CHARTER SCHOOL FINANCES & IMPORTANCE OF TRANSPARENCY

1. CHARTER SCHOOL FINANCES & IMPORTANCE OF TRANSPARENCY Thursday May 3, 2018

2. CHARTER SCHOOL FINANCES & START UP TIPS “The question that faces the strategic decision-maker is not what his organization should do tomorrow. It is: What do we have to do today to be ready for an uncertain tomorrow?” – Peter Drucker “Everybody has a plan until you get punched in the face” – Mike Tyson Thursday May 3, 2018

3. Charter School Revenue in PA • State, Local (tuition), Federal, & Donations • State – doesn’t really exist anymore • Good old days included Social Security, PSERS • Currently Rental reimbursement and Ready to Learn Block Grant • Local – approx. 95% of total revenues • Tuition Calculation Circus • Federal – entitlement grants helpful, but not game changers • Donations – don’t count on them until operating and checks clear bank

4. Charter School Financial Best Practices • Demonstrate a Commitment to Fiscal Transparency • Ensure a Segregation of Duties Regardless of Size • Board Establishes a Commitment to Fiscal Transparency • Set Goals and Monitor Regularly • Monthly Financials – delivered timely • Annual Reports and Audit

5. Fiscal Transparency Demonstrate Fiscal Transparency by posting these docs on WWW 1. Annual Budget – consolidated or expanded format 2. Most Recent Independent Audit – multiple years are better 3. Most Recent 990 – multiple years are better 4. Monthly Financial Statements – overview, or complete: income statement, balance sheet, deposit & disbursement detail 5. Organizational Chart

6. Fiscal Transparency Demonstrate Fiscal Transparency by posting these docs on WWW Right To Know Officer’s contact info accessible on website - Best response to RTK request = already available on our website Administrator(s) contact info accessible on website Board Member list & Bio’s accessible on website Enrollment Info accessible on website

7. Fiscal Operations Responsibilities • WHO does WHAT, and HOW do we hold ourselves accountable? • Key Administrators & Finance Committee create “Role Chart” • Review it with Board, Put it on the WWW

8. Ask Good Questions Good News! Board members do not need to be CPAs, financial experts, or even good at math to be good stewards of public funds. The most important job of board members is to ask good questions and hold employees & vendors accountable for good answers.

9. 3 More Things……… 403bs for new employees: It is not your responsibility to bail out PSERS Think – and speak – about “compensation” rather than “salary/pay”. An employee with $50K salary may cost the school $90K when PSERS, health benefits, tuition reimbursement and other expenses factored in Educate your stakeholders – Board, teachers, families – and make them partners

10. Where to go for more information • Experts in your field – look for the best • Peers – benchmark the best • Associations – technical materials & standards • Administrative Agencies – procedural & technical knowledge and resources • Where to go when things go wrong • Use phone – call trusted counsel • For any fraud/waste/abuse: • Move fast, document steps • Why training and refreshers are important • Reminds staff it’s important • Happy auditors/examiners Resources Engage Your Team of Professionals Charter Choices The Education Governance Academy PA Coalition of Public Charter Schools PA Department of Ed US Department of Ed – Charter School Office National Charter School Resource Center National Alliance for Public Charter Schools