Schools explain missing deadline

LUCY TOWNEND
Last updated 12:00 29/05/2014

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Two Manawatu schools have been red-flagged in government audits for failing to file their financial accounts on time, with one saying it is due to book-keeping blunders caused by bureaucracy.

Feilding High School and Hato Paora College were both highlighted in a recently-released auditor-general's report for not having completed their 2012 audits by the due date of February 28 this year.

They were two of 30 schools noted from the 2480 New Zealand schools and subsidiaries audited.

Feilding High School said no funds had been misused or misappropriated, rather historical record keeping was under dispute.

Hato Paora College said the school had been extra vigilant after problems in its audit last year, which may have caused delays.

Schools prepare their financial statements annually, and they are due on December 31. They are expected to send drafts to the auditor by March 31 the following year, as well as audited statements to the Ministry of Education by May 31.

Feilding High School failed to meet the deadlines because of ownership queries surrounding the school's hostel and teaching farms, which led to unaccounted-for funds, principal Roger Menzies said.

"There was quite a significant amount of money that should be on our books, if it's owned by us, and there was conjecture around that."

There were question marks surrounding who owned the land of the co-educational boarding school's hostel buildings and two teaching farms - an 81-hectare sheep and cattle farm in the hill country near Feilding, and a 16ha dairy farm adjacent to the school on Churcher St in Feilding.

Menzies said this led to a "standoff", with the Ministry of Education asking the school to prove its possession, and the school asking the ministry to do the same.

The confusion was due to difficulties in locating records from central government, property depreciation and concerns about cyclical maintenance, Menzies said. "There have been major issues around ownership - it's a bit of a bureaucratic mess," he said. "We've got plenty of money to run the school and that's the important thing . . . we're just talking book entries."

The school's report had since been filed and issues with the auditor-general's office had been ironed out.

"I don't know how we get to the bottom of who owns what, but we've come to an arrangement with the auditor to submit our reports," Menzies said. He could not state the exact figure of how much in land value was being disputed but said: "We're talking millions".

The ministry's head of education infrastructure services, Kim Shannon, said there had been discussion about what should appear on the school's balance sheet or the Crown's.

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The ministry had passed "beneficial ownership" of the hostel over to the school but the school mentioned some land may have been "gifted" by a community member, Shannon said.

"We are not disputing the school's claim but our records indicate the site is ministry-owned and we would be happy to see any records the school might have that indicate otherwise."

An auditor-general's office spokeswoman said adjustments were made to the school's financial statements to allow the audit to be completed based on the inclusion of the hostel buildings on the school's balance sheet.

Hato Paora board chairman Peter Douglas said that after the school was last year labelled in breach of the Education Act for board mismanagement, it was very particular about this year's audit.

The integrated school took the unusual step of combining its constitutionally-separate boards last year, joining the trustees' work with that of the proprietors, bringing together about 20 people, but there had been issues around record keeping and conflicts of interest.

The school had since taken measures to separate the two governing bodies and to ensure the book work was accurate.

"We had a more thorough audit than normal because we were making sure the measures we'd taken were adequate," he said.

"It's debilitating getting a tag on your audit . . . I hope we've done a sufficient amount to satisfy them, because our intent is right."

- Manawatu Standard

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