Board Financial Oversight Governing Board Online Training Module

General financial responsibilities Responsibilities of financial oversight and monitoring of school’s finances School’s finances include: Budget development and management Accounting system development and management Financial reporting Safeguarding of assets Audits

Oversight vs. Management The board as a whole provides financial oversight – usually through the Board Treasurer School administration, typically defined as the principal and other lead management, is responsible for managing finances – usually through the Business Administrator

Board Treasurer and Business Administrator Responsibilities Budget Development / Management Board Treasurer – Work with Business Administrator to develop budget timelines; verify timelines are being followed; review budget status through regular financial reporting; assure that budget is aligned with strategic goals. Business Administrator – Prepare, present, and execute the budget in alignment with established timelines and strategic goals.

Board Treasurer and Business Administrator Responsibilities Accounting System Development / Management Board Treasurer – Assure that financial controls are in place; periodically review to make sure financial controls are being followed; assure that accounting system is meeting school’s needs. Business Administrator – Design and implement financial controls; manage accounting system and execute financial policies and procedure.

Board Treasurer and Business Administrator Responsibilities Financial Reporting Board Treasurer – Review and understand regular financial reports; monitor financial reports to track progress of school; ask questions of management to clarify financial activity. Business Administrator – Prepare regular financial reports; Reconcile accounting system regularly to ensure accuracy of financial reports; Present financial reports to Board Treasurer and others as needed; Submit all required financial reports complete, on-time, and accurate to authorizer, lender, and other required parties.

Board Treasurer and Business Administrator Responsibilities Safeguarding of Assets Board Treasurer – Verify that the school has proper insurance coverage in place; ensure that proper financial controls and security measures for building assets are in place. Business Administrator – Work with vendor(s) to execute proper insurance coverages are in place for the school; execute proper financial controls and implement appropriate security measures for building assets.

Board Treasurer and Business Administrator Responsibilities Audit Board Treasurer – Review annual audit report and compare to regular financial statements prepared by Business Administrator; read management letter and any recommendations in audit. Business Administrator – Prepare for audit; coordinate audit and work with auditors while on-site; present audit report to the board; implement any recommendations and correct concerns from audit.

Budget Development / Management Development Understand sources of funding Understand expenditures Tie expenditure decisions to school goals Monitoring Regular budget vs. actual reporting Regular update on changes to budget projections Long-Range Planning Plan for increasing financial health Tie revenue and expenditure projections to school goals

Accounting System Development / Management Cash management Purchasing Accounts payable Human resources Buildings operation / contract oversight Payroll Payroll taxes Benefits PERA

Accounting System Development / Management Internal controls Segregation of duties

Financial Reporting Management reporting Balance sheet Statement of revenues and expenditures vs. budget Statement of cash flows Other Regulatory reporting USOE reporting FASB (Financial Accounting Standards Board) TABOR Grant reporting / Bondholder reporting / Other reporting

Safeguarding of Assets Proper recording and tracking of assets Maintenance of adequate insurance Security of cash on hand Security of records on hand

Audit Annual audit required Contract with independent CPA firm Review annual audit report and compare with regular financial management reports Read management letter with audit report

Source of Financial Information at Your School Contract with authorizer All annual financial reports, journals, ledgers, vendor ledgers, and audits All monthly financial reports, journals, ledgers, and backup Bond financing documents Bylaws Vendor contracts

Other School-Related Entities School Foundation School facility corporation Parent/teacher organizations Educational Service Providers (ESPs)