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What Every School Board Member Can Learn About School Finance

This resource provides an overview of school finance for school board members. It covers sources to access school financial information, the concept of "settle-up" and how it is reported in an audit, financial monitoring by administration and board, and lessons learned from Forney ISD. It also includes links to relevant finance documents.

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What Every School Board Member Can Learn About School Finance

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  1. What Every School Board Member Can Learn About School Finance THE TOOLS and SOURCES For Examining school district FINANCIAL DATA

  2. Overview of Discussion Points The Background. Sources to access school financial information. What is “settle-up,” and how is it reported in an audit? Financial monitoring by administration. Financial monitoring by board. What a district can learn from Forney ISD.

  3. The Background District was funded on inaccurate ADA numbers

  4. The Background

  5. The Background Audit report reflected inaccurate state aid Typically, a due to other governments showing an overpayment of state aid is reported in this section as a liability (code 2180).

  6. The Background

  7. The Background Audit report reflected inaccurate state aid

  8. Sources to Access School Financial Information All TEA finance reports can be viewed by going to https://wfspcprdap1b16.tea.state.tx.us/Fsp/Reports/ReportSelection.aspx

  9. What is settle-up & how is it reported?

  10. What settle-up is & how is it reported?

  11. Financial monitoring by administration Approximately 80% of a budget is personnel

  12. Financial monitoring by administration LPE versus DPE Analysis – Cash Flow and Audit Impact Overpaid $1,488,863 $3,579,451 $7,589,057 $13,651,360

  13. Financial monitoring by school board Stay in the loop (TEA letter to FISD on Financial Solvency Review)

  14. Financial monitoring by school board Sample board calendar

  15. Financial monitoring by school board

  16. Financial monitoring by school board

  17. Financial monitoring by school board Study reports for trends

  18. Financial monitoring by school board

  19. Financial monitoring by school board • Know how much is “truly” in the budget… Board believed the 2011/12 adopted budget was a deficit of $458,252 In actuality, the deficit budget was over $5 million 2011/12 fiscal year expenses omitted from original budget included $2 million plus in salaries, telephone lines, an energy contract, loan payment that did not mature for 4 more years, etc. So, a board can learn from this occurrence by doing the following: 1) Ask for documentation of budget cuts; 2) Ask for documentation of revenue estimates; and 3) Look for trends in reports like the one on the previous slide.

  20. What a district can learn from Forney ISD Consider changing audit firms or audit teams every 5 years – fresh eyes and different perspective is good. TEC § 11.1511(b)(9): “The board shall: . . .monitor district finances to ensure that the superintendent is properly maintaining the district’s financial procedures and records.” Ask questions and stay informed. Look hard at staffing trends versus student trends as well as large purchases.

  21. What a district can learn from Forney ISD • Financial hick-ups can be overcome • FISD agreed to 5-year equal repayment plan with TEA • With only 9 months left in the 2011/12 fiscal year, FISD was able to accomplish the following: • Turn a $5+ million true deficit budget into a surplus • Eliminate most or all of the 15 financial statement findings and one federal award finding in the prior year audit report • Turn the food service program around – went from operating an annual $87k deficit in 2010/11 to $341k surplus in 2011/12

  22. Links to School Finance Documents Summary of Financehttp://ritter.tea.state.tx.us/school.finance/funding/sofweb7.html#pledge Payment Ledgershttps://wfspcprdap1b16.tea.state.tx.us/Fsp/Payments/Ledger.aspx Region XIII Templatehttp://www5.esc13.net/finance/

  23. Questions? Keith Bell, Board President board@forneyisd.net Michael Holland, Superintendent michael.holland@forneyisd.net Lucas Janda, Chief Financial Officer lucas.janda@forneyisd.net

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