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MDE and ISD Partnership: Darkening the Dotted Lines

MDE and ISD Partnership: Darkening the Dotted Lines. Monitoring and Compliance Training: Financial Management. Overview. Financial Management Pre-Training Assessment Survey. Financial Management: Timekeeping. Timekeeping: Content. Financial Management System (FMS)

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MDE and ISD Partnership: Darkening the Dotted Lines

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  1. MDE and ISD Partnership:Darkening the Dotted Lines Monitoring and Compliance Training: Financial Management

  2. Overview

  3. Financial Management Pre-Training Assessment Survey

  4. Financial Management: Timekeeping

  5. Timekeeping: Content Financial Management System (FMS) Federal Timekeeping Requirements

  6. Timekeeping: Components of a Good FMS • Written Policies and Procedures • New Staff/Position Training • Adherence to Approved Policies and Procedures • Annual Review and Training Updates • Timely

  7. Timekeeping:Regulations • 2 CFR 225 (formally OMB Circular A-87, Attachment B, Item 8h) • PowerPoint: Federal Fiscal Requirements. Michigan Department of Education, Office of School Improvement

  8. Timekeeping: Definitions and Terms • Cost Objective - a function, organizational subdivision, contract, grant, or other activity for which cost data are needed and for which costs are incurred

  9. Timekeeping: Definitions and Terms • Personnel Activity Report (PAR) - record maintained by employee working on more than one cost objective which is prepared after the fact, reflecting the actual total activity of the employee, at least monthly and signed and dated by the employee

  10. Timekeeping: Definitions and Terms • Semi-Annual Certification - certification that employee worked on a single federal award or cost objective.  Must be prepared at least semi-annually, signed, and dated by employee or supervisory official having firsthand knowledge of the work performed

  11. Timekeeping:Overview • Written Policies and Procedures • Multiple Activities or Cost Objectives • Single Federal Award or Cost Objective • Estimations • Quarterly Comparisons • Adjustments and Budget Revisions

  12. Policies and Procedures: Payroll Components • There are written policies and procedures governing payroll administration • Salaries from the Financial Expenditure Report (formerly DS-4044) agree with the district’s general ledger payroll accounts for all federal grant programs

  13. Policies and Procedures: Payroll Components • All salary costs for work performed are within the grant period • Salaries must comply with the employment contract which indicates the annual salary scale for the grant period

  14. Policies and Procedures: Timekeeping • There are written policies on recording time distribution for employees who work on one or more federal award or cost objective

  15. Timekeeping: Multiple Cost Objectives For employees working on multiple activities OR cost objectives: • The district has Personnel Activity reports (PARs) • The PARs are prepared at least monthly

  16. Timekeeping: Multiple Cost Objectives • The PARs are signed and dated by the employee • The PARs account for the staff person’s actual total activity

  17. Timekeeping: Multiple Cost Objectives • The PARS are actual real-time records and not prepared in advance of the time period covered

  18. Example-Personnel Activity Report Example 1: Single Award/Multiple Cost Objectives A school district could have an employee funded with a single federal award and working on multiple cost objectives In IDEA, a physical therapist could work part time at the local district and part time at a non-public school where data is required for the proportionate share, a PAR is required

  19. Example-Personnel Activity Report Example 2: Multiple Awards/Multiple Cost Objectives A school district could have an employee funded with multiple federal awards and working on multiple cost objectives In IDEA, Part B Sec. 611 supports students ages 3-21 and Sec. 619 supports ages 3-5. If the employee works with students 3-5 and 6-21 a PAR is required

  20. Timekeeping: Single Federal Award or Cost Objective For employees working solely on a single federal award OR cost objective: • The district has certifications or a blanket certification showing that the employees worked solely on a single federal award or cost objective

  21. Timekeeping: Single Federal Award or Cost Objective • The certifications are prepared at least semi-annually • The certifications are signed by the employee or a supervisor with first-hand knowledge of the work performed by the employee and are dated after the fact

  22. Timekeeping: Single Federal Award or Cost Objective • The certifications are actual real-time records and not prepared in advance of the time period covered

  23. Example-Semi Annual Certification Example 1: Single Award/Single Cost Objective A school district could have an employee funded with a single federal award and working on a single cost objective In IDEA Part B Sec. 611, a physical therapist working all their time at the local district, a semi annual certification is required

  24. Example-Semi Annual Certification Example 2: Multiple Awards with Single Cost Objective A school district could have an employee funded with more than one federal award working on a single cost objective, where the awards support the cost objective In IDEA, Part B Sec. 611 supports students ages 3-21 and Sec. 619 supports ages 3-5. If the employee works with only ages 3-5 on both awards, a semi annual certification is appropriate.

  25. Timekeeping: Estimations • The system for establishing estimates produces reasonable approximations of the activity performed

  26. Timekeeping: Quarterly Comparisons • At a minimum, quarterly comparisons are made of actual costs to budgeted distributions based on monthly activity reports

  27. Timekeeping: Adjustments • Adjustments are made to costs charged to federal awards based on the activity actually performed • These adjustments can be made annually only if the quarterly comparisons show differences between budgeted and actual costs of less than 10%

  28. Timekeeping: Budget Revisions • Budget estimates or other distribution percentages are revised at least quarterly, if necessary, to reflect changed circumstances

  29. Timekeeping:FAQs • What are the audit requirements? Your auditor will take a sample of expenditures and request timekeeping documentation for anyone charged to federal funds.  If your records are insufficient, the auditor will include a finding in the audit report and may question costs.  See the Michigan School Auditing Manual for further information

  30. Timekeeping:FAQs • What happens if you cannot produce the documentation for the single audit? Auditor will site 100% of salaries as questioned costs and could result in a penalty of repayment

  31. Timekeeping: Other Resources • The Michigan School Auditing Manual • Report from the Time Log Work Group, Michigan Department of Education, Office of School Improvement, February 13, 2008

  32. Timekeeping: Other Information • Contacts • MDE: Office of Audits • ISD:

  33. LEA Fiscal Review

  34. Resources

  35. Committee Membership

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