mike dooley & paul stone may 12, 2016 · 2016-05-17 · 2016 annual conference michael j....

Mike Dooley & Paul StoneMay 12, 2016

2016 Annual Conference


Michael J. (Mike) Dooley, CSBOSupervisor, School District and ESD Budgeting

(360) [email protected]


New items in the General Fund:

◦ In Program 01 Basic Education: Activity 31 Instructional Professional Development

will now allow duty codes 940 and 943 in Object 3 classified salaries.

◦ In Program 98 School Food Services: Activity 41 Supervision will now allow duty codes 960

and 963 in Object 3 classified salaries.


Housekeeping items in the General Fund:◦ Budget Edit 1.136 changed to an error edit. Districts with an approved Skill Center must list expenditures in

either Program 45 or 46 to clear the error.◦ Budget Edit 1.137 changed to an error edit. Districts without the legal authority to operate a Skill Center

cannot list expenditures in either Program 45 or 46. Removing expenditures in either Program 45 or 46 will clear the error.

◦ Budget Edit 1.800 updated to reflect the recently enacted state-wide salary allocation minimum amount of $35,700.

Some good news:◦ No new items in the Associated Student Body Fund. Yeah!!!

◦ No new items in the Debt Service Fund. Yeah!!!

◦ No new items in the Capitol Projects Fund. Yeah!!!

◦ No new items in the Transportation Vehicle Fund. Yeah!!!


July 10 Budget Deadline – RCW 28A.505.040

◦ The statue requires a school district budget be submitted to its ESD and copies be made available to the public by July.

◦ Final adoption deadline is August 1 for 2nd class school districts and August 31 for 1st class school districts.

◦ Notice requirements for final hearing and adoption are required to be at least once each week for two consecutive weeks with the last notice no later than seven days prior to the hearing [WAC 392-123-054].


And the question you’re all probably thinking about asking:◦ Is it a legal requirement to have the F-195 document

available to our school board in order to adopt a budget?

◦ Or can we use some other form of documentation that provides the budget information for adoption??


Both RCW 28A.505.090 and WAC 392-123-053 say:

“… every school district budget shall be prepared, submitted and adopted in the format prescribed by OSPI. The budget classifications contained in said format shall be in accordance with the accounting manual for public school districts [emphasis added], published by OSPI and SAO. Budgets prepared and adopted in a format other than that prescribed by OSPI shall not be official and will have no legal effect …”

So what the heck does “… in accordance with the accounting manual for public school districts …” mean??


“…. in accordance with the accounting manual for public school districts ….” is found in the School District Accounting Manual [SDAM] in Chapter 2 – Budgeting, page 2-3, first paragraph. It says:

◦ “The Budget DocumentEach fiscal year, the district’s adopted official budget document (Form F-195), shall be submitted in the format prescribed by OSPI. Refer to RCW 28A.505.090 and WAC 392-123-053. (Districts may prepare additional budget information for local use.)”

◦ SO…. We would counsel to proceed as planned to adopt even without the F-195 format. School districts can always load information into the F-195 system after the budget is approved.


Reminder that WAC 392-123-078 says:◦ Annual budgets of first-class school districts shall be

reviewed by the educational service district prior to the adoption by the school district board of directors.

And also….

Reminder that WAC 392-123-079 says:◦ Annual budgets of second-class school districts shall be

reviewed by the educational service district prior to adoption by the school district board of directors.


Budget Extension Reminders for FY 2015–16:◦ All of you are busy preparing your new year budgets, but don't

forget any remaining current year budget extensions.◦ August is the final month to file your F-200 budget extensions with

your ESD and OSPI.◦ Depending on when you submitted your current year F-200 for

approval and when you printed your new year F-195 budget document, you may need to reprint your new year budget to allow your current year budget extension to be accurately displayed in the middle column of your new year F-195.


Budget Extension Reminders for FY 2015–16:◦ Review budget monthly to determine necessity of an extension.◦ Must complete a budget extension prior to incurring expenditures

in excess of the total appropriations as required by RCW 28A.505.150, and WAC 392-123-071 and 072: For 1st class school districts, adopted and filed prior to incurring

expenditures that exceed the appropriation in each fund. For 2nd class school districts, adopted and approved by both the

ESD and OSPI prior to incurring expenditures that exceed the appropriation in each fund.

The ESD and OSPI will adjust budget extensions that do not meet this requirement.


Budget Extension Reminders for FY 2015–16:◦ WAC 392-138-110 requires that the Associated Student

Body initially review revisions to the Associated Student Body (ASB) budget. Therefore, an extension of the ASB Fund budget should occur prior to the closing of school to secure the necessary student involvement.◦ Check your DSF appropriation for adequate spending level

for your district’s debt payment schedule.◦ Check your TVF appropriation for adequate spending level

for that too-good-to-pass-up year-end close-out bus deal.


Budget Extension Reminders for FY 2015–16:

◦ August 31st a is very specific deadline for budget extensions for both 1st and 2nd class school districts.◦ Both WAC 392-123-071 and 072 say “shall be the

close of business on August 31 or the last business day prior to August 31 if August 31 occurs on a non-business day” ◦ So what the heck does that mean??


Budget Extension Reminders for FY 2015–16:◦ For 1st class school districts, in accordance with WAC 392-123-

071, the final date for school district boards to adopt appropriation resolutions exceeding budgets (a.k.a., F-200 budget extensions) is close of business on Wednesday, August 31st.

◦ Thursday, September 8th will be the last day for ESDs to file budget extensions requests with OSPI for 1st class school districts.

◦ Any budget extensions received after Thursday, September 8th

from a 1st class school district cannot be processed and will not be included in OSPI calculations and data files.


Budget Extension Reminders for FY 2015–16:◦ For 2nd class school districts, in accordance with WAC

392-123-072, the final date for forwarding school district board approved F-200 budget extension requests by ESDs to OSPI for final approval is close of business on Wednesday, August 31st.

◦ Any budget extension from a 2nd class district that is submitted after Wednesday, August 31st to OSPI cannot be processed and will not be included in OSPI calculations and data files.


Budget Extension Reminders for FY 2015–16:

◦ For more information on processing budgeting extensions go to the WASBO Small Schools Committee website and access the April 27th

committee meeting presentation materials “Budget Extensions: Do’s and Don’ts” with handouts. A recording of the meeting can also be found.


F-197 Cash File Questions and Answers:◦ What is the purpose of the F-197?

Monthly data collection mechanism required of educational service districts (ESD) by OSPI and used periodically by School Apportionment and Financial Services (SAFS) to gather select district financial data – such as net cash, investments, and local deductible revenues – on an as needed basis.

2016 Annual Conference 18

F-197 Cash File Questions and Answers:◦ How is the F-197 data used? Both the F-195 and F-196 financial applications for the running

of edits to check for budgetary reasonableness and accuracy in year end reporting of a district’s financial data.

Annual School District and Educational Service District Financial Reporting Summary.

SAO as a supplemental tool as part of its fiscal year end reconciliation of the F-196 to the county treasurer reports.

Measure a district’s Days Cash on Hand as one of the indicators in the financial health tool.


F-197 Cash File Questions and Answers:◦ Why is the F-197 reconciliation template no longer

posted to the OSPI website? Previous templates audited to a standard not

required by law. Recently amended Administrative, Budgeting, and

Financial Reporting (ABFR) for 2014-15 and 2015-16 provides updated guidance for districts to follow.

Movement away from making F-197 the source document of audit focus with respect to monthly cash balancing.


F-197 Cash File Questions and Answers:◦ Does the F-197 data need to be reconciled? In accordance with WAC 392-123-132, each district shall

reconcile amounts reported by its County Treasurer [RCW 28A.510.270] with the district records for all funds.

This WAC, as it is written, directs a district to reconcile amounts monthly with its county treasurers’ report, not the F-197.

Because the F-197 does not capture all of the county treasurers’ report information, it is not intended to be a replacement for the county treasurers’ monthly report; nor does it relieve a district from its monthly reconciliation of its county treasurers’ report.


F-197 Cash File final points:◦ Districts are still required to reconcile amounts

reported by the county treasurer with their financial records for each fund.◦ Amounts entered in the F-197 Cash File system by

educational services districts (ESD) are expected to be the same amounts reported by the county treasurer.◦ When compared with a district’s financial records,

amounts posted in the F-197 Cash File system are expected to be accurate.


F-197 Cash File final points: OSPI does encourage monthly reconciliation of district accounts

with a simulation of closing using the fund balance budget status report (Form F-198) [pursuant to WAC 392-123-115].

The F-197 is made available to districts through the Education Data System (EDS) portal for their recommended comparison to their county treasurers’ monthly report for accuracy and for the reporting of all F-197 discrepancies to their respective ESD for correction.

The F-197 in EDS can be thought of as an on-line bank statement that displays a district’s checking account balance so it will know its bottom line.



Michael J. (Mike) Dooley, CSBOSupervisor, School District and ESD Budgeting

(360) [email protected]

Paul StoneSchool District Accounting Supervisor

[email protected]


The School District Accounting Manual (SDAM) is a collaborative product developed by the School District Accounting Advisory Committee (SDAAC) under the joint direction of:◦ The State Auditor’s Office (SAO).◦ The Office of Superintendent of Public Instruction (OSPI).

The committee meets regularly to ensure prescribed accounting instructions remain current and appropriate.


SDAAC meetings are scheduled now through December 2016 for the 2017–18 Accounting Manual updates.

The 2016–17 edition of the Accounting Manualis scheduled for publication at the end of May.


Accounting Manual revisions for Fiscal Year 2016–17

Hot Topics on the Horizon◦ ESSA Fiscal Requirements ◦ Chart of Accounts Restructuring on the

Horizon◦ New GASB Statements


Timely Deposits Added Narrative Modifications Throughout the

Accounting Manual Repeat of Federal Forest and Schedule of Long-

Term Liability Information from 2015–16 Addendum Items


Timely Deposits Chapter 3, Page 7, Narrative has been added to better

describe the collection and deposit of public funds.

Pursuant to RCW 43.09.240: Every public officer and employee, whose duty it is to collect or receive payments due or for the use of the public shall deposit such moneys collected or received by him or her with the treasurer of the local government once every twenty-four consecutive hours.


7 Timely Deposits (continued)

The treasurer may in his or her discretion grant an exception where such daily transfers would not be administratively practical or feasible as long as the treasurer has received a written request from the district and where the district certifies that the money is held with proper safekeeping and that the entity carries out proper theft protection to reduce risk of loss of funds.


7 Timely Deposits (continued)

Exceptions granted by the treasurer shall state the frequency with which deposits are required as long as no exception exceeds a time period greater than one deposit per week.

If necessary, make arrangements with your County Treasurer to receive a written agreement regarding your deposits.


Narrative changes

Beginning in the 2016-17 school year, Full Day Kindergarten is state funded.

This affects several narratives in the Accounting Manual.


Narrative Change Chapter 3, Page 9, Unearned Revenue:

The narrative example in this section is modified.

The revenue has been received and is available to pay for current liabilities of the district, but unless the district performs some service the money will have to be returned.


Unearned Revenue (continued)

Deleted: One example would be a parent who pre-pays for non-state-funded full-day kindergarten tuition in advance of the start of the school year.

Added: An example would be a parent who prepays for the ASB Yearbook and/or school lunches in advance of the start of the school year.


Narrative Change Chapter 4, Page 23, GL 660 Unearned

Revenue:

Narrative is modified and new examples are incorporated.

Identical to changes made at Page 3-9, describing Unearned Revenue.


Narrative Change Chapter 6, Page 16, Program 79 Instructional

Programs—Other:

Full Day Kindergarten is deleted from the list of program examples.


Program 79 (continued)79 Instructional Programs—OtherRecord expenditures not directly identifiable with specific other instructional programs in the 70 series. Examples include, but are not limited to, the following: (All programs in the list are not presented here.) AIDS Education GEAR UP

Local funded full-day Kindergarten program (This should include costs for the tuition based or levy supported full-day kindergarten portion and not identified with any other specific expenditure program.)


Narrative Change Chapter 3, Page 15, Voucher Certification and

Approval:

The narrative has been modified to clarify expedited payment of claims and align the narrative with the referenced RCW 42.24.180.

The interpretation of the language is not affected.


Deductible Revenues Narrative Changes were made as an addendum to

the 2015–16 Accounting Manual regarding the law removing Federal Forest Revenue from the list of Deductible Revenues.

All areas of the Accounting Manual referencing Federal Forest as a deductible revenue are modified.


Narrative Changes5500 Federal Forests Applicable Fund: (GF, DSF, CPF)

Record revenue from the distribution of federal forest fees. Districts will be allowed to keep all of their federal forest revenue with no conditional requirements to qualify. During the 2016–17 school year, school districts receiving federal forest revenues shall not have their general apportionment reduced.

Note: Revenue in this account reduces the state payment to the district in Revenue Account 3100 Apportionment.


Narrative Change Chapter 5, Page 11, Revenue 2100 Tuition and Fees—Unassigned:

Narrative has been modified to better describe the revenue code and to distinguish fees from the sale of goods and services.

Legal reference is modified.


Revenue 2100 (continued)2100 Tuition and Fees—Unassigned Applicable Fund: (GF)

Record revenue from tuition and fees to attend or participate in an activity or academic event not assigned to another specific revenue account. This should include revenues from tuition and fees not funded by basic education, or levy. , or other specific revenue sources for all day kindergarten programs.

(Reference: RCW 28A.325.010 AGO 73-11.)


Narrative Change Chapter 5, Page 12, Revenue 2200 Sales of Goods, Supplies, and Services—Unassigned: Narrative has been added to better describe the

source of funds and to distinguish the sale of goods and services from fees.

The legal reference is modified.


Revenue 2200 (continued)2200 Sales of Goods, Supplies, and Services—Unassigned Applicable Fund: (GF, CPF, TVF)

Record revenue derived from the sales of goods, supplies, and services that are not assigned to a specific program. Include classroom fees that represent the sale of optional student materials or project materials consumed or kept by the student. Include fees that represent the sale of services.

(Reference: AGO 73-11, RCW 28A.335.090, RCW 39.33.070.)


Narrative Change Chapter 5, Page 15, Revenue 2900 Local Support Non–Tax—Unassigned:

Additional narrative is included for specific types of local support.


Revenue 2900 (continued)2900 Local Support Non–Tax—Unassigned

Applicable Fund: (GF, DSF, CPF, TVF)

Record revenue from any local non-tax source for which a specific revenue account has not been provided. Include in this account items such as: county-assessed impact fees and the difference in the amount recorded as revenue and the amount actually deposited (cash over and short).


Narrative Change Chapter 6, Page 9, Special Education Instruction:

The narrative introducing the Program expenditure type 20 is modified and updated.

Minor cleanup.


Special Education Instruction (continued)

Special education students are individuals classified as developmentally delayed, mentally retardedintellectually disabled, multi-disabled, deaf-blind…

The new WSECM continues to rely relies on each school district’s December Federal Child Count Report…


Narrative Change Chapter 6, Page 10, Program 21 Special Education—Supplemental—State:

Minor narrative modification.


Program 21 Special Education (continued)21 Special Education—Supplemental—State

Record special education expenditures funded by state and other sources. Include preschool special education expenditures. Also include expenses for providing home hospital services pursuant to WAC 392-172A-02100 and Medicaid Special Education pursuant to RCW 74.09.5255 school-based healthcare services for eligible special education students.


Narrative Change Chapter 6, Page 10, Program 22 Special Education—Infants and Toddlers—State:

The narrative has been modified.


Program 22 (continued)

22 Special Education—Infants and Toddlers—State

Record expenditures for providing early intervention services to all children with disabilities from birth through age two. School districts provide or contract for early intervention services in partnership with local birth through two lead agencies and birth through two providers. Once a child reaches age three, record relevant Individualized Education Program (IEP) expenditures in Program 21 Special Education—Supplemental—State.

(Reference: RCW 28A.155.065)


Narrative Change Chapter 6, Page 10, Program 24 Special Education—Supplemental—Federal:

The narrative has been modified.

The section on excess cost is removed from this location as it is duplicated elsewhere in the Accounting Manual.


Program 24 (continued)

24 Special Education—Supplemental—Federal

Record special education excess cost expenditures for federal grants under the Individuals with Disabilities Education Act (IDEA). Federally funded portions of the safety net awards (revenue code 6124) should be reflected in program 24 expenditures.


Narrative Change Chapter 6, Page 28, Activity 63 Operation of Buildings:

The narrative has been clarified to better distinguish Activity 63 from Activity 64 Maintenance.


Activity 63 (continued)

63 Operation of Buildings

Operations encompass those activities related to a building’s normal performance of the function for which it is used. Include expenditures for personnel who maintain buildings custodians…


Chapter 8, Page 14 Schedule of Long-Term Liabilities (SLTL):

InstructionsNarrative Changes were made as an addendum to the 2015–16 Accounting Manual.


Narrative Change Chapter 10, Page 15, Special Education Maintenance of Effort:

The narrative has been clarified for new reporting rules.


Special Education Maintenance of Effort (continued)

There are two main differences between the special education MOE test and the ESEA cross-cutting test. The first difference is the special education test requires that the district’s expenditures are at least the same as the prior year’s or the last year in which the district passed maintenance of effort using the same maintenance of effort test, …


Special Education Maintenance of Effort (continued)

The second difference is that special education expenditures may be reduced by up to 50 percent of the district’s increase in IDEA funding in the current year compared to the prior year provided the district meets certain conditions. ◦ This only applied to about 6 districts last year. ◦ Contact OSPI Special Services for more information.


ESSA Fiscal Requirements Chart of Accounts Restructuring New GASB Statements


Every Student Succeeds Act (ESSA)

Federal Fiscal Rules require an examination of the school district chart of accounts and modifications to the account

code structure.

ESSA has an impending impact.


ESSA was signed into law in December 2015.

Fiscal Rules will take effect in 2017–18.

Expenditure reporting will be impacted.


ESSA Section 1111 (h)

OSPI must report:

The per-pupil expenditures of federal, state, and local funds…

Disaggregated by: source of funds, and each school for each school district…


ESSA Section 1111 (h) (continued)

LEAs (school districts) must also report this information annually for its spending and spending in each of its schools.

For more information, this topic is being presented at length in another WASBO venue.


The School District Accounting Advisory Committee (SDAAC) has created a Chart of Accounts Subcommittee to examine the current account code structure and to recommend modifications necessary to meet federal and state demands for fiscal transparency.


The Legislature’s intent to “Fully Fund” education means Apportionment resources to expenditures need to be segregated from Local Levy resources to expenditures.

School Based fiscal reporting requirements may require the state to control more of the account code structure.


Many challenges exist as we explore fiscal accounting concepts that are foreign to the Washington state model of Program-Activity-Object dimensions.

Our goal is to design a bridge that protects features in our COA and expands dimensions to meet the new fiscal reporting requirements.


SAO and OSPI will be working together to develop guidance for districts in these areas.

Statement No. 72 – Fair Value Measurement and Application. ◦ A new Note Disclosure for FY 15–16

Statement No. 73 – Accounting and Financial Reporting for Pensions and Related Assets That Are Not within the Scope of GASB Statement 68 ◦ We are reviewing; but we do not expect this to be

applicable to school districts.



Statement No. 76 – The Hierarchy of GAAP for Local Governments ◦ This is informational guidance only.

Statement No. 77 – Tax Abatement Disclosures ◦ We are reviewing; we do anticipate this to be

applicable to school districts. But, possibility a Note Disclosure



Statement No. 78 – Pensions Provided through Certain Multiple-Employer Defined Benefit Pension Plans◦ Effective for FY 15–16: A Note Disclosure will be

required if you are contributing to union-sponsored Pension Plans.


Effective 2017–18 for Local Governments:

GASB Statement No. 75 – Accounting and Financial Reporting for Other Post-Employment Benefits (OPEB)◦ This is the School District’s OPEB version

of GASB 68 for Pension)


Narrative taken from GASB exposure draft

◦ For cost-sharing employers: The requirement that a cost-sharing employer

have an individual liability relative to the net OPEB liability for benefits provided through a cost-sharing OPEB plan should be carried forward to the final Employer Statement.


Our Expectations HCA will publish the OPEB version of the DRS

Participating Employer Financial Information (PEFI) Report.

New amounts will need to be reported on the Schedule of Long-Term Liabilities in Phase 2 for the F-196

New Fiscal Note disclosure requirements OSPI will likely provide an OPEB Reporting Tool

similar to the Pension Reporting Tool.


Thank you for coming.

Paul StoneSupervisor – SD/ESD Accounting

[email protected]


mike dooley & paul stone may 12, 2016 · 2016-05-17 · 2016 annual conference michael j....

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