ACCOUNTING ISSUE / WINTER 2013
INDISPENSABLE TOOL for SCHOOL BUSINESS MANAGEMENT
Accountable Accounting www.iasbo.org
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Meaningful, Relevant Training For Business Office Staff The newly revamped Support Staff Designation Program allows your staff to customize their professional development throughout the year and attend seminars that cater specifically to your district needs.
New staff can learn the ropes Established staff can keep up with the profession Everyone can network and share best practices “When I first came into the district my business manager signed me up. It certainly is a whole different world and the classes offered in the Support Staff Designation Program helped me make the transition.� Sue Liston, now a Business Manager at Chicago Ridge SD 127.5
Learn more and enroll your staff today:
iasbo.org/designations 2 |
Update Magazine / Winter 2013
INSIDE
Illinois Association of School Business Officials Update Magazine / Winter 2013 / v.21 / i.02
ACCOUNTING ISSUE
ACCOUNTABLE ACCOUNTING HUMAN RESOURCES + PURCHASING ISSUE / SPRING 2013
INDISPENSABLE TOOL for SCHOOL BUSINESS MANAGEMENT
Shifting Gears New Ways to Look at
Human Resources New Ways on Pg.
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24 Accountable Accounting: Evaluating Your Software System Can Redefine How You Do Business
THE NEXT ISSUE: HUMAN RESOURCES New requirements that are driving changes in HR.
Changing systems is more than just figuring out how your district will keep the books moving forward–it’s an opportunity to evaluate and re-tool business operations for the next decade or more. Cover Story by Eric M. Miller and Andrew L. Mace, CPA
Audit Preparation Checklist School district officials can significantly reduce the amount of time auditors are on-site by following eight best practices before the auditors ever arrive. By Bert G. Nuehring, CPA and Christine A. Torres, CPA
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www.iasbo.org
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PERSPECTIVE
ARTICLES
FROM-THE-PODIUM The Anatomy of a Dashboard: How to effectively use dashboard reports. 07
FROM-THE-OFFICE Conducting the “Orchestra�: The importance of well-rehearsed school business leadership. 09
FROM-THE-FIELD A Base of Support: Accounting impacts everything from the budget to operations. 11
Budgets can be simple or complex and understanding them can be overwhelming. Read about the community communication process from the perspective of a board member. By Alex Bosch
FROM-THE-DISTRICT Top 10 Electronic Efficiencies for the Business Office. 14
ACROSS-THE-GLOBE Telling Your Budget Story: MBA program is an opportunity for learning and recognition. 18
20 Protect Your District
A lack of control over affiliated organizations such as PTAs, PTOs and activity clubs can make districts vulnerable to the risk of fraud. Taking a proactive approach and applying some best practices can greatly reduce these risks. By Bert G. Nuehring, CPA and Matt Geerdes, CPA
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SCHOOL BUSINESS 101 Best Practices for Cash Handling: Deposits, having a set process and training staff on fraud risks. 19
Building Alignment with Internal Controls: A small district perspective
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Update Magazine / Winter 2013
With limited resources, it can be a real challenge for small districts to establish appropriate internal controls. Learn how one small district changed their processes, and made the auditors happy. By Warletta Brookins, Ph.D.
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RESOURCES
ON MY LIST
Untangling the Web Understand which state and federal mandates dictate what belongs on your district Web site and which requirements create opportunities for greater transparency and value. By John M. Izzo and Cynthia M. Baasten
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In the face of shifting conditions, ways to help your staff embrace and adopt the need for change.
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THE FINAL WORD Great Ideas from Great Illinois ASBO Members Paul Starck-King, CPA Chief Financial Officer Antioch CCSD 34 Paul believes that for the business office, stewardship of the community’s children involves supporting our teachers’ and administrators’ goals and utilizing financial resources to accomplish those goals.
The New Mindset of Accounting: Tools for your software system search, Web site compliance and more.
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46 www.iasbo.org
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Keep the Legacy Going
Take Part in the Work of the Foundation Get Support to Advance in Your Career — See a list of available scholarship opportunities at: iasbo.org/scholarships Nominate Someone to be Recognized — Help us reward the best and brightest in the profession. Learn more at: iasbo.org/awards
All award and scholarship applications are due by December 15.
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Update Magazine / Winter 2013
PERSPECTIVE / Board President
FROM–THE–PODIUM The Anatomy of a Dashboard: How to Effectively Use These Reports In management information systems, a dashboard is “an easy to read, often single page, real-time user interface, showing a graphical presentation of the current status (snapshot) and historical trends of an organization’s key performance indicators to enable instantaneous and informed decisions to be made at a glance.” 1 Seriously? This definition illustrates what you DON’T want in a dashboard report: information presented in a lengthy and confusing format. A dashboard, simply defined, is “a document presenting the most significant information about a subject on a single page.” 2 Dashboards should display only the most vital information gathered from a given data set. To serve their purpose and fulfill their potential, dashboards can provide quick answers to critical questions from just one glance.” 3
Hillarie J. Siena ASST. SUPT./BUSINESS AFFAIRS GLENBROOK HSD 225
SIMPLY SAYING
Clear, consistent dashboard reports that provide meaningful “snapshots” of relevant data will serve your district well. Where to begin? Create dashboards tailored to fit the informational goals within your district using simple visual designs and layouts. Each dashboard report should present a different data set, and the collective reports should follow a logical order. Whether you are presenting historical, current or prospective data, each dashboard should present clear, concise information, properly titled to afford the reader an immediate understanding of what they are reviewing. Graphical representations should accompany numerical data, and charts should be carefully selected to effectively bring meaning to the data and to highlight the overall message. When appropriate, dashboard reports should also contain footnotes to clearly identify sources of data and to provide additional annotation.
The purpose behind dashboard reporting is to facilitate intelligent decision-making and provide relevant information that can be effectively used in the continuous process of organizational improvement. This can be accomplished through a strong understanding of data sources and how the information you are presenting interrelates with overall district goals. Keeping this focus will serve all stakeholders, both internally and externally. Clear, consistent dashboard reports that provide meaningful “snapshots” of relevant data will serve your district well and provide valuable information to the community at large. FOOTNOTES: 1. Peter McFadden, CEO of ExcelDashboardWidgets “What is Dashboard Reporting”. Retrieved: 2012-05-10.
How many dashboard reports should you create? The answer to this question depends upon the number of key data points that you wish to summarize and publish.
2. Dashboard. (n.d.). Collins English Dictionary – Complete & Unabridged 10th Edition. Retrieved September 15, 2013, from Dictionary.com website: http://dictionary.reference.com/browse/dashboard 3. http://www.gooddata.com/blog/reports-vs-dashboards-whats-the-difference
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Update Magazine / Winter 2013
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PERSPECTIVE / Executive Director
FROM–THE–OFFICE Conducting the “Orchestra” of School District Accounting Someone once told me that a great leader is like an orchestra conductor. With my background in music – I listened. It’s the idea of waving your baton, each part of the organization coming in and it all chiming in together to sound glorious. Michael A. Jacoby EXECUTIVE DIRECTOR This Winter UPDATE focuses on school district accounting. Applying the analogy, the school ILLINOIS ASBO business leader would wave his or her baton and accounting would show up, followed by operations, then technology, transportation and so on. And when everything comes together, they would all work marvelously to create a thing of beauty. As much as we would like to believe that happens, THE ANALOGY IS A MYTH! Actually, leadership is more like orchestra conducting during a rehearsal where everything is going wrong. A true leader is the one who knows how to rehearse the right things and make the appropriate adjustments to make it go right. SIMPLY SAYING
A true leader is the one who knows how to rehearse the right things and make the appropriate adjustments to make it go right. At the Heart of What SBOs Bring to the District From analyzing and implementing financial software systems to building financial dashboards for boards and communities, a school business professional can make such a huge impact. Illinois ASBO is committed to developing and growing these professionals. I’m not talking about just the Board of Directors or the Illinois ASBO staff; I’m referring to our members. With nearly 2,000 voices joining together to identify and advance best practice, a school district can virtually guarantee that it will be well served when it employs a member of our Association.
In the larger statewide arena, we are dealing with some of the most difficult financial times in a generation. Yet, I am amazed that I hear from some board members or superintendents that they do not need a financial professional on their staff or they cannot afford one. How do they think this orchestra is going to sound without a conductor who can read the score? To promote this awareness, Illinois ASBO has invested in a series we entitle the Value of the Profession. It includes a step-by-step guide to posting, recruiting, securing and retaining a high quality school business official. Be sure to check out the resources on our Web site and take the wise path to financial success – and great music!
www.iasbo.org
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THE
MAGA ZINE
UPCOMING WINTER
SEMINARS
Check out www.iasbo.org/events or the latest Calendar of Events included in the UPDATE mailing for full seminar listings including location and PDC sponsorship and register for professional development today.
Illinois Association of School Business Officials
Northern Illinois University, IA-103 108 Carroll Avenue DeKalb, IL 60115-2829 P: 815.753.1276 / F: 815.516.0184 / www.iasbo.org
Update Editorial Advisory Board PDC COORDINATOR MEMBERS Richard A. Lesniak, Ancillary Services Kristopher P. Monn, Educational Enterprise Grant L. Sabo, Facility Management Cathy L. Johnson, Financial Resource Management Kevin Dale, Information Management Robert J. Ciserella, Information Management
December 2013
January 2014
February 2014
S M T W T F S 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 1 2 3 4 5 6 7 8 9 10 11
S 29 5 12 19 26 2
S 26 2 9 16 23 2
M 30 6 13 20 27 3
T W T F S 31 1 2 3 4 7 8 9 10 11 14 15 16 17 18 21 22 23 24 25 28 29 30 31 1 4 5 6 7 8
M 27 3 10 17 24 3
T 28 4 11 18 25 4
March 2014
W 29 5 12 19 26 5
T 30 6 13 20 27 6
F S 31 1 7 8 14 15 21 22 28 1 7 8
Session
S 23 2 9 16 23 30
M 24 3 10 17 24 31
T 25 4 11 18 25 1
W 26 5 12 19 26 2
T 27 6 13 20 27 3
F S 28 1 7 8 14 15 21 22 28 29 4 5
Date
Time
12/5/13
8:00 AM
From GO to GREEN: How Sustainability Practices Can Increase Dollars Spent on Learning
Naperville
12/6/13
7:30 AM
Educational Professionals Support Conference
Naperville
12/10/13
8:00 AM
Maintenance Operations AM | Custodial Operations PM
1/14/14
8:00 AM Public Relations & Internal Communications
1/22/14
8:30 AM
1/22/14
9:00 AM Delegate Advisory Assembly Meeting
ISDLAF+ School Finance Seminar: Mid-Year Budget Review
Location
Hoffman Estates Naperville East Peoria Naperville
1/23/14
8:30 AM
ISDLAF + School Finance Seminar: Mid-Year Budget Review
1/28/14
8:30 AM
ISDLAF + School Finance Seminar: Mid-Year Budget Review
Naperville
PDC Meeting of the Whole
Elk Grove Village
O'Fallon
Paul A. O'Malley, Sustainability Amy McPartlin, Materials & Services Management
BOARD & EXTERNAL RELATIONS MEMBERS Nelson Gray, President-Elect Kurt J. Hintz, SAAC Chair
AT-LARGE MEMBERS Sandra Kwasa, Illinois Association of School Boards Phyllis A. Hanna, Glen Ellyn SD 41 John A. Gibson, Homewood SD 153 Susan L. Harkin, Comm. Unit Sch. Dist. 300 Eric Miller, Skokie SD 69
STAFF MEMBERS Michael Jacoby, Executive Director
815.753.9366, mjacoby@iasbo.org Susan P. Bertrand, Assistant Executive Director 815.753.9368, sbertrand@iasbo.org Angie Byers, Communications Coordinator 815.753.9371, abyers@iasbo.org Rebekah L. Weidner, Staff Writer/Editor 815.753.9270, rweidner@iasbo.org Brett M. Olson, Designer 815.753.7654, bolson@iasbo.org Tammy A. Curry, Designer 815.753.9393, tcurry@iasbo.org
Illinois ASBO Board of Directors Hillarie J. Siena, President
Nelson W. Gray, President-Elect Susan L. Harkin, Treasurer
2/7/14
8:30 AM
2/11/14
Grounds Care & Planning and Playgrounds 8:00 AM AM: PM: Energy Savings, Sustainability, LEED
Naperville
2/27/14
12:30 AM Avoiding Payroll Pitfalls at All Cost
Elk Grove Village
2013–16 Board of Directors
3/3/14
8:30 AM
Leadership Series: Conflict Competence Leading Effectively
Naperville
Illinois ASBO Board Liaisons
3/11/14
8:30 AM
ISDLAF+ School Finance Seminar: Collective Bargaining Symposium
Naperville
3/11/14
8:00 AM Best Practices in Purchasing
Naperville East Peoria
3/13/14
8:30 AM
ISDLAF+ School Finance Seminar: Collective Bargaining Symposium
O'Fallon
4/8/14
Systems: HVAC, Electrical, Plumbing 8:00 AM Building and Technology
4/9/14
9:00 AM Delegate Advisory Assembly Meeting 7:30 AM
Illinois ASBO 63rd Annual Conference & Exhibitions
7/8/14
8:30 AM
Leadership Series: Crucial Conversations
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Update Magazine / Winter 2013
David Bein, Jennifer J. Hermes, Glayn C. Worrell 2012–15 Board of Directors
Dean L. Gerdes, Cathy L. Johnson, Lyndl A. Schuster
Kurt Hintz, Service Associate
8:30 AM
4/30/14
2011–14 Board of Directors
David H. Hill, Luann T. Kolstad, Ann C. Williams
ISDLAF+ School Finance Seminar: Collective Bargaining Symposium
3/12/14
Mark E. Staehlin, Immediate Past President
Naperville Naperville Schaumburg Naperville
Advisory Committee Chair Michael A. McTaggart, Service Associate Advisory Committee Vice Chair Terrie S. Simmons, ASBO International Liaison Debby I. Vespa, ISBE Board Liaison Laurel DiPrima, IASB Board Liaison
Privacy Policy
All materials contained within this publication are protected by United States copyright law and may not be reproduced, distributed, displayed or published without the prior written permission of the Illinois Association of School Business Officials. You may not alter or remove any trademark, copyright or other notice from copies of the content. References, authorship or information provided by parties other than that which is owned by the Illinois Association of School Business Officials are offered as a service to readers. The editorial staff of the Illinois Association of School Business Officials was not involved in their production and is not responsible for their content.
PERSPECTIVE / SAAC Chair
FROM–THE–FIELD A Base of Support for the District Accounting is important to school districts because it is the base that offers great support to management for planning, controlling and assessing the financial health of an organization. Accounting also permits financial administrators to develop standards for all operating areas in order to evaluate performance, use data to identify areas of inefficiency and suggest productivity enhancements that ensure optimum utilization of resources.
Kurt J. Hintz BUSINESS DEVELOPMENT MANAGER PERFORMANCE SERVICES, INC.
SIMPLY SAYING
The tasks and functions performed by school business officials are extensive and complex and the knowledge and skills of accounting are basic to all of them. Those who know me recognize that accounting is not an area of great strength. While at the University of Iowa I was “provided” several opportunities to experience managerial accounting coursework and I still feel far from comfortable in this area. There was a reason my dad always told me I had a personality for sales; it was his nice way of saying numbers were not my strong suit and business management may not be a good fit. What I do recognize is that individuals who have the gift of accounting skills are extremely important to the success of the school district that they serve. While the tasks and functions performed by school business officials are extensive and complex, the knowledge and skills of accounting are basic to all of them. They contribute to the understanding of how resources are deployed and the impact of their use.
An accounting perspective positively impacts everything from developing and managing the budget to the daily operations across the district. This is particularly true in the area of project development. Leadership from the finance and accounting side who are included or driving strategic planning can often bring benefits from a structured and efficiency-driven mindset. It is no surprise that the economics of Illinois continue to be a source of difficulty facing Illinois school districts. The impact of this condition affects everything from available funding and cash flow to accountability and statutory requirements. Remaining current and strategic is a daunting task for all school business officials. This is where investing in and drawing from a strong network of resources is so important. Thankfully, there are a lot of “smart” companies out there that help districts with their accounting needs.
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CONTRIBUTORS
Cynthia M. Baasten
Alex Bosch
Warletta Brookins, Ph.D.
Manager Sraga Hauser, LLC
School Board Member Homewood SD 153
Superintendent Pembroke CSD 259
Practices in all areas of school law, with a concentration in special education, joint agreement issues and labor and employment matters. Has worked as a Certified Public Accountant and a law clerk. In 2012 and 2013, Cynthia was recognized by Chicago Magazine as a “Rising Star” in the field of school/ education law. cbaasten@sragahauser.com
Board of education member since June 2012, Alex is on the finance and property committee. Served on the board of directors of Foundation 153 for three years, including two years as president to raise funds to provide grants to district staff. alex.bosch@sbcglobal.net
National educational speaker and presenter, a former journalist, radio station program director, cable television talk show host, public school teacher, educational consultant and state level education administrator. She is currently enrolled in the Northern Illinois University School Business Managment Program. wbrookins@pembroke.k12.il.us
Matt Geerdes, CPA
John M. Izzo
Ronald R. O’Connor
Senior Manager Crowe Horwath, LLP
Member Manager Sraga Hauser, LLC
School Business Official
Provides auditing and consulting services to governmental and educational entities. With over nine years in public accounting, he is a presenter for Illinois ASBO among other associations and has authored articles for Crowe’s Government Advantage. matt.geerdes@crowehorwath.com
Has focused his legal practice in school and local government law, real estate taxation and public finance, constitutional law, election law and board procedures. John has coauthored two chapters in the IICLE treatise on School Law and is a frequent presenter for Illinois ASBO. jizzo@sragahauser.com
Has taught and worked in the business office for nine years. Ron is currently in year two of his Ed.D. in Education Leadership. Has implemented efficiency as a Baldrige Examiner through the Lincoln Foundation. oconnor.ron@gmail.com
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Update Magazine / Winter 2013 2013
Andrew L. Mace, CPA Has served numerous villages, more than fifty school districts and vocational or special education cooperatives, plus other local governmental units and not-forprofit organizations. His focus is audit, internal control review and enhancement and operational consulting. andymace@comcast.net
Eric M. Miller
Bert G. Nuehring, CPA
Asst. Supt. /Finance & Operations Skokie SD 69
Partner Crowe Horwath, LLP
Serving in his current role since 2010, Eric previously worked for CPS as an Operations Manager at Lincoln Park High School. He currently serves on the Budgeting and Finance PDC, as well as the Editorial Advisory Board for the UPDATE. millere@skokie69.net
Has been in public accounting for over 24 years serving governmental and non-profit entities including American Recovery and Reinvestment Act monitoring and reporting, performance auditing, project oversight and more. bert.nuehring@crowehorwath.com
Would you like to be an UPDATE Contributor? Contributions to the UPDATE Magazine are solicited periodically to enhance the content of the Magazine. If you have an issue that you feel needs to be brought to the forefront, present your article ideas to Angie Byers at abyers@iasbo.org. Keep in mind that issues are themed so your contribution may not appear for some time, or we may choose to distribute it in some other format. The issue themes that we will be soliciting articles for next year include: • School District Operations • School Finance • Non-Traditional Programs We look forward to seeing new faces on this page as we continue to make the UPDATE an indispensable resource for school business management.
Christine A. Torres, CPA Senior Manager Crowe Horwath, LLP
Has over eleven years experience in public accounting including single audits (A-133), community colleges, cities and school districts. Has assisted and consulted on engagements in the areas of Grant Compliance Review, Internal Control Review, Healthcare Claims Review and Management of Finance Departments. www.iasbo.org | 13 christine.torres@crowehorwath.com
FROM–THE–DISTRICT / Electronic Efficiencies
TOP 10 ELECTRONIC
FOR THE BUSINESS OFFICE
Electronic efficiencies can be useful allies in the world of school business. The average productivity of top CPA firms improved by 9.5% from 1995 to 1999,1 partly due to the changing role of information technology.
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4
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CLOUD SYSTEM
DATA TRACKING SOFTWARE
PAYMENT PROCESSORS
ACH PAYMENTS
P-CARDS
A cloud system exists when a third party houses the server. Users access data as long as access to the Internet is available. For example, a person can create a file at work, head home and then work on the same file through the local network. The cloud system makes sharing easy and redefines “portability.”
In order to be more efficient, one must first identify which problems they face every day. Web-based software is available to develop data based on user requests. For instance, the business office may face issues with payroll deductions, particularly in August and January. Data tracking software measures these trends, assisting with resolutions based on (in)consistencies.
Processors allow for easier fee transactions for both producers and consumers. Payment processors may make purchasing as easy as swiping a card or entering card information. For example, one processor lets consumers buy event tickets through the Internet and print them out at home. People are not handling cash, money collectors for events are no longer needed and the potential for fraud is eliminated.
Automated Clearing House (ACH) payments speed up multiple business functions. Examples include payroll, IRS payments and TRS/IMRF payments. Rather than printing and mailing checks, one can send dollars to another party by sending a file with all necessary information. Instead of worrying about a late payment, a school district can send its due amount by an ACH file.
Procurement Cards (P-Cards) eliminate the paper involved in the initial steps of a purchase order and rid of cash involvement in transactions. Employees do not handle cash and purchases occur through an electronic transfer. This has proven effective, for example, when an art teacher does not have enough supplies for class the next day. He can use his P-Card at the local store and receive those supplies on time rather than having to go through the ordering process.
With all the tasks delegated to finance and operations,
EFFICIENCY IS CRUCIAL.
Following these few tips will make for an efficient business office.
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Update Magazine / Winter 2013
By Ronald R. O’Connor SCHOOL BUSINESS OFFICIAL
EFFICIENCIES Like our CPA brethren, new tools allow school business officials to do a lot with little resources. The following is a list of 10 efficiencies for the business office.
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ELECTRONIC CALENDARS
ELECTRONIC PURCHASE ORDERS (POs)
PAPERLESS DISTRICT MEETINGS
VIDEO CONFERENCING
The business office should access each other’s calendars if the schematics allow. This ensures that each member can assist one another if time permits, as well as inform the team of their responsibilities. There is also an organizational aspect, as it assists teammates with planning around each other’s schedule/ events. One creative use of electronic calendars in the business office could be for team members to place their cross training agenda on a calendar, allowing others to see what they are becoming proficient in and know that there were multiple people who could do a task, rather than just an individual.
POs are entered and then sent to an approver. Electronic POs contain the same information as the paper version, but are found through the adopted system. A person can type in the information and the information bounces from one approver to the next. This makes for greater efficiency and a quicker process.
Paperless meetings save money and minimize copier use, since these meetings can consume hundreds of pages at a time. Agendas can be scanned and e-mailed, using computers or tablets to read each item. In the business office, in order to go over a report, each person must bring their computers to read the discussed documents. As long as employees have the proper hardware, any meeting can be paperless.
This allows for faceto-face meetings, regardless of distance. As an added bonus, data charts and pictures can be seen in real time. A presenter can point at a visual and expect the audience to see items. Larger districts may use this to communicate among multiple buildings over a greater square mileage.
10 SCANNING DEVICES
Scanners bring about a new way of filing. Files can be placed in one spot on a hard drive, ready for duplication, while saving physical space. Files will also be ready for e-mail transmittal. This is a great way to save all the mandatory payroll records without taking up too much space in the office. A business office can search easier by looking for the title in the computer folder.
FOOTNOTES: 1. Banker, R.D., Chang, H., & Natarajan, R. (2005). Productivity Change, Technical Progress, and Relative Efficiency Change in the Public Accounting Industry Management Science, 51(2), 291-304.
www.iasbo.org www.iasbo.org
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FROM–THE–TABLE / Audit Preparation
AUDIT PREPARATION CHECKLIST
EIGHT STEPS TO PREPARE FOR THE AUDITORS ARRIVAL If you’re involved in your school district’s annual audit process, you probably need a welldeserved breather. But it’s never too early to start thinking about what you can do to make next year’s audit easier and more effective for all involved. School district officials can significantly reduce the amount of time auditors are on-site by following eight best practices before the auditors ever arrive.
1. COLLECT AND COMPLETE ALL OF THE REQUESTED ITEMS ON THE “PROVIDED BY CLIENT” (PBC) LIST. The majority of the items included on the PBC list – especially the more complex items – should be ready and waiting when the auditors arrive for their fieldwork. It’s much more efficient, for example, to have the capital assets information available for the auditors at the start of their fieldwork. There often are a high number of additions and changes that the account undergoes and districts rarely capture everything on their initial effort. Districts that take their first shot at gathering the information in advance will be able to collect the additional requests while the auditors are working on other areas. If the capital assets data is not available at the beginning, however, the auditors might have to return at a later date when the district has assembled all of the requisite information.
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Update Magazine / Winter 2013
By Bert G. Nuehring, CPA PARTNER CROWE HORWATH, LLP
Christine A. Torres, CPA SENIOR MANAGER CROWE HORWATH, LLP
2. IDENTIFY A SUITABLE WORK AREA FOR THE AUDITORS. The auditors should work in close proximity to accounting and financial reporting personnel to facilitate interaction between them and district personnel. The designated space should be free of interruptions (unlike, for example, a lunchroom) and available for the duration of their visit. The ideal work area should include a telephone and Internet access. 3. ESTABLISH A REALISTIC TIME FRAME. Communicate with the auditors ahead of time to determine the best time for the audit. The right timing can make all the difference. If the auditors arrive before the district has finished its prep work, they won’t have enough to do or will end up testing amounts that are not final and have to do the work twice. If they are scheduled to arrive too close to the deadline, they will have less time to complete their work and end up putting in longer hours over fewer days. Several other factors also warrant consideration, such as employee vacation schedules. Audits shouldn’t be scheduled for times when vital people (the CFO, controller, head accountant or grant manager) will be out of the office. The date of the board meeting is also critical – the audit should be scheduled to allow sufficient time to distribute and discuss the results prior to the meeting. And remember to allow for adequate time for everyone to complete any reviews without having to neglect other duties. 4. ALERT YOUR STAFF. Make sure your employees know when the auditors are coming, what they’ll be doing and when they need to finish. Let your staff and the auditors know who the auditors should deal with when they have inquiries. 5. COMPLETE ALL RECONCILIATIONS. The district should perform all reconciliations, including bank reconciliations and any detail schedules for general ledger totals, before the auditors arrive so they’re working with the final set of figures. Otherwise, they might have to duplicate their efforts, which causes unnecessary delays and drives up your costs.
6. SCHEDULE TIME EACH DAY TO MEET WITH THE AUDITORS. No matter how much a school district prepares, the auditors will have follow-up questions and requests. If auditors know they have a designated meeting time every day, they can aggregate all of their requests for additional items or explanations instead of interrupting throughout the day with questions. 7. PROVIDE MATERIALS IN ADVANCE. In the best-case scenario, school districts provide auditors with some items a week before the fieldwork. When auditors have access to the trial balance and any summary schedules where additional samples will be needed (for example, check registers, accounts payable listings, accounts receivable listings or payroll registers), they can begin the preliminary analysis and start making additional requests based on the final yearend balances. 8. UNDERSTAND THE AUDITORS’ RESPONSIBILITIES. It’s important to understand that the auditors aren’t responsible for the financial statements or the footnote disclosures. The auditors also aren’t responsible for reconciling accounting information or compiling data. The auditors might be available to assist with such matters, but the school district is ultimately responsible for these items.
PREPARATION IS HALF THE BATTLE Preparation is essential for a smooth audit process. When your staff is prepared and the auditors are armed with all possible information from the start, it reduces problems, delays and costs.
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ACROSS-THE-GLOBE / Meritorious Budget Awards
The MBA Program: Telling the Budget Story ASBO International established the Meritorious Budget Awards (MBA) program in 1995 to promote and recognize excellence in school budget presentation and enhance school business officials’ skills in developing, analyzing and presenting an education system budget. By creating a document that includes the components outlined in the program, districts can address all the questions that their district and community may have about the budget. This year, ASBO introduced a program for first-time applicants. An introduction to the MBA, Pathway to the MBA helps districts prepare to submit their budgets for the full MBA.
Budget Components The MBA program provides criteria that school business officials can use to develop a budget that provides budget data in a comprehensive, logical format. The budget should consist of four major sections: introductory, organizational, financial and informational. Introductory section — An overview of the other three sections. A reader of the school district’s budget document should be able to review this section and have a general idea about the document’s contents. Organizational section — A detailed discussion of the policies and processes that go into establishing the budget: goals and objectives, budget policies, financial administration and management. Financial section — Illustrates the district’s financials with additional narrative to explain the numbers presented. Informational section — Includes supplemental information that contributed to the development of the budget, such as tax data, student enrollment and performance measures. For the Pathway to the MBA program, applicants complete only two of the four sections of the MBA criteria checklist. The introductory section is mandatory; districts can choose one of the three other sections to complete. 18 |
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A Learning Opportunity Districts can submit the completed document to the MBA program or the Pathway to the MBA for peer review. The document is reviewed by professionals, including school business officials currently working as business managers, finance directors, superintendents and consultants. The reviewers provide constructive feedback on the budget document, guiding districts to continuously improve and enhance their document to ensure that stakeholders are gaining the most value. Reviewers’ comments also help applicants prepare for the next year’s program submission.
A Recognition Opportunity Districts whose budgets meet the MBA criteria are awarded the MBA and receive a plaque and certificate, letters of accomplishment and recognition in ASBO publications. Districts whose budgets do not meet the MBA criteria are given comprehensive guidance regarding changes that will bring their budget up to MBA standards. Districts whose budgets meet the Pathway to the MBA criteria receive professional recognition in ASBO publications, comprehensive comments about their budget to help guide them toward participation in the MBA program and a Pathway to the MBA award plaque. This article was excerpted from the September 2013 issue of School Business Affairs. For more information regarding the Meritorious Budget Awards program or the new Pathway to the MBA program, contact Patrick O’Connor at poconnor@asbointl.org or 866.682.2729 x7077.
PERSPECTIVE / On the Profession
SCHOOL BUSINESS 101 What is a best practice for cash handling within the district? How do you go about training staff on this issue? William Harkin
ASSOC. SUPT./BUSINESS SERVICES, WAUCONDA CUSD 118
Have a question or issue that needs to be addressed by School Business 101? Submit your ideas or questions to Rebekah Weidner at rweidner@iasbo.org
A: Teaching secretarial and building staff about the risk of fraud when dealing with student activity accounts is important. They are susceptible to check writing scams if staff is not made aware of the risks. We have recently experienced this in our district and it is an area you might not think of as opposed to the business office where staff members are in the accounts daily. Angela M. Crotty
BUSINESS MANAGER, MIDLOTHIAN SD 143
A: We are a staff of three — an accounts payable person, payroll and business manager. We separate duties on which person receives the deposits and who makes the deposits. The business manager always signs off on all deposits.
Margaret E. Kyne
FINANCE MANAGER, UNION RIDGE SD 86
Want to add to the discussion? Add your response in the Hot Topics Group within the peer2peer Network. Then, watch for the next School Business 101 discussion for a chance to be featured in the UPDATE Magazine.
A: Ideally, those who handle cash should not be involved in or have access to accounting records nor be involved in the reconciliation of cash book balances to bank balances. We have a documented policy on Cash Management. Our staff are comfortable using the district policy and procedure manuals and they are updated on a continual basis. We make sure that there is a paper trail when handling cash and it is recommended that staff deposit cash in the district safe with accompanying documentation as soon as possible in order to eliminate accidental loss or theft. Cathy A. Williams
ACCOUNTING SPECIALIST, NORTHWEST SUBURBAN SPEC. ED. ORG.
A: The best practice is having a set process in place and signing off for every exchange. In our special education cooperative, each school has a safe where money is kept until it is transferred to the central office. In the central office, the money is signed for when it is received, is reconciled and is stored in the vault until it is taken to the bank.
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We are all faced with financial information on a weekly, if not daily basis. At a minimum, we deal with household finances in our personal lives. It could be a small component of one’s professional career or it could be what some do on a full-time basis. Regardless of how much time any of us spend dealing with finances, sometimes it can be a challenge to understand what we are looking at or being told when handed a budget for the first time or on multiple occasions. 20 |
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POINT OF VIEW
Budgets can be simple or complex and understanding them can be overwhelming. I have been working with budgetary information in my professional career on a weekly and, more often, on a daily basis for more than fifteen years. Some budgets are straightforward and can be reviewed and thoroughly understood within a matter of minutes. Others have taken several days to study in order to reach a point of having a basic understanding of a budget’s components. The more complicated budgets generally require access to the person or persons who assembled and have firsthand knowledge of the data behind the numbers that can explain the assumptions incorporated into the budget.
FRAMING THE DISCUSSION In 2010, the administration and board of education for Homewood School District 153 made the difficult decision that a referendum would need to be placed on the April 2011 ballot seeking additional funds for the schools. The decision to seek a referendum for funds was based upon projected revenues and expenses utilizing the district’s budget model over several years. The referendum would ask taxpayers for money at a time when the economy was not strong, housing values had dropped significantly and many were unemployed or facing the possibility of becoming unemployed.
By Alex Bosch SCHOOL BOARD MEMBER HOMEWOOD SD 153
The district’s board and administration had been analyzing the budget and a period of annual budget deficits was approaching. The superintendent and business manager presented and reviewed the budget with the board and provided them with information they would need to make a decision about the five referendum options available for consideration. I was fortunate to have been part of those discussions as a community member. Attending the discussions about the district’s expenses and revenues would prove to be valuable in communicating with community members during the referendum awareness efforts. The first step in communicating the district’s budget had taken place. The superintendent and business manager had presented the budget to the Finance & Property (F&P) Committee of the district’s board of education. Upon review and approval of the F&P Committee, the budget was presented to the board of education as a whole. A significant amount of time was utilized to effectively communicate the budget projections to ensure everyone’s questions and concerns were addressed. Out of the five referendum options under consideration, the option the board selected was to ask taxpayers for their permission to issue a working cash bond.
During the preliminary discussions regarding the need for a referendum, the president of the school board and the superintendent approached me about co-chairing efforts to communicate the need for a referendum. I had been involved in the school community as a parent, as well as a member and president of Foundation 153, a not for profit established to provide grant funding to our schools. Without hesitation I accepted the task and along co-chair, a former president of the school board, the challenge of communicating the budget status of the district was underway.
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With the referendum question itself finalized, communicating it to the community became the referendum committee’s undertaking. We underwent the following steps in our communication process:
1. DEVELOPING FREQUENTLY ASKED QUESTIONS (FAQS) These focused primarily on the financial aspects of the district’s financial well-being and a variety of benchmarks, such as average salaries for teachers and administrators. The budget itself was available for community members to review.
The FAQs were intended to provide answers about the budget. Their contents were based upon input from the board of education and the administration of the district (beyond the superintendent and business manager).
2. VISITS TO LOCAL TAXING BODIES With a deck of slides and FAQs in hand, members of the referendum committee, school board and administration attended meetings of the other four governmental taxing bodies (Village of Homewood, Homewood-Flossmoor High School District 233, Homewood-Flossmoor Park District and the Homewood Library) within the district’s boundaries.
The intent of the presentation was to inform, and then seek, each taxing body’s support for our referendum. The taxing bodies asked additional questions that assisted the group in refining the FAQs. These presentations also assisted in refining the materials to ensure information would be presented clearly, concisely and included the information the community would want to know.
3. INFORMING THE COMMUNITY AT LARGE With the board of education, teacher’s union, parent support organizations (PTA, Foundation 153 and Parent Music Association) and governmental taxing bodies now familiar with the district’s budget, the next step was to share the information with the community. The referendum committee became intimately familiar with the FAQs and asked any questions that had not been incorporated to that point. To communicate the budget information to the community, the referendum committee developed a Web site and held community forums and “coffee cup” sessions in residents’ homes. The Web site contained information about the district’s budget, displayed the FAQs and explained the referendum and how it was beneficial to the district and the community. Questions could be submitted through the Web site and individuals would receive a response by the referendum committee, the district’s administration or the board of education. The community forums and “coffee cup” sessions were led by a team with one member of the referendum committee, one member of the district’s administration and one member of the 22 |
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school board. Information about the referendum was presented at the meetings to encourage an open dialogue about the budgetary status of the district. If a member of the committee was not able to answer a particular question about the budget or about the district in general, the board member or member of the administration was available to provide an unbiased answer. The referendum committee representative’s role was then to persuade attendees to vote in favor of the referendum. The goal of the communication plan was to be transparent, honest, share information and answer all questions in a professional and respectful manner. The school district’s budget is complex and not easy to understand and requires significant effort to present the information in a variety of ways to aid in understanding. People absorb information differently and that is why the referendum information was presented in a variety of mediums (Web site, PowerPoint slides, flyers, etc.) and forums. In-depth information was also available for individuals who wanted to analyze the details and it was available in bullet points for individuals who only wanted the main points.
POINT OF VIEW / Budgeting In Basic English
The communication has not stopped since the referendum passed by almost 80% in April of 2011. The administration and board of education hold annual budget meetings for the community to attend. The district’s mailings to everyone in Homewood contain budget information along with information appearing on the website. The goal is to continue to be transparent and communicate information continuously to the district’s constituents in an effort to maintain a strong community and school district connection. The success of communicating a district’s budget is dependent on many individuals. The conversations occur at
The Governmental Accounting Standards Board (GASB) defines financial reporting as the means of communicating financial information to users (GASB Statement 1, Paragraph 32). For this communication to be effective, financial information must have the following basic characteristics: • Understandability. Information should be clear, but not oversimplified. • Reliability. Information should be verifiable and free from bias. • Relevance. There must be a close, logical relationship between the information provided and the purpose for which it is needed. • Timeliness. Information should be available soon enough after the reported events to affect decision-making. • Consistency. Once a principle or a method is adopted, it should be used for all similar events and conditions. • Comparability. Procedures and practices should remain the same across time and reports.
multiple levels: the board of education, district administration, staff, teachers, parents and members of the community. Open lines of communication and transparency are important towards the development of trust. Opportunities for an open dialogue regarding financial matters exist within Homewood School District 153 and I am fortunate to be part of the district as a parent, community member and member of the board of education and F&P committee. We are a community that works together to be successful in providing an environment for students to learn and reach their potential, no matter what financial challenges we face.
Homewood School District 153’s approach to demystifying the budget consists of a communications strategy with the following components: 1. An active dialogue between everyone involved. The administration communicates and presents the budget and supporting documentation to the F&P Committee and the board of education on a regular basis. 2. Shared through multiple mediums – Although there are requirements regarding publishing the budget, the district does not stop at the minimum. 3. Ongoing development of communication materials that present the information for individuals with varying financial knowledge. 4. Information is clear and concise. 5. Transparency is vital at all times. 6. Sharing all information, even if it might contain a less than favorable budgetary story in the short-or long-term. 7. Engaging the community in budget discussions when the situation is favorable and not favorable.
Source: Center for Education Statistics
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COVER STORY
By Eric Miller ASST. SUPT./FINANCE & OPERATION SKOKIE SD 69
Andrew Mace, CPA ADDITIONAL ASSISTANCE PROVIDED BY: MARTIN PALTZER, JR. TREASURER NILES TWP. HSD 219
Accountable Accounting Evaluating Your Software System Can Redefine How You Do Business Long gone are the days of keeping the books with a simple paper-based ledger and a pencil. We have been using computer-based systems to help track our financial transactions for some time now, and the current software package offering is vast. The benefits from these systems are simply amazing, with solutions to problems you didn’t even know you had. However, the evaluation and implementation of a new accounting system takes thought, dedication and time. The process is more involved than purchasing your next district vehicle, but may be less intense than rebuilding the junior high school. Either way, it’s more than just figuring out how your district will keep the books moving forward; it’s an opportunity. This could be the one chance the organization will have to evaluate and re-tool business operations for the next decade or more. This could be the time to alter job descriptions, more closely align skill sets and save the district both time and money.
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Do Your Homework
You can return almost anything you bought last weekend from the hardware store. However, you’ll have to look carefully at the fine print to determine if your accounting software has a return policy. On second thought, maybe it’s better to just do your research before you make this purchase in hopes of making the right choice the first time around. It’s a big investment in both human and financial capital and deserves the time up front. You may only get one shot and your investment on the front end can make or break a successful choice for which software company or package can best serve your district. The following is a non-exhaustive list of action items and areas to research as you go through the process of analyzing and evaluating your next accounting software selection.
Form a Steering Committee
Contact Your Colleagues
Don’t form a committee just to form a committee. Assemble a team of key players that will help evaluate, keep the project moving along and help make the major decisions along the way. Technology directors, treasurers, other business officials, accounting supervisors and maybe your superintendent should all be considered to be potential members of the steering committee. When considering these members, think about who will push the envelope and can challenge the process to help create possibilities of how your organization could do business.
Give your neighboring districts and friends a call to find out from those you trust most which software they have and what the pros and cons are in their eyes. There’s nothing like speaking to end users directly to find out what their experience has been and what to be on the lookout for as you go through the process. Things change quickly in school business management and you want to be ahead of the curve. Besides, they may have a copy of a recent RFP they used to give you some ideas on what to include in your own version.
Learn the Current Product Offerings While there are many different accounting systems out there today, you’ll probably want to narrow your choices to a handful. Start to learn what the different systems' capabilities are from the few companies you are looking at seriously. Think about what the systems do but also begin to think about aligning your wish list to see how things match up.
Identify Your Needs Your business office staff and other frequent users within the organization probably have a long list of frustrations with your current accounting software. This is a great place to start your list of what the new system should and shouldn’t have. But don’t limit your thinking to your current state; don’t allow the staff to try to force the new system to do things the way they’re used to doing them. This is an opportunity for change and to improve your current processes. If you aren’t aware of the many possibilities, reach out to other districts and see what ideas you can borrow from them. Consider a field trip to other business offices with part of your committee to see how others work with their systems. 26 |
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COVER STORY / Evaluating Your Software System
Talk to Your Auditors
Integrate Internal Controls
Contact your auditor to find out what features or aspects of the system may be most important from their perspective. They like certain reports produced, and more and more, they want the data exported in a particular manner to potentially import into their auditing software. Ask for help to pin point weaknesses in your current internal control system and how you can continue to evolve and improve with your new setup to address any internal control issues. While you are the one who will ultimately be living with your choice, they may give you a few things to think about as you create your wish list.
Integrating key controls into the new system is imperative. It’s possible that different people will perform different functions under the new system. Be careful not to assign incompatible duties. It might be a good idea to ask your auditors for assistance in this area. The software vendors are usually very good with this, but some internal controls can be very subtle. Be certain to limit access to different system functions to the correct people. Make sure that passwords are not shared and that they expire about every two months or so. Most of the new systems on the market now employ budgetary controls within the system. These are key – they flag for potential budget overages and usually kick it up another level for approval. Make sure you take full advantage of this feature as it is a key control.
Ask Your Board Your board will undoubtedly want certain financial reports and information presented to them in a particular manner as well. It’s possible they’ll want the information in a similar vein as they’ve always received it, but challenge them too. You may not be aware of the many different reports the system can generate until you are well into the implementation phase. However, you may want to get your board finance committee involved early on in the process. Survey them to find out what information they do want and how the delivery can be improved. Their input will be invaluable and it’s important for them to take ownership as well. This is especially true when it comes time to approve your investment.
Assess Your Technology As you narrow down the choices, you will probably need to start asking some very specific questions regarding the requirements needed to support the system. If the district’s in-house technology staff can handle this project on top of their current work load, great. If not, think about finding a consultant to help early on in the process. Not only can consulting fees be expensive, but you could potentially be looking at infrastructure and hardware costs anywhere in the range of $75,000 - $200,000. This obviously depends on a number of factors but remember you are planning for potential expansion and disaster recovery for several years out at minimum. Someone needs to be thinking about everything from the number of redundancies in the data back-up system to network configurations.
Prepare for a Culture Change Yes, it’s about the system, but at the same time it’s not about the system. The system does need to be robust and function in a way that supports the vision for the organization well into the future. It also needs to have all of the bells and whistles you’ve been waiting for. BUT, what may end up being an even greater challenge than your evaluation is the change process for implementing your new and shiny features. It’s not that you shouldn’t go ahead and purchase the Grant Tracking Module with the new accounting software your Accounting Supervisor has his heart set on. However, you must know what your organization’s appetite for change is and what level of support you have from both up above and from down below. Will your superintendent tease you in front of the leadership group for the recommended changes, or will he/she fully support the need for change and champion the cause? Will the school secretaries complain about the new system, or will they sing your praise for how it creates efficiencies and streamlines their piece of the operation? Think about it and consider how much your district can take on, in what order and over what time period.
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Choose Wisely: Options on a Typical Accounting Menu • Core Accounting
• Data Import
• State Reporting
• Grant Tracking
• Project Management
• Human Resources
• Web Interface
• 24/7 Support
• Fixed Assets
• Consulting
• Substitute Interface
• Budget Tool
• Training
• Applicant Tracking
Learn From Their Experience This article was driven by the experience Skokie School District 69 went through, along with the other Niles Township School Districts, while analyzing and implementing a new accounting software system. While you and your district will face challenges as you venture down this path, the return on the investment is well worth it!
Questions that Count: What to Ask When Analyzing a New System 1. How flexible is the system and what level of customization is offered?
10. Will you be processing transactions in batches or in real time?
2. Can new or different modules be added in the future?
11. Does it assist with the preparation of your budget?
3. What are the system requirements? How about bandwidth need?
12. Can it account for and create the proper reports for grants and other state documents?
4. Will the vendor likely be in existence down the road?
13. Do you want the system to handle activity funds and convenience accounts?
5. Does the system integrate with other existing systems (i.e. sub calling, personnel, student records)? 6. Does it have a Web interface? Can the system be accessed with various technology in real time? 7. What is the total cost for the project? (Think technology consulting fees, extra hardware, potential external project management fees, training costs, etc.) 8. What does the support packages consist of and what are its recurring costs? 9. Do you want your system to assist with financial projections? Can it run scenarios? 28 |
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14. Does it handle fixed asset tracking and recording easily? (The best systems allow you to capitalize at the time of requisition.) 15. Does it provide for GASB 34 reporting and adjusting? 16. Do you go live with your new system at the beginning of the fiscal year, or is it better to go live at the beginning of the calendar year? 17. Do you run parallel systems just in case? Do you have extra staff on stand-by during kick off?
COVER STORY / Evaluating Your Software System
No Small Undertaking The evaluation and implementation of your district’s next accounting software may very well span two fiscal years. The reality is that you and the business office staff will be out of the office for weeks at a time doing everything from site visits, to user group trainings and system set up workshops. The implementation alone is something like a part-time job on top of your current responsibilities, which should be considered. This is no small undertaking and it warrants commitment from some of the key leaders heading up the process. It’s going to be a stressful time, but the more scenario planning you do the more prepared you will be no matter what happens. And remember… breathe! You’ll get through it, and hopefully you now have a few things to think about as you go through the process.
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Protect
Your District Encouraging Fiscal Responsibility in Affiliated Organizations
S
chool districts of all sizes often benefit from the activities of affiliated organizations such as foundations, sports booster clubs, parent teacher associations (PTAs), parent teacher organizations (PTOs) and activity clubs. But a district’s lack of control over those organizations could make it vulnerable to risks like fraud. Even if a school district isn’t directly financially liable for fraud committed through an affiliated organization, donors, parents and other stakeholders will look to the district for accountability. Districts, therefore, should take steps to reduce the risk of fraud and other such incidents by affiliated organizations that could lead to negative repercussions for the districts themselves. 30 |
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ARTICLE
By Bert G. Nuehring, CPA PARTNER CROWE HORWATH, LLP
Matt Geerdes, CPA SENIOR MANAGER CROWE HORWATH, LLP
The Fraud Problem Many school district-affiliated organizations operate in conditions that make them vulnerable to fraud. A quick Google search turns up a significant number of examples from 2013 alone, including: •
•
•
On Aug. 8, the former treasurer of a Virginia high school athletic booster club who was accused of stealing more than $300,000 of club money pleaded guilty to wire fraud. According to the indictment, he covertly transferred $300,000 in booster club funds over four and a half years to an online investment account he opened in the club’s name. The former treasurer used the account to write $50,000 in checks to himself and make payments to his personal credit card. In February, the former treasurer of a California PTA was charged with grand theft after an investigation found more than $17,300 was missing from the organization’s books. An audit revealed fraudulent receipts, missing cash deposits and reimbursements to the former treasurer for merchandise never received. A Pennsylvania PTO treasurer was arrested in March for stealing more than $11,300 from the organization. She allegedly cashed 34 checks, 30 of which were forged with the signature of the organization’s president. She also allegedly took about $250 in cash from fund-raiser, candy and pencil sales.
Not surprisingly, each of these incidents received coverage in the local media, generating considerable negative publicity for both the organizations and the associated school districts.
Risks for Affiliated Organizations As the police detective in one PTO fraud case observed, “Most organizations where you have this type of fraud, there’s no checks and balances. These are crimes of opportunity. The money is there and [the perpetrators are] in charge of the money.”
In particular, several common characteristics of affiliated organizations create these opportunities: Lack of centralized operations Few of these organizations maintain a central business office; instead, their operations and record keeping (or lack thereof) are frequently run out of a member’s house, with the location changing as often as new officials are elected. And the organizations’ activities aren’t held solely on school grounds, making it even more difficult to keep track of funds. Large number of transactions A booster club might sell concessions at a football game that draws hundreds or even thousands of fans. The large number of transactions comes with a large inherent risk of fraud or plain negligence. Multiple money handlers Although an organization might have a single treasurer, numerous people will collect cash at an event. As with the risk associated with a large number of transactions, the more hands that are involved, the greater the risk of misappropriation or negligence. Lack of formal written procedures Affiliated organizations typically have a high rate of turnover as students age out of schools and parents move on. The lack of written policies and procedures can impede the transfer of knowledge from one generation of members to the next, which could lead to risky and hardto-monitor “freelancing” by the newcomers. Complicated rules and regulations Affiliated organizations, especially PTAs, are usually subject to a confusing web of rules and regulations related to governance as mandated by national sponsoring groups, as well as federal and state tax regulations. A single layperson who is serving as a member of management might not be able to process and understand all of the rules, let alone ensure compliance.
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Recommended Internal Controls Perhaps the most significant – and common – risk for organizations affiliated with school districts (and, therefore, for the school districts, too) is the lack of adequate internal controls. The volunteers who staff these organizations, while well meaning, in fact might well be completely unfamiliar with the concept of internal controls.
Also: • Cash receipts should be deposited on a timely basis. If daily deposits aren’t feasible, money should be secured in a safe or other locked location. •
Cash receipts should never be left unsecured over weekends or holidays.
It’s up to school districts, then, to set forth best practices on internal controls for their affiliated organizations. In particular, districts should strongly recommend the following internal controls:
•
Overages and shortages must be reported with as much detail as possible. Overages and shortages should be shown separately, rather than “netted” into a single figure.
Segregation of duties The organization should see to it that no single person has custody of its assets while also being responsible for record keeping or reconciliation of documentation. For example, the treasurer shouldn’t be able to prepare and sign checks, record disbursements and reconcile bank accounts without adequate review and approval by another member of management.
•
Bank deposit slips should be prepared in duplicate, with the original going to the bank and a copy retained for bank statement reconciliation purposes.
•
Bank accounts should be reconciled monthly by someone without access to the checkbook.
Cash receipts procedures The organization should have cash collections and verification procedures. All money collected from any source should be substantiated by auditable records, such as pre-numbered receipts, ticket reconciliations, deposit forms or cash register tape reconciliations. The organization should be able to confirm that the money deposited represents all of the money collected.
Cash disbursements procedures Organizations also should have formal procedures for purchases and other disbursements. For example: •
Payments will not be made without evidence of receipt of goods or services.
•
Expenditures must be supported by invoices.
•
Disbursements must be made with prenumbered checks.
•
Two signatures are required on a check.
In addition to recommending internal controls, school districts should request organizations to provide periodic financial statements. Ideally, a district will receive financial statements on at least an annual basis from PTOs and booster clubs (along with copies of their federal filings) and on a monthly basis from activity clubs, which usually conduct many transactions.
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ARTICLE / Protect Your District
Additional Best Practices
•
Organizations are responsible for their own tax status, accounting and financial records and must make their own arrangements for audits, if necessary. Organizations typically are not audited as part of the district’s own annual financial audit.
Although the different types of affiliated organizations might have different missions and activities, school districts can reduce their own risks by imposing the following guidelines on all such organizations: •
An application must be filed with the district before the organization can form.
•
Organizations must have their own minimum amount of liability insurance, as determined by the district.
•
The organization must submit a copy of its adopted constitution and bylaws with its application.
•
School district personnel are prohibited from holding any official position in an affiliated organization.
•
The organization must annually submit an application and an updated plan of activities for approval. The renewal application must include:
•
Fundraising at any school site is directly under the control of school authorities and must be approved in advance by at least the site administrator. Districtwide fundraising must be pre-approved by the district.
•
No individual should personally benefit from the activities conducted by the organization (this should be included as a bylaw).
•
Organizations must comply with federal and state tax filing and reporting requirements to establish and maintain tax-exempt status (see www.irs.gov and the appropriate state Web site for more information).
- An annual financial statement for the year just ended, including all expenditures and income. - A budget for the upcoming year. - A plan for the related activities. •
The district has the express right to review and audit the organization’s financial statements to verify the organization’s financial integrity.
•
Authorization of the organization is valid for up to one year, but if the superintendent deems it necessary, he or she can revoke the authorization.
•
Affiliated organizations are not legal components of the school district. Each organization should have its own tax identification number.
•
The district can require organizations to be officially recognized as tax-exempt 501(C)(3) organizations and require them to provide a copy of their determination letter or certificate of not-forprofit status.
Help Them Help Themselves While school districts aren’t financially responsible for their affiliated organizations, they could easily suffer reputational and other damage as a result of problems in the organizations. Districts, therefore, should formally educate affiliated organizations about the applicable requirements, internal controls and guidelines through workshops, manuals and training sessions led by auditors. By taking a proactive approach, a school district can help reduce the risks faced by all interested entities. FOOTNOTES: 1. http://www.roanoke.com/news/nrv/2136558-12/former-blacksburg-booster-club-treasurer-pleads-guilty-to.html 2. http://www.utsandiego.com/news/2013/Feb/27/education-menifee-PTA-treasurer-grand-theft/ 3. http://www.post-gazette.com/stories/local/region/treasurer-took-more-than-11300-from-parent-teacherorganization-police-say-679136/#ixzz2cG42CZKw 4. http://triblive.com/news/adminpage/4079818-74/police-pto-schnupp#axzz2cG5nSBe4
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UNTANGLING
THE WEB
What is required (and what you really should have) on your district Web site Which information you post on your district’s Web site is dictated by a number of factors, namely State and federal laws. However, districts should consider their Web sites as more than just a tool to stay in compiance — they are an opportunity to create transparency and provide added value to communities. 34 |
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ARTICLE
By John M. Izzo MEMBER MANAGER SRAGA HAUSER, LLC
Cynthia M. Baasten MANAGER SRAGA HAUSER, LLC
H
istorically, local governments have been required to provide notice to the public through publishing information in the local newspaper. Now, local governments find that posting public notices on Web sites saves taxpayer dollars while reaching a widespread, community audience. Nearly every state has or is discussing the shift towards posting public notices on government Web sites.1
In Illinois, school boards are required by federal and State law to provide students and their parents or guardians, employees and the community with a variety of information concerning applicable rights, use of funds and overall governance of the public body. Due to the widespread use of the Internet, Illinois law now requires school boards to post certain information on their Web sites as a means of fulfilling these obligations. Also, many school boards have found that disseminating information via the school district’s Web site adds value in that posting information on their Web site is more cost efficient and saves time.
What is Mandated by Illinois State Law
School boards are mandated to post certain information under Illinois law, namely, the Illinois Open Meetings Act (OMA), the Illinois Freedom of Information Act (FOIA) and the School Code of Illinois. OMA Requirements As a public body under State law, a school board must comply with the provisions of the Illinois Open Meetings Act (OMA), including but not limited to, providing the public with information about when board meetings are held and what topics are addressed during those meetings. (105 ILCS 5/10-6, 5/10-22.31c.) The OMA (5 ILCS 120/2.02, 2.06) provides that any public body maintaining a Web site must post: • An annual schedule of all regular board meetings at the beginning of each calendar or fiscal year, including the dates, times and places of such meetings. • A notice of the annual schedule of all regular board meetings until a new notice of the annual schedule is approved. • A notice of each regular board meeting until that meeting has concluded.
• The agenda for each regular board meeting at least 48 hours prior to that meeting and until that meeting is conducted. • The minutes of each regular board meeting within 10 days after the board’s approval of the minutes until at least 60 days after the initial posting.
Also, the OMA mandates (5 ILCS 120/7.3) that a school board that participates in the Illinois Municipal Retirement Fund must post information about its employees’ total compensation packages. A “total compensation package” includes salary, health insurance, housing allowance, vehicle allowance, clothing allowance, bonuses, loans and granted sick and vacation days. School districts must post: • An employee’s total compensation package that exceeds $75,000 per year within six business days after the board approves its budget. • An employee’s total compensation package of $150,000 or more per year at least six days before the board approves that package.
• For both of these requirements, the board may opt to post the total compensation package(s) at the district’s principal office instead of on its Web site, so long as directions on how to find such information are posted on the Web site.
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FOIA Requirements The Illinois Freedom of Information Act (FOIA) not only requires a school board to provide timely, written responses to requests for records submitted by the public, but also mandates (5 ILCS 140/4) that specific information be posted on its Web site at all times: • A brief description of the school district. • A short summary of the district’s purpose. • A block diagram giving the district’s functional subdivisions. • The total amount of the district’s operating budget. • The number and location of all of the district’s separate offices. • The approximate number of full and part-time employees. • The identification and membership of any board, commission, committee or council that operates in an advisory capacity relative to the district’s operations, exercises control over the district’s policies and procedures and/or which the district is required to report and be answerable to for its operations.
• A brief description of the methods the public may use to request information and records, a directory of the FOI officer(s), the address for sending requests and any fees.
Value-Added FOIA Posting While FOIA requires that only a brief description of how to make a request for public records be posted on the Web site, posting additional FOIA-related information will likely reduce time and expense of processing FOIA requests. For example, a school district is required to have rules and regulations pertaining to the availability of records and the procedures to follow, including the times, places and persons to which requests must be made. (5 ILCS 140/3(h).) Posting these rules, regulations and procedures on the district’s Web site may streamline the process by answering questions typically asked by the public. FOIA also requires a school district to create, maintain and make available to the public a records list describing the types or categories of records maintained by the district. (5 ILCS 140/5.) Posting the records list on the district’s Web site will meet the access requirement, reduce the number of FOIA requests and reduce the back-andforth communications between the requester and the FOI officer(s) that often occur due to inaccurate or unclear descriptions of records sought by the requester.
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ARTICLE / Untangling the Web
School Code Requirements The School Code of Illinois includes mandated postings, most of which are connected to the school board’s expenditure of public funds and student performance. School boards that maintain Web sites must post: 1. Annual District/School Report Cards. The district and individual school report cards received from ISBE must be presented at a regular board meeting and posted no more than 30 calendar days after receipt each year. (105 ILCS 5/10-17a.)2 2. Annual Budget. The school district’s current annual budget, itemized by receipts and expenditures. (105 ILCS 5/17-1.2.)3 3. Contracts. A list of all collective bargaining agreements and contracts over $25,000, including but not limited to leases, vendor contracts, contracted and supplemental education service agreements, transportation contracts and out-placement agreements. (105 ILCS 5/10-20.44(b).) 4. Annual Report on Contracts. The annual report submitted to ISBE on all of the district’s contracts over $25,000 during the previous fiscal year, including the total number and total value of all contracts and of those contracts awarded to locally owned businesses and businesses owned by minorities, females and persons with disabilities. (105 ILCS 5/10-20.44c.) 5. Annual Report on Administrator/Teacher Salaries and Benefits. A report on the base salary and benefits of the superintendent, other administrators and teachers must be presented at a regular board meeting and then posted prior to submitting the report to ISBE on or before October 1 of each year. (105 ILCS 5/10-20.47.)
6. Annual Report on Shared Service and Fiscal Efficiency. A report summarizing the school district’s attempts to improve fiscal efficiency through shared services or outsourcing in the prior fiscal year and listing potential shared services or outsourcing that may be considered or investigated for the next fiscal year and any anticipated barriers. (105 ILCS 5/17-1.1.) 7. Hearing on Waiver/Modification of State Mandate. At least 14 days prior, post the time, date, place and general subject matter of a public hearing concerning an application for a waiver or modification of a mandate in the School Code or administrative rules. (105 ILCS 5/2-3.25g(c-5).) If a waiver/modification application related to contracting with a commercial driver training school is granted, post the final contract with the commercial driver training school. (105 ILCS 5/2-3.25g(d).) 8. Completion of Board Leadership Training. The names of all board members who successfully completed required leadership training. (105 ILCS 5/10-16.) 9. Anti-Bias Education Policy. Any adopted board policy to incorporate activities that address intergroup conflict (i.e., anti-bias education). (105 ILCS 5/27-23.6.)
The mandated postings should be: • Displayed prominently on the district’s Web site. • Organized into logical categories. • Described in language understandable to the general public.
• Depending on the racial/ethnic composition of the local community, provided in other applicable native languages in addition to English.
School personnel who are responsible for managing the Web site should check the links to required information routinely to ensure they work properly. Also, the Web site should provide contact information of the school official(s) who will explain the posted information upon request.
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Other Information Worth Posting on the Web
There is a plethora of information already generated by a school district that may be beneficial to post on its Web site from a public relations and economic standpoint. Much of this information is not required by law to be posted on a district’s Web site but disclosure is required in another manner. Going a step further, it may be beneficial to post information gathered or developed by school districts for their own use or use by students, parents, staff and the community. State Disclosure Requirements School boards are required to maintain and/or disclose the following information, though the information is not required to be posted on the district’s Web site: • An annual statement of affairs must be made available to the public by submitting such statement to ISBE, having copies available in the main administrative office and publishing a summary in a newspaper of general circulation prior to December 1. (105 ILCS 5/10-17(a).) • A report of expenditures of $500 or more in the aggregate per person, firm or corporation, including all wages, salaries and expenditures over $500 paid from any revolving fund. (105 ILCS 5/10-17(a).)
• The Illinois Educational Labor Relations Act requires parties engaged in collective bargaining to submit written final offers and a cost summary following a declaration of impasse, which the IELRB must post on its Web site within seven days after receipt along with the parties’ outstanding issues. (115 ILCS 5/12.) • The Local Government Professional Services Selection Act was amended to provide, in part, that a public body may post an advertisement on its Web site for the procurement of architectural, engineering or land surveying services. (50 ILCS 510/4, as amended by P.A. 98-0420.)
Federal Disclosure Requirements School districts are required under federal law to provide information concerning student and school performance. Such information is not required on a district’s Web site but doing so provides an additional avenue for parents to obtain the information, such as: • NCLB Information: The No Child Left Behind Act of 2001 (NCLB) regulations require that, when a school is identified for school improvement, corrective action or restructuring, the school district and school must communicate with the parents of each child in an understandable and uniform format and, to the extent practicable, in a language the parents can understand. The parents must receive communications directly such as through mail or e-mail and through broader means such as the Internet, the media and public agencies. (34 C.F.R. §200.36.) Therefore, some NCLB notices may be posted on the district’s Web site for widespread dissemination. What districts are required to disseminate to parents and the public:4 • Annual district report cards. (20 U.S.C. §6311(h)(2).) • Annual progress review for each school. (20 U.S.C. §6316(a)(1)(c), (c)(1)(B).) • Failure to Make AYP notice. (20 U.S.C. §6316(b)(6); 34 C.F.R. §200.36, 200.37(5).) • Annual Supplemental Education Services notice. (20 U.S.C. §6316(e)(2).) • Corrective action notice. (20 U.S.C. §6316(b)(7)(E); 34 C.F.R. §200.36, 200.38.) • Restructuring plan/activities notice. (20 U.S.C. §6316(b)(8)(c).) • Parents “right to know” notice. (20 U.S.C. § 6311 (h)(6)(A).) • Limited English proficient (LEP) student notice. (20 U.S.C. §6312(g)(1)(A), (g)(3).) • LEP parent meeting notice. (20 U.S.C. §6312(g)(4).) • Separate LEP notice. (20 U.S.C. §6312(g)(1)(B).) • Other school notices, including notice of an annual meeting, a written parent involvement policy and timely information about NCLB programs. (20 U.S.C. §6318(a)(2), (b)(1), (c)(1), (c)(4).) 38 |
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ARTICLE / Untangling the Web
• Parents’ Rights to Education Records: The Family Educational Rights and Privacy Act regulations require a district to provide an annual notice of parents’ rights in any way that is reasonably likely to inform parents of their rights and effectively notify parents who have a native language other than English or have a disability. (34 C.F.R. §99.7(a).) • Student Survey Policies: Under the Protection of Pupil Rights Amendment, a district must notify parents of policies regarding surveys of students, instructional materials, physical examinations and personal information used for marketing and like-related activities at least annually at the beginning of the school year and within a reasonable time after a substantial change to such policies. (20 U.S.C. §1232h(c)(2)(B), (c)(2)(C).) • School Lunch Notices: Near the beginning of the school year, a district must provide the public with information about free and reduced price meals and/ or free milk under the National School Lunch Program, School Breakfast Program and Special Milk Program. (7 C.F.R. §245.5.) A district must provide parents with application forms for these programs. • School Wellness Policy Notice: The Healthy, HungerFree Kids Act of 2010 states that a district must inform and update parents, students and the community about content and implementation of its school wellness policy and, periodically, measure and report on the implementation. (42 U.S.C. §1758(b)(4), (b)(5)(A).)
• Asbestos Management: The Asbestos Hazard Emergency Response Act regulations require that a district annually provide written notice to parents, teachers and employee organizations about the availability of the district’s asbestos management plan and any planned or in-progress inspections, response actions and surveillance activities. (40 C.F.R. §763.84(c).) • Rights of Homeless Students: The McKinney-Vento Homeless Assistance Act requires homeless liaisons to provide public notice of the education rights of homeless students in places where homeless students receive services (e.g., schools, family shelters and soup kitchens). • Anti-Discrimination Notices: A district is required to publish information about its anti-discrimination policies and procedures, including the contact information for coordinators assigned to handle discrimination complaints, pursuant to Title VI of the Civil Rights Act of 1964, Title IX of the Education Amendments of 1972, the American with Disabilities Act, the Age Discrimination in Employment Act, Section 504 of the Rehabilitation Act of 1973 and the Boy Scouts of America Equal Access Act. • IDEA Procedural Safeguards: The Individuals with Disabilities Education Act provides that a district may post procedural safeguards on its Web site. (20 U.S.C. §1415(d)(1).)
Creating Transparency and Adding Value
A school district should carefully consider what information might create transparency and add value by being readily available to students, parents and the public. Posting on the district’s Web site may serve as a backup for giving notice to students, parents and employees. Where the district is required by law to provide information to these individuals directly, posting that same information on the district’s Web site creates an additional defense for the district against claims that those individuals were not notified or did not have knowledge of applicable rights, policies and rules. This may be achieved by posting the board policy manual, employee handbooks and parent-student handbooks on the district’s Web site. Also, districts often overlook posting administrative procedures, which provide detailed information about the manner in which the district will proceed with requests, complaints and investigations. FOOTNOTES: 1. Information obtained from USA Today, Move to online public notices looms over papers, by Emery P. Dalesio, Associated Press (5/22/09), at: http://usatoday30.usatoday.com/tech/news/2009-05-22-online-notices_N.htm 2. If report cards are posted on a Web site, the district must send a written notice to parents stating (a) that the report cards are available on the Web site, (b) the Web site address, (c) that printed copies will be sent to parents upon request and (d) the telephone number that parents may call to request printed copies. 3. The district must notify parents that the annual budget has been posted on the Web site and the Web site’s address. 4. From the National School Board Association Council of School Attorneys, Annual Notices (July 2013) and Policies Required By Federal Law (July 2013), available at www.nsba.org.
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Building Alignment with Internal Controls A small district’s perspective
Internal controls are a major issue. School districts must demonstrate that they are responsibly being good stewards of taxpayers’ dollars. Boards of education are charged with the responsibility of ensuring the taxpayers’ educational dollars are spent appropriately and establishing fiscal systems of accountability. While large school districts have business, operations and finance departments to assume these responsibilities, small districts struggle to establish appropriate internal controls
to meet acceptable standards by auditors. In some small districts, school board members must play an active role to ensure appropriate internal controls are in place.
BEFORE: Too Many Tasks By Too Few Staff That is the case in Pembroke CSD 259, a one building rural school district with 300 students, 30 staff members and a business office, which until recently amounted to the superintendent and a bookkeeper. Due to financial constraints, creative measures had to be established to align district internal controls with the legal expectations.
Initial internal controls included the following: • An external treasurer was hired to reconcile the bank accounts, sign checks each month and provide a report to the board of education. • The superintendent’s secretary received all the revenue. • The superintendent, who also served as the principal, was responsible for counting funds to be deposited in the bank by the secretary.
• The bookkeeper would enter the budget and funds received into the electronic accounting system, which could print reports for the board. • The bookkeeper would enter all of the accounts payable into the system. If the superintendent was not available, she moved forward to pay the bills. • The bills were then presented to the board for payment, after they had already been paid.
• The secretary would drop deposits off at the local bank.
Each year internal control issues were the only audit finding for the district. The issue was always that one person was doing too many things in the area of the district finances. The superintendent, who like many superintendents had little experience in a small district where the checks and balances rested with only a few people, realized that something needed to change if there was going to be true accountability and real internal controls.
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ARTICLE
By Warletta Brookins, Ph.D. SUPERINTENDENT PEMBROKE CSD 259
AFTER: New Staff and True Accountability When the bookkeeper accepted a position with another district, the district hired a director of fiscal services. In addition, an administrative assistant for fiscal services was hired to do purchase orders, accounts payable, data entry, answer telephones and serve as the backup payroll clerk. The director of fiscal services was brought on board as a consultant to examine the fiscal operations and make recommendations. Brainstorming sessions on internal controls were held with the superintendent, fiscal consultant and board members to establish a procedure that would work well in the district.
The following internal controls were established: • A finance committee comprised of two board members was appointed to review all bills and supporting documentation along with the superintendent or director of fiscal services. • Accounts payables are printed out and supporting documentation gathered to present to the board for review prior to payment. The board finance committee meets twice a month to review accounts payables to ensure bills are paid in a timely manner. During its monthly meeting, the entire board officially approves the bills authorized by the committee. • The executive assistant to the superintendent receives revenues, such as checks and fundraising proceeds, processes them on paper and presents them to the director of fiscal services, who enters revenues into the accounting system.
• The superintendent approves requisitions and purchase orders and reviews bills before they are entered in the accounting system. • The administrative assistant for fiscal services enters expenditures into the accounting system. • The executive administrative assistant in the school office enters time into the accounting system. The superintendent approves the time. • The director of fiscal services processes the payroll checks and direct deposits for staff. • A local accountant reconciles the accounts monthly for board review and approval.
The district had hoped to eliminate the accountant and allow the director of fiscal services to utilize the accounting system to reconcile the accounts each month. However, the auditor requested that they keep the accountant in place to maintain effective internal controls. www.iasbo.org
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ARTICLE / Building Alignment with Internal Controls
THE AFTERMATH: A Well-Run Organization While internal controls were initially in need of improvement for Pembroke School District 259, audits now indicated that there was no wrongdoing. The auditor, who in the past came in and spent a week examining all aspects of the fiscal services for the district, this time came in for one day and reviewed all the requested materials. They requested a few more documents, returned one more day later in the week and the audit was complete. The auditor said they were pleased with the changes that had been made, the fact that everything was in place and that the district had seriously addressed the internal control issues that they had pointed out year after year.
Enhanced internal controls have also allowed fiscal services within the district to run much smoother and faster. What once took weeks, or even months to accomplish, is now being accomplished in days because duties have been divided and no one person is doing the bulk of the work. Because of the enhanced internal controls established by the board of education and staff, the superintendent is now confident and clear on their financial status, where money is going and things they need to do to ensure their cash flow and revenues remain intact. Well-established and implemented internal controls resulted in a well-run organization. Creative thinking, brainstorming and planning were required to determine the need and establish internal controls that work.
What once took weeks, or even months to accomplish, is now being accomplished in days because duties have been divided and no one person is doing the bulk of the work.
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RESOURCES Taking Leadership Beyond the Budget The “speed of change” in the 21st century is faster than ever before — and the world of school business management is no exception. You are constantly adapting to new laws, new requirements and the list goes on. How will your organization adapt in the face of shifting conditions? And, how can you help your staff embrace and adopt the need for change? Learning from common mistakes In Leading Change, John Kotter asserts that some growing pains are inevitable. However, much of the anguish that organizations face in the change process is actually avoidable.
He begins by pointing out key mistakes of companies and organizations that have undergone change processes. These include: • Allowing too much complacency. • Underestimating the power of vision (and under communicating that vision by factor of 100 or more)! • Permitting obstacles (imagined or real) to get in the way. • Declaring victory too soon. • Neglecting to anchor the change within the culture. No shortcuts to transformation These common mistakes also form the basis of Kotter’s eight-stage process of creating major change. According to Kotter, where many organizations fall short is trying to shortcut the earlier stages in the process and getting too far ahead of themselves without forming a solid foundation first. It’s easy to overestimate how simple it will be to push people out of their comfort zones. However, without a sense of urgency, people won’t give the extra effort that is essential. In the same way, only when staff understand the vision, believe in the benefit and see it acted out by their leaders will they embrace change.
Only when staff understand the vision, believe in the benefit and see it acted out by their leaders will they embrace change.
On My List Leading Change By John P. Kotter
Overview: In today’s economy, change is not only necessary to compete and prosper; it is essential to your organization’s survival. Unfortunately, there are no shortcuts if you want your staff to truly embrace this change. In Leading Change, walk with a known expert through the process of change from start to finish. Learn your way around the common mistakes of business leaders and leave with a new perspective on your role as a leader in a changing environment.
Where budgets and plans fall short A management focus can also inhibit organizations. Managers tend to focus on processes such as budgets, staffing and controls. Leaders, on the other hand, are people who can create and communicate visions and strategies. In an ideal situation, leaders can focus on the vision and delegate the managerial tasks to lower levels. As the educational environment continues to shift, finding leaders who embrace this role and commit to continual growth will be key to your organization’s success.
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A New Mindset for the Business Office See article, “Top 10 Electronic Efficiencies for the Business Office” by Ronald O’Connor on pg. 14.
Moving Beyond Survival “New approaches, mind-sets and tools will stock the budget survival kit of superintendents and school board members for years to come.” From Smarter Budgets, Smarter Schools: How to Survive and Thrive in Tight Times By Nathan Levenson, Cambridge: Harvard Education Press, 2012
Making Technology a Priority US Department of Education data tells us that as of 2010: • 100 percent of districts kept student data in an electronic data system. • 88 percent of districts agreed that technology was a priority for district administration. • Only 47 percent agreed that funding for educational technology was adequate! Source: Ed-Tech Stats, US Department of Education, 2010
More Articles to Guide Your Software Search See article, “Accountable Accounting” by Eric Miller and Andrew Mace on pg. 24.
A Strategy for Finding the Right Accounting Software Randolph P. Johnston, Journal of Accountancy September 2003 Gain more practical tips and advice on “one of the most challenging tasks you could face in your professional career” in this helpful article!
How to Choose an Accounting System Developed by Sage Software 2005 This white paper lays a framework for your decision process including what questions to ask, what to look for and who to involve in the process of change.
FIND THESE RESOURCES AND MORE!
Links to all the resources mentioned on this page are available on the Illinois ASBO Web site: www.iasbo.org/UPDATE 44 |
Update Magazine / Winter 2013
RESOURCES
Communicate Wisely Through Your Web Site See article, “Untangling the Web” by John Izzo and Cynthia Baasten on pg. 34.
Make an Impression “Your school’s or school district’s Web site is the number one communications tool that you have available. Designing an effective Web site is paramount so that your public will receive the message you are trying to communicate.” From Tips for a Successful School/District Web Site, Posted by Don Mace on his blog, Ramblings about Instructional Technology and School Communications.
Leave Print Behind “…city and county governments say posting public notices on Web sites can save taxpayer money — and reach a public increasingly leaving the printed page behind.” From USA Today, Move to online public notices looms over papers, by Emery P. Dalesio.
Two Documents to Help You Give Notice Annual Notices (July 2013) and Policies Required by Federal Law (July 2013) From the National School Board Association Council of School Attorneys Refer to these documents as you “untangle” what information your district is required to provide and the methods required for giving notice.
In the News: Fraud Cases in School Districts Former Blacksburg booster club treasurer pleads guilty to wire fraud Former Menifee PTA treasurer charged with grand theft Treasurer took more than $11,300 from parent teacher organization, police say Former Bethel Park PTO president charged in theft from organization For tips on how to stay out of the headlines, see the article, “Protect Your District” by Bert Nuehring and Matt Geerdes on pg. 30.
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THE FINAL WORD Speaking Up About School District Accounting Paul Starck-King, CPA Chief Financial Officer Antioch CCSD 34 pstarck-king@antioch34.com
“Being good stewards of the community’s children and financial assets is our role… Stewardship of the community’s children, for the business office, involves supporting our teachers’ and administrators’ goals and utilizing financial resources to accomplish those goals. Just as importantly, if we can save everyone time that they can use to prepare for class or address the needs of students, then that is another aspect of our role. At Antioch 34, we have just automated student registration and I’m looking forward to seeing how everyone uses the time to support students that they previously spent on registration.”
“If our accounting is properly aligned… We are able to readily apply management metrics to identify areas of operational or fiscal structuring where financial efficiencies can be gained. Those saved resources can then be redeployed into other areas to move the district forward. This may mean that we have to increase our sophistication with regard to the way we account for time, benefits, facilities, transportation, food service, etc.”
“Many of us have been experiencing an increasing demand from our boards for more and better reporting… And that will only increase over the next 5 to 10 years. It’s imperative that we meet their current demands and anticipate future areas of interest and concern. Although not specifically accounting per se, aligning expenditures with revenues (e.g. CPI based CBAs) will garner growing attention. There are things we can do now to prepare for that.”
A practice districts can adopt to improve their accounting… As a former auditor with one of the big four accounting firms where I worked with mom and pop, as well as fortune 500 companies, I would suggest that school districts (relatively small organizations) can all improve their internal controls with easy-to-implement steps. Although it is not easy, we all should automate our timekeeping. Automated time keeping improves the accuracy of payroll, creates a processing-time efficiency, allows for more detailed record keeping (which gets us to some of those management metrics) and addresses the requirement that we maintain accurate time records for non-exempt employees. Let’s get away from annualizing non-exempt employee pay. It’s non-compliant. JIM WOMACK / NIU
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Update Magazine / Winter 2013
DID YOU KNOW‌
Surveyed school business officials reported achieving an average two to three times their annual salaries in annual savings‌
Giving us plenty to talk about as we help promote the value of the profession!
Help us spread the word about the ROI of school business officials. Visit www.iasbo.org/profession today! | 47 www.iasbo.org
TOOLS IDEAS NETWORKING MEMBERS RELATIONSHIPS COMMITTEES BREAKOUT SESSIONS EXHIBITORS EVENTS OPPORTUNITIES LEADERSHIP CONFERENCE ILLINOIS ASBO
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REGISTRATION IS NOW OPEN For Service Associate Members!
REGISTER TODAY AT IASBO.ORG/AC2014 APRIL 30 - MAY 2, 2014 | SCHAUMBURG, IL 48 |
Update Magazine / Winter 2013