FINANCIAL MANAGEMENT IN SELECTED

ELEMENTARY SCHOOL

IN ZAMBOANGA CITY

A RESEARCH PAPER

In Partial Fulfillment of the Requirements in Educational

Research 200

Researcher:
Fatima Ayeza J. Majid
 CHAPTER I

INTRODUCTION

Background of the Study

Different scholars have defined school management in

various ways. Management is a term used to describe the

techniques and expertise of efficient organisation, planning,

direction and control of a given institution. Griffin (1984:4)

defines it as the process of planning, leading and controlling an

organisation’s human, financial, physical and information

resources to achieve organisational goals in an efficient and

effective manner.

The various functions of management include finance,

production, personnel and marketing. Specifically, financial

management deals with the efficient allocation of financial

resources within the organisation. Financial management

involves three functions namely: the mobilisation of funds

(financing): the channelling of the mobilised funds into areas

where returns are maximised while risks are minimised

(investment); and the distribution of the resultant earnings to the

shareholders (dividends). In a typical business firm, the

objective is to manage the finances so as to maximise

shareholders wealth.

Financial management is not the domain at profit making

firms only, but also for nonprofit making organisations. The

public sector can specifically apply the same principles in

ensuring effective and efficient utilisation of resources. However,

the finance techniques have to be modified to suit the unique

circumstances that prevail in the public sector. That is, the

financial decisions in the public sector can also be classified as

financing (fund raising), investment and dividend. The dividend

decision is a trivial one in the public sector as no dividends are

declared. The size of and composition of the public sector is

quite widespread especially in the developing countries.

Education is one of the main public activities where

extensive resources are directed. This is best indicated by the

huge budgetary allocation to this sector by the Government.

Spending in education rose from 433.38 Billion in 2016 to 543.2

Billion in 2017.

The fact that such resources are directed towards education

implies that there is need for efficient management of these

resources.
 Whereas tools of evaluation efficiency are difficult to come by

or even understand, does not license the managers in this

sector to carelessly and irresponsibly manage these resources.

The Financial Management refers to the efficient and

effective management of money (funds) in such a manner as to

accomplish the objectives of the organization. It is the

specialized function directly associated with the top

management.

There are different definitions of financial management by

different scholars:

“Planning is an inextricable dimensions of financial

management. The term financial management can notes

that funds flows are directed according to some plan.”-

James Van Horne

“Financial management is that activity of management

which is concerned with the planning, procuring and

controlling of the firm’s financial resources.”-Deepika &

Maya Rani

“Financial Management is the Operational Activity of a

business that is responsible for obtaining and effectively

 utilizing the funds necessary for efficient operation.”-

Joseph Massie

“Financial Management is an area of financial decision

making, harmonizing individual motives and enterprise

goals.”-Weston and Brigham

Thus, Financial Managements can be said a good guide for

allotment of future resources of an organisation. Preparing and

implementation of some plans can be said as financial

management.

The financial aspect of schools also merits consideration as

the allocation of funds and its proper utilization on students’

learning enhance the internal efficiency of schools.

School financial management comprises the planning and

implementation of a financial plan,accounting, reporting and the

protection of assets from loss, damage and fraud. Schools can

regulate their financial management with internal rules. If the

school does not have the internal rules, there is a risk that

internal controls are not set. The school principal and the school

governing council is accountable for setting the internal controls

and internal auditing. The main products of financial

management are the financial plan and the annual report.

 The reporting process is closely linked to the planning

process, the definition of objectives and measuring.

STATEMENT OF THE PROBLEM

The study sought to determine the challenges faced by the

principal/school heads in the management of school finances in

selected schools in Zamboanga central district. Specifically, it

seeks to explore answers to the following questions:

1. What are the financial managerial practices of the

principals/school heads in zamboanga central district?

2. What are the weaknesses of financial management

practices in zamboanga central district?

3. Are schools implementing the Department of Education’s

policies and guidelines organize and manage funds

appropriately?

4. How are school finances audited by the Department of

Education?

5. Are teachers and stakeholders of the school in zamboanga

central is satisfied with how the principals manage the

finances of their respective schools?

SIGNIFICANCE OF THE STUDY

This research will be of value to the Department of Education

and the schools that will be used as case study as the

recommendations made will be handed to them.

Recommendations will also be handed to the Department of

Education so that the research can assist other schools that

might be experiencing challenges in the management of funds.

The study will provide schools and their communities with

knowledge that will enable them to manage funds in a correct

manner. Findings will be analysed based on Educational

Policies and Guidelines of the Department of Education.

SCOPE AND LIMITATION

This study will be of value to the Department of Education

and the schools that will be used as case study as the

recommendations made will be handed to them.

Recommendations will also be handed to the Department of

Education so that the research can assist other schools that

might be experiencing challenges in the management of funds.

1. The study is delimited to 3 public elementary schools under

Zamboanga Central District such as Zamboanga Central

Sped Center, Sta.Barbara Central School and Mariki

Elementary School which includes the following:

a. School Principals

b. Teachers

c. Stakeholders

2. The study will be conducted during four consecutive Friday’s

which will be lasted to one (1) month.

DEFINITION OF TERMS

To facilitate better understanding of this study, the

following variable terms were operationally defined:

A. Independent Variables

1.School Principal- the educator who has executive

authority for a school.

2.Teacher- is a person who helps others to acquire

knowledge, competencies or values.

3. Stakeholders- is a party that has an interest in a

company/school
B. Dependent Variables

1.Financial Management- refers to the different and

effective management of money(funds) in such a manner

as to accomplish the objectives of the organization.

2.Organization- is an entity comprising multiple people,

such as an institution or an association, that has a

collective goal and is linked to an external environment.

3. Planning- is the process of thinking about the activities

required to achieve a desired goal.

4. Policy- is a deliberate system of principles to guide

decisions and achieve rational outcomes.

5. Guidelines- is a statement by which to determine a

course of action.
 CHAPTER 2

REVIEW OF RELATED LITERATURE AND STUDIES

LITERATURE REVIEW

The researcher will review literature on the management of

finances in schools in the form of books, articles, Department of

Education policies regarding management of school finances

and Acts regarding the management of funds in government

departments. Financial management will be reviewed in terms of

the funding of schools, school budget, financial organization,

financial reporting and recording, and financial auditing in

relation to DepEd Order No. 13,s. 2016 (DO 13).

According to Thompson et al. (1994: 305-307) the first and

most fundamental principle of school budgets is that educational

programmes cost money: without funds there are no schools.

The second fundamental principle is that the primary purpose of

a budget is to translate educational priorities into programmatic

and fiscal terms. Thus the school’s budget is a statement of

priorities. Prioritization of programmes occurs through the

budget process where top priorities are funded first and other

programmes’ survival is a function of economic fortunes.

 A third fundamental principle of budgets is that they are not

natural phenomena that occur spontaneously in educational

environments but are created by people charged with carrying

out a school district’s legal educational obligations, which are

influenced by philosophical and fiscal realities. A fourth

fundamental principle is that budgets must be seen as a

powerful political tool in school districts. The process by which

money talks within budgets is highly political. The budget is the

means by which public approval or disapproval of the school is

expressed (Thompson et al., 1994: 305-306).

Candoli, Hack and Ray (1992: 136) also resonates similar

views in that they too believe that the school budget can be

conceptualized as an equilateral triangle, with the educational

programme as the base and expenditures and revenues as the

other two legs. If any one of the three sides is shortened, the

other two must also be shortened. Only when the three side

lengths are in proportion, the basis of a feasible budget

document would be in place.

STUDIES/RESEARCH REVIEW