While Sydney's largest Islamic school Malek Fahd was thrown into turmoil on Tuesday with the announcement that the Commonwealth was revoking $19 million in funding, the Canberra school has sought to assure its community that it is a separate entity.

The Islamic Council of Canberra chairman, Mohammed Berjaoui, said the decision regarding Malek Fahd had no immediate impact on the Canberra school, which he said was expanding and had secured registration from the ACT government to operate this year.

The decision to axe funding at the Sydney Islamic school, which caters for more than 20000 students, followed a nine-month formal financial audit.

The Canberra Islamic School and Malek Fahd are two of six Islamic schools across the country operated by the Australian Federation of Islamic Councils, along with the Islamic College of Brisbane, the Islamic College of Melbourne, the Islamic College of South Australia and Langford Islamic College in Western Australia.

All six schools came under investigation by the federal Department of Education last year after a string of sackings among senior staff members and principals, allegations of financial mismanagement and concerns over the delivery of the curriculum.

The department said "compliance assessments" were still being finalised across the other schools – including the Islamic School of Canberra.

Federal Education Minister Simon Birmingham said that in the case of Malek Fahd, federal funding had been revoked because authorities were not convinced that funding was being exclusively used for the education and welfare of students.

"Unfortunately, the authority that operates Malek Fahd Islamic School was not able to demonstrate to my department that they had addressed the significant concerns about their financial management and governance arrangements raised during the formal compliance review of their operations," he said.

He also urged the public not to see the investigation on religious grounds.

"This should not be seen as a matter that only relates to Islamic schools, this relates to school governance," he said.

Mr Berjaoui is the school's business manager and said he was co-operating fully with Commonwealth authorities regarding the financial audit.

"We have answered all their questions and we have nothing to hide," he said.

He said the school had received approval to be registered this year in Canberra by the ACT Education Directorate and student numbers had risen from 195 last year to 230.

The directorate confirmed that the registration of the Islamic School of Canberra was renewed in 2015 for the period January 1 – December 31, 2016, but "the school has been advised that registration for this period is dependent upon ongoing receipt of Commonwealth government funding, in order to meet the ACT's financial viability requirements of registration".

Mr Berjaoui was confident this would happen.

"It is difficult when there is all this negative publicity surrounding the Sydney school," he said.

"For us, I can only stress, there is no change, it is business as usual."

The school charges around $1500 a student each year and according to the most recent data from 2013 on the MySchool website, it received $622,708 from the Commonwealth and $104,768 from the ACT government to operate.

Mr Berjaoui said the school also received about $350,000 a year from the Australian Federation of Islamic Councils.

He stressed that the school served its educational purpose and funding was being used appropriately. Students were achieving NAPLAN results substantially above the national average, according to the MySchool website.

Mr Berjaoui said he hoped the continued publicity surrounding the Sydney school did not upset Canberra families.

"I have not had any calls today [Tuesday]. I think our families trust in us and are happy with what we are doing despite the media coverage," he said.

The school had had to hire two more teachers this year and was looking for more staff to continue planned expansions.