Fund Balances PowerPoint Presentation
What are fund balances? . Why does _____ ISD maintain a fund balance in the General Fund?. Why is Discussion of District Fund Balances Timely?. The State Legislature Convenes on 1/11/2011. State lawmakers estimate a deficit of $18b.+. ID: 434284Embed code:
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What are fund balances?
Why does _____ ISD maintain a fund balance in the General Fund?Slide2
Why is Discussion of District Fund Balances Timely?
The State Legislature Convenes on 1/11/2011
State lawmakers estimate a deficit of $18b.+
One option for closing this deficit is to require school districts to use local resources in place of state revenue
This option may be attractive to state lawmakers because of misconceptions of fund balance
State-mandated use of our fund balance will be devastating to our districtSlide3
Our District’s Fund Balance Policy
_______ ISD Annual Operating Policy:
A financial goal of the district shall be to have a sufficient balance in the operating fund to be able to maintain fiscal independence in case of financial needs or crisis.
The district shall strive to maintain a yearly fund balance in the general operating fund in which the total fund balance is 22.5% of total operating expenditures and the unassigned fund balance is 15% of the total operating expenditures.Slide4
What are Fund Balances?
Districts use the General Fund to pay expenses related to instructing and transporting students.
Within the General Fund:
Assets – Liabilities = FUND BALANCE
The amount reported as district’s fund balance is a snapshot.
A fund balances will fluctuate daily.Slide5
What are Fund Balances?
A fund balance may be:
“Reserved”, “Designated”, or “Unreserved, Undesignated”
Only the last category of fund balance is available for
any legal expenditure
Fund balances are the culmination of the board’s financial decisions over many yearsSlide6
What a Fund Balance is not?
Fund Balance is not:
a Savings Account
a Rainy Day Fund
the result of unduly high taxesSlide7
Why do district’s have fund balances?
Lower interest rates on district bonds
Unforeseen expenditures & Disasters
Ongoing support for educational programs
What is the Recommended Level of Fund Balance?
The Government Finance Officers Association (GFOA) recommends an unassigned fund balance of “no less than two months of…regular general revenue operating expenditures.”
The Texas Education Agency’s (TEA) optimum fund balance calculation requires school districts to add two months of cash disbursements to amounts needed to cover any cash flow deficits.Slide9
_________ ISD’s Fund Balance
______ ISD’s fund balance as of (end of fiscal year 2009/2010 was $______________
Reserved balances were $
Designated balances were $
The remaining unreserved, undesignated portion of ____________ ISD’s fund balance at (end of fiscal year 2009/2010) was $___________Slide10
_________Isd’s Fund Balance – By the Numbers
_________ Isd’s fund balance is equivalent to:
$_____ per enrolled student
_____% of our annual operating budget
____ months of operating expenses
Our district’s fund balance [meets/fall short] of the GFOA/TEA standard.Slide11
Recent Budget Activities Affecting _______ ISD’s Fund Balance
On July/August XX, the school board approved the 2010-11 school year budget
This budget uses XXXX of the fund balance to
Example 1 (Give teachers/personnel a salary increase)
Example 2 (Provide xxx program to increase student achievement in ___________)
The 2010-11 school year budget added $____ to the fund balance