Financial viability

A registered non-government school must be financially viable. Find out about the requirements for financial viability and certification.

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Under the Education Act 1990, a registered non-government school must be financially viable. The requirements for financial viability are described in the school registration and accreditation manuals.

What is financial viability?

A financially viable school is one that can:

continue operating into the foreseeable future, including for the full period of its school registration, and
operate the school and educate students without financial difficulty.

When assessing and monitoring their financial position, schools should consider:

current finances and sources of funding
loans and other financial commitments
lease or rental arrangements
the school’s business plan
current and future budgets.

Strong financial viability is supported by:

sound financial management
informed decision‑making
appropriate financial controls.

Schools are expected to identify and manage financial risks early. If financial stress is not addressed, it may place the school’s registration at risk.

Providing evidence of financial viability

Schools applying for initial registration or renewal of registration must provide evidence that they are financially viable.
The type of financial evidence required by NESA depends on the school’s risk assessment. The Overview of the Risk Assessment Framework (PDF 167.31KB) explains:

how schools are grouped into risk categories, and
the evidence required for each category.

Depending on the outcome of that assessment, NESA may request:

a certification from the school principal, or
a financial viability certification or warrant from a NESA‑approved body.

An Inspector may ask for additional information if concerns about compliance are identified during the assessment of an application, or at any other time where compliance concerns emerge.

NESA-approved bodies to certify financial viability

Where a non-government school is required by NESA to get an assessment and certification or warrant of its financial viability, it must be undertaken by one of the following NESA-approved bodies:

Schools should contact their relevant system authority or an approved body for advice. Organisations or individuals wishing to become a NESA-approved body should contact schoolrego@nesa.nsw.edu.au.

Certification outcomes

If a school principal provides the financial viability certification, it is included in the school’s application to NESA.
If an approved body assesses the financial viability, the Principal is required to sign a certification and submit that and the report (if relevant) to NESA. The certification will determine a risk rating of:

low
medium
high.

Where a school’s financial viability is assessed as a medium or high risk, an assessment report is provided that:

describes the school’s financial context
explains the risks identified
outlines any actions needed to address them
may recommend future monitoring.

Record keeping

A school’s proprietor must have policies and procedures to regularly check the school’s financial viability. These must clearly state which documents are used, how they are audited and that certified financial statements are kept for seven years.
A proprietor must notify NESA through RANGS Online if the school’s external auditor changes before the end of a contract, or if the proprietor’s affairs come under any form of external control.