Photo: RNZ / Richard Tindiller
The Auditor-General, John Ryan, says recent audits found problems with the accounts of 88 schools, the most in five years.
The Auditor-General's report on audits of schools' 2023 accounts said the schools either did not provide enough information or disagreed with auditors over aspects of their finances.
It said seven schools were in serious financial difficulty and needed letters of support from the Education Ministry confirming they were a going concern.
The schools were Cambridge East School, Matipo Road School, Ngakonui Valley School, Puoto School, Taumarunui Primary School, Wallacetown School, and Te Kura o Ōmanaia.
The report said the Education Ministry needed to get on with simplifying and improving schools' financial reporting, something it agreed to do several years ago.
"Although the Ministry has committed to the project, it has not yet allocated resources to complete it. In our view, given how some schools struggle with the current financial reporting processes, this project is increasingly important," the report said.
Auditor-General John Ryan says the number of schools with problems in their accounts is at the highest level for five years. Photo: Controller and Auditor General
It also urged the ministry to decide what action it should take in cases where schools' spending on their principals was not appropriate.
"In our 2023 audits, we found incidences where schools had used funding for principals' professional coaching and well-being support in ways that did not have any educational benefit for the school.
"We also noted incidences where the educational benefit of gifts provided and overseas travel were not well defined."
The report said auditors reported sensitive spending that provided a personal benefit to the principal in 54 schools.
The payments covered expenses including gym memberships, pilates classes, sports events, nutritionist consultations, nutrient products, adventure tourism, guided walks and overseas family travel.
Auditors also reported 10 schools made gifts to staff that did not have board approval, were excessive, or were inconsistent with the school's gift policy.
One paid about $40,000 to staff, including the principal, to show appreciation for their work during the Covid-19 period, the report said.
Four schools spent amounts on hospitality and entertainment that seemed excessive.
The report said in 23 schools principals approved their own expenses or had them approved by someone subordinate, and for 32 there was no approval of credit card spending, or it was approved by someone subordinate.
"As we have previously reported, credit cards are susceptible to error and fraud or being used for inappropriate expenditure, such as personal expenditure. Money is spent before any approval is given, which is outside the normal control procedures for spending public money," the report said.
