Top 10 Questions to
Ask and Answer in
Your 1st 100 Days
… Financially
Speaking
Patti Schroeder, Shawn Snyder,
Gary Sinclair
Key Points
A. Provide you with a list of questions you need
to ask and get answered during your 1st 100
days… financially speaking
B. Guide you to tools that will help you get the
answers you need
C. Introduce you to a financial forecasting model
that can work for you (FPP)
Reflection
Reviewing supporting documentation provides
you with a learning opportunity
Can the answer be confirmed if requested?
Trust, but verify!
1.
Where does our school
district stand financially as of
June 30, 2015?
Financial Health
Why is this important?
•Good financial health
can
concentrate on something else
•Poor financial health
must
concentrate on finances and propose
and make tough financial choices
Recommended Resources
Financial Health—Tools You Can Use
 7 Key Indicators Report
• What do they tell you on about your district’s
financial health?
• Trend lines?
 Audit Report
• Read narrative to learn more about district
• Are corrective action plans in place?
http://www.ia-sb.org/Finance.aspx
7 General Fund Key Indicators
1. Certified Enrollment
2. Solvency Ratio
3. Percent of Revenue Spent
See 7 Key
GF Financial
Indicators
handout
4. Unspent Authorized Budget (UAB) Ratio
(more on this later!)
5. Annual UAB Ratio
6. Salary & Benefit Expenditures
7. New Money % - Settlement %– Change in
Salaries/Benefits %
2.
If we promised to make
reductions, did we?
How do we know?
Rightsizing
Why is this important?
• If reductions/ rightsizing are in place, financial
health should be improving
• If reductions were proposed and not done,
you will need to get them in place to improve
financial health
• If no reductions proposed, does this mean
your financial health is good or poor?
Depends…
Rightsizing
Discuss with SBO
Review /understand prior year
approved budget detail
Cross reference prior year to
current year
3.
Do we have a line item budget?
Are we tracking expenditures
against that budget?
Line-Item Budgets
Why are they important?
• Identifies: How much can be spent; By
whom; For what purpose.
• Developed March-October, depending
on approach used by the district.
• Provides guidance for the day-to-day
question, “Can we afford to make this
purchase?”
Line-Item Budgets
Review Line-Item Budget with SBO:
How was it /should it be developed?
How can we use it / are we using it to
monitor expenditures and make prudent
purchasing decisions?  Listen to IASB
webinar on “Funding
Priorities”
4.
Are there big hiring
decisions yet to be made?
Staffing
Why is this important?
• Staffing compensation (salaries and benefits)
generally makes up 75-82% of all General Fund
spending
• If all staffing decisions are done and are a part
of the line-item budget, 75-82% of your
spending is already “booked.”
• One teacher costs $78,308 annually, one
principal costs $125,910 (state wide average – FY 2015)
Staffing
Review Staffing levels with SBO and
administrative team:
What changes in staffing levels were agreed to
during the budget development process?
Have those changes (reductions or new hires)
been completed and reflected in our line item
budget?
See 7 Key GF
What do our trend lines tell us?
Financial
Indicators handout
5.
Have we purchased those
materials we need for first
semester?
Purchases
Why is this important?
•Time is of the essence!
•Major purchases take time to
order, receive, and get into the
classroom
Purchases
Ask administrative team about
purchasing needs for first
semester.
Are purchasing needs accounted
for in our line-item budget?
6.
Do we have a user friendly
monthly financial report?
Financial Reporting
Why is this important?
•Required by law
(Code section 291.7)
•Highlights your district’s
financial status throughout the
year
•Demonstrates financial
transparency
Financial Reporting
 How do our monthly financial reports mirror (or not)
our line-item budget? Our published budget?
 Are we on track to end the year in the black?
 Are our reports user friendly for our board and our
community? If not what changes in reporting do we
need to make?
Monthly Financial Reporting
http://www.ia-sb.org/Finance.aspx
7.
What is our UAB ratio
and trend line?
UAB Ratio
Why is it important?
#1
key financial indicator!
• UAB is Unspent Authorized Budget or unused
spending authority or credit card limit
• UAB Ratio = UAB/Max Spending Authority
• By law, if UAB is negative, must appear before
the SBRC:
• Work out plan
• Quarterly progress reports to SBRC
UAB Ratio
What do our trend lines tell us?
Work plan required? If so, are
we following the plan? See 7 Key GF
Financial Indicators
handout
Unspent Authorized Budget Explanation
(AKA Unspent Spending Authority)
http://www.ia-sb.org/Finance.aspx
8.
What legal due dates are
important?
Due Dates
Why are they important?
•Required by law
•There are consequences if not
met
Due Dates
Why are they important?
ITEM
CAR – Certified Annual
Report upload to DE
DUE DATE
9/15/XX
CONSEQUENCES
Appear before SBRC
May delay State Aid
(also SES, Transportation rpts)
Certified Enrollment
(taken on October 1)
10/15/XX Basis for per student
funding for next fiscal
year
ISL tax levy renewal
4/15/XX
Funding disappears
Voter PPEL tax levy
renewal
4/15/XX
Funding disappears
Why important in the 1st 100 days? Each item requires
significant lead time to accomplish.
Due Dates
Are we on target to meet these
deadlines?
Do we have a plan to ensure we meet
ISL and/or Voter PPEL renewal
deadlines?
DE Critical Filing Dates
Special Election Timeline
Calculators (PPEL/ISL)
School Special Election Dates
9.
Are we on track with district
and community facilities
planning expectations?
Facilities Planning
Why is this important?
•District facilities can and should
enhance and enrich student and staff
learning
•Adequate funding throughout the
process is a must!
•Community support is priceless!
Facilities Planning
 Are we on track to open newly
constructed/remodeled facilities on time?
 How are we using / do we have a plan for using our
Sales Tax revenue?
 What long term debt do we have?
Notes to Financial Statements – Audit Report
 Do we need to start planning for a bond
referendum? Revenue Bonds? PPEL debt?
10.
Are we solvent over the long
term?
How do we know?
Financial Forecasting
Why is it important?
Financial
Planning
Knowing
where you
have been is
important!
Knowing
where
you are is
critical!!
Knowing
where you
are going is
priceless!!!
Financial Forecasting
Do we have a way to forecast our
needs over the next several
years, based on varying
assumptions?
 Does our futures modeling
show that our district’s UAB will
remain positive?
PMA – FPP One approach
• Contains five-years of district financial history
• FPP developed to use assumptions to project a five
year budget plan
• Tool contains elements that actually create and project
a district budget for five years
• Projection tool includes history and projections for
expenditure, revenues, taxes, UAB, cash balance,
projects, aid and levy worksheets, 703 forms and all
supporting documents
• Funds are inter-connected as needed
• Work with district develops the Base Scenario
11.
BONUS - What went well,
what did not, as part of our
budget process last year?
Budget Development Process
Why is this important?
•Need to understand prior year
budget development dynamics
•Need to start formulating a
plan/calendar for budget
discussions for next year
Budget Development Process
Discuss pros/cons of district’s prior year budget
development with:
Board President
Individual Board members
SBO; other key staff members
Community members that were involved in
prior year budget discussions
Board President’s Budget Calendar