A public school is not required to comply with the PFMA as the PFMA only applies to Departments, Public Entities, Constitutional Institutions and Provincial Legislatures.
Section 15 of the South African Schools Act (SASA) states that, “every public school is a juristic person, with legal capacity to perform its functions in terms of this Act.”
Section 38(1)(j) of the PFMA requires that before transferring any funds (other than grants in terms of the annual Division of Revenue Act or to a constitutional institution) to an entity within or outside government, written assurance must be obtained from the entity that the entity implements effective, efficient and transparent financial management and internal control systems, or, if such written assurance is not or cannot be given, render the transfer of the funds subject to conditions and remedial measures requiring the entity to establish and implement effective, efficient and transparent financial management and internal control systems.
The Municipal Finance Management Act (MFMA) has a similar provision in Section 67 requiring that before transferring funds of the municipality to an organisation or body outside any sphere of government otherwise than in compliance with a commercial or other business transaction, the accounting officer must be satisfied that the organisation or body:
- has the capacity and has agreed
- to comply with any agreement with the municipality;
- for the period of the agreement to comply with all reporting, financial management and auditing requirements as may be stipulated in the agreement
- to report at least monthly to the accounting officer on actual expenditure against such transfer; and
- to submit its audited financial statements for its financial year to the accounting officer promptly;
- implements effective, efficient and transparent financial management and internal control systems to guard against fraud, theft and financial mismanagement; and
- has in respect of previous similar transfers complied with all the requirements of this section.
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