Financial Solvency Review & Financial Reports Free Powerpoint Templates

Part 1. Financial Solvency Review of School Districts Part 2. Review of TEA Financial Reports Available on TEA Website

Financial Solvency Review Texas Education Code (TEC), §39.0822 FINANCIAL SOLVENCY REVIEW REQUIRED.  (a)  The agency shall develop a review process to anticipate the future financial solvency of each school district.  District revenues and expenditures Student-to-staff ratios Rate of change in the unreserved general fund balance Number of students Adopted tax rate Independent audit report Actual financial information for the first quarter

Identifying Districts for Review 4 flags can be set: Student-to-staff ratio Expenditures exceeding revenues Actual expenditures exceed budget Low/declining fund balance

Student-to-Staff Ratios WADA-to-staff ratio and teacher-to-student ratio both used Considered the best leading indicator(s) of financial problems Districts divided into groupings based on number of students

Teaching Staff

Total Staff

AISD Ratio Examples WADA / total staff 101,458.428 / 7,479.36 = 13.56 Enrollment / teachers 84,676/ 5,975.66 = 14.17

Group Averages Under 100 11.71 9.95 8.39 7.13 100 to 249 11.55 9.82 Group (Number of WADA or Enrolled Students) Mean WADA-to-All-Staff Ratio 85% of Mean WADA-to-All-Staff Ratio Mean Enrollment-to-Teacher Ratio 85% of Mean Enrollment-to-Teacher Ratio Under 100 11.71 9.95 8.39 7.13 100 to 249 11.55 9.82 9.48 8.06 250 to 499 11.97 10.18 10.73 9.12 500 to 999 12.35 10.50 11.48 9.76 1,000 to 1,599 11.93 10.14 12.45 10.58 1,600 to 2,999 11.83 10.06 13.52 11.50 3,000 to 4,999 12.05 10.24 14.29 12.15 5,000 to 9,999 12.24 10.40 14.80 12.58 10,000 to 24,999 12.60 10.71 14.88 12.65 25,000 to 49,999 12.75 10.83 15.01 12.76 50,000 and Over 12.99 11.04 15.06 12.80 13.56 Austin better than group average for WADA, slightly under for enrollment to teacher ratio (14.17)– but close definitely not below the 85% threshold

Student-to-Staff Ratios Student-to-staff ratio flag set if ratio — Less than 85% of enrollment group average Declined by more than 7%

General Fund Expenditures Exceeding Revenues Expenditure flag set if expenditures exceed revenues by — More than 6% More than 4% and more than 3% in the prior year

Actual Expenditures Exceed Budget Measures ability to stay within budget Flag set if expenditures exceed budget by — More than 10% More than 6% and more than 4% in year before

Fund Balance An alert for a rapid depletion in the unreserved general fund balance is specifically mentioned in statute. In addition, an alert is triggered for districts with a very low or negative fund balance as these districts are clearly struggling with solvency issues.

Identifying Districts for Review Fund balance most important Districts identified if have — 3 or more flags Fund balance flag + 1 other flag Fund balance less than 1% of expenditures 2010 => 30 Districts / 30 Charters

First-Quarter Expenditure Survey

First-Quarter Expenditure Survey

First-Quarter Expenditure Survey

First-Quarter Expenditure Survey

Review Process TEC, §39.0823   Districts identified as having problems submit — Interim financial reports Staff and student counts

Financial Plan If data confirm problem, district must submit financial plan to agency for approval Accredited warned if: the district fails to submit a plan . The plan is not approved by the agency. the district fails to comply with a plan approved by the agency (4)  the agency determines in a subsequent school year that the approved plan for the district is no longer sufficient or is not appropriately implemented.

Accredited–Warned Status If plan not acceptable or not followed, Accredited-Warned status

Questions on financial solvency?

TEA Financial Reports PEIMS financial reports and data downloads Audit (balance sheet report) Summary of Finances (SOF)

School Finance Reports

School Finance Reports

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PEIMS Financial Reports

District Drop-Down

PEIMS Financial Report (Revenues)

Expenditures

New Audit Report (C1 Schedule)

New Audit Report (C1 Schedule) This report has sections for assets, Liabilities and fund balances

Liabilities

Fund Balances

New SOF report – coming soon

New SOF

Report Selection List

District Selection

Run-ID Selection Each time allotments change new record added , can choose html, excel or pdf for printing

SOF: HTML

SOF: PDF (Consolidated Report)

SOF: Excel

Cost of Recapture Report

Cost of Recapture Report

Email Us Belinda.dyer@tea.state.tx.us Al.mckenzie@tea.state.tx.us