Financial Management Policy
The RTO is committed to establishing a long term presence in the vocational education and training sector, as a provider of quality training and assessment services. A key factor in attaining this aim is the ongoing financial stability and wellbeing of TheRTO, resulting from careful, responsible and hands-on financial management, aligned to the business goals, the nature of its operations and the nuances of the market in which it competes
This policy ensures that The RTO uses efficient financial management practices and systems.Ensuring compliance with the Standards for Registered Training Organisations (SRTOs 2015) along with the current VET (WA) Ministerial Corporation Purchase of Training Service’s Business Rules and accompanying current WesternAustralian Department of Training and Workforce Development’s VET Fees andCharges Policy.
2. Policy Statement
The RTO will ensure that it maintains sound financial practices, ensuring the financial security of the RTO and enabling its ongoing viability, profitability and growth.Conservatism will prevail as the key influence over financial decisions.Equally, an uncompromising commitment to integrity and professionalism will remain the keystone to all finance, banking, investment and general business transactions.
The RTO will:
a) Ensure it complies with the “Financial Viability Risk Assessment Requirements”;
b) Implement and maintain effective business planning and financial management processes;
c) Ensure that accounts are certified by a qualified accountant (Certified to AustralianAccountant Standards) at least annually and are made available to. the VET Registration body upon request;
d) Ensure that a full financial audit of the RTOs financial accounts from an independent qualified accountant (Certified to Australian Accountant. Standards) is obtained and made available to the VET Registration body upon request;
e) Implement and maintain procedures to protect fees paid in advance, to comply with the ‘Schedule 6 -Requirements for Fee Protection” of the Standards for RTOs 2015.
f) Provide students with complete and accurate fee information.
g) Issue and receipt fees and charges in-line with The Department of Training and WorkforceDevelopment’s current Fees and Charges Policy or agreed. upon documented payment arrangements with the student.
h) ProvideRefunds, as per Refund Policy.
3.1 The following words and expressions have the following specific meaning, as in the Standards for Registered Training Organisations (RTOs) 2015.
FinancialViability Risk Assessment Requirements means the requirements made under section 158 of the National Vocational Education and Training Regulator Act 2011 or equivalent requirements made or adopted by the VET Regulator of a non-referringState as the case requires.
Registration means registration as an RTO by the VET Regulator, where that registration is then entered on the National Register.
Scope of registration means the training products for which an RTO is registered to issue AQF certification documentation. It allows the RTO to:
a) both provide training delivery and assessment resulting in the issuance of AQF certification documentation by the RTO; or
b) provide assessment resulting in the issuance of AQF certification documentation by the RTO.
VET Regulator means:
a) the National VET Regulator; and
b) a body of anon-referring State that is responsible for the kinds of matters dealt with under the VET legislation for that State.
4. The RTO Obligations to- Financial Viability Risk Assessment Requirements 2011
a) The VET Regulator can request The RTO to demonstrate its financial viability at any point in time.
b) The assessment of the ‘Financial Viability’ by the VET Regulator is directed evaluating the likelihood of The RTO business continuity, and its capacity to achieve quality outcomes. The assessment informs a judgement about whether The RTO has the financial resources necessary to:
i. Acquire the requisite assets and physical resources to deliver all qualifications on its scope of registration;
ii. Employs sufficient appropriately qualified staff to cover the courses for which it takes enrolments;
iii. Provide appropriate levels of student services to students;
iv. Remain in business to ensure that each student can achieve completion;
v. Meet the above requirements even in an unsure environment.
4.2 Obligation to Submit Assessment
a) The RTO must submit an assessment of financial viability risk by a qualified independent financial auditor nominated by the VET Regulator at any time. during the registration period.
b) The obligation to submit also applies to parent organisations, affiliated companies or organisations that have a vested interest in the organisation.
4.3 Indicators for Assessment
a) The assessment will be undertaken by assessing common indicators of financial performance and position. These may include, but are not limited to:
i. Liquidity –including current ratio and cash flow assessments;
ii. Solvency –including debt to assets assessment, debt to equity assessment;
iii. EconomicDependency (e.g. reliance upon government funding or a particular cohort of students);
iv. Revenue, profit and cash flow;
v. Commercial risk’
vi. Audit opinion;
viii. Compliance withall statutory obligations(e.g. GST, taxation, superannuation)
ix. Compliance with accounting standards;
x. Accounting policies – impact of organisation accounting policies on its financial risk.
4.4 Information to Be Assessed
a) Information that could be used to assess the common indicators may include, but are not limited to:
i. Independent review of financial projections, including underlying assumptions;
ii. Business planning, including forecast income streams and forecast expenditure;
iii. Assets and liabilities;
iv. Financial statements audited by an independent qualified auditor;
v. Financial records for the previous 12 months, including profit and loss, balance sheets;
vi. Cash flow and bank accounts;
vii. Short term budgets and forecasts, including assumptions;
viii. Information on current and projected student enrolments, including assumptions;
ix. Tax records;
x. Information about current debts and debtors, credit and creditors, loans and repayments;
xi. Plans, and information on any legal disputes;
xii. Inter-company dealings, transfers, ownerships and loans;
xiii. Contingent liabilities;
xiv. Ultimate ownership details;
xv. Post reporting activities.
5. Policy Principles
The following principles underpin this policy.
5.1 Financial Management
a) The RTO aims to maintain a sound financial position, which facilitates its stability, planned business growth and profit projections through
i. Business planning, including forecast income and expenditure;
ii. Monitoring Cash flow;
iii. Formulation of and adherence to annual budgets;
iv. Ongoing reinvestment in the business to ensure it remains well resourced to meet student needs;
v. Maintenance of adequate cash reserves to meet planned commitments, as well as unforseen events;
vi. Striving to remain debt free as part of its overall strategy of optimising return on investment and consequently maintaining price competitiveness;
vii. Careful safeguarding of assets, via comprehensive insurance and security measures.
5.2 Course Fees
a) Fee for Service Course Fees
i. The RTO will strive to maintain highly competitive fair and reasonable fee structures, outlining these in a “Schedule of Fees”.
ii. The RTO adjust sits fees and charges from time to time. Changes to fees will be fairly and equitably applied, advertised and clearly indicate the date from which the change will take effect.
iii. The RTO provides details of course fees in all course information. (See StudentInformation Policy)
iv. Course fees maybe negotiated with individual students, as approved by the CEO of The RTO.
5.3 Fee Payment Arrangements
a) Fee for Service Course Fees
i. All Fee for Service Course Fees are payable via a payment plan.
a) The RTO will not accept prepaid fees from individual students in excess of a total of $1500 (being the threshold total prepaid fees amount).
b) In accordance with Schedule 6 – Standards for RTOs; The RTO adopts the following to protect fees paid in advance.
c) Details of payment schedules and specific conditions relating to payment plans are available at enrolment and provided to the student in writing.
ii. Flexible payment arrangements/options will accommodate individual circumstances.
iii. Fees must be paid in full before certification will be issued.
iv. If payment instalment / arrangements are in place, and a payment becomes overdue and remains unpaid for a period in excess of 14 days, The RTO. reserves the right to suspend the students learning or assessment (or both) until all fee payments are up-to-date.
v. Flexible payment arrangements, such as instalments, credit card, direct debit, cheques and EFT remittance are acceptable to accommodate the. diverse financial situations of students.
Students who withdraw are entitled to a full refund of the applicable course fee, resource fee and other fees where;
- A unit is cancelled or re-scheduled to a time unsuitable to the student; or
- A student is not given a place due to maximum number of places being reached
Administration Coordinator can approve a full refund of fees at any time during delivery if a class is cancelled because of declining student numbers, no available lecturer, or due to other circumstances caused by the RTO.
Students who withdraw for reasons other than those outlined above and who lodge a withdrawal form before the withdrawal date for a unit – which the RTO will determine foreach unit,
- wishes to cancel enrolment less than 7 working days prior to course commencement will be refunded 50% of fees paid
- no less than 20% duration for that unit will be eligible for a full refund less $100 Administration Fee and
- Where less than 50% of the course has been provided to the student a 50% refund less $100.00 admin fee will apply.
Pro Rata Refunds
Administration can approve a pro-rata refund of fees and charges at any time during the course of delivery if students withdraw for reasons of personal circumstances beyond their control. For example:
- Serious illness resulting in extended absence from classes.
- Injury or disability that prevents the student from completing their program of study.
- Other exceptional reasons at the discretion of the accountable officer.
- In all cases, relevant documentary evidence (for example, medical certificate) is required.
- If a student cannot attend a course for which they have enrolled in and paid for, a 20% transfer fee applies to any request for transfer where the notice period is less than 5 working days.
Refunds Following Re-Assessment
Students requesting a review of their assessment should do so within four weeks of the date of publication of the results. There are fees associated with this service– refer to the section Incidental Charges.
Should a ‘Not YetCompetent’ student achieve an outcome of ‘Competent’ on a review of the assessment, the $25 per unit re-assessment charge is to be refunded. The $50per unit charge for reporting on assessments is not refundable at any time.
Refunds will not be made to individuals or organisations when a person is booked into a course and fails to attend. Where 50% or more of the course has been provided to the student no refund will apply.
5.5 Asset Management
a) Acquisitions of assets are in accordance with strategic planning, training and assessment strategies and budgetary considerations.
b) Projected budget for asset acquisition will be included in annual strategic planning and the overall viability review for individual projects.
6. The RTO Responsibilities
The CEO of The RTO is responsible for:
a) Ensuring compliance with financial management policies, procedures and systems.
b) Ensuring compliance with Financial Viability Risk Assessment Requirements 2011.
c) Monitoring and reporting on compliance with these financial management policies and procedures.
d) Undertaking reviews of the effectiveness of the policies, procedures and systems annually and to use the results of such reviews to drive further improvements.
When requested, provide The Training Accreditation Council with a formal assurance that The RTO has sound financial management standards for matters relating to the Scope of Registration and scale of operations.
a) If applicable ensure compliance with the current Department of Training and Workforce Development’s VET Fees and Charges Policy.
b) If applicable, provide the Department of Training and Workforce Development with transparent receipts of payment of student fees and proof of payment either via the production of bank statements or other methods requested by The Corporation.
7. Access & Equity
The RTO Access & Equity Policy applies. (See Access & Equity Policy)
8. Records Management
All documentation from Financial management processes are maintained in accordance with Records Management Policy. (See Records Management Policy)
9. Monitoring and Improvement
All Financial Management practices are monitored by the CEO of The RTO and subject to ongoing review during monthly Financial Review meetings. Areas for improvement are identified and acted upon. (See Continuous Improvement Policy)
Information on how GST is applied
In this procedure the terms:
“Administration fees” –A supply of administrative services made by the RTO that is directly related to the supply of an education course is GST-free under paragraph 38-85(b). Administration services may include review of completed assessment materials, resulting, provision of results to the course, monitoring and auditing of the quality of the course. The ruling provides a list as per below:
- (a) program changes;
- (b) enrolment services, including the processing of late enrolments;
- (c) late issue or replacements of student cards;
- (d) examination arrangements and assessments of students including re-assessment of results where a student has failed;
- (e) processing academic results including duplicate degree copies;
- (f) overdue charges or late payment charges;
- (g) record-keeping;
- (h)administration of the library;
- (i)administration of a textbook scheme;
- (j) administration of the supply of course materials;
- (k) graduation certificates;
- (l) course reinstatement;
- (m) charges for HECS statements.
- “Enrolment fees” –Where a fee charged to confirm a student's place at the RTO and creates a right for a student to receive a GST-free education course, that fee is GST-free a sit relates to a right to receive a GST-free education course. This is regardless of whether the fee is being paid by the student or a third party on behalf of the student (such as a parent, employer or school) (Pt 111 & 112of GSTR 2001/1)
- “Non-accredited” –courses where a statement of attainment is not issued and is not a nationally recognised training
- “Tuition .course fees”– tuition fees are fees paid directly towards the GST fee education course
- “GST free education course” means:
- a course of study or instruction that is a tertiary course determined by the Education Minister under subsection 5D(1) of the Student Assistance Act. 1973 for the purposes of that Act; or
- a course of study or instruction accredited at Masters or Doctoral level and supplied by a higher education institution or a non-government higher education institution; or
- any other course of study or instruction that the Education Minister has determined is a tertiary course for the purposes of this Act.
- “professional or trade course” is defined in section 195-1 as:
- a course leading to a qualification that is an essential prerequisite: for entry to a particular profession or trade in Australia; or
- to commence the practice of (but not to maintain the practice of) a profession or trade in Australia.' NOTE: This is only for the first time completing the course, refresher courses not included here.
1. Procedure Review
This procedure will be reviewed each year and as a standing item, include details of the date it was reviewed.
1.1 Procedure Additions or Amendments
Separate to the mandated annual review, the procedure may be varied at any time due to legislative changes or to fall in line with widely accepted best practices in the workplace. In the event of any changes, the procedure will be updated and relevant stakeholders advised.
2. Related Documents
3. List of Courses
The below is provided to allow for an understanding of GST free education courses; non-accredited courses and professional or trade course.
GST free education courses-
- All Certificate I, II, III, IV as well as Diploma courses on scope for The RTO that are NOT linked to a national licence.
- All single units of competency that are NOT linked to a licence or high risk ticket
- All refresher courses that are linked to units of competency (e.g. high risk refreshers where the participant previously holds competency and wishes to be reassessed.)
- Professional development offered to schools, staff, trainers and third party providers
- Any training that results in a certificate of participation
- Any training that is not national recognised training
Professional or Trade courses-
- Any full qualification that is a pre-requisite for a trade as determined by a national instrument, licence or regulatory body (for example the Certificate III inElectrotechnology is a requirement for an electrical licence)
- Any unit of competency that is licensed or regulated and required for entrance into that industry or profession (for example White card, all high risk tickets)
- Any skill set that is regulated and required for entrance into the industry (for example traffic management course in WA)
Combination courses (for example white card within a trade taster) must be separately itemised and GST charged against each as applicable.