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PUBLIC SCHOOL FINANCE New Superintendents September 16, 2011

PUBLIC SCHOOL FINANCE New Superintendents September 16, 2011. Leanne Emm Assistant Commissioner 303-866-6202 emm_l@cde.state.co.us. Financial Accreditation Audit Compliance Budget Policies & Procedures Financial Transparency Economic Forecast Key Staff Contacts Questions. Agenda.

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PUBLIC SCHOOL FINANCE New Superintendents September 16, 2011

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  1. PUBLIC SCHOOL FINANCE New SuperintendentsSeptember 16, 2011 Leanne Emm Assistant Commissioner 303-866-6202 emm_l@cde.state.co.us

  2. Financial Accreditation Audit Compliance Budget Policies & Procedures Financial Transparency Economic Forecast Key Staff Contacts Questions Agenda

  3. Financial Accreditation

  4. Accreditation of school districts and institute – contracts – rules22-11-206 C.R.S. • Accreditation Report • Financial compliance - Budgeting, Accounting and Reporting (Articles 44 and 45) 22-11-206 (4)(a)(I)&(II) C.R.S. • Submitted with Annual Financial Report (Audit) • Handout

  5. Removal of Accreditation – recommendations – review – appeal - rules22-11-209 C.R.S. • Loss of Accreditation: • Have 90 days from receipt of notice to remedy noncompliance for failure to comply with provisions of Article 44 or 45 concerning accounting and financial reporting. • Could possibly lead to state review panel evaluation.

  6. Article 1 of Title 29, C.R.S.Part 6Audit - Compliance

  7. Audits – required. 29-1-603 C.R.S. • Requirement that auditors ensure the district or school is complying with the provisions of section 22-44-204 (3), C.R.S. • use of the financial policies and procedures handbook • Anticipate Federal requirement for individual charter schools to issue separate independent financial audit • Fiscal year ending June 30, 2012

  8. Audits – required. 29-1-603 C.R.S. • The audit report shall contain a fiscal year report of receipts and expenditures of each “fund” with designated program reports as required by the FPP Handbook. • This means all financial activities as those activities are defined by “generally accepted accounting principles” for governments.

  9. Submission of reports29-1-606 C.R.S. • Audit to be completed and submitted to school board by November 30 • Authorizers may require charters to submit earlier in order to incorporate into district audits • Audits due to the state auditor and CDE within 30 days after the audit report is received (December 30th).

  10. Submission of reports29-1-606 C.R.S. • Written requests for extensions may be requested through the state auditor’s office if the audit report cannot be completed and filed by December 30th • State auditor may authorize an extension, not to exceed 60 days (February 28th).

  11. Audit Submission • In an extension has been granted - consequences for audits submitted after the February 28th deadline: • Financial Accreditation watch • Withholding of property taxes

  12. Why so Stringent? • The Department is required to submit consolidated state financial data to Federal Government • If deadlines missed • Withhold Federal Funds to the State which then must be withheld from districts

  13. Article 44 of Title 22, C.R.S.Part 1Budget Policies and Procedures

  14. Budget and appropriation – required. 22-44-103 C.R.S • BOE must: • Adopt Budget and appropriation via resolution for each year • Prior to the beginning of the next fiscal year (June 30).

  15. Failure to adopt budget or appropriation 22-44-104 C.R.S. If either the budget or appropriation resolution is not adopted prior to June 30, the entity is held to 90% of prior year’s adopted budget.

  16. Budget – contents – mandatory22-44-105 C.R.S. • Describe the expenditure • Show amount budgeted for current fiscal year • Show the amount estimated to be expended for the current fiscal year • Show amount budgeted for ensuing fiscal year • Summarize revenues by revenue source • Summarize expenditures by function (program), fund and object

  17. Budget – contents – mandatory22-44-105 C.R.S. • Expenditures, interfund transfers, or reserves, may not exceed available revenues and beginning fund balance. • May not budget a deficit! • Ending fund balance must cover TABOR and positive unreserved fund balance

  18. Budget – contents – mandatory22-44-105 C.R.S. • If beginning fund balance planned to be used, a resolution must be adopted by the board authorizing the use. • Amount of beginning fund balance to be used • Purpose for spending the funds • State the plan to ensure the use of fund balance does not lead to ongoing deficit

  19. Appropriation resolution - required22-44-107 C.R.S. • The appropriation resolution is the authority to spend funds and must reflect the adopted budget • May incorporate the budget adoption and appropriation resolution into same document • May also incorporate the “use of fund balance” resolution • End of year expenditures may not exceed appropriation – audit finding!

  20. Preparation of budget22-44-108 C.R.S. • A proposed budget must be submitted to the board by June 1 • Within 10 days of submittal, notice of budget must be published • Public hearing must be held

  21. Budget – consideration - adoption22-44-110 C.R.S. • The board may review and change the budget at any time prior to January 31st. • This allows for the budget to reflect more current funding data: • Actual student counts • District assessed valuation • Total Program/Per Pupil Revenue

  22. Budget – consideration - adoption22-44-110 C.R.S. • Supplemental Appropriations • Funds that become available for specific purpose after the budget is adopted or after the budget has been changed • Grants, bond or mill levy override elections, etc • Must adopt supplemental appropriation in order to spend the funds – prior to end of year!

  23. Public School Financial Transparency Act

  24. Financial Transparency ActArticle 44 of Title 22, C.R.S. Part 3 With the passage of HB10-1036, The General Assembly enacted the  "Public School Financial Transparency Act", which directs local education providers to post financial information on-line, in a downloadable format, for free public access.

  25. Local Education Provider • School District • Board of Cooperative Services • State Charter School Institute • District Charter School • Institute Charter School

  26. Compliance Timeline Commencing July 1, 2010 • FY2009-10 and FY2010-11 Annual Budgets • District Budget Document • Uniform Budget Summary Sheet • FY2009-10 Financial Audit • Quarterly Financial Statements • Salary Schedules or Policies

  27. Compliance Timeline Additionally commencing July 1, 2011 • Accounts Payable Check Registers • Credit, Debit and Purchase Card Statements

  28. Compliance Timeline Additionally commencing July 1, 2012 • Investment Performance Reports

  29. Compliance Timeline • Update information within 60 days • Completion of report, statements, applicable information • For example • Budget Posted by August 30 if adopted June 30

  30. Financial Transparency Act22-44-304 (2) C.R.S. • Not required to post • personal information relating to payroll • other information that is confidential or protected from public disclosure pursuant to state or federal law • Examples: HIPPA; IDEA; Homeless

  31. Financial Transparency Act The current and prior two budget years’ financial information must be maintained on-line until the end of the current budget year.

  32. Financial Transparency Act Make the page easy to find: • It should be no more then 1-2 mouse clicks from the homepage. • If linking to district, go to specific site and add verbiage about how public can “drill to charter information”

  33. Website Link

  34. Where We Are GoingFY2012-13

  35. FY2012-13 – June Forecast Late February 2012 – actual inflation

  36. FY2012-13 • Potential is high for further reductions • Growth in students and caseloads continue to pressure the General Fund • State Education Fund balance diminishing

  37. PSFU CONTACT INFORMATION

  38. Resources • Colorado Department of Education – www.cde.state.co.us • Colorado Legislative Council – www.colorado.gov/lcs • Colorado Associate of School Executives – www.co-case.org • Colorado Association of School Boards – www.casb.org • Colorado School Finance Project – www.cosfp.org • Great Education Colorado - www.greateducation.org • Children’s Voices - www.childrens-voices.org • The Bell Policy Center – www.thebell.org

  39. Questions?

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