1. School District of Palm Beach County Charter School Fiscal Training November 13, 2018

2. Discussion for Today Charter Tool Benchmarks Financial Monitoring
Prior Fiscal Year
Current Fiscal Year
Financial Monitoring
Monthly financial statements
Annual financial reviews
Important Grant Related Items
Understanding the Charter School Revenue Worksheet
Resources Available on District Website
Authoritative Guidance
Key Takeaways

3. Prior Fiscal Year Related Benchmarks
July 31 – Annual Audit Contract (Audit Engagement Letter)
July 31 – General Ledger
July 31 – Annual Program Cost Report
August 1 - Unaudited Annual Financial Statements **changes to FY19 template, including new accounts and detail of categoricals**
September 30 – Final amended budget minutes evidencing board approval
September 30 – Annual Financial Statement Audit* including management letter and response and minutes evidencing board approval
September 30 – Annual property inventory form reconciled to annual audit (69I F.A.C.) + **all non-capitalized personal property e.g. desks, chairs, file cabinets, routers, iPads etc.**
March 31 – Form 990 and extension, if applicable
March 31 – Single Audit
*Note: Charter schools are not component units of the school district and auditors that are not members of the American Institute of CPAs (AICPA) Governmental Audit Quality Center (GAQC) will be reported to the Audit Committee

4. Current Fiscal Year Related Benchmarks
July 31 - Adopted Budget
July 15 - Annual Contract for Accounting Services
July 15 – ACH Deposit Form (revised in FY19)
September 7 - Florida Classroom Supply Assistance – affidavit/roster/check request
October 15 - Florida Classroom Supply Assistance – verification of payment
October 31 – Immediate Aid to Restart School Operations (Restart) Program Grant - including Election to Participate and Assurances, Budget Narrative DOE 101S, and Narrative description (on Word document-charter school letterhead)
November 2 – Educational Facilities Security Grant - Election to Participate and Assurances, Budget Narrative DOE 101S, Narrative description (on Word document- charter school letterhead), and Project Performance Accountability DOE 900D
April 15 – Verification Best and Brightest payment was paid to qualifying teachers by April 1.

5. Current Fiscal Year Related Benchmarks
Monthly/Quarterly – Financial Statements, checklist and budget amendments, if applicable (no more than thirty (30) days after the last day of the reporting period, (6A , FAC)
Monthly/Quarterly – Grant reporting
21st Century, Planning/Implementation Grants, Restart and Security Grant - Itemized Expenditure Reimbursement Report, if applicable, find under June benchmarks.
IDEA and Title I have separate benchmarks from each department.
Annual - Financial reviews for those selected

6. Benchmark Reminders
Whenever financial reports are uploaded – change status to “ready for review”
For benchmarks that you believe do not relate to your school – change status to “exemption requested”
For example high performing school only needs to report quarterly
If a benchmark is “locked” send an to Sharon Kovner to “unlock” the benchmark.
Remember to respond to notes and change status to “ready for review” if any new documents are added.

7. Monthly Financial Statements – Common Mistakes
Transfers in and transfers out do not match, with no explanation
Fund balance does not agree between statements
Beginning fund balance is not updated to match the final audited financial statements (starting with October financial statements)
Balance sheet does not balance
Assets = liabilities + fund balance
Budgeted FTE is higher than actual
Amend budget if more than a 5% variance
No explanations are provided for significant variations
Loans and transfer made to schools outside Palm Beach County
Supporting documentation for loans is not provided (i.e. board approved agreement, repayment terms, signed board minutes evidencing approval to governing board
Special revenue is not reported in a separate fund
Capital projects are not reported in a separate fund

8. Monthly Financial Statements – Common Mistakes Special Revenue
Grants (IDEA, Title I, Implementation, Food Service, etc.) should be reported in a special revenue fund.
Refer to FLDOE Financial and Program Cost Accounting and Reporting for Florida Schools (2018 Red Book)
Special revenue funds are used to account for and report the proceeds of specific revenue sources that are restricted or committed to expenditures for specified purposes other than debt service or capital projects
Special revenue funds should be budgeted appropriately at the beginning of the school year and not commingled in the general fund

9. Monthly Financial Statements – Common Mistakes Capital Outlay
Capital revenue should be reported in a capital outlay fund.
Refer to FLDOE TAN No Charter School Capital Outlay Funding - Eligible Uses and Charter School Financial Reporting
Transfers must be made to the general fund for those expenditures that do not meet the definition to be reported in a capital outlay fund.
Any unspent funds in the general fund must be transferred back to the capital outlay fund

10. Financial Checklist

11. District Responsibility for Assessing Financial Condition SBE Rule 6A-1.0081, FAC
Timely notification to the Charter School Board of a financial concern that needs to be addressed, otherwise the schools risk closure.
What are the conditions:
Actual enrollment (FTE) is less than 70% of budgeted/projected enrollment (FTE).
Expenses exceed budgeted expenses for three (3) consecutive months.
YTD budget = Annual budget/12 x months elapsed
Expenses exceed revenues for a period of three (3) consecutive months.
Unbudgeted financial events for which the school has insufficient reserves to compensate.
If any of these occur provide an explanation to possibly avoid a financial Corrective Action Plan (CAP).

12. Annual Financial Review – Five Areas
Budget Preparation – policy & procedures and benchmarks
Financial Accounting – policy & procedures including review to ensure Financial Accounting policy and procedures are being implemented, review of accrued liabilities (prompt payment, AP aging, notes, loans, lines of credit and/or related party), capital assets, expenses exceeding revenue, financial CAPs, CSR, no material weakness or significant deficiencies, and benchmarks
Grants Accounting – policy & procedures and reported in a separate fund and benchmarks
Transparency – website includes annual budget independent audit, and minutes
Financial Viability – financial indicators, cash flow, fund balance, steady FTE counts

13. Annual Financial Review
Possible ratings
Meets the Standard - All indicators are rated Compliant unless Not Applicable.
Partially Meets the Standard - No more than 10 indicators are rated Non-Complaint.
Does Not Meet the Standard - Neither of the above, meets criteria for financially deteriorating condition, or a serious issue of non-compliance is identified by the district.
Beginning with the FY19 Financial Annual Review:
Charter schools receiving a rating of “Partially Meets the Standard” or “Does Not Meet the Standard” will be required to prepare and present a corrective action plan to District staff.
Depending on the nature and severity of the noncompliance, charter schools may also be required to present such a corrective action plan, after it has been reviewed by District Staff, to the School Board for review and approval.
The plan must be presented within 60 days of receipt of notice of noncompliance from the District, unless the parties mutually agree to extend the date of completion of the corrective action plan by the charter school.

14. How are schools selected for an annual financial review?
Every school is reviewed at a minimum once every three years regardless of risk assessment and those deemed “higher risk” including but not limited to:
Schools in first few years of operations
Schools with turnover at leadership levels
Declining enrollment
Unexpected enrollment growth
Change in the student demographics
Audit findings
Incomplete /inaccurate grant reimbursements
Deficits with no explanation
Expenditures exceeding budget/revenue
Financial statements with common mistakes
Non-engaged boards and/or school leadership
Not providing information timely

15. Important Grant Related Items
Entitlement and competitive grants are all reimbursement based.
Last date to issue purchase orders is 30 days prior to the grant project ending date.
Goods and services must be received/performed by the grant project ending date.
Invoices for goods and services received/performed must be paid within 15 days of the grant project ending date. Reimbursement must be requested by the same date.
Budget Amendments for projects must be approved by the FLDOE no later than 60 calendar days before the end of the grant project period.
Do not wait until the end to submit a reimbursement request or risk losing the funds!
Charter Schools must also comply with the Greenbook
Uniform Grant Guidance (UGG) was effective December 26, 2014.
Purpose is to create one document with consistent procedures for all grant programs by consolidating existing grant guidance (such as circulars).
District Grants Manual is available on the district website.

16. FY19 IDEA Allocation
IDEA allocation will change each year based the following factors:
Award $38,662603
Indirect cost $1,070,954
Private school set aside $1,753,083
Shared services $6,175,960
Net available $29,662,605
% of charter disable students x 8.9%
Charter school share $2,640,406
Weighted charter FTE / 12,762
Base funding $206.90
251 = $206.90
252 = $ ($ x 3)
253 = $1, ($ x 7)
254 = $2, ($ x 11)
255 = $3, ($ x 18)

17. FY19 IDEA Allocation - PreK
PreK IDEA allocation to five eligible schools will change each year based the following factors:
Award $1,002,488
Indirect cost $27,769
Private school set aside $12,141
Shared services* $0
Net available $962,578
% of charter disable students x 3.24%
Charter school share $31,230
Weighted charter FTE / 659
Base funding $47.39
251 = $47.39
252 = $ ($47.39 x 3)
253 = $ ($47.39 x 7)
254 = $ ($47.39 x 11)
255 = $ ($47.39 x 18)
* Shared services to be reassessed each year.

18. What is Title I Comparability?
General funded staffing at Title I schools must be the same as non-title schools based on dollars or staff ratios.
Starting in FY17, DOE required that charter schools are included with district schools.
Date certain = Last day of October survey period
Reminders:
Hire certified teachers and enter in PeopleSoft
Update staff and salaries in PeopleSoft (data in PeopleSoft is reported to FLDOE)
If out of compliance and not corrected, you risk losing your Title I allocation.

19. Understanding the Charter School Revenue Worksheet
Section I Base Student Funding

20. Understanding the Charter School Revenue Worksheet
Section 2 ESE Guaranteed Allocation

21. Understanding the Charter School Revenue Worksheet
Section 3 Charter School % of UFTE and WFTE – used to calculate categoricals

22. Understanding the Charter School Revenue Worksheet
Section 4-16 Categoricals

23. Understanding the Charter School Revenue Worksheet
Section 17 CSR Categorical

24. Understanding the Charter School Revenue Worksheet
Section Transportation, Teacher Classroom Supply, Food Service

25. Understanding the Charter School Revenue Worksheet
Section 22 Administrative Fee and Monthly Payment
October Payment = 9 remaining months (Oct, Nov, Dec, Jan, Feb, Mar, Apr, May, and June)

26. Resources Available on District Website
Important financial and grant deadlines
Current and historical payments including FEFP and federal grants
Provide link to your external auditor
Job aid for charter schools to order from district warehouse
Any invoices over 60 days past due will be deducted from the school’s FEFP payment
ACH forms
Required to be submitted annually, must be signed by the board chair
Link to FLDOE Charter School Revenue Estimate Worksheet
Link to FLDOE Charter School Capital Outlay Allocations
Link to Charter Support Unit (CSU)
Provides support to charter schools in the first three years of operation
Provides useful resources for all charter schools

27. Authoritative Guidance
Florida Statute sections* – , , , F.S.
Florida Administrative Code SBE Rule* – 6A , 69I
Charter School Contract
FLDOE Red Book, Green Book, TANs
Federal Compliance Supplements
Uniform Grant Guidance (UGG aka Super Circular)
Generally Accepted Accounting Principles (GAAP)
Governmental Accounting Standards
Florida Auditor General/Charter Schools
Provides rules and guidelines, auditor selection requirements and required electronic submission of audited financial statements
Performs FTE audit every two to three years
Audits district compliance with monitoring charter school fiscal oversight every two to three years
*Most common

28. Key takeaways
Using a management company does not eliminate the responsibly of the charter school board or school leadership from the responsibility of fiscal oversight.
If you do not understand your financial statements ask your accountant or management company to explain.
Remember the governing board and management are responsible for fiscal management
The more explanations you provide the fewer questions you will have from the district.
Use the financial checklist to avoid a financial Corrective Action Plan.
Recommend monthly/quarterly budget amendments
Build up a reserve to address contingencies:
To address unexpected decline in enrollment, hurricane damage, audit finding, etc.
Charter schools must maintain support for the Florida Auditor General, Inspector General and/or District Audits/Reviews.
Any audit findings will be deducted from your FEFP.

29. Charter School Compliance
Contact Information
Heather Knust, Budget Director PX 48702
William Dufresne, Specialist PX 45881
Charter School Compliance
Payments
Sharon Kovner
(benchmarks, charter school grant reimbursement, cost report)
Budget Analyst
Direct (561)
PX 47315
Rick Oglenski
(charter school payments, i.e. FEFP payments)
Specialist
Direct (561)
PX 48766

30. Questions

31. Walk down memory lane…
Everything on the previous slides except final amended budget or monthly financial checklist PLUS:
Financial Mid-year and Final reviews – for ALL schools
Monthly – general ledger
Monthly – bank reconciliation and copies of ALL cancelled checks
Grant reimbursements – invoices and copies of cancelled checks
Before Charter Tools – school mailed, delivered or scanned support.
No consistency on accountability
And more….