not yet been issued, were:

  • Avondale Intermediate – there is a disagreement between the school and the Ministry about capital works funding;
  • Hamilton's Fraser High School – there are financial management issues, which we noted in the reports on the 2008 and 2009 audits (see the section on modified audit opinions);
  • Hatea-A-Rangi School – there are financial management issues;
  • Hukarere College – there are doubts about the financial viability of the school, which we noted in the report on the 2009 audit;
  • Otepopo School – the school has closed and some records are missing;
  • Te Aute College – there are doubts about the financial viability of the school, which we noted in the report on the 2009 audit; and
  • Te Kura Kaupapa Māori ō te Kura Kōkiri – there are financial management issues, which we noted in the report on the 2009 audit (see also paragraphs 5.16 and 5.17).

We will continue to try to complete these audits as soon as possible, so that accountability to the public is achieved.

Modified audit opinions

In the reporting period, 22 school audit reports (less than 1% of the total) contained a modified audit opinion because:

  • The auditor was not able to obtain assurance over all the school's income and/or expenditure:25
    • College Street School – a closed school where some of the invoices were missing;
    • Edendale School (Auckland) – the recoverability of money was unclear;
    • Red Beach School – limited controls over locally raised income;
    • Te Kura Kaupapa Māori o Otepou – limited controls over some transactions;
    • Te Kura Kaupapa Māori ō te Kura Kōkiri (for the 2009 audit) – opening balances were not supported;
    • Te Kura Kaupapa Māori o te Whanau Tahi (for the 2010 and 2011 audits) – limited controls over income;
    • Te Kura Ngā Ruahine Rangi (for the 2009 audit) – limited controls over income and expenditure;
    • Te Wharekura o te Rau Aroha (for the 2010 audit) – limited controls over expenditure; and
    • Waimauku School – limited controls over locally raised income.
  • The results of a forensic investigation into financial management were not known:
    • Hamilton's Fraser High School (for the 2008 and 2009 audits) and Fraser Community Childcare Society Incorporated (for the 2010 audit); and
    • Mayfield Primary School (Auckland) (for the 2010 audit).
  • The auditor was not able to obtain reliable evidence to support the cyclical maintenance provision:26
    • Saint Patrick's Catholic School (Taupo); and
    • Wellington East Girls' College.
  • Other reasons:
    • Hato Paora College (for the 2010 and 2011 audits) – this integrated school had not been managed by a properly constituted board of trustees, which was a breach of the Education Act 1989 (sections 75 and 94);
    • Kaikohe Christian School – the board of trustees of this integrated school incurred expenditure of $43,000 on the relocation of classrooms, which was the responsibility of the proprietor, without the approval of the Ministry; and
    • Wanganui City College – the board of trustees did not prepare consolidated financial statements, including the transactions and balances of its subsidiary (College House Hostel Trust), as required by accounting standards.

Emphasis of matter paragraphs on probity and similar matters

Some audit reports mention matters that are not concerned with the presentation of the financial statements but are considered important in the context of public accountability. In the reporting period, eight audit reports mentioned matters concerned with probity, prudence, or waste. These were:

  • Ferguson Intermediate (Otara) – The School spent $68,000 on overseas trips, domestic travel and accommodation, and hospitality and gifts. This expenditure contributed to the School's operating deficit. In our view, this spending showed a lack of probity on the part of the board. We made a similar comment in the School's 2009 report.
  • John McGlashan College – The board made a contribution of $350,000 to the proprietor towards a new sports centre, without the approval of the Ministry. The amount was repaid in full in May 2012.
  • Mairehau School – The board made a contribution of $100,000 to a trust to build a hall on Crown land without a formal agreement with the trust or the Ministry. In our view, this spending showed a lack of prudence on the part of the board. We understand that the board has now requested that the trust repay the money.
  • Marcellin College and Saint Paul's College (Ponsonby) – The previous proprietor had continued to operate and carry out the responsibilities and obligations under the integration agreement and legislation, but without legal authority. We understand that these responsibilities were to be transferred to the new proprietors of the Colleges in 2012.
  • Sacred Heart College (Auckland) (for the 2010 and 2011 audits) – The financial statements referred to relationships between the College and related organisations on three matters:
    • There were conflicts of interest with the College's Foundation, which had three members in common with the board, one of whom was the principal who received additional remuneration in his role as chief executive of the Foundation. These members did not exclude themselves from board meetings when it considered matters concerning the Foundation, which is a breach of the Education Act (clause 8(8) of Schedule 6).
    • In 2010, the College modified the distribution of parental donations between itself and the Foundation, which resulted in it having an operating deficit of $500,000.
    • The new proprietor had not been operating and the previous proprietor continued to act without authority. We understand that a formal transfer is to take place in 2012.
  • Te Kura Kaupapa Māori  ō te Kura Kōkiri (for the 2009 audit) – Some of the expenditure appeared to have been personal and inconsistent with the expectations of the Ministry. For example, an overseas trip to the Cook Islands, traffic fines, shipping clothing and household items overseas, tyres and repairs of vehicles not owned by the school, and a satellite TV subscription. In our view, this spending shows a lack of probity on the part of the board.

Serious financial difficulties

The financial statements show most schools are financially sound. For example, the information available indicates that about 2250 schools have a combined working capital of nearly $600 million. However, about 200 have a working capital deficit, which could affect the school's ability to pay its bills. For a few, the deficit is large enough to be serious. Deficits arise for different reasons (such as spending more on staff or assets than can be afforded or a declining number of students).

Where a school has a large working capital deficit for its size, the auditor seeks confirmation from the Ministry that it will continue to support the school financially. Normally, the Ministry provides that confirmation. Nevertheless, it is important that we draw the public's attention to schools that have financial difficulties to resolve, which they normally achieve by constraining expenditure for some time.

In the reporting period, 45 audit reports (nearly 2%) drew attention to the financial position of the school. These schools are aware of their financial position and are taking action to resolve their difficulties. During 2012, they might have improved their position enough that they are no longer in serious financial difficulty.

Given the public interest in the financial health of schools, we had intended to carry out a special audit project, analysing the last few years' information for all schools. However, we have been unable to complete our data-set and now intend to analyse the 2012 financial information, with a view to reporting in about November 2013. During the next year, we also intend to strengthen our processes for ensuring consistency in the reporting of serious financial difficulties, so that our report next year can provide a more comprehensive summary.

Compliance with financial and other legislation

We ask auditors to consider whether schools have complied with certain legislation. Most schools comply with the legislation that auditors consider. Where our auditors identify a breach of legislation, it might be reported in the audit report or the financial statements. During the 2011 audits, the breaches of the Education Act that auditors identified were:

  • 33 borrowed more than they were legally permitted (section 67);
  • 16 gave loans to staff (section 73);
  • 10 had conflicts of interest (section 103A and/or clause 8(8) of Schedule 6);
  • six invested school money in organisations that had not been approved (section 73);
  • five paid one or more of their teachers directly (rather than through the Ministry's payroll system, section 89); and
  • 15 breaches were for other reasons.

We have not given details of all the schools that breached legislation in 2011 because some of the breaches were comparatively minor or had been disclosed by the school in its financial statements. However, the more important ones that were mentioned in audit reports were:

  • College Street Normal School – The board paid a company owned by one of its trustees $87,000 for building and repair work without the approval of the Ministry.
  • Northland College – The College, which is in serious financial difficulty, borrowed $273,750 more than is permitted without the approval of the Ministry. It has also acquired $436,000 in company shares without approval.
  • Rotorua Boys' High School – The school, which is in serious financial difficulty, obtained approval for borrowing above its permitted limit, but did not comply with the conditions of the additional borrowing (because its hostel did not make a surplus in the year).
  • Rotorua Girls' High School – The school lent money to a childcare trust, without Ministry approval, to help with building renovations. The outstanding balance had been brought down to $15,047 at 31 December 2011.
  • Sacred Heart College (Auckland) – The College breached the conflict of interest legislation (see also paragraph 5.17).
  • Te Kura Kaupapa Māori o Otepou – The board paid a company owned by one of its trustees $45,000 for running a bus contract, without the approval of the Ministry (see also paragraph 5.16).
  • Timaru Boys' High School – The school invested $170,000 without approval in organisations other than approved banks.

Appointing school auditors for 2012-2014

In this section, we explain the process we use to:

  • appoint auditors for schools for the next three years; and
  • ensure that those audits are cost-effective, of a satisfactory quality, and meet the Auditor-General's auditing standards.

Under the Public Audit Act 2001, the Auditor-General is the auditor of all state and state-integrated schools – currently about 2460 schools. The Auditor-General appoints auditors to carry out those audits on her behalf. About 60 auditors are appointed from a range of audit firms – from small local firms through to the major international firms.

Appointed auditors must audit schools in keeping with the Auditor-General's auditing standards and instructions, and we subject them to regular quality assurance reviews.

The audit agreements between the Auditor-General and appointed school auditors expired with the 31 December 2011 audits. New three-year agreements are now being put in place, following a process that allows for consultation between schools, appointed auditors, and our Office.

In most instances, the current appointed auditors will be re-appointed for a new three-year period. However, for about 100 schools, the appointed auditor will be changed because:

  • the previous appointed auditor no longer met the Auditor-General's independence requirements;
  • an audit firm has withdrawn from auditing schools and their audits needed to be re-allocated;
  • either the school or the appointed auditor requested a change (in about 60 other instances, issues were resolved without changing the appointed auditor); or
  • the portfolio of audits of some appointed auditors needed to increase to improve their "critical mass" of audits (for example, staying abreast of the Auditor-General's auditing standards, the school audit brief, and current school audit issues).

The Auditor-General allowed only a very limited set of circumstances in which appointed auditors could increase audit fees (that is, the Ministry's new payroll system, significant changes in the school, repeated poor quality accounts prepared by the school, and cost inflation of 2-3%).27 We discussed those circumstances with the Ministry before we discussed them with appointed auditors.

We expect that all auditor appointments for the new three-year period will be made in time for the start of audit work for the financial year ending 31 December 2012.

State-integrated schools

There are 332 state-integrated schools, comprising 14% of all state schools, and they have about 88,000 pupils. Integrated schools used to be private schools but have become part of the state education system. They provide education within the framework of a particular or general religious or philosophical belief.

Integrated schools are governed by elected boards of trustees (boards), which are Crown entities, in the same way that other state schools are governed. The boards are responsible for the teaching of their pupils and the operation of their schools, and are publicly accountable.

However, integrated schools differ from other state schools because they have proprietors, which are private entities. Proprietors appoint representatives to boards and provide and maintain the school buildings and land. Most proprietors own the land and buildings, but a small number lease the property from a third party. They also have responsibility for maintaining the "special character" of their schools – that is, their religious or philosophical character.

Boards and proprietors both receive funding from the Government, and both can also raise funding directly from private sources. The Private Schools Conditional Integration Act 1975 (the Act) sets out which matters boards and proprietors are each responsible for and gives proprietors some capacity to set compulsory charges for attendance at the school (known as "attendance dues"). There are also limits on what attendance dues can be used for.

The Ministry is responsible for most of the public funding for integrated schools and administers the Act. The Government funds boards for the teaching and operating costs of integrated schools and for minor maintenance, in the same way that it funds all other state schools. Boards of integrated schools receive more than $500 million a year for these purposes.

The boards of integrated schools have to work in partnership with proprietors. The different funding streams and split responsibilities between the board and the proprietor make this a complex model. It is not always easy to draw clear lines between public and privately funded activities. It can also be hard to provide clear information and accountability to parents, given the different bodies involved, which each have different reporting obligations.

As the auditor of all public entities, we audit the financial statements of each board of trustees, which captures the state funding and any donations to, or funds raised by, the school. We do not audit the financial statements of the private sector proprietor.

Relationships between boards and proprietors

We consider that, in most instances, the relationship between boards and proprietors is handled with proper regard to public accountability, recognising the need to maintain a separation between private and public money.

However, in some instances, the financial relationship between the board and the proprietor is blurred. There are about 2000 trustees on the boards of integrated schools, many of whom are in that position for only a few years, and some can lack knowledge about how they are expected to operate.

The Ministry has taken several steps to improve the relationship between boards and proprietors:

  • Unlawful funding of proprietors' buildings by boards in previous years has been corrected.
  • The Ministry is exercising stronger control over the funding of proprietors' buildings by boards.
  • The Ministry has issued guidance to boards and proprietors on the fees that may be charged to parents.
  • The Ministry has issued guidance to manage conflicts of interest on the part of proprietors' representatives.
  • The Ministry has issued model financial statements, which recommend that all transactions between boards and proprietors be disclosed.
  • The Ministry has specified new requirements for proprietors' attendance dues accounts, including providing guidance material and a model set of accounts. After considering legal advice and a High Court declaratory judgment, the Ministry has also reviewed the levels of attendance dues charged by all proprietors. This review was due to be completed by mid-November 2012.
  • In 2007, the Ministry commissioned an audit of how proprietors use the property funding it provides, which resulted in a number of recommendations. For example, the Ministry requires proprietors to maintain separate bank accounts and separate ledger accounts for their different funding streams.
  • In 2008, the Ministry carried out a detailed review of integrated schools. The review recommended that the Ministry impose specific accounting and planning requirements on proprietors. These included separating money received and spent, and establishing independent audits to ensure compliance with Crown requirements.

The Ministry has not told us whether the recommendations described in the last two items listed above have been implemented.

There are some further issues that have not yet been resolved. For example:

  • Accounting standards have not yet been revised to define proprietors as "related parties" of boards and to require transactions between them to be disclosed.
  • A very small number of proprietors make additional payments to the principal for normal duties, which is unlawful.
  • A similarly small number of proprietors make additional payments to the principal of a higher amount than the Ministry would allow a board to make for the same purpose.
  • The Ministry has not yet determined the form of documentation for board-funded capital works of proprietors' buildings.
  • A very small number of integrated schools have weak governance arrangements, in that formal decisions of the board are made in combined meetings with the proprietor.
  • In a few instances, the proprietor has transferred its responsibilities to another body without the approval of the Ministry.

Overall, we consider that the separation between public and private funds is clearer than it once was. Nevertheless, the relationship between boards and proprietors remains an important area of risk in the school sector, and one that we will continue to actively monitor.

Parental donations

In February 2010, we reported on the accountability for public funding of integrated schools, and our decision to defer a performance audit of how the Ministry manages the Crown's financial interest in integrated schools.28 In that report, we noted that, in our view, the accountability arrangement for parental donations was a major outstanding area. Therefore, we decided to collect some information on the issue and to report to the Secretary for Education.

The parents of pupils at integrated schools can be asked for money by various bodies:

  • The board may seek funds of a similar nature to that requested from the parents of pupils at other state schools (donations and some limited fees).
  • The proprietor may require payment of compulsory attendance dues.29 These amounts are approved by the Ministry and can be used to provide land and buildings.
  • The proprietor may seek voluntary contributions.30 These may be used for any purpose.
  • Parents may also be asked for donations by other bodies, such as trusts that may be connected to the board or the proprietor. Again, these may be used for any purpose.
  • If a school has a boarding hostel, parents will be charged fees by the body running the hostel (which may be the board, the proprietor, or some other body).

Parental fees and donations can appear in four different sets of financial statements – the financial statements of the board, the proprietor's attendance dues account, the proprietor's voluntary financial contributions account, and the financial statements of another entity (for example, a trust).

The first three sets of accounts have to be audited. The Auditor-General appoints the auditors of boards while proprietors appoint auditors for the attendance dues and financial contributions accounts. The Auditor-General is responsible for auditing the board's financial statements, but is not responsible for the other audits.

When a proprietor or another body raises funds from parents, it is a transaction between two private sector parties, even though the school office often provides administrative support. This fundraising has been the subject of public interest, usually because of concerns about the size of the donations sought, confusion about whether the contribution is voluntary or compulsory, or a lack of clarity about whether the donation is for the board (public sector) or the proprietor (private sector).

In our view, the number of different parties involved and the associated accountability arrangements make it difficult for parents to satisfy themselves about the use to which their fees and donations have been put because:

  • the charges and donations can appear in three (or four) different sets of financial statements;
  • different auditors can be appointed to audit those financial statements;
  • financial statements of some of the entities involved might not be audited or be publicly available; and
  • it can be difficult for a parent to access all the financial statements to get an overall picture.

Some of this complexity is inevitable, given the legislated model for integrated schools. However, from an accountability perspective, it creates risks. For example, in this type of structure, it might not be possible to detect whether the same expenditure was being charged against more than one source of income.

We asked our auditors, during the 2011 school audits, to collect information from a sample of integrated schools on the amounts raised from parents and on which entity benefits. Some initial findings are:

  • The total amount collected from the parents of pupils at the 89 integrated schools included in the sample is about $80 million a year – $24 million for boards, $36 million for compulsory attendance dues, and $18 million for voluntary financial contributions.
  • The amount collected by individual schools for each pupil varies widely – ranging from nothing to more than $5,000 a year.
  • About 10 schools arrange for the collection of donations on behalf of another body (in two instances, the amounts are large).
  • Some schools appear to collect voluntary amounts purely for the benefit of the board, while others collect purely for the benefit of the proprietor.

We are analysing the information obtained and intend to report separately in more detail to the Secretary for Education and, if necessary, publicly.

Kura kaupapa Māori

In December 2011, we reported on the findings of our review of financial management in kura kaupapa Māori (kura, or Māori language immersion schools).31 Overall, most of the 72 kura had good policies and processes to manage their finances, comply with the law, and appropriately manage sensitive expenditure and conflicts of interest. However, the policies and practices in a significant minority of kura (about 20%) did not reflect the good practice set out in the guidance that the Ministry has provided to schools.

We noted that the information provided by the Ministry should be enough for kura to be aware of, and meet, their responsibilities to comply with the law and manage finances, sensitive spending, and conflicts of interests.


The Ministry told us that it was revising the model financial management policies it makes available to schools. The revised policies, which the Ministry planned to publish in December 2011, would include more detailed guidance about sensitive expenditure and delegations. The Ministry was also reviewing its Handbook to more clearly and explicitly link the information about financial advances to staff to relevant legislative provisions.

In our report, we recommended that the Ministry monitor the effectiveness of its guidance and compliance with it in kura and other small schools and, if necessary, produce more targeted guidance.

The Education and Science Committee's report on its hearing into our report noted that the Ministry had confirmed that it would issue revised guidelines on sensitive expenditure and make it clear that loans to staff are unlawful. The Committee expressed an interest in viewing the revised guidance and financial model when the Ministry published them. The Committee also noted that we would monitor the issue and, if necessary, ask the Ministry to issue targeted advice to the kura in question.

Progress since the select committee hearing in May 2012 includes:

  • We have asked the auditors of kura to provide for a follow-up exercise in their 2013 audits. The results of this exercise should be available by late 2014.
  • The Ministry has revised its Handbook to more clearly and explicitly link the information about financial advances to staff to relevant legislative provisions.
  • The Ministry has not yet managed to issue its revised policies, including the guidelines on sensitive expenditure and delegations, partly because of revising its priorities after the Canterbury earthquakes. Because of the delay in publishing these policies, the Ministry is carrying out another round of consultation to ensure that the proposed model policies are still current and fit for purpose.
  • With our recommendation for the Ministry to produce more targeted guidance for kura, the Ministry has been exploring appropriate vehicles for producing such guidance. This matter is yet to be resolved.

Payments above a principal's normal salary

In December 2010, we reported on the results of our review of the additional remuneration paid to secondary school principals.32 In 20% of the 400 schools reviewed, auditors found that either additional remuneration had been paid without the approval of the Ministry or it was not clear whether some payments were remuneration that would need the Ministry's approval.

In most instances, the additional payments were not large. However, the underlying principles are important. Firstly, payments that are remuneration are lawful only if they are approved by the Ministry. Secondly, there is always heightened sensitivity about payments that have the potential to create private benefits, even if they are genuine business expenses. Thirdly, in some circumstances, reimbursing a private expense can be unlawful and can lead to prosecution by the New Zealand Police.

After we published our report, the Ministry issued comprehensive guidance to schools to clarify when its approval is required. It has also published a circular on the need for boards to consider recovering unlawful payments. This should ensure that boards are aware of the general expectation that they consider recovering the money when unlawful payments are made.

For the most common forms of possible unlawful remuneration (for example, home telephone, Internet, or insurance bills, or the use of a car), the Ministry anticipated increased numbers of requests for its approval. In 2011 and 2012, the Ministry has noticed an increase in the number of applications for such payments. We intend to look at a small sample of schools in our next school audits to assess whether all necessary applications are being made.

We understand that the Ministry is still considering the issues we raised about payments by proprietors – that is, the possibility that some of the payments were unlawful, equality of remuneration for all state schools, and the proper management of conflicts of interest. The select committee's report on its hearing (held in May 2012) noted that, to improve transparency and prevent these "double payments" (when proprietors pay principals for matters already covered by the salary paid by the Ministry), school auditors are now asked to ensure that the financial disclosure note includes all transactions between proprietors and the boards of trustees and also boards' employees.

The Ministry also said that it would consider requiring boards of integrated schools to disclose financial transactions with proprietors in their financial statements. This would help maintain the transparency of any remuneration received from proprietors by principals. The Ministry is still considering this.

24: A non-standard audit report is issued in keeping with the International Standard on Auditing (New Zealand) 705: Modifications to the Opinion in the Independent Auditor's Report and/or the International Standard on Auditing (New Zealand) 706: Emphasis of Matter Paragraphs and Other Matter Paragraphs in the Independent Auditor's Report.

25: This means that the auditor could not confirm that all the school's income had been recorded, or that all the expenditure was properly incurred, rather than there had been a loss of public money.

26: This means the estimated amount to maintain the school's buildings during the next 10 years.

27: We will be working with the Ministry of Education during the next few months to minimise the additional work that auditors have to carry out, and to ensure that schools are able to sign off their payroll reports – and their annual financial statements – with confidence.

28: Central government: Results of the 2008/09 audits, Part 9 – Accountability for public funding of integrated schools.

29: Section 36 of the Private Schools Conditional Integration Act 1975.

30: Section 37 of the Private Schools Conditional Integration Act 1975.

31: Education sector: Results of the 2010/11 audits, Part 6 - The financial management of Māori immersion schools.

32: Central government: Results of the 2009/10 audits (volume 1), Part 8 - Payments above a school principal's normal salary.

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