Monroe County Intermediate School District
Bylaws & Policies
 

6800 - SYSTEM OF ACCOUNTING

It is the policy of the Board of Education that a chart of accounts be established in accordance with the requirements of the State Department of Education for the accounting of all District funds.

The Executive Director of Business shall be responsible for the proper accounting of all District funds. S/He shall ensure that expenditures are budgeted under and charged against those accounts which most accurately describe the purpose for which such monies are to be or have been spent. Wherever appropriate and practicable, salaries of individual employees, expenditures for single pieces of equipment, and the like shall be prorated under the several accounts which most accurately describe the purposes for which such monies are to be or have been spent.

A report of the revenues and expenditures in each of the District's Funds shall be made to the Board on a monthly basis by the Executive Director of Business.

FUND BALANCE IN ACCORDANCE WITH GASB STATEMENT NO. 54

Purpose. The following policy has been adopted by the School District in order to address the implications of Governmental Accounting Standards Board ("GASB") Statement No. 54, Fund Balance Reporting and Governmental Fund Definitions. The policy is created in consideration of unanticipated events that could adversely affect the financial condition of the School District and jeopardize the continuation of necessary services. This policy will ensure that the School District maintains adequate fund balances and reserves in order to:

 A.provide sufficient cash flow for daily financial needs;

 B.secure and maintain investment grade bond ratings;

 C.offset significant economic downturns or revenue shortfalls; and

 D.provide funds for unforeseen expenditures related to emergencies.

This policy and the procedures promulgated under it supersede all previous regulations regarding the School District's fund balance and reserve policies.

Fund type definitions. The following definitions will be used in reporting activity in governmental funds across the School District. The School District may or may not report all fund types in any given reporting period, based on actual circumstances and activity.

 A.The general fund is used to account for all financial resources not accounted for and reported in another fund.

 B.Special revenue funds are used to account and report the proceeds of specific revenue sources that are restricted or committed to expenditure for specific purposes other than debt service or capital projects.

 C.Debt service funds are used to account for all financial resources restricted, committed or assigned to expenditure for principal and interest.

 D.Capital projects funds are used to account for all financial resources restricted, committed or assigned to expenditure for the acquisition or construction of capital assets.

 E.Permanent funds are used to account for resources restricted to the extent that only earnings, and not principal, may be used for purposes that support the government's purposes.

Fund balance reporting in governmental funds. Fund balance will be reporting in governmental funds under the following categories using the definitions provided by GASB Statement No. 54:

 A.Restricted fund balance
  Definition - includes amounts that can be spent only for the specific purposes stipulated by the constitution, external resource providers, or through enabling legislation.

 B.Committed fund balance

  1.Definition - includes amounts that can be used only for the specific purposes determined by a formal action of the government's highest level of decision-making authority.

  2.Authority to Commit - Commitments will only be used for specific purposes pursuant to a formal action of the School District. A majority vote is required to approve a commitment and a two-thirds (2/3's) majority vote is required to remove a commitment.

 C.Assigned fund balance

  1.Definition - includes amounts intended to be used by the government for specific purposes but do not meet the criteria to be classified as restricted or committed. In governmental funds other than the general fund, assigned fund balance represents the remaining amount that is not restricted or committed.

  2.Authority to Assign - The School District delegates to the Superintendent or his/her designee (the Assistant Superintendent for Business and Administrative Services) the authority to assign amounts to be used for specific purposes. Such assignments cannot exceed the available (spendable, unrestricted, uncommitted) fund balance in any particular fund.

 D.Unassigned fund balance
  Definition - includes the residual classification for the government's general fund and includes all spendable amounts not contained in the other classifications. In other funds, the unassigned classification should be used only to report a deficit balance from overspending for specific purposes for which amounts had been restricted, committed, or assigned.

Operational guidelines. The following guidelines address the classification and use of fund balance in governmental funds:

 A.Classifying fund balance amounts - Fund balance classifications depict the nature of the net resources that are reported in a governmental fund. An individual governmental fund may include nonspendable resources and amounts that are restricted, committed, or assigned, or any combination of those classifications. The general fund may also include an unassigned amount.

 B.Encumbrance reporting - Encumbering amounts for specific purposes for which resources have already been restricted, committed or assigned should not result in separate display of encumbered amounts. Encumbered amounts for specific purposes for which amounts have not been previously restricted, committed or assigned, will be classified as committed or assigned, as appropriate, based on the definitions and criteria set forth in GASB Statement No. 54.

The Superintendent shall establish guidelines necessary for the implementation of this policy.

M.C.L.A. 141.421 et seq.
A.C. Rule R340.351 et seq.

Revised 5/9/11

© Neola 2011