Financial Accountability - Information for Services

This page provides information, including frequently asked questions (FAQs) and important resources, for services to assist with completing financial accountability through ECCMS.

Important: There are many changes in this year’s financial accountability statement.

Please read the Financial Accountability Return Guide before completing your financial accountability statement.

Financial accountability due date

Financial accountability statements released on Wednesday 8 November 2023 must be completed by Friday 15 December 2023.

Note: when a financial accountability statement is added in the Early Childhood Contract Management System (ECCMS), it has a status of Draft. After the statement is submitted, its status will change to Submitted.

About ECCMS

ECCMS is the online system used by the department to manage funding and contracting arrangements with early childhood education service providers.

See further information on setting up your access and using ECCMS in the FAQs below.

FAQs

If a service received funding within the period captured by the financial accountability, an email notification will be sent to the primary contact of each service provider from ECCMS. To review or update the contact details for your provider, please log in to ECCMS and select the Main Details tab under the Service Provider menu item. Providers are responsible for maintaining and updating their services’ contact details within ECCMS.

Completing financial accountability statements are a requirement under the NSW Department of Education’s Grant Programs Terms and Conditions. Providers are required to accept and agree to the Terms and Conditions each year to receive funding.

Financial accountability statements released on Wednesday 8 November 2023 must be completed by Friday 15 December 2023.

Yes, all financial accountability statements must be submitted via ECCMS.

  1. Financial accountability statements can be accessed from the To Do list tab or in the ECCMS left-hand menu by clicking Funding Specification. Capital Works Financial accountabilities can be accessed directly from the bottom ECCMS left-hand menu.
  2. Locate and click the Funding Specification that corresponds with the funding you have received.
  3. Click the Accountability tab.
  4. Locate the correct Financial Year, and then click the Financial hyperlink, which opens the financial accountability statement to be completed.

More information on how to complete your financial accountability statement can be found here in the Financial Accountability Return Guide.

Service providers cannot transfer grant funding between services from different grant program, unless specifically permitted in the program guidelines e.g. Start Strong for Community Preschools Fee Relief funds to Start Strong for Community Preschools Program payment.

About ECCMS

To access ECCMS, you will need a myGovID and be linked to the provider in RAM. Step-by-step instructions on how to set this up is available on the ECCMS webpage.

Note: Troubleshooting RAM is provided by the Australian Taxation Office (ATO).

More detailed information on using ECCMS can be found in the ECCMS Service Provider Guide (PDF 7108.79KB).

If you require further details on how to complete your financial accountability reporting requirements online via the Early Childhood Contract Management System, please see pages 74 to 87 of the ECCMS Service Provider Guide.

If a service received funding within the period captured by the accountability, you will receive an automatic email to the main contact email address in ECCMS. The program funding the email relates to will be noted in the subject heading of the email.

Services should log into ECCMS and navigate to the ‘To Do’ list in the left-hand menu. A list of all outstanding financial accountabilities will be listed.

Note: A financial accountability will show ‘draft’ if it has not yet been submitted.

Click on the underlined ‘financial accountability’ to navigate to complete the financial accountability statement. When you have finished completing the information, scroll to the bottom of the financial accountability statement and select ‘Submit’.

Once the financial accountability statement has been submitted, the accountability will disappear from the To Do list. Navigate to the Funding Specification and click on the ‘Accountability’ tab. The financial accountability will now show ‘Submitted’.

Start Strong for Community Preschools Fee Relief Funding

Reserved Fee Relief Funds (Quarantined Funds) are funds that were not allocated to an enrolment e.g. the service had fewer children enrolled than funding was provided for, or the service had a number of enrolled children where families have claimed fee relief elsewhere. These funds must be reserved (quarantined) by the service and recorded in your liabilities. The amount at this section is manually entered by the service.

Note: Only enter the reserved (quarantined) fee relief amount, where fee relief funds were not allocated to an enrolment

See the examples below.

Our service received funds for 50 children under Start Strong for Community Preschools Fee Relief funding. The total enrolments claiming Fee Relief at our service was 60 children.

How do I show this on the financial accountability statement?

Calculate the difference between the amount paid by the Department, and the amount the service passed on to families. This figure should be displayed as a negative in the ‘Reserved Fee Relief Funds’ section. This amount will be considered in the next Fee Relief Payment adjustment from the department.

How do we cover the cost of the additional families claiming Fee Relief at our service?

Services should cover the cost of additional families claiming Fee Relief from their retained profits

When will our service be reimbursed by the department for the additional enrolments claiming Fee Relief at our service?

Services may be eligible for additional funding in 2024 to address a Fee Relief related deficit accrued because of providing Fee Relief to more enrolments than the service was initially funded for in 2023.

No, only record amounts where Fee Relief Payment has been used to cover costs. Services should only record amounts where Fee Relief funds were actually used to cover the costs of what families would have normally been required to pay.

If families actually paid additional fees such as enrolment/administration, resources, excursions etc, don’t record that amount in Part 1 Fee Relief Payment.

Actual fees paid by families are recorded in the INCOME section in Part 2 Program Payment.

Simple Rule: If families actually paid any fees, include these fees Part 2 Program section. If the Fee Relief funding was used to cover fees, and families didn’t pay, include these fees in Part 1 Fee Relief Payment section.

No, services must apply the funding in the order noted in Fee Relief Payment Spending Rules i.e. if there is any surplus after applying the funding to level 1 ‘reduce the daily fees as much as possible for 600 hours per year for eligible children accessing fee relief at the service’, you must firstly apply this surplus to level 2 ‘reduce the cost of additional charges to families accessing fee relief at the service’.

If there is any surplus after applying against level 2, then any surplus funds can be applied against one or all of the options at level 3 which includes reducing the operating expense of the service per the Program Payment spending rules.

Note: The amount entered in Expenditure item iii) # will be automatically deducted from the operating expenses noted in Part 2 Program Payment.

Completing the Start Strong for Community Preschools/Mobile Preschool Funding Program Financial Accountability Statement

No, services receiving payments under both Start Strong for Mobile Preschools and Mobile Preschools Funding Programs will note a combined total income amount on the accountability.

Start Strong for Community Preschools and Mobile Preschool Funding Program Fee Relief Payments began in January 2023. The financial year financial accountability statement captures payments made within the 2022-2023 financial year.

The 2023-2024 financial accountability statement will capture a full twelve months of payments for the next 2023-2024 financial year.

Yes, financial reporting requirements depend on whether the service provider is classified as a Tier 1 or Tier 2 organisation under NSW Fair Trading guidelines. Services registered with ACNC will still need to attach the required documents relative to Tier 1 or Tier 2 organisations under the NSW Fair Trading guidelines when completing their financial accountability statement.

More information can be found under Financial Reporting Requirements of the Financial Accountability Return Guide, and on the NSW Fair Trading website.

Yes, surplus funds noted in the Non-DoE column on the previous year's Start Strong for Community Preschools/Mobile Preschool financial accountability statement should be manually entered on this current year financial accountability statement. Please don’t enter a deficit amount.

Note: This is not the surplus amount noted on your audited/non-audited financial income and expenditure statements from your accountant/bookkeeper. The surplus noted on your audited/non-audited financial income and expenditure statements is a combination of all of your income and expenditure.

No, where services receive multiple funding grants from the department e.g. Fee Relief Payment, Start Strong for Community Preschools/Mobile Preschool funding, Disability and Inclusion funding, Quality and Participation funding etc, the income and expenditure amounts shown on your audited/non-audited financial income and expenditure statements from your accountant/bookkeeper are a combination of all grants and income streams income and expenditure across all programs.

Remember to extract the income and expenditure relative to each program when completing your financial accountability statement.

It is not correct to transpose the total line-item amount on your audited/non-audited financial income and expenditure statements unless Start Strong for Community Preschools, Mobile Preschool Contracts or Mobile Preschool Funding Program grant funding is the only grant income your service received from the department.

If you received funding for the Disability and Inclusion Program or the COVID-19 Free Preschool Funding program, remember to first deduct wages paid to staff using these two grants, from the total wages line-item on your audited/non-audited financial income and expenditure statements from your accountant/bookkeeper.

If the service received Traineeship grants or Maternity Leave payments, or previously JobKeeper and JobSeeker, the wages expenditure of these amounts should be noted against Non-DOE column wages expenditure line items (service delivery staff or administration and management staff) in the ‘Non-DoE Funds’ column as they were received from other sources, not DoE.

If your service received funding under the Grow Your Own (ECEC) program, any wages paid for trainees using that funding should not be recorded on the Start Strong for Community Preschools/Mobile Preschool Funding Program accountability. Record these wages amounts on the Grow Your Own (ECEC) program accountability.

This year the Start Strong for Community Preschools/Mobile Preschool Funding Program Fee Relief Payment and Program Payment are part of the one accountability.

In Part 1 Fee Relief Payment Section, only include the fee relief passed on to families, or where administration costs were paid for using the fee relief payment. Don’t include any other expenditure here.

In Part 2 Program Payment, don’t include Start Strong for Community Preschools Fee Relief funding, Start Strong Free Preschool, COVID-19 Free Preschool or any other department Early Childhood Outcomes grant funding under this section. These grants will be acquitted on their own financial accountability.

See notes at the bottom of Part 1 Fee Relief Payment on the accountability template.

#Less funds used for operating expenses from Fee Relief payments.

Note: The amount entered in Part 1 Fee Relief Payment Expenditure item iii) # will be automatically deducted from the DoE Funds column operating expenses. This is because the service will be acquitting that amount already under Part 1 Fee Relief Payment expenditure.

Services should enter values into each column in Part 2 Program Payment section on the Start Strong for Community Preschools financial accountability statement.

For some expenditure categories where splitting is difficult (such as 'Salaries and Wages'), a revenue % apportion basis can be used as a guide e.g. if the total income for 'DoE Funds' is $60,000 and 'Non-DoE Funds' is $40,000 totalling to $100,000 then 60% of expenditure can be apportioned to 'DoE Funds' column and 40% to 'Non-DoE Funds' column.

If the NSW Department of Education is the major funder e.g. if total income for 'DoE Funds' is $90,000 and 'Non-DoE Funds' is $10,000 totalling to $100,000, then expenditure should be shown first in the 'DoE Funds' column bringing the balance to $0, and remaining expenditure shown under the 'Non-DoE Funds' column.

An Asset Register showing Early Childhood Outcomes (ECO) and non-ECO funded assets must be submitted if any depreciation, capital expenditure or sale of assets has been reported in the accountability.

It is expected that services will utilise the full DoE funds first, then cover any expenses over and above the DoE grant funding from their other sources of funding (Non-DoE Funds) and any retained profits.

The DoE Funds column total at this section should be $0.00 showing all DoE grant funds have been expended.

Note: There should not be a deficit noted in the DoE Funds column if a surplus is noted in the Non-DoE Funds column. Services would have utilised Non-DoE Funds to cover the deficit noted in the DoE Funds column.

It is acceptable for the service to have surplus funds in the Non-DoE column after all DoE grant funds have been expended (showing $0.00 balance).

A deficit in both DoE Funds and Non-DoE Funds columns is acceptable if a service used all DoE Funds income as well as their Non-DoE Funds income and were required to use any retained profits to meet the shortfall and keep operating.

These charges often arise when there is a central administration or head office cost centre that supports multiple units within an organisation. It is acceptable for service providers to allocate a reasonable portion of overhead costs to Early Childhood Outcomes funded programs. This however must be done on a consistent basis and as part of an appropriate costing methodology.

No, if a service has incurred a deficit in prior years, this deficit cannot be carried forward and should be absorbed by the service provider.

Surplus funds threshold

This section is only relevant to Start Strong for Community Preschool Program.

Surplus thresholds are based on the total surplus after completing both Part 1 Fee Relief Payment and Part 2 Program Payment expenditure on the financial accountability statement.

A surplus amount will be noted in the bottom row at ‘Total Surplus’ with a calculated percentage of what that surplus amount is to the annual 2023 Start Strong for Community Preschools Program.

The threshold is based on the surplus percentage of the total funding under this program. For more information see Surplus and Refunds in the 2023 Start Strong for Community Preschools Guidelines. Visit Start Strong for Community Preschools to access the guidelines.

The service will firstly need to calculate 10% of the annual Start Strong for Community Preschools Program Funding. Examples and further information can be found in the Part 3-DOE Funding Surplus Overview and Declaration FAQ in the Financial Accountability Return Guide.

The service will firstly need to calculate 10% of the annual Start Strong for Community Preschools Program Funding.

See the examples below:

  1. The service will calculate the 10% of the annual Start Strong for Community Preschools Program funding e.g. $380,000 x 10% = $38,000. This is calculated using the annual program funding (total of Fee Relief Payment plus Program Payment).
  2. ECCMS will calculate the surplus amount into a percentage e.g. $27,000 ÷ $380,000 x 100 = 7.1%,

If the surplus is up 10% or $30,000 (whichever is greater) of the annual program funding, the service should select Option A.

If the surplus threshold is greater than 10% or $30,000 (whichever is greater) of the annual program funding, the service should select Option B.

Example 1 – Option A
Total Program Funding (including Fee Relief and Program payments) $380,000
Total Surplus at Part 3 $27,000
ECCMS Surplus % Calculation ($27,000 ÷ $380,000 x 100) 7.1%
10% of Start Strong Annual Program (10% of $380,000) $38,000

Service can choose to keep the amount below 10% of program funding or $30,000 (whichever is greater).

As $27,000 is less than $38,000 (10% of the annual program funding), the service can opt to keep the surplus to carry over to the next funding period.

Example 2 – Option B
Total Program Funding (including Fee Relief and Program payments) $380,000
Total Surplus at Part 3 $42,000
ECCMS Surplus % Calculation ($42,000 ÷ $380,000 x 100) 11.05%
10% of Start Strong Annual Program (10% of $380,000) $38,000

Service can choose to keep $38,000 (up to 10% of program funding).

Additionally, where the service has an operational need to retain the surplus, they can apply to the department to keep the surplus amount which is greater than 10% or $30,000 (whichever is higher).

This is done by the service by firstly completing the Surplus Application Form and then checking the confirmation box (the top box at Option B) on the financial accountability statement. The Surplus Application Form will be available soon and more details will be communicated.

Service can choose to keep the additional $4,000 which is the amount above the $38,000 (higher than 10% or $30,000).

The service has completed the Surplus Application Form and has checked the confirmation box (the top box at Option B) on the financial accountability statement.

DoE surplus funds cannot be transferred to other service providers, in between services or across funded programs, unless it is permitted specifically in the program guidelines.

This year under the Start Strong for Community Preschools program/Mobile Preschool Funding Program, services can choose to transfer surplus funds under Part 1 Fee Relief Payment to Part 2 Program Payment sections. This is done automatically by ECCMS when the amount to transfer is entered into the cell in the Fee Relief Payment expenditure table.

The department understands that some providers may have a surplus at the end of their reporting period which needs to be returned to the department according to the Terms and Conditions.

This is applicable to services receiving funding under the Start Strong for Community Preschools only.

After completing the financial accountability statement, services can calculate their surplus threshold and choose how they would like to manage their surplus (if any) from the relative Option A or B.

They then can apply to retain surplus funding (where applicable) under the total Start Strong for Community Preschools Program. See the instructions on the accountability template or noted in the Financial Accountability Return Guide.

This year there is an additional attachment in the list. Services will need to attach a separate statement that reconciles with the Fee Relief Income and Liability accounts.

See Financial Reporting Requirements in the Financial Accountability Return Guide for further information.

Resources

Category:

  • School operations

Business Unit:

  • Early Childhood Outcomes
Return to top of page Back to top