Region V Hot Topics March 29-30, 2012

Transcription

1 Region V Hot Topics March 29-30, 2012 Sarah Miller, Presenter Patti Scott, Presenter Minnesota Department of Education Division of School Finance 1500 Highway 36 West Roseville, MN

2 Agenda FY 2011 UFARS Submission Review Common Errors Restricted Revenue and Expenditure Reporting State Funds with Statutory Reserves Alternative Facilities Bonding and Levy Program Federal Funds Course Codes SERVS/UFARS Reconciliation Stimulus Education JOBS Finance Code 152 School Finance Award Year 2012 FY 2011 Data 2011 First Special Session Legislation Review FY 2012 UFARS Changes FY 2013 UFARS Changes Q & A 2

3 FY 2011 UFARS Submission Review 3

4 UFARS Balance Sheet Errors Restricted/Reserved Funds Balance Sheet UFARS Code Balance May Not be Negative 403,408, 413, 416, 417 X Comment 418 X Only allowed in Fund Allowed in only Funds 01, 08, 20, 25, , 425, 426, 428, , 445, 447, , (Unassigned Fund Balance) X Must be negative. Deficit in Funds 2, 4, 6, 7, or 47 is allowed 4

5 UFARS Expenditure and Revenue Reporting Errors Food Service Fund Child-Nutrition ( Series) Revenues and Expenditures require a specific Finance code in the Series. Commodities (Source 474 must equal Object 491) Expenditures UFARS Chargeback Codes Must be Zero 195, 295, 365, 398, Shared Costs for Paired Districts only may not be negative Sum of 535 Capital Leases PLUS 589 LeaseTransactions/Installment Sales must be zero Revenues Sum of 020 Property Tax Shift Recognition Revenue PLUS 299 State Aid Adjustments for Property Tax Shift must be zero 5

6 Restricted Revenue and Expenditure Reporting 6

7 State Restricted/Reserved Expenditure and Revenue Reporting UFARS Expenditure and Revenue Reporting Finance code is required for expenditure and revenue reporting related to restricted/reserved Balance Sheet Accounts Prior year ending restricted/reserved balance plus revenues, plus transfers-in, less expenditures and transfers-out should equal ending restricted / reserved fund balance. Provides a more accurate picture of how expenditures are funded Gives the auditor a clean pool of expenditures to audit 7

8 Alternative Facility Bonding and Levy Program Two distinct sets of districts participate under Minnesota Statute 123B.59. Each set of districts account for revenue and expenditure differently. 25 districts qualify through facility age and square footage under M.S. 123B.59, Subd. 1(a) and use revenue for approved projects that qualify under health and safety criteria, deferred maintenance, or disabled accessibility. The remainder of districts qualify under M.S. 123B.59, Subd. 1 (b) and must use this program if the district has an approved health and safety project of $500,000 or greater at a school site. The revenue may be used only for this approved project. 8

9 Alternative Facilities 1(a) Schools Only the 25 Districts qualifying under M.S. 123B.59, Subd. 1 (a) account for revenue and expenditure as follows REVENUE (aid and levy) AND EXPENDITURE Fund Program Finance Source Course or XXX XXX Additional revenue, other than levy or aid may result from: Utility rebates Insurance or legal settlements Petrofund reimbursements CODE ADDITIONAL REVENUE Fund Program Utility Finance Rebates Source Course or XXX 9

10 Alternative Facilities 1(b) Schools Must record expenditures and revenues under Program code 855 coupled with the appropriate Finance code as identified by the following UFARS dimensions: Fund Program Finance Source , 349, 352, 358, 363, 366 Note: The most common Finance code is 366 for indoor air quality. Additional revenue, other than levy or aid may result from: Utility rebates Insurance or legal settlements Petrofund reimbursements Code Additional Revenue: XXX Fund Program Finance Source REVENUE , 349, 352, , 363,

11 Federal Expenditure and Revenue Reporting Federal Expenditure Reporting Appropriate Finance codes are required for all federal expenditures reported. Course codes are required for all federal funds drawn on SERVS Financial (SFIN) for SERVS/UFARS Reconciliation. Federal Revenue Reporting Record all Federal revenues using the appropriate Finance, Source, and Course code. Since they are reimbursement based, revenues should be recorded when drawn from SERVS or accrued at year-end. The use of a Course code is not currently required for revenue reporting, but strongly encouraged. 11

12 Federal Expenditure and Revenue Reporting Course Code Matrix State FY and Federal Award Year Federal Award Year State Fiscal Year 2012 Course Code 012 Course Code Course Code 012 Course Code 000 Course Code Course Code 012 Course Code 000 Course Code 011 Course Code

13 Course Code Issues in UFARS Be sure to use the proper federal fiscal year course codes in UFARS (000, 011, 012) for the funding stream that you drew the funds from in SFIN Make sure your local crosswalk is not reporting course code 011 as 000 Make sure your local crosswalk is not reporting course code 012 as

14 Federal Revenue and Expenditure Reporting Title 1 Set-Asides Category FY 2012 FY 2013 Highly Qualified Suggested Suggested LEA Level Activities Suggested Suggested Neglected Suggested Suggested Homeless Required - * Required - * Parent Involvement Required - ** Required - ** AYP School Choice / SES Required - *** Suggested AYP Professional Development Required - *** Suggested Waiver School Improvement N/A Required - **** * - Required to set aside if LEA has homeless population. Not required to spend. ** - Required if grant award exceeds $500,000 *** - Required for schools not making AYP. Required to spend. ****- Required for schools identified as Priority or Focus 14

15 Federal Expenditure and Revenue Reporting Title I Set-aside course codes in UFARS FY 2012 These course codes should only be used with Finance code 401, with the exception of which may be used in Federal Special Education reporting Current Prior 2nd Prior Year Year Year Course Code (000) (011) (012) Highly Qualified LEA Level Activities Neglected Homeless Parent Involvement AYP School Choice / SES AYP Professional Development

16 Federal Expenditure and Revenue Reporting Title I Set-aside course codes in UFARS FY 2013 These course codes should only be used with Finance code 401, with the exception of which may be used in Federal Special Education reporting Current Prior 2nd Prior Year Year Year Course Code (000) (011) (012) Highly Qualified LEA Level Activities Neglected Homeless Parent Involvement AYP School Choice / SES AYP Professional Development "Waiver" School Improvement 667 TBD TBD 16

17 SERVS/UFARS Reconciliation Because modifications to SERVS Financial (SFIN) eliminated the need to draw by Finance, Object, and Course code, reconciliation now requires a three-way match between SFIN and UFARS Comparison report is on the SFIN Reports menu at: School Support > Data Submissions > SERVS Financial SFIN version updated live and reflects any changes in SFIN data; UFARS data is as of district s last submission 17

18 SERVS/UFARS Reconciliation Three Way Reconciliation: 1. UFARS expenditures and final SFIN budget must match by Finance and Object code 2. UFARS expenditures and total SFIN draws must match by Finance and Course code Title I Expenditures will be broken out by required AYP set-aside Course Codes 3. SFIN budget must match total SFIN draws by Finance code 18

19 SERVS/UFARS Reconciliation MDE will accept UFARS as the audited and final expense. If the amount of expenditures in SFIN is greater than UFARS, Federal program staff will review to determine if funds need to be paid back If it is determined that an overpayment exists, districts will be required to repay funds drawn on SFIN in excess of the UFARS reported amount. If repayment occurs after UFARS is closed, use source code 406 as a contra-revenue account with a course code designating the Vintage of the Federal Award (e.g. 011 for FFY 2010 drawn in SFY 2011 repaid in SFY 2012) so as to prevent reconciliation problems in SFY

20 REAP Flex/Transfer Title II to Title I Funds transferred or REAP flexed from Title II (FIN 414) to Title I (FIN 401) will appear on the Title I reconciliation report and be excluded on the Title II reconciliation report These costs will be identified by Program 216 and FIN 414 as reported in UFARS and drawn from the transferred funding stream in SFIN You must transfer the funds in SFIN for OBJ codes 430, 460, 555, and 820. These must be reported in UFARS using program 216 and FIN Code

21 Stimulus Education Jobs Finance Code

22 Stimulus Education Jobs Update Allocations of Education JOBS funds are based on the district s FY 2011 entitlements for: General Education Revenue State Special Education Aids State Special Education Excess Cost Aid The final calculation of Education JOBS funds is anticipated to be completed by the March 16, 2012 when all general education revenue and state special education aids are finalized. 22

23 JOBS and UFARS Three possible situations: 1. District spent 100% of estimated Education JOBS award; FY 2011 UFARS expenditures exceeded its initial SERVS allocation and draws; district recorded a FY 2011 year-end revenue receivable. 2. District spent only 90% of its estimated Education JOBS award (amount initially loaded to SERVS FY 11); district has remaining funds that can be balanced forward to FY The amount drawn from FIN 152 on SERVS Financial exceeds district s final Education JOBS allocation; repayment is required. 23

24 #1 District Spent 100% of JOBS Funds (Estimated); Recorded FY 2011 Receivable Draw additional funds from SERVS FY 2011, up to the amount of audited Finance 152 expenditures reported on UFARS. Credit the balance drawn from SERVS FY 2011 to the FY 2012 revenue receivable. Balance forward any remaining JOBS funds into SERVS FY 2012; budget, and submit for review and approval. 24

25 #2 District s SERVS Draws < Final JOBS Allocation; Can Balance Forward Districts should review the FY 2011 Education JOBS budget to be sure that it matches both audited FY 11 UFARS expenditures and FY 11 SERVS draws. Once the SERVS budget has been reviewed and revised to actual draws, the district may balance forward the funds to FY 2012; budget, and submit for review and approval. 25

26 #2 Education JOBS Funds Balanced Forward, Reporting Revenues and Expenditures in FY 2012 Fund Org Source/ Program Finance Object Course Revenue 01 xxx xxx Expenditures 01 xxx xxx 152 xxx

27 #3 Repayment is Required The district expenditures and the amount of the draws exceeds the final allocations of Education JOBS funds. MDE will notify districts that have drawn in excess of final Education JOBS allocation. Do not send repayment until notified by MDE. A correction form to repay the funds to MDE will be included in the notification. Districts are requested to promptly repay the funds to assure compliance with cash management. 27

28 # 3 Repayment is Required If the district carried a revenue receivable at FY 2011 year-end for Education JOBS-eligible expenditures AND is required to pay back funds, record the following journal entries to pay back the funds and eliminate the receivable: FUND ORG/GL PROG FIN SRC CRS DEBIT CREDIT PAY BACK FUNDS BY WRITING CHECK REVERSE RECEIVABLE (JOURNAL ENTRY) $ 25, $ 25, $ 25, $ 25,000 28

29 FY 2011 Draw Deadline Districts and charter schools may draw any remaining Education JOBS funds for FY 2011 through Monday, April 23, 2012 SERVS Financial will be closed the morning of April 24, 2012 to any further FY 2011 draws on Finance Dimension

30 Reconciling FY 2011 Finance 152 After the last draw and payment date from SERVS Financial, the Division of School Finance will initiate the reconciliation of SERVS Draws to audited UFARS data. The reconciliation process will compare the total draws on SERVS Financial to the total expenditures on UFARS. If a district s FY 2011 UFARS expenditures are less than the total draws on SERVS Financial, repayment may be required. A correction form will be prepared by MDE and sent to the district business office. MDE will not be reopening FY 2011 UFARS for corrections. 30

31 Obligation and Liquidation Period Education JOBS funds must be obligated by September 30, The last draw date for FY 2013 expenditures will be December 17,

32 School Finance Award 2012 for FY

33 School Finance Award 2012 for FY 2011 Awarded annually by the Minnesota Department of Education (MDE) Division of School Finance to recognize schools for meeting statutory deadlines, as well as select policy, fiscal and financial reporting criteria. List of qualifying schools is now posted to the MDE web site School Support > School Finance > Financial Management > Guidance and Reports > School Finance Award Criteria and Application Qualifying districts/schools must have submitted a School Finance Award application form by 4:30 p.m. on February 29, Incomplete applications were not considered. Accepted School Finance Award applications are being reviewed and approved by MDE and the award recipients will be posted on the MDE website and receive certificates and a letter of congratulations from Commissioner Dr. Brenda Cassellius. 33

34 Finance Award Criteria C) Accuracy in Financial Reporting 1) The district/school s final UFARS Submission Turnaround Report has no edit errors. 2) The district/school s final audited UFARS data agrees with the independent audit data. 3) The district/school s final SERVS/UFARS Comparison Report has no variances (C.3.) 4) The district/school s final EDRS/UFARS Comparison Report has no variances (C.4.) 34

35 C) Accuracy in Financial Reporting Criteria C.3. and C.4. Updates: Evaluation of these criteria will be based upon reports as of February 29, Variances may be permitted on the EDRS/UFARS Comparison Report for Finance code 756, where reconciliation is not possible because of other MDE reporting requirements. Finance code 152 Education JOBS will be excluded from the requirement of no variance between SERVS/UFARS because FY 11 allocations will not be final until mid-march Variances between SERVS/UFARS for select object codes in Title Programs where funds have been flexed and variances between to and from Finance codes net to $0. Other allowances may be made where reconciliation is not possible because of MDE reporting requirements. 35

36 2011 Legislative Changes Affecting FY 2012 and 2013 UFARS 36

37 2011 Legislative Changes Changes to education statutes enacted by the 2011 legislature affect UFARS codes beginning FY Laws 2011, First Special Session, Chapter 1 apter&year=2011&type=1 Updates have been published in the 2012 UFARS Manual. 37

38 2011 Legislative Changes Temporary Authority to Request and Receive Commissioner Approval of a Permanent Fund Transfer for FY 2012 and FY 2013 (Article 5, section 11) The legislature provided temporary authority for districts to request and receive commissioner approval to make a permanent transfer under Minnesota Statutes, section 123B.80, without the need to identify an unforeseen event directly related to the fund or account involved. 38

39 2011 Legislative Changes A board may apply for and receive commissioner approval, as long as the transfer meets the following criteria: 1) The transfer must not affect June 30, 2011 fund balances; 2) The transfer cannot be from Fund 02, Food Service, or Fund 04, Community Service; 3) The transfer cannot increase state aid obligations to the district; 4) The transfer cannot result in additional property tax authority for the district. 39

40 2011 Legislative Changes Request for Fund Transfer Form The Request for Fund Transfer form and an instructional guide to assist districts to identify accounts where transfers are either allowed or disallowed are posted on the MDE website at: School Support > School Finance > Financial Management > Request for Fund Transfer 40

41 2011 Legislative Changes Incoming Transfers New UFARS Source Code: 651 Commissioner Approved Transfers In Use this code with the appropriate Finance code to record transfers in approved by the commissioner under Minn. Stat. 123B.80 and adopted by the school board. This includes transfer requests approved in FY 2012 and FY 2013 under the temporary authority granted in Laws SP, Chapter 11, Article 5, Section 11, which requires the board to adopt a resolution stating that the transfer will not diminish instructional opportunities for students. Transfer requests under this temporary authority are not permitted from the food service fund (02) or the community service fund (04) and must be approved if they do not increase state aid or result in additional property tax authority for the district. 41

42 2011 Legislative Changes Outgoing Transfers New UFARS Object Code: 911 Commissioner Approved Transfers Out Use this code with the appropriate Finance code to record transfers out approved by the commissioner under Minn. Stat. 123B.80 and adopted by the school board. This includes transfer requests approved in FY 2012 and FY 2013 under the temporary authority granted in Laws SP, Chapter 11, Article 5, Section 11, which requires the board to adopt a resolution stating that the transfer will not diminish instructional opportunities for students. Transfer requests under this temporary authority are not permitted from the food service fund (02) or the community service fund (04) and must be approved if they do not increase state aid or result in additional property tax authority for the district. 42

43 2011 Legislative Changes Finance 302 Operating Capital (Article 1, section 9) Permitted uses of operating capital revenue are amended to include to lease vehicles and to pay costs directly associated with closing a school facility, including moving and storage costs (Minnesota Statutes, section 126C.10). 43

44 2011 Legislative Changes Finance 306, 307 and 308 Staff Development (Article 1, section 35) The General Education Revenue Reserve requirement for staff development is suspended for FY 2012 and Revenue otherwise required to be reserved for staff development (M.S. 122A.61, Subd. 1) may be used for operating costs. These expenditures should not be coded to finance codes 306, 307 or

45 2011 Legislative Changes Finance 306, 307 and 308 Staff Development Any existing fund balances in the restricted/reserved account for staff development (403) on June 30, 2011, must be used for appropriate staff development activities (coded to 306, 307 and 308). Under the authority provided in 2011 First Special Session Laws, Chapter 11, Article 5, section 11 and upon commissioner approval, a school district or charter school may make a transfer from restricted/reserved account 403 during FY 2012 or FY

46 2011 Legislative Changes Finance 339 Safe Schools Crime Levy $3 Set- Aside (Article 1, section 24) Effective July 1, 2011, districts are no longer required to set aside $3 per adjusted marginal cost pupil unit (AMCPU) for licensed school support staff. Districts with restricted/reserved 449 fund balances must continue to use Finance 339 when spending set-aside reserves for licensed school support staff. During FY 2012 or FY 2013 only, with the commissioner s approval (Chapter 11, Article 5, section 11), districts may make a transfer from restricted/reserved account

47 2011 Legislative Changes Finance 339 Safe Schools Crime Levy $3 Set- Aside Maintenance of Effort (MOE) spending for licensed school support staff related to the safe schools levy is eliminated effective July 1, Since this certification, as MDE had implemented it, occurred during the subsequent fiscal year, there was no MOE certification required for FY

48 2011 Legislative Changes Object 433 Supplies and Materials Individualized Instruction (Article 1, section 10) Minnesota Statutes, Section 123B.41, Subd. 5 is amended to include electronic books and other printed materials delivered electronically as examples of individualized instructional or cooperative learning materials eligible for nonpublic pupil aid. Expenditures for electronic books do not include the dedicated hardware equipment known as e- Readers or e-book devices. 48

49 2011 Legislative Changes Object 460 Textbooks and Workbooks Minnesota Statutes, Section 123B.41, Subd. 2 is amended to include electronic books and other printed materials delivered electronically in the nonpublic pupil aid textbook definition. Expenditures for electronic books do not include the dedicated hardware equipment known as e- Readers or e-book devices. 49

50 2011 Legislative Changes Finance 723 Transportation of Pupils Attending Special Education Programs (Article 10, section 2) Beginning in FY 2012, districts may include the costs of transporting a student on a school bus equipped with a power lift to provide transportation for a curricular field trip activity when the power lift is required by a participating student s Individualized Education Plan (IEP). 50

51 2011 Legislative Changes Finance 728 Special Transportation of Selected Pupils (Article 10, section 2) Beginning in FY 2012, districts may include the costs of transporting a student on a school bus equipped with a power lift to provide transportation for a curricular field trip activity when the power lift is required by a participating student s section 504 Plan. For questions about new legislation or student transportation reporting, contact Kelly Wosika at or kelly.wosika@state.mn.us. 51

52 New: Compensatory Revenue Pilot Project Formula Aid Compensatory Revenue Pilot Project Formula Aid (Article 1, Subd. 10): One-time $9,776,000 appropriation for Fiscal Year 2013 only For districts having pupil unit counts in the top 20 Compensatory pupil unit counts Eligible for the greater of zero or $1,400 times the number of compensatory pupil units, minus the amount of compensatory education revenue received by the district under Minnesota Statutes, section 126C.10, subdivision 3 52

53 New: Compensatory Revenue Pilot Project Formula Aid UFARS Reporting: Treated as additional state aid for permitted Compensatory Education expenditures as defined in Minnesota Statute 126C.15, subd.1. Use Finance 317 to report all Revenues and Expenditures Revenue source code 300 Chapter X Grid permitted object codes. Must be reserved: Balance Sheet code 441, Restricted/Reserved for Basic Skills. 53

54 Literacy Incentive Aid Effective for FY 2013 and later - Minnesota Statutes, Section 124D.98 District schools and charter schools are eligible Only those schools enrolling students in grades 3 or 4 and with MCA test results from the prior year generate revenue for the district or charter school. Schools with a broader grade span (e.g., K-8 elementary schools) generate more with a given set of test results than schools with a narrower grade span (e.g., K-5 elementary schools). This is probably an unintended consequence and may be adjusted by the Legislature in the future. While aid is generated using school level data, there is no requirement for funds to be spent at the school generating the revenue. The aid may be used for any general fund purpose. 54

55 Literacy Aid Accounting UFARS Accounting Treatment: New Source Code added for Literacy Incentive Aid Source Code 212 available for use in FY 2013 Finance Code 000 Revenue is unrestricted, not required to be reserved. 55

56 Literacy Aid Estimates Estimated aid calculations posted to School Finance section of MDE web site under: MDE > School Support > School Finance > Funding Projections and Trends 1) Detailed Calculations by school building show the aid that would have been generated at each building if the aid had gone into effect for FY 2011 based on 2008, 2009 and 2010 test scores: Literacy Incentive Aid (01/17/2012) 2) Summary by school district -- (see line 46): District Revenue FY FY 2013 End-of-Session 2011 March 1, 2012: Literacy Incentive Aid and FY 2011 Year Revenue Spreadsheets posted to web site updated to reflect February 2012 forecast. No new test data available, but will be updated to reflect actual FY 2012 fall enrollment. 56

57 Implementation Schedule July 2012: Initial estimates of aid entitlement will be loaded to IDEAS FY 2011 growth data will be included if available by early July Any legislative changes will be reflected Later during FY 2013: Final FY 2013 aid entitlements will be calculated and loaded to IDEAS as soon as FY 2012 proficiency and growth data are available. (Date is uncertain at this time) IDEAS Payments may be found on the new MDE web site at: Data Center > Data Report & Analytics > Minnesota Funding Reports (MFR) 57

58 Small Schools Revenue Effective for general education revenue for fiscal year 2013 and later; Minnesota Statutes 126C.10, Subd. 2(c) A school district, not including a charter school, is eligible for small schools revenue equal to the product of: 1) $5,224; 2) the district s Adjusted Marginal Cost Pupil Units (AMCPU) for that year; 3) The greater of zero or the ratio of (i) 1,000 less the district s AMCPU s for that year, to (ii) 1,000; and 4) 0.10 No reserve requirement; record using Finance 000, Source

59 Food Service Bad Debt Federal regulations and USDA guidance mandate that bad debt arising from the operation of a school food service is an unallowable cost to the food service program. 59

60 Food Service Bad Debt This includes meals charged by students that are not subsequently paid (in a system where charges can be made and payments made to settle the account later) AND negative account balances (in a system where students pre-fund the account) AND situations where the student has no balance and is given a meal (these must all be recorded as revenue via the point-of-sale system and charged to a student s account). 60

61 Food Service Bad Debt A new UFARS object code for bad debt expense and a new contra-asset general ledger account for the allowance for uncollectible accounts will be created for Fiscal Year Details on the full accounting treatment for bad debts will be disseminated via Business Manager and Food Service Listserv messages and the School Business Bulletin in the near future. 61

62 Individuals with Disabilities Education Act Birth through Age Two (B-2) MDE is required to meet Federal reporting requirements of the Individuals with Disabilities Education Act (IDEA). MDE needs to distinguish B-2 expenditures from state and local sources for the Federal Special Education Maintenance of Effort (MOE) calculation. B-2 expenditures are currently being recorded to Finance Code 740. Definition of Finance Code 740 will be revised and a new Finance Code IDEA, Part C, B-2 will be implemented in FY

63 Other Salary Payments UFARS Coding Change for FY 2013: Modifications to Object Code 185 Other Salary Payments (Licensed or Certified) Includes all other compensation which is beyond the contract school day or school year. Includes compensation that is hourly-based or eventbased not described in other salary object dimensions for employees licensed or certified by the Minnesota Department of Education, Minnesota Department of Health, or a national professional association. 63

64 Other Salary Payments UFARS Coding Change for FY 2013: New Object Code Other Salary Payments (Non- Licensed or Non-Certified) Includes all other compensation which is hourly based or event-based and beyond the contract school day or school year not described in object code 185 for employees that are non-licensed or non-certified. 64

65 Questions 65

66 MDE Program Finance Contacts Sarah Miller Patti Scott Education Finance Specialist Education Finance Specialist School Finance School Finance or or Greg Hein David Day Education Finance Specialist Education Finance Specialist School Finance School Finance or or Lisa DeRemee Supervisor, Financial Management, Facilities and Transportation School Finance or UFARS Helpdesk: MDE IT-Helpdesk (SERVS Questions) 66

67 Other Contacts SERVS Financial How to gain access to SERVS Error messages and malfunctions when using SERVS ARRA Stabilization/Education Job Funds or Title Programs Title Programs Special Education Special Education Funds 67