701 FINANCIAL ACCOUNTING SYSTEM

701.1 DEPOSITORY OF FUNDS

Code No.  701.1

 

 

DEPOSITORY OF FUNDS

 

 

Each year at its annual meeting, the board shall designate by resolution the name and location of the financial depository institution or institutions to serve as the official school district depository or depositories.  The maximum deposit amount to be kept in the depository shall be stated in the resolution.

 

It shall be the responsibility of the board secretary to include the resolution in the minutes of the meeting.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Legal Reference:          Iowa Code §§ 12C; 279.33 (1993).

 

 

Cross Reference:        210.1 Annual Meeting

                                    206.3 Secretary-Treasurer

                                    704    Revenue

 

 

 

 

Approved        08/23/94          Reviewed         12/08/07; 9/17/01; 9/18/06;9/14/11; 9/13/16; 9/14/21          Revised            

                                                   

 

 

 

 

 

MORNING SUN COMMUNITY SCHOOL DISTRICT BOARD OF DIRECTORS

701.2 TRANSFER OF FUNDS

When the necessity for a fund has ceased to exist, the balance may be transferred to another fund or account by board resolution. The Morning Sun Community School District monies received for a specific purpose or upon vote of the people may only be transferred, by board resolution when the purpose for which the monies were received has been completed. Voter approval is required to transfer monies to the general fund from the capital projects fund and debt service fund.

 

If all requirements for district use of funds under the Preschool Foundation Aid, Professional Development Supplement, Home School Assistance Program, Teacher Leadership Supplement, or any discontinued fund have been met and funds remain unexpended and unobligated at the end of the fiscal year, the district may transfer all or a portion of remaining funds by passage of a board resolution into the district’s flexibility account in accordance with law.  Before the expenditure of amounts in the flexibility account, the district shall publish notice of the time, date, and place of a public hearing on the proposed resolution approving said expenditures.  The board must find and certify that the statutory requirements of each original source of funds have been met before adopting the resolution approving the expenditures.  The district will present a copy of the signed board resolution to the Department of Education.

 

The District may transfer by board resolution from the general fund to the student activity fund an amount needed to purchase or refurbish protective and safety equipment required for any extracurricular interscholastic athletic contest or competition sponsored or administered by the Iowa High School Athletic Association of Iowa Girls High School Athletic Union.

 

If the before and after school program exceeds the amount necessary to operate the program, the excess amount may, following a public hearing, be transferred by resolution of the board of directors of the school corporation for deposit in the general fund of the school corporation to be used for school district general fund purposes.  The district will present a copy of the signed board resolution to the Department of Education.

 

Beginning in FY 2024, unexpended and unobligated dollars that remain at the end of a fiscal year in addition to ongoing revenues may be transferred to the Teacher Salary Supplement (TSS) program from Professional Development Supplement (PDS), Talented and Gifted (TAG), and Teacher Leadership Supplement (TLS) without board action.

 

The district may choose to request approval from the School Budget Review Committee to transfer funds to make a program whole, prior to its elimination.

 

Temporary transfers (loans) of funds are permitted between funds but must be repaid to the originating fund, with interest, by October 1 following the end of the fiscal year.

 

It shall be the responsibility of the board secretary to make recommendations to the board regarding and to provide the documentation justifying the transfer.

 

 

 

Legal Reference:       Iowa Code §§ 24.21-.22; 279.8; 279.42; 298A;

289 I.A.C. 6

 

 

 

Cross Reference:       701.3  Financial Records

                                    703     Budget

                                    704.2   Sale of Bonds

 

 

 

Approved: 8/23/94

Reviewed: 12/08/97; 9/17/01; 9/18/06; 9/14/11; 9/13/16; 9/14/21; 1/11/24

Revised:  7/13/21; 5/11/23

701.3 FINANCIAL RECORDS

Financial records of the Morning Sun Community School District shall be maintained in accordance with generally accepted accounting principles (GAAP) as required or modified by law. School district monies shall be received and expended from the appropriate fund and/or account. The funds and accounts of the school district shall include, but not be limited to:

 

Governmental fund type:

  • General fund.  This fund is the chief operating fund of the district.  It is used to account for all financial resources except those accounted for and reported in another fund.
  • Special revenue fund.  These funds account for the proceeds of specific revenue sources other than trusts or major capital projects, that are legally restricted or committed to expenditure for specified purposes other than debt service or capital projects.
    • Management levy fund
    • Physical plant and equipment levy fund
    • Public education and recreation levy fund
    • Student activity fund
  • Capital projects fund.  These funds are used to account for financial resources to acquire or construct major capital facilities or other capital assets (other than those of proprietary funds and trust funds) and to account for revenues from SAVE.
    • Physical Plant and Equipment Levy Fund (PPEL)
    • Secure and Advanced Vision for Education (SAVE)
  • Debt service fund.  This fund is used to account for the accumulation of resources for, and the payment of, general long-term debt principal and interest.

 

Proprietary fund type.  This fund is used to account for the accumulation of resources for, and the payment of, general long-term debt principal and interest.

  •  Enterprise fund
    • School nutrition fund
    • Child care fund
    • Internal service fund
    • Community Education
    • Preschool (nonvoluntary, state)

 

Fiduciary funds.  These funds are used to account for monies or assets held by the school district on behalf of, or in trust for, another entity.

  • Trust or agency funds
    • Expendable trust funds
    • Nonexpendable trust funds
    • Custodial funds
    • Pension trust funds

 

Non-Fiduciary Scholarship Fund

 

Account groups.  The groups are the accounting records for capital assets and long-term debt.

  • General fixed assets account group
  • General long-term debt account group

  

The board may establish other funds in accordance with generally accepted accounting principles and may certify other taxes to be levied for the funds as provided by state law.  The status of each fund must be included int he annual report.

 

It is the responsibility of the superintendent in conjunction with the school business official to implement this policy and bring necessary changes in the maintenance of the school district's financial records to the attention of the board.

 

As necessary the board may, by board resolution, create additional funds within the governmental, proprietary and fiduciary fund types. The resolution shall state the type of fund, name of the fund and purpose of the fund.

 

 

 

Legal Reference:       Iowa Code 291; 298; 298A

                                   281 I.A.C. 98

 

 

 

Cross Reference:       704     Revenue

                                   705     Expenditures

 

 

Approved:      9/13/16

Reviewed:      9/14/21; 1/11/24

Revised:        

701.4 GOVERNMENTAL ACCOUNTING PRACTICES AND REGULATIONS

School district accounting practices will follow state and federal laws and regulations, generally accepted accounting principles (GAAP) and the uniform financial accounting system provided by the Iowa Department of Education.  As advised by the school district’s auditor, determination of liabilities and assets, prioritization of expenditures of governmental funds and provisions for accounting disclosures shall be made in accordance with governmental accounting standards.

 

In Governmental Accounting Standards Board (GASB) Statement No. 54, the board identifies the order of spending unrestricted resources applying the highest level of classification of fund balance—restricted, committed, assigned, and unassigned—while honoring constraints on the specific purposes for which amount sin those fund balances can be spent.  A formal board action is required to establish, modify, and or rescind a committed fund balance.  The resolution will state the exact dollar amount.  In the event the board chooses to make changes or rescind the committed fund balance, formal board action is required.

 

The Board authorizes the Superintendent or Board Secretary to assign amounts to a specific purpose in compliance with GASB 54.  An “Assigned fund balance” should also be reported I the order of spending unrestricted resources but is not restricted or committed.

 

Fund Balance Reporting

Financial reporting for the balances in the district’s governmental funds is based on Governmental Accounting Standards Board (GASB) Statement 54, Fund Balance Reporting and Governmental Fund Types Definitions.  Fund balance refers to the difference between assets and liabilities in the governmental funds balance sheets.  GASB 54 established a hierarchy that is based on “the extent to which the government is bound to honor constraints on the specific purpose for which the amount sin those funds can be spent.”

 

The governmental funds can have up to five fund balance classifications.  The classifications are defined below from most to least restrictive.

 

Nonspendable Fund Balance includes amounts that cannot be spent because they are either not in spendable form, or legally or contractually required to be maintained intact.  This includes items not expected to be converted to cash, including inventories and prepaid expenses.  It may also include other property acquired for resale and the principal of a permanent fund.

 

Restricted Fund Balance should be reported when constraints placed on the use of resources are either externally imposed by creditors, grantors, contributors, or law or regulations of other governments; or imposed by law through constitutional provisions or enabling legislation.  This includes “categorical balances.”

 

Committed Fund Balance reflects specific purposes pursuant to constraints imposed by formal action of the board.  Sch constraints can only be removed or changed by board action.

 

Assigned Fund Balance reflects amounts that are constrained by the government’s intent to be used for specific purposes but meet neither the restricted nor committed forms of constraint.  Unless the amount is negative, the assigned fund balance is the residual classification for the governmental funds other than the general fund.  If the amount is negative, then the residual amount is shown as unassigned.

 

Unassigned Fund Balance is the residual classification for the general fund only.  As noted above, if a negative residual amount exists in other governmental funds, then the amount is reported as unassigned.

 

It is the responsibility of the superintendent to develop administrative regulations implementing this policy.  It is also the responsibility of the superintendent to make recommendations to the board regarding fund balance designations.

 

 

 

Legal Reference:       Iowa Code § 257.31(4); 279.8; 297.22-25;298A (2011).

 

 

Cross Reference:        701.3   Financial Records

                                    703      Budget

                                    704      Revenue

 

 

 

Approved: 7/13/11

Reviewed: 9/14/11; 9/13/16; 9/14/21; 1/11/24

Revised: