The former business manager of embattled Sydney Islamic school Malek Fahd has welcomed a decision to cut federal funding.
The federal government spent $19 million on the school last year but now says it will withdraw funding over concerns about the school's financial management.
Malek Fahd's former business manager Agim Garana says he's not surprised, citing mismanagement under school chairman Hafez Kassem.
"I'm very pleased that the decision has been made, because you don't want a school like this to run the way it has been running," Mr Garana told AAP.
"The money should be going to education. Why isn't that happening?"
Mr Garana said contracts for employment at the school had been awarded in a way that breached proper tender processes.
The school was paying $1.5 million per year in rent to the Australian Federation of Islamic Councils - which Mr Kassem presides over - when the land was worth less than half that, Mr Garana said.
Mr Kassem and AFIC have been contacted for comment.
Mr Garana said he was sacked last October for opposing Mr Kassem and added that the chairman had refused to stand down despite warnings from education authorities.
He called for the board's removal, saying the school wouldn't survive without federal funding.
"Parents are extremely upset," he said.
"It's embarrassing how this man has continued to survive so long."
Federal Education Minister Simon Birmingham said the school was put on notice last year for not complying with "fundamental governance, financial and accountability requirements".
"After carefully considering the response to the issues raised in the compliance notice, my department had to make the difficult decision to revoke the funding approval," he said in a statement.
"School governance should be of the highest standard and funding should be exclusively used for the education and welfare of students."
More than 2200 students were enrolled at Malek Fahd in 2014.
The education department has directed concerned parents to contact the school.
Five other schools around the country are under review: the Islamic College of Brisbane, the Islamic College of Melbourne, the Islamic College of South Australia, the Islamic School of Canberra, and Langford Islamic College in WA.
