activity fund accounting act301 campus & student activity accounts presented by: deborah...
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Activity Fund Accounting ACT301
Campus & Student Activity Accounts
Presented by: Deborah Ottmers, Fredericksburg [email protected]
ASBO
Contents
Activity Fund Presentation SlidesFASRG – Account CodesFASRG - Cash ManagementFASRG - SBDM Activity Fund Accounting Exhibits - Sample formsAudit ProgramsSales Tax Issues
Updated: Jan 2010
Two Types of Activity Funds
SAF = Student Activity Funds
CAF = Campus Activity Funds
Often times, both use the same accounting
system at the school, but they are very
different types of funds
Updated: Jan 2010
How do I distinguish between the two types?
Do other persons besides the students decide how to spend the money? If yes, funds are CAF - Fund 199 or 461.Do the students have sole responsibility for deciding how to spend the money? If yes, funds are SAF - Fund 865
Updated: Jan 2010
CAFPresent Assets and LiabilitiesPresent Revenues and ExpendituresReport with Governmental Funds Report as part of Government-wide Financial Statements
SAFPresent Assets and Liabilities ONLYReport with Fiduciary Funds
Activity Fund Presentationin Financial Statements
Updated: Jan 2010
Updated: Jan 2010
Updated: Jan 2010
Policy Requirement
Updated: Jan 2010
BOARD POLICIES (CFD)
Updated: Jan 2010
CAF
CAMPUS Activity Funds:Belong to the Campus/DistrictMoney raised locally at the school or donated to the schoolAccounts include school office and departmental accountsSponsors for CAF accounts include the Principal as well as departmental people
Updated: Jan 2010
CAF
Expenditures must benefit student body
Like General Funds: Must adhere to State and Board policy and District regulationSubject to purchasing and bid laws
Updated: Jan 2010
Updated: Jan 2010
ALLOWABLE EXPENDITURES(Examples)
General operation of the schoolPublic purpose in the realm of educationDirect or indirect benefit to students
Field trips - admission feesPerfect attendance incentives for studentsTeacher appreciation & awardsClassroom and office suppliesRefreshments & snacks (for inservices, staff meetings, retirement receptions).
Updated: Jan 2010
PROHIBITED EXPENDITURES(Examples)
Individual membership feesGifts (i.e., flowers, Christmas turkeys, gift certificates, bonuses) of public fundsDonationsAbuse of staff appreciation meals, parties for staff, including food, decorations, favorsExtravagant expenditures
Refer to Exhibits for expanded list (Sample)
Updated: Jan 2010
STUDENT FUNDS = CLUB FUNDS = AGENCY FUNDS
Belong to various student groups; not to the campus or districtMoney spent by the students in the SAF organization
SAF
Updated: Jan 2010
STUDENT FUNDS = CLUB FUNDS = AGENCY FUNDS
Belong to various student groups; not to the campus or district - “trust” fundsSpending decisions rest “solely” with the students Not subject to purchasing & bid lawsClass, club or student groups must have elected officers (in order to qualify for tax free days)
SAF
Updated: Jan 2010
REVIEW OF BUDGET CODES
Financial Accounting System Resource Guide (FASRG)
Review of Account Codes
Ensure that fund, function, & object match the purchase
Updated: Jan 2010
Accounting Methods
CentralizedFunds are controlled and disbursed through the school district’s accounting department
DecentralizedFunds are accounted for and controlled at the various school sites
Combination of the two
Updated: Jan 2010
Centralized Accounting Method
AdvantagesBetter internal controls by using one central systemEasier access to information and records for performing auditsConsistent & efficient cash managementLess accounting responsibility at the campus level - district management
Updated: Jan 2010
Centralized Accounting Method
DisadvantagesLess control at the school sitePossible delay in information and reporting to the school sitePossible delay in obtaining checks for planned disbursementsPossible delay in ordering supplies, equipment, etc.
Updated: Jan 2010
Chain of Responsibility
Updated: Jan 2010
RESPONSIBILITY of SPONSOR
Attends annual meeting and obtains information bookletSpends money in accordance with guidelinesMaintains records to support financial activitiesReconciles account to reports monthly; turns in reconciliation.
Updated: Jan 2010
RESPONSIBILITY of SECRETARY/BOOKKEEPER
Records SAF & CAF transactions to include receipts, deposits, disbursements, and journal entries Assists sponsorsInforms Principal of problems and concerns
Updated: Jan 2010
RESPONSIBILITYof District Accounting Department
Trains BookkeepersProvides Help DeskDistributes reportsReviews bookkeepers’ monthly bank reconciliations and sales tax reportsUpdated: Jan 2010
RESPONSIBILITYOF PRINCIPAL
ULTIMATE responsibility for:SAF & CAF funds and transactionsSafekeeping money Proper accounting and administrationApproval of disbursements in accordance with procedures manual.
Updated: Jan 2010
CASH MANAGEMENT
Updated: Jan 2010
FASRG 8.5.1.3
Cash Management
Separation of DutiesIf possible, at least two persons should be involved in cash handling & deposits
High Risk AreaFlow of money must be supported by receipt books and bank deposits
Updated: Jan 2010
Cash Management - Deposits
Procedures should include:All funds collected must be deposited
Cash collected should not be disbursed by cashing personal checks
Deposits should match the amount collected and should be supported by receipts or listings of collectionsDeposits to district office and bank should be timely - daily if possible
Updated: Jan 2010
Cash Management - Receipts
Procedures should include:Both the sponsor and secretary/bookkeeper should be present when the money is counted & receiptedAn official receipt book with pre-numbered, bound receipts in triplicate should be used if an electronic system of receipts is not available
A copy of the receipt must be given to the person paying (sponsor)A copy of the receipt must remain in the receipt bookA copy of the receipt should be attached to the deposit documentation
Updated: Jan 2010
Cash Management - Receipts
Procedures should include:Receipts are not to be pre-dated or pre-signed Receipt numbers must be used consecutivelyReceipt numbers should be written on the bank deposit slip for documentationReceipts should not be alteredVoided receipts must be re-attached to the receipt book
Updated: Jan 2010
Bank Account Reconciliations
All accounts must be reconciled on a monthly basisBanks allow for 10 - 30 days for discovery of errorsSealed Bank statements should be routed to someone other than the person who deposits funds Excess funds should be invested
Updated: Jan 2010
CHECK DISBURSEMENTS
Updated: Jan 2010
Check Disbursements
Use District’s depository bank Pre-numbered checks must be usedTwo signers should sign each checkNo checks for “Cash” Sufficient funds must exist in the appropriate activity account(s)
Updated: Jan 2010
Check Disbursements
All expenditures must be supported by original invoicesPre-payments should not be made for goods or servicesOriginal invoices should be stamped “Paid” to avoid duplicate paymentsDisbursement records must be maintained for five (5) years
Updated: Jan 2010
Payments to Individuals
No payments for services should be made to district employees - all payments should be made by the Payroll Department
(Exception if they have their own business)
Payments for services:Check your district’s policiesA SSN or TIN is required – W-9 Form1099 issues
Updated: Jan 2010
Recordkeeping Requirements
All receipt books, deposit slips, and checks must be maintained for auditSupporting documentation for Fund Raisers:
Fund Raiser authorization formFund Raiser Profit/Loss Statement (Recap)Fund Raiser Collections RecordFund Raiser Merchandise Distribution Log
Updated: Jan 2010
Other Issues
Donations Received -Check local policy for limit before Board or Superintendent approval is requiredEquipment purchases - CAF Fixed assets should be taggedRetention of records - Five (5) years
Collect records from sponsors at year-end as part of check-out procedures
Updated: Jan 2010
Other Issues – No Raffles
Updated: Jan 2010
Other Issues - FMNV
Often times, fundraisers are food salesCan’t have competing food salesFoods of Minimal Nutritional Value (FMNV)
Federal regs prohibit the sale of certain foods to students during the school day
Elementary: May not serve FMNV at any time, anywhere on the school campus during the school day. Snacks can only be during nutritional breaks.Middle School: May not serve FMNV during meal times. Nutritional snacks can only be after lunch.HS: May not serve FMNV during meal times.
FMNV during school holiday celebrations are ok to an extent
Updated: Jan 2010
Other Issues – FMNV Penalties
Texas Dept. of Agriculture (TDA) will monitor and enforce the policy to ensure complianceTDA will disallow all meal reimbursements for the day and require the school to reimburse the food service account for the lost reimbursementDocumented corrective action plan will be required and monitored for compliance
Updated: Jan 2010
Updated: Jan 2010
CAMPUS and STUDENT ACTIVITY FUNDS PROCEDURES MANUAL
Procedures governing activity fund accountsControls to help prevent
misappropriation of fundsviolations of Federal, State, & District regulations
acts of fraud or negligenceDistribute to sponsors, bookkeepers, & principals - Provide training!
Updated: Jan 2010
Updated: Jan 2010
Manuals on the Internet
Use TASBO’s Member’s Best PracticesGo to a specific ISD’s website and lookGoogle “Activity Fund Manuals Texas School Districts”
Updated: Jan 2010
Common Audit Findings and Recommendations
Audit to ensure funds are in compliance with policies and procedures
Updated: Jan 2010
AUDIT FINDINGS
“Broken” audit trailMoney collected doesn’t equal the money depositedInventory of goods purchased and money deposited doesn’t equal the total merchandise purchased [vendor invoice]Receipting of funds - missing void receipts, changes to receipts, etc.Lack of documentation for checks
Updated: Jan 2010
AUDIT FINDINGS
“Weaknesses in Internal Control”Lack of dual signature of authorized check signers, when requiredImproper receipting of cash (incomplete or missing receipts, etc.)Lack of supporting documentation for check disbursements, such as vendor invoicesViolation of District’s policies regarding timely bank deposits
Updated: Jan 2010
Other Audit Findings
Violation of District’s policies and procedures over activity fundsLack of reconciliation between Sponsor’s records and campus bookkeepers
Updated: Jan 2010
RESOURCES
TEA Websitewww.tea.state.tx.usFinancial Accountability System Resource Guide (FASRG v14)
FAR - Account CodesPurchasingSBDM - Activity Fund AccountingManagement - Cash Management
Updated: Jan 2010
QUESTIONS & ANSWERS
Updated: Jan 2010
Activity Fund Accounting ACT301
Campus & Student Activity Accounts
Presented by: Deborah Ottmers, Fredericksburg [email protected]
ASBO