1. Financial Management: Cash Management
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2. Cash Management: Overview
Budget Process
Funds Requests
Internal Procedures
Drawing Down Funds from MDE
Final Expenditure Reports
PD Focus – Cash Management
Funds Requests – Internal and drawing down funding from MDE
Budget Process
Final Expenditure Reports
Supplanting limitations
10/21/2009

3. Cash Management: Regulations
OMB Circular A-87, Cost Principles for State, Local and Tribal Governments
OMB Circular A-133, Compliance Supplement. (March 2008)
EDGAR, Sub Part C, §76.707: When Obligations are made.
EDGAR, Sub Part C, §80.21: Payment
Cash Management Regulatory Guidance
10/21/2009

4. Cash Management: Definitions and Terms
Cash Management System:
MDE system that manages the cash disbursement of federal and state pass-through grants
EDGAR:
Education Department General Administrative Regulations. Regulations that contain important administrative requirements that apply to federal education funds
10/21/2009

5. Cash Management: Definitions and Terms
Final Expenditure Reports (FERs): FERs close projects by reporting that funds have been expended and are in compliance with the aproved budget. This report is due as soon as the LEA has spent project funds, but no later than 60 days after the termination of the project. 
Cash Management – Terms and Definitions
10/21/2009

6. Cash Management: Definitions and Terms
OMB-Circular A-87: Cost Principles for State, Local, and Indian Tribal Governments. Source of the basic threshold standards that must be present for a cost to be payable with federal funds
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7. Cash Management: Definitions and Terms
Reimbursement The preferred method of payment for federal grant expenses
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8. Cash Management: Content
LEAs records agree with MDE approved budget
Funds Requests
Funds are requested on a regular basis
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9. Funds Deposit All funds are deposited promptly
The person performing the cash receipts function:
Does not sign checks
Does not reconcile bank accounts or maintain non-cash accounting records
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10. Bank Reconciliation
Bank statements are received directly (and unopened) by the person responsible for bank reconciliation
Bank statements are reconciled at least monthly
Paid checks are examines for date, name, cancellation, and endorsements
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11. Handling of Vouchers (and Grant Alignment)
Vouchers are identified by grant, number, date, and expense classification
Checks include supportive documentation when being submitted for signature
Supportive documents are canceled to prevent reuse
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12. Handling of Vouchers (and Grant Alignment)
Invoices or vouchers are approved in advance by authorized officials.
Voided checks are properly canceled and retained
Blank checks are secured
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13. Cash Payable Policy/Practice
Drawing cash payable to “cash” or “bearer” is prohibited
There are established procedures that prevent checks from being issued on an oral authority
Employees are prohibited from having custody of any unrecorded cash or negotiable instruments of the LEA
10/21/2009

14. Program Income
LEA has written policies and procedures on the receipt and obligation/ expenditure of program income
The policies and procedures assure that program income is obligated properly, and during the required period
Two different people are assigned the responsibility for the receipt and obligation of program income funds
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15. Final Expenditure Reporting
FERS are filed on time
FERS should equal the cumulative total of the funds requested
FERS for less than approved amounts will result in recovery of excess funds
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16. Budget Process
The LEA operating budget reflects sufficient non-federal funds to match the federal funds during the grant period, if required by the grant
The responsibility for budget preparation is defined at all organizational levels
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17. Budget Process The LEA has an operating budget for each of its grants
Line item costs for the grant award are consistent with the MDE approved budget for the grant
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18. Budget Process
The LEA does not exceed the grant established threshold for moving expenditures between functions
All expenditures recorded in a function were approved by the MDE program office
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19. Assets
The LEA has written procedures and controls in place to protect assets acquired with grant funds
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20. LEA Match
If the federal grant requires local match, the LEA operating budget reflects sufficient non-federal funds to match the federal funds during the grant period for the fiscal years under review
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21. Inventory Procedure
All equipment purchased with grant funds is properly tagged and inventoried
Equipment records are maintained
A physical inventory is taken at least annually and reconciled with the equipment records
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22. Inventory Procedure
The LEA has adequate maintenance procedures that keep the equipment in good condition
An inventory control system exists that protects against loss, damage, or theft of equipment and required investigation of such
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23. Disposition of Equipment
The LEA has procedures for the disposition of equipment
Equipment that is purchased with grant funds shall be disposed of according to federal criteria
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24. Cash Management: Critical Elements
Funds Deposit
Bank Reconciliation
Vouchers
Cash Payable Policies/Procedures
Program Income
Final Expenditure Reporting
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25. Cash Management: Critical Elements
Budget Process
Assets
LEA Match
Inventory Procedure
Disposition of Equipment
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26. Cash Management: FAQs
What day(s) of the week are grant payments processed?
Tuesday and Thursday
Food & Nutrition Services/Fiscal Reporting System payments are processed on what day(s) ?
Wednesday
Cash Management – FAQ Scenarios
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27. Cash Management: FAQs When will my payment arrive?
Electronic Fund Transfers (EFTs) within two to three days; Paper warrants within three to five days
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28. Cash Management: FAQs
I saved my request for funds and have not received the money
The recipient must also certify final expenditures for payment to be processed
I am not able to access the CMS
The certifier for a recipient must complete a CMS Security Access form and fax to MDE
Cash Management – FAQ Scenarios
10/21/2009

29. Cash Management: FAQs
What are the steps for certifying a Final Expenditure Report?
You must save, post, and certify your final report
Where do I find what a payment is for?
Go to Viewing Data, then to Payment Ledger, and enter your requested date in the Disbursement Date field. Select the date and this will display payment details
Cash Management – FAQ Scenarios
10/21/2009

30. Cash Management: Other Resources
CMS Training
Deputy Superintendent Memoranda
NEW MDE Cash Management System (September 13,2006
Required Change in Federal Cash Advance Procedures May 29, 2007)
Three-Day Cash Advance (Oct. 21, 2008)
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31. Cash Management: Other Resources
MDE Federal Fiscal Review, Local Education (LEA) Review Tool
10/21/2009

32. Cash Management: For More Information
Contacts:
CMS: Debbie Roberts, MDE
MDE: Specific Program Office
ISD:
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33. Resources
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34. LEA Financial Management Resources
All resources identified in this Professional Development module are available on:
Michigan LearnPort
Collaboration Center
Community Room
LEA Financial Management Resources
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35. Committee
Membership
10/21/2009

36. MDE/MAISA Monitoring and Compliance Committee
Becky Rocho, Calhoun ISD, (269)
Patty Cantú, MDE, Office of Career and Technical Education, (517)
Mary Ann Chartrand, MDE, Grants Coordination and School Support, (517)
Terri Lynn Giannola, MDE, Office of Career and Technical Education, (517)
10/21/2009

37. Cash Management Subcommittee
Stan Kogut – ISD Chair Ingham ISD
(517) ;
Louis Burgess – MDE Co-Chair MDE – Grants Coordination and School Support
(517) ;
Craig Thurman - MDE Co-Chair MDE – Financial Management
(517) ;
Tom Armstrong Wexford-Missaukee ISD
(231) ;
10/21/2009