School Accounts

HubDoc Partners

Did you know if you are using Xero you now have access to their FREE data entry software called HubDoc?

What does it do?
It takes all your bills and receipts, and once set up properly HubDoc automatically uploads these into Xero draft purchases, ready to be reviewed and approved. This is a very efficient way to reduce data entry time (and human error) and get the source document attached to the transaction in Xero. This eliminates unnecessary filing and keeps even the auditors happy.
We’re HubDoc experts…
Give us a call today if you would like to get started from April 2020. We can provide training and set up.

School Accounts

Remote Possibilities

We’ve Always Been Remote…

School Accounts

…but not in a socially distant way!

In these uncertain times schools are having to adapt and embrace the remote services model.
Distance is our strength. School Accounts operates remotely from virtual offices with our team based across Auckland and beyond.

We’ve got this…
Our technology is effective and robust – We have always embraced technology and now in these unprecedented times this technology helps us ensure your business continuity. We have always used the internet, telephone and mobile office connectivity to run our business and this is second nature to us, rest assured we are here for you at all times. While traditional service providers may face the possibility of extended social distancing measures, we are already well experienced online collaborators and will continue to provide an excellent service for our clients.

Time to upskill?
School Accounts continues to hire great skills and as such as we have capacity to provide additional services for your schools – let us know and we will reach out for a discussion.
For example, it may be that your accounts staff struggle to work from home, but with just a little input from us they can be back on track in no time. We manage remote learning via Microsoft Teams, and this can be just as effective as being there in person.

Annual Report blues?
We have our clients annual reports just about all wrapped up, so if you are struggling to make deadlines we have capacity right now to help you out!

The Robots Are Coming!

…but our jobs are still safe.

Machine learning and automation of data entry is already here, and Xero Accounting software is the leading school accounting software provider on this to date.

Receipt Bank:
You may have seen me harp on about this before, but as an Add On partner with Xero, Receipt Bank already has this area sussed. You can forward the emails from your suppliers, or drag PDF bills into Receipt Bank (or take a photo of your receipt from your smart phone) and hey presto! The bill ends up in draft in Xero with the data already populated AND a PDF of the bill attached. You are still able to check the details and get it approved for awaiting payment (no loss of user control!). You can even go paperless entirely if your school team has the appetite.

Credit Cards:
Imagine the added bonus of being able to send credit card and cash payment receipts into Xero directly from the user’s phone (before the receipt fades or gets lost in the car)! Receipt Bank can even detect when a receipt comes through t he bank in Xero and suggest a match. This makes for a timely, transparent and easily auditable accounts experience.

People like change they choose. This type of change can revolutionise the way you spend your time. Most leading experts assure us that the coming of AI will not make humans defunct in the workplace, rather release us to do more of the building relationships stuff that is essential to effectiveness. It makes accounts payable quite enjoyable!

Hit me up for a FREE demonstration of Receipt Bank in the next few weeks, so you can see for yourself it is something that will benefit your accounts team.

School Accounts

Time for a Sea Change?

Ahoy there, to the school professionals who are keeping our schools, preschools and high schools financially afloat. The ship may be low in the water but if she’s still moving forward congratulations!

Whether you are the Principal making key decisions with your stakeholders all in mind, or the data entry person keeping the information needed to make those decisions up to date, you will be challenged/invested/interested in having great people, processes and technology in place.

At School Accounts Ltd it is our passion to help schools achieve the above. It can be as simple as updating the accounting software you are using, or just using what you are using to the best of its ability. We talk Xero (we live and breathe and work Xero!) and have created school monthly and annual reports templates that can be tailored to your school. We can up-skill your key staff in technology or efficiency improvements that can release them to better use of their time.

We are pretty excited about our annual reports processes. No more gathering up papers, photocopying, putting folders together for auditors, being asked to repeat work you’ve already done, or spelling out what seems to be obvious! We show you how to store in the cloud at the time of the transaction, and provide you with online folders to drop extraneous information throughout the year. You simply give auditors access at year end and we can manage their queries for you. School Accounts Ltd are keeping up with cutting edge ways to improve methodologies without disrupting your ship’s navigation.

We like to make sure you have everything sorted ahead of time to minimise delays, or stress when it comes to school reporting deadlines. Our staff are handpicked for their friendly natures. Dealing with us is like having someone on your crew who is willing to understand your quirks and passions and get the job done without creating unnecessary waves. Who wants to get sea sick when you could be enjoying the view from the deck?

Invite us on-board and we’ll show you our charts. Drop us a line (call or email) and we’ll arrange a time to talk ship.

School Accounts

Term 2 Tweaks

Welcome to Term 2, the land of opportunities! You made it through Term 1’s new year duties, welcomed new children into the fold, instigated the ideas and budgets formulated in 2016, and took your school for a test drive in 2017.

Term 2 is often a great time to review and consolidate. You know the drill: What is working well? What is not living up to expectations? If you can, do a quick ‘pros and cons’ inventory of your key objectives and projects for 2017. What are the stand out things that may need tweaking in Term 2?

Things that are going well: What are the key strengths of your arena that contribute to the success? How can you celebrate, encourage, reward and do more of that?

Things that are not so flash:  Do they just need tweaking, revisiting the goals, or scrapping altogether and replacing? Does it relate to personnel, programmes, or processes? Is it a minor weakness that can be addressed, or a major failing that needs urgent attention?

Outsource or Up-skill?

Having someone take care of the annoying-but-necessary week to week stuff may be what is needed to release you to take care of the big stuff – things that contribute to the main thing – kids learning and quality staff retention. What can you outsource? What is the best use of staff time?

Investing in professional development for internal staff who handle key processes, can make all the difference to efficiency, quality of services, or delivering on compliance.

How can we help?

School financial service providers can be a source of assistance when budgets, software, financial processes or skills of support staff need assessing.

We have your back when it comes to locally raised funds, property projects, asset management, Board member education, cyclical maintenance, and budget setting. As well as that, one of our favourite things is to train staff in school financial processes (and Xero tips), or new Board members in school financial literacy.

Providing an outside ‘fresh eyes’ perspective on how things are operating can sometimes give you the resource you need to make changes. Here are three reviews that School Accounts Ltd offer for example:

  1. Processes Review. We ‘follow the dollar’ both from an accounts payable and accounts receivable point of view and let you know if there are any processes that can be practicably improved to benefit the school. This includes handling of locally raised funds.
  2. Xero Review. We take a look at how internal staff are using Xero and provide feedback and training if relevant (and keep it fun!)
  3. Specialist Review. Whether it is your budget, fixed assets, cyclical maintenance or school building projects, we can help.

Term 2 is your opportunity to shine and make 2017 the best year ever yet! Just like George Clarke’s Amazing Spaces reviews, “I’ve never seen anything like it in my life!” could be rolling off the tongue as onlookers shower their approval of your arena. Okay, we’re getting carried away. But aim for the best anyway.

We do.

School Accounts
Go home sooner!

How many times has your Principal told you ‘go home, it’s late’ and you say ‘I’m just going to finish entering these invoices, we really need to pay them tomorrow.’? How would you like an APP that could do all the entering for you, so that all you need to do is check and approve them?

What would you do with that extra hour a week? Go home sooner?

Or perhaps get to that job the boss REALLY wants you to do?

Accounts payable (entering and paying suppliers) can be really time critical, time draining, and time dependent. We have an amazing solution our clients are just ecstatic about.

Not only can you send invoices to it by forwarding an email, scanning a hard-copy, drop and dragging a PDF, or by taking a photo on your phone, you can also send Visa receipts to it. It then sends the invoice or receipt all done through to Xero where it awaits your approval and payment, or ready to match against your Visa statement.

What’s more, a copy of the invoice as a PDF is attached to each invoice or spend money in Xero, so you no longer need to file hard copies in the office. Free up some space!

This APP is called Receipt Bank, and as a Receipt Bank Partner School Accounts Ltd can subscribe your school, train and support your Accounts Payable staff, or even do all the work for you if needed.

Have you been thinking about freeing up your Admin and Accounts staff so they can get on to some more school focused tasks? Or are you concerned about staff morale as they constantly work overtime and struggle to meet deadlines?

We can help. We LOVE to help. Find more about it by clicking here.

Subscribe through School Accounts Ltd today and watch the smiles and gratitude bloom!

School Accounts

Librarians Rule, Okay?

Your school library is one of the most diversely represented elements of the education system? What do I mean by that? The size and importance of a schools library is not necessarily related to the size of the school, nor the demographics of the population, budget or location. We see this at our end when processing stats for the library at year end. The dreaded Library Stocktake.

I guess some librarians would be flattered that Accounts people take such an interest at least once a year. But the more likely reality is they are just irritated. Apologies.

Any hoo!

I’m writing this article for two purposes:
1. I found a great resource that either the School Executive Officer or the Head Librarian may be interested in.
2. We would like to address some potential areas of conflict when it comes to annual reporting of library figures.

Here’s the mystery for us Accounting types: even when a school has a perfectly good and perhaps expensive piece of library software that just churns out the numbers for the year end stocktake, somehow the starting figure has managed to change between years. We can end up with some interesting ‘write-offs’ of books in order to account for this difference. Sometime between finalising the previous years end balance, and starting the new year, the figures have changed.

Did students start the new year by returning a whole lot of books that had been accounted for as ‘lost’?
Was the same report used in both years or perhaps different parameters get ‘ticked’ each time?

A critical issue is what date at which the previous years library stocktake is closed and what date the new year is officially rolled over into. It needs to be a golden rule that the library system cannot be used in between times.

You can Balance!
So suggestion one is to take a good look at how your system is run, how it is rolled over from one year to the next, and making sure the year is indeed complete before running the year end stocktake for the bean counters. Here’s how you can tell things are not working: if your new year opening balance is different to the prior year’s closing balance!

For a handy stocktaking guide provided by the National Library of NZ, click here.

You can be Memorable!
Suggestion two is that a library is not just about numbers of books. If you don’t already have an annual library report as part of your reporting package, take a look at this amazing suggestion from the National Library of NZ specifically for the school library: click here for writing your Annual Report.

This is a way you can promote and educate the school management and community about the value of the library in the school. They outline all the pro’s in the article so do read it before you throw up your hands in a ‘don’t I have enough to do already’ sort of way! They even have some worked examples and templates. Some of you may be streets ahead and already weaving this kind of magic – congrats!

We here at School Accounts are vitally interested in your little (or big) school library. We’re happy to help staff figure out their stocktake dramas. We can give you a little template that may help make sense of the numbers the auditors and MOE require.

Do take heart and have a go at promoting your piece of paradise this year.

School Accounts

Mitigating Audit Blues

Audit issues over Locally Raised Funds
We thought the above topic will be of relevance to your school especially due to external audit sensitivity over this Revenue area.

Your school’s audit service providers may have previously raised their concerns through the Management Report to the Board.

These concerns typically have centred on the lack of internal controls affecting Locally Raised Funds and whether this lack of internal control impact on the accuracy and completeness of revenue as reported in the financial statements.

Some external audit service providers have resorted to qualifying their Audit Report due to this uncertainty especially when certain fund sources have been deemed to be material to audit.

What are Locally Raised Funds?
Locally raised funds are revenue items that are broadly classified as either School Activity or General Fundraising.

School Activity funds for example, are funds raised for School Trips, Kapa Haka, In School Activities, and Production income.

General Fundraising includes Gala Fundraising and funds received by way of Grants from external Foundations like the Lottery Grants Board.

Internal control processes at your school

Well, let’s step back a bit…

What are Internal Controls?
No, it has nothing to do with your physical disposition!

“Internal control is broadly defined as a process, effected by the Board of Trustee’s, management, and other personnel, designed to provide reasonable assurance regarding the achievement of objectives in the following categories:
• Effectiveness and efficiency of operations
• Reliability of financial reporting
• Compliance with applicable laws and regulations
• Safeguarding of assets

Internal control consists of five interrelated components:
Control environment – The control environment includes the integrity, ethical values, and competence of the Board’s staff and is the foundation for all other components of internal control.
Risk assessment – Every School faces risks that must be identified, analysed, and managed to achieve its governance objectives.
Control activities – Control activities are the measures used to help ensure that management directives are carried out and that risks are addressed. They take many forms including policies and procedures, approvals, verifications, reconciliations, performance reviews, security measures, and segregation of duties.
Information and communication – Information systems must be in place to identify, capture, and communicate relevant information in a form and timeframe that enables people to carry out their responsibilities and maintain accountability for the School’s assets.
Monitoring – The entire internal control process must be monitored and the quality of its performance assessed as a part of regular management and supervisory activities. Corrective actions must be taken whenever the system does not perform as intended.”

Yes, the definition rather sounds daunting in a school context but let’s have a look at what policy, procedure, processes and controls a school may currently have in place over the collection and recording of Locally Raised Funds together with a cause/effect analysis.

School Activity Funding

Scenario 1
Pupil is given a $50 note by parent/caregiver for a class trip. On the way to school pupil uses funds to buy a Prezzy Card to fund internet gaming costs. Pupil still goes on trip due to Board policy that no pupil should miss out.

The Board, unknowingly, has incurred an additional $50 cost. Pupil is naturally ecstatic and absent from school for the next three days.

In this example, would you think that the Board had prepared an appropriate Revenue collection policy?
Are there extenuating demographic factors? Rural, domestic?

Regardless, policies could still be developed to cover for this scenario.

Scenario 2
Exactly the same scenario above but this time, pupil hands over the $50 to his teacher who has been given the responsibility for collecting the funds. Teacher dutifully records the relevant details in a paper record and retains the cash and record in teacher’s desk.

At the end of the week, teacher hands over the cash and records to the main office for receipting and banking.

Well done! But wait…does this scenario address certain key components of internal control referred to above?

Effectiveness issue. Is there a duplication in the handling of cash and of the recording duties?

Custody Issue. Are Board funds retained in a secure environment (other than a teacher’s desk)?

Timeliness issue. Was the banking recorded and performed daily, intact?

Policy/Procedure issue. Could teacher not instruct pupil to visit the office for direct payment and thereby have more time for teaching? (There is another effectiveness issue raised in this regard.)

Scenario 3
Parent sets up an internet banking arrangement with the school. Monies are transferred and school administration personnel record the transaction using a Student Management System (if applicable) and to update the General Ledger.

This process is the most administratively cost effective and efficient due the nature of the transaction.

Liquid cash is more prone to “diversion” than any other form. Internet transactions are immune to diversion barring Internet piracy…and rejection by the Banks due to “insufficient funds”.

There is an absence of cash handling fees.

Your accounting software (such as Xero) creates the bank transaction which can then be analysed and recorded into the General Ledger within minutes.

This transaction process of course is extremely subject to geographic and domestic demography and we would all love to live in a perfect world.

Next we will examine the biggie that gives the auditors the “twitches” …yep…Gala and other significant Fundraising!

There is a huge amount of fun and camaraderie whenever we ever attend a school gala.

Coconut shies, Books and White Elephants, BBQ snags with bread and onion and mild American, meat raffles and oh! Children having fun without being scolded by teachers and what? Fine weather too!

Then the auditors arrive later (not to the gala of course) and say, well, it’s all good having money recorded in your financial system for the Gala but…

• Are we satisfied that the internal controls (policy and procedure) the Board had in place are sufficient to ensure the Gala funds recorded in your General Ledger is accurate and complete?
• If we are not satisfied (and a true auditor has no sense of humour…unless sarcasm is an acceptable form of humour), Does the lack of internal control provide a material audit risk to the financial disclosures made in the Annual Report?

We offer some scenarios below regarding this form of General Fundraising but we stress that this only applies to Gala and other financially material fundraising activity that is conducted directly by the Board of Trustees on behalf of the School and its beneficiaries, namely the pupils.

Generally there is little audit risk when, Parent Teacher Associations, Friends of the School and such associations operate independently of the School Board with such major fundraising activity.
These Associations/entities usually remit the proceeds to the Board in the capacity as an independent institution.
Is your PTA or similar association an independent entity from the Board?? If so, the scope of the audit only includes Board activities and does not concern itself with “interested parties” that are under independent control.
The concept of Board independence is critical in this regard and we would be only too pleased to assist the Board in developing appropriate structures to address this particular area of Governance.

There are key audit control/financial risk elements when a Gala (or similar, significant fundraiser) is convened by the Board;

• Even if non-cash transaction facilities (such as EFTPOS) were made available by the Board, there will still remain a substantial amount of liquid cash involved.

Liquid/Cash funds derived from Gala fundraisers and similar are able be “diverted” no matter how benevolent the purpose and the consequence will have cause/effect on the Board financial reports.

• Cash collection/custody and recording can be susceptible to distortion of the financial result

• Cash donations at Gala events may be offered without requirement for receipt

Typical Gala Fundraising Scenarios

Scenario 1

Successful Gala!
Out of the Gala cash proceeds, cash is utilised to negotiate a transaction for a “high value” item such as an Electronic Learning Board for $7,000. Funds raised from Gala = $25,000 less the $7,000 = $18,000.

The Bouncy Castle and other Amusement theme providers are paid directly from cash funds derived from Gala activity upon conclusion of the fundraising event.

Residual cash proceeds are deposited into a “common fund” container and taken away by a volunteer for safe keeping during the weekend period.

These funds were banked by the volunteer on the next banking day.

Question: Have Gala funds been collected, banked intact and completely recorded in the Board financial General Ledger?

Answer:Funds have been banked net of disbursements from the Gala funds. Income and expenses recorded in the General Ledger and Financial Reports are not complete and accurate.

Scenario 2
Same gala event but this time, the School has arranged and has prepaid the Amusement Theme providers via the school bank account and has posted these to the General Ledger as Gala Expenses.

Also, the school has designated Board staff volunteers to be at the various points of sale, including the Amusement theme sites. Bouncy Castle Operators have been advised that they will not be involved in collecting cash.

These volunteers text the Office staff when cash levels become high and two Office staff collect the funds and return the same to the office.
If the office staff have time, the cash can be counted with both staff present and a banking lodgement can be completed, bagged and secured ready for banking the following business day.

This process is carried out throughout the Gala day until the end of the fundraiser.
Residual cash is collected by the two office staff and returned in the same way to the office and retained in the safe and is counted and banked on the following Monday.

Question: Will the process outlined above provide more assurance to audit that there was sufficient separation of duties in the cash collection process and that Gala funds have been collected, counted and banked intact?

Answer: The above process provides for a better separation of duties between the parties receiving the cash and those in charge of the recording, banking and custody of the same. No disbursements have been directly made out of the Gala proceeds. Because banking’s were made regularly on Gala day, there will also be less time spent by Office staff in counting and banking the residual funds so that they can focus on their normal roles without the additional stress.

This second scenario is simply an example where cash losses can be minimised to a great extent. Cash being cash is highly liquid and would still be exposed to loss with the above example however, we believe that external audit would gain more confidence over the material completeness and accuracy of gala funds.

What ideas and thoughts do you have? The mind boggles with cunning plans!

Have fun on Gala day too! It’s possibly the only time of the year where the pupils can “dunk” their teacher and/or Principal…

School Accounts

2017 Budget Bliss

Yes! (Oh no!)

It is that time of the School year when your Accounting Service Provider would/should have forwarded to the School Principal and/or the Administration Team, Budget 2017 workpapers to complete.

You, as Principal and also in consideration of your Administration staff, might feel stressed over this Financial Governance requirement. However, as you know it is a useful financial management tool as well as being a statutory obligation.

We would be delighted to assist you in any way we can to provide your Board with an appropriate Budget that fits with your Charter, Strategic and Annual Implementation Plans.

Our following information and advice is here for you, as Principal and for your Administration Team to assist you to provide your Board with an objective budget using objective budgeting techniques.


Budgeting is a process that requires objective and predictable data and should also provide a linkage to the Board’s Strategic and Annual Implementation Plans.

What is the Board deciding to implement in 2017 as part of the above??

MoE initiatives also tend to change rapidly to meet demands of the community (or political motivation) at any point during a school year. What is funded and spent in the previous and current years may have little or no relevance to the 2017 school reporting year.

“Change is a constant in any organisational or personal environment. If we can adapt and plan for change, this will help define the success for us as individuals, Principals, Teaching staff and pupils”. (Colin Falconer)

Budget Approach Summary

All schools are expenditure driven to meet the requirements for positive student/pupil outcomes in any period of their tenure and these are funded by various sources such as Operational Grant, Special Grants, Fundraising and Trading Activities.
We consider the word “justification” as an appropriate point to work from for any expense/activity budget line item (or General Ledger account code that is reported upon).

Justification refers to knowing the cost drivers for each activity, and whether the cost is appropriate and relevant to the Board’s Annual Implementation & Strategic Plans, MoE new initiatives and normal operating activity.

Working the budget backwards refers to examination of each operating Expense line item and upon justification for each budget expense line item, one can then examine and plan for sustaining the planned operational expenditure and your School’s Working Capital requirements by way of the school’s Revenue streams, (e.g. Operations Grant, Special Grants, Fundraising, and Trading Activities).

Budget Techniques

There are a number of techniques although we have included only three in this blog for simplicity;

Cost Plus Approach
This method simply involves looking at last year’s budget line amount and increasing the amount by a percentage.

This method is not often recommended since last year’s budget line expense/income may have little relevance to the new year. Also, there is no objectivity nor justification considered under this approach. However, there are circumstances where this might be useful such as estimating inflation on utilities E.g. water, electricity, subscriptions.

Stab in the Dark
This approach is typically used in Fundraising and Trading Activities and lacks any objectivity. There are appropriate bases to use for these activities which we will discuss later.

Zero Basis
This approach as the name suggests requires that each budget line amount starts from scratch and the budget is calculated from known factors such as Roll Count, new MoE Initiatives, Cleaning Contract payments and Operational lease costs. Consideration should also be made to whether any contracts are likely to expire and whether new contracts will be entered during the new year.

This approach provides more objectivity and goes a long way to support/justify the income or expense line item.

The following link is to our websites free resource Budgeting Table, which gives an indication as to the appropriate base to use for some typical revenue/expense lines that schools traditionally have trouble with in the budget exercise: School Accounts Budgeting Basis

Variances to Budgets

Throughout the above examples (given in the link), we hope that we have demonstrated the need for objectivity when preparing your 2017 Budget.

Once the Board’s Annual Budget has been approved, there is no need to change this during the new year…that is flexible budgeting and while flexible budgeting might provide for a “pretty picture” with no variance, it will not provide you any appropriate base to work from in the following year. There will always be “one-off’s” or items coming from “left of centre”. These are recorded as variances with the suitable explanation, which helps inform you for the next year’s budgeting exercise.

It is an accounting requirement that your original ratified budget must be used for the annual financial papers. But do note, where there is a substantial unprecedented change in a budget item, you can have the Board of Trustees ratify these changes so that the updated budget becomes the annual work paper.

In Summary

If you keep the words “justification” and “objectivity” in your mind while budgeting, you and your Admin Team are on a good path to providing better financial stewardship and financial governance for your Board.

We sincerely hope that this article on budgeting will go some way to guide you and your Admin staff to positive outcomes for your School.

At School Accounts Limited we are well experienced with these processes. If you find you are in need of some assistance, we would love to help. Contact us for an appointment now.

Nicola Edie and Colin Falconer

School Accounts

One of those days?

School admin in Crisis? Holidays causing strife in the school accounts department? Had a key accounts staff member just resign or get seriously sick and now you are in need of some relief work?

This is a service we have capacity for right now, so if you need a part time, short term reliever until things get sorted give us a call! We hit the ground running with extensive experience in school finances and accounting processes.

We are here and can help. With a smile! Contact Nicola on 021 116 4747