AUSTIN INDEPENDENT SCHOOL DISTRICT INTERNAL AUDIT DEPARTMENT BUDGET SERVICES AUDIT PROGRAM

Size: px

Start display at page:

Download "AUSTIN INDEPENDENT SCHOOL DISTRICT INTERNAL AUDIT DEPARTMENT BUDGET SERVICES AUDIT PROGRAM"

Susan Bradley
6 years ago
Views:

1 GENERAL: Budget preparation and administration are important aspects of overall district operations. The budgeting process allows the district the opportunity allocate resources, to improve it's operations, make better financial decisions and achieve the educational objectives. AUDIT OBJECTIVES 1) Determine if the budget process is supported by policies and procedures; 2) Review and document the budget development, adoption and administration process; 3) Document the manner in which expenditures for funds for approved allocations are controlled by administration; and 4) Determine whether the district is achieving the optimum fund balance. AUDIT PROCEDURES 1) General a) Obtain: i) Policies and Procedures ii) Prior Audit Reports iii) Job Descriptions iv) Organizational Chart v) Related Information on Laws and Regulations vi) Minutes of the Board vii) Annual Financial and Compliance Reports viii) Develop a matrix of location codes and the budget for each location for the past three years. b) Evaluate policies and procedures to determine adequacy. (Include AISD Board Policy) c) Verify that policies and procedures have been communicated to the appropriate personnel.

2 d) Review prior examination reports to determine whether corrective action has been implemented for noted deficiencies. 2) Budget Planning a) Obtain and evaluate all budget planning documents to ensure compliance with local policy and state law. Include (budget calendars, budget training documents, staffing or other allocation formulas used to prepare campus and departmental budgets. i) Document the budget calendar activity/process for the 2013/2014 budget. (Include the date the calendar is published.) ii) iii) iv) Document when and how the Board was apprised of activities which may affect the District's performance and prepares them for the next budget cycle. Document the manner in which budgets support academic performance goals for all students (include all sub-populations), the District Improvement Plan (DIP) and Campus Improvement Plan (CIP). Document the manner in which community input obtained. Through public hearings, advisory councils, etc. 3) Budget Development a) Collect budget proposals provided to the board and staff. Evaluate the effectiveness of each. Determine and document how the district budget developed. b) Evaluate staffing allocation formulas. Compare current year staffing levels to the formulas. Document who creates and updates the formulas each year. c) Confirm that state and Texas Education Code (TEA) requirements are met: Section through section of the Texas Education Code (TEC) and TEA's Financial Accountability Resource Guide (FASRG) Budget Module. Deadlines to prepare i) Determine and document the dates when the budget must be prepared and adopted by the board of trustees, inclusive of amendments, for a district with a

3 September 1 fiscal year. Determine date deadlines ii) The president of the board must call a pubic meeting of the board giving ten days notice in a news paper, for the adoption of the district budget (TEC). iii) Concurrently with the publication of notice of the budget, the district must post a summary of the proposed budget on the district s website or in the central administrative office if the district does not have a website. (TEC) iv) The budget must be legally adopted before the adoption of the tax rate. For districts with July 1st fiscal year, the district must not adopt a tax rate until after the district receives the certified appraisal roll. Also, the district must publish a revised notice and hold another public meeting before the district may adopt a tax rate that exceeds (1) the rate proposed in the notice prepared using the estimate; or (2) the district s rollback rate determined using the certified appraisal roll. (TEC) v) The officially adopted budget, as amended, must be filed with TEA through PEIMS by the date prescribed in the annual system guidelines. 4) Budget Forecasting a) Document the forecasting methods used to develop the district budget. i) Forecasting by Analogy b) Forecasting distribution of Student Population from Total Population, c) Forecasting with Cohort Survival Ratios d) Forecasting with Geo-referenced Data, b) Evaluate the manner in which forecasted budget implications are managed. i) Student enrollment and Average Daily Attendance (ADA) projections ii) Staffing iii) Salaries iv) Facility needs v) Long-term liability vi) Staff development vii) Debt retirement obligations (Financial Advisors 1st Southwest) viii) Transportation ix) Projected income

4 c) Note any significant variances in the last three years annual financial reports (GASB 34) and the original budgets. 5) Budget Review and Monitoring a) Obtain budget reports supplied to the board on an ongoing basis. b) Document how the Board is informed of budget matters throughout the year. c) Develop a matrix of budget adjustments, include: who is involved in the process, how the mid-year adjustments are managed, are budget adjustments signed preapproved and are they distributed to the board? d) Identify budget inconsistencies with the district's strategic plan, goals and objectives. How are budgets and expenditures evaluated for inconsistencies? 6) Fund Balance a) Develop a matrix of the district's fund balance management policies, procedures and practices. b) Document how the Board is made aware of the impact of decisions on the fund balance. c) Develop a schedule of the past five years audit financial statements with the actual fund balance and show the variances. 7) Miscellaneous a) Document who allocates campus budgets and how they are allocated. b) Document who allocates department budgets and how they are allocated. c) Document the process of analyzing budget variances, both under and over budget.

5 d) Develop a schedule of unfair expenses charged to campuses and departments. Contingencies (lawyers, administrative leave, special circumstances, etc.) e) Develop a schedule of departments with multiple organizational codes and determine how the budget is split between the various locations. f) Develop a schedule of shared costs and direct costs. g) Determine how new departments are funded when there is a change in the organizational chart. h) Document strange or unusual circumstances experienced by the budget department for the past three years and how they were budgeted for.

BUDGET PREPARATION WORKSHOP

BUDGET PREPARATION WORKSHOP 2011-2012 Presented: February 22 & 25, 2011 Budgeting Workshop Booklet General Guidelines 2011-2012 Proposed Budget Calendar Account Coding Account Codes Supplement Funding