KATreasurer had it right - with your own EIN your organization is independent of the school and of the school system. They should have very limited control over your funds.
Having said that there are reasonable oversights the school system could ask for - we are required to report our fundraising and expenditures for the year.
Even though you are independent you are there to support the school and if the school has reasonable requests you should make a good faith effort to meet them. An adversarial relationship is not in anyones interest.
As far as funding specific things, you are independent and I don't know of any legal requirement why it has to be they way they suggest. For example, our field trips are paid for by the school, but the Principal gives us a copy of the paid bus bill and we reimburse the school for the expenditure (up to our budget limit per grade). The teachers know how much the PTO will pay to subsidize field trips and they account for it in the budget for the field trip. As another example, cultural program we pay for directly. Our committee chair works with the Principal and Teachers to make sure the programs fit the curriculum and to find a date, but the PTO for them directly - the school is not involved. So there is more than one way to handle these situations.
Actually, your principal may not be pulling your leg on this one. We handle funds for field trips and assemblies in a similar manner. We budget the amounts for each and write the principal (school) a check for the full amount to deposit into the activities account. The principal then pays for the field trip and assembly expenses from the school's account.
You can always call the Department of Education (or the superintendant's office) for verification of what the principal told you.
When you give the principal the money, you can also request copies of all bills, invoices and receipts for the activities you are "pre-paying" for.
I use a Program Funding receipt that has room to list a description of what the money is supposed to be used for. At the bottom, there's a place the recipient has to sign that says: "I received $___ from the PTO. I agree these funds will be used exclusively for the programs/items described above." Then it's signed and dated.
I have seen many posts on this site where there are school districts that require your group to let them know of fundraisers that are being planned and even getting permission to have them. It could be that the school district is trying to make sure that students and families aren't getting overwhelmed with fundraisers. The school staff can be affected too, because they often have to handle getting paperwork and even money and goods back and forth between the group and the students.
As for the reporting of results, it could be that the school district is trying ensure that there aren't huge financial discrepancies between schools within the district. I know our school district has some limits on what we can provide and has told us "no" on a couple of things because they felt it gave an unfair advantage to our students over the rest of the district's students. It bothered us that we couldn't fund the programs, but I can certainly understand it. If my child was in a school where the families couldn't afford to donate money or participate in fundraisers and I saw another school providing amazing things for their kids, I would be very disappointed.
As for her claiming this is "dictated by the Department of Education" I would question that. You could politely ask her for the documentation that requires you to function in the way she has stated. You could even go to their website and take a look around on your own.
I wouldn't just hand over any money, you need documentation for expenditures. Remember, you are a separate organization, not a part of the school district! Since you now have your own EIN you are on the right track. What do your bylaws or treasurer's procedures say about requirements for writing checks?
I am the PTO Co-President of an elementary school wich houses pk-5. Last year we were told that we needed to have our own EIN number for our PTO checking account because we no loner could be under the School's. We today we were told that our Superitendent of schools was no going to require each school to have writen permission for each fundraiser we do and we HAVE to report back to her on our total amount that is rasied. Also we were told that going forward all field trips and cultral events that we fund we need to give the money directly to the principal for her to deposit in the the school's activity fund and she would pay for all expenses. To me this sounds a little fishy, she claims that this is a dictated for the Department of Education. I do not believe her because she has twisted words and lied before. I was wondering if anyone is having this issue and also if anyone has heard of such a thing before. I don't think she has any right to say how we spend our money. Any help would be greatly appreciated.
