Raising funds — state integrated schools
Both boards of trustees and proprietors of state-integrated schools can raise funds. These funds must be used for purposes that match the roles and responsibilities of the board of trustees and proprietor. The funds raised by each party must be kept separate. Proprietors and boards of trustees of state-integrated schools need to understand the financial relationships between the 2 bodies, and the requirements for keeping their funds separate.
Because fundraising in integrated schools can involve both proprietors and boards of trustees, and therefore 2 different beneficiaries, the party that's responsible for the fundraising must ensure that the purpose and intended beneficiary of the fundraising are clearly identified and communicated to parents and the wider school community.
This means parents and other members of the school community should be given full information about the intended purpose and beneficiary of any fundraising to which they're invited to contribute from the outset.
Proprietors may raise funds for purposes related directly to their responsibilities under the Education Act 1989 (the Act) (for example, property and special character), and for any other purpose as long as it's consistent with the legal status of the proprietor.
Section 451 of the Act affirms that, in addition to raising funds by collecting compulsory attendance dues which may be charged under section 447, a proprietor may:
- conduct fundraising activities within the school
- inform parents of the proprietor’s financial obligations through school publications, such as the prospectus
- request that parents make regular voluntary financial contributions to service debt repayments in relation to school land and/or buildings or other buildings associated with the school.
Boards of trustees
The Act confirms that boards of trustees of integrated schools are able to raise funds in the same ways and for the same purposes as the boards of state schools. These funds are Crown funds and shouldn't be confused with funds owned by the proprietor.
Holding of funds
There are different accounting requirements for locally raised funds or voluntary contributions, depending on whether the fundraising has been carried out by the proprietor or the board of trustees.
Section 452 of the Act states that the board of trustees, staff or students of an integrated school can't take part in any fundraising to contribute to the proprietor’s property-related costs during normal school hours (when the school is open for teaching).
The board of trustees, staff or students of integrated schools may volunteer to participate in fundraising carried out for that purpose outside of school hours.
We recommend that funds raised by proprietors be deposited directly into the proprietor's bank account.
If the school does hold funds for the proprietor, those funds should be recorded separately from income and transferred out as soon as possible. Schools need to keep full documentation about any funds held on trust. This will help to prevent the blending of proprietor and board of trustee funds and the associated risk of the board of trustees assuming the functions of the proprietor in respect of the funds it holds on trust.
Section 453 of the Act states that when proprietors carry out any fundraising or receive any voluntary contributions, it 's the proprietor's responsibility to keep accounts of this money. This requirement also applies to any funds raised when board of trustees members, staff or students of integrated schools take part in fundraising for the proprietor outside of normal school hours. In each of these scenarios, the funds raised are private and belong to the proprietor.
All proprietors’ accounts of fundraising and voluntary contributions must be audited by a chartered accountant at least once every 12 months. Proprietors must ensure that these accounts (and the auditor's report on them) are made available to any parents or other contributors who request to see them.
Boards of trustees
Any funds collected through fundraising undertaken by and for the board of trustees are considered Crown funds and are treated in the same way as funds provided directly by the Ministry
Boards of trustees are subject to separate accountability and governance requirements from proprietors. As Crown entities, boards of trustees are accountable to the Crown, including following a rules-based financial framework that specifies how their funds must be held and maintained.
Under section 158 of the Crown Entities Act 2004, any funds from a board of trustees fundraising activity must be deposited as soon as possible into an account in the name of the school, which can be opened and used only by the board of trustees. School boards of trustees can bank only with an approved institution.
Boards of trustees have no authority to operate accounts in the name of third parties, such as proprietors, or to manage any funds raised by (or on behalf of) proprietors, as these funds are privately owned by the proprietors.
Section 161(3) of the Crown Entities Act allows a board of trustees to hold money on trust for any purpose or for another person, which means that funds raised or voluntary contributions received for a proprietor may be held temporarily in the school's bank account.
Donors may be eligible to receive tax credits for voluntary contributions/donations if the recipient (board of trustees, or proprietor) is an approved donee organisation.
Find out more about tax credits for donations.
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