Charter School Petition Training Financial Services

Report
Charter School
Petition Training
Financial Services
Financial Services
1
Section H: Financial Plan
Financial Plan
Does the petition provide a comprehensive and realistic financial plan for
the charter school? The question is asking if the petitioner’s overall
financial plan is thorough and their assumptions sound and reasonable.
This financial plan should include at a minimum:
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Revenue projections supported by realistic enrollment and reasonable student
funding calculations. Expenditures cannot exceed revenue in any year.
Start -up costs (initial expenditures such as leasehold improvements, furniture,
equipment, LAN hardware and wiring, computers, software, textbooks, etc.)
Facility plans (detailed lease or purchase information for a specific location)
Cash or cash equivalents equal to one month’s operating expenses.
Does the petition describe the charter school’s plans for securing other
sources of funding, including funding from corporations, individuals,
foundations, philanthropic groups, or any other sources? Any budgeted
funds must be committed (i.e. letter of intent, grant award letter).
Financial Services
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Section H: Financial Plan
Financial Policies & Procedures
Does the petition describe the financial policies and procedures that the
charter school will implement to assure sound fiscal management and that
the policies and procedures will be available on site? These Financial
Policies & Procedures might include:
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Description of All Funds
Basis of Accounting, Revenue Recognition, Accrual of Expenditures
Account Number Structure and Level of Legal Budgetary Control
Fixed Asset Capitalization Thresholds by Asset Type
Processes and Internal Controls for General Ledger, Cash Receipts
and Disbursements, Purchasing, Payroll
• Investment Policy
• Safeguarding of Fixed Assets
• Annual Independent Audit of Financial Statements
Financial Services
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Section H: Financial Plan
Required Statements, Descriptions, and Lists
Does the petition state that the charter school will designate a chief
financial officer possessing credentials in accordance with the Guidance
accompanying this Rule (O.C.G.A § 20-2-2065(b)(7) for the purpose of
developing and adhering to generally accepted accounting principles? Be
specific in your statement.
Does the petition describe the level of autonomy the charter school will
have over budgets and expenditures? Fully describe the school’s
autonomy, especially when a management company is involved.
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Section H: Financial Plan
Does the petition state, in addition to any other financial provisions that
the petitioner chooses to include, that:
(a) the charter school will provide the CCSD with a monthly Budget
versus Actual Statement, and Balance Sheet in a format acceptable to
the District within 45 days after the end of each month? The budget
included in the above statements must be balanced, i.e. expenditures
cannot exceed revenues. All monthly budgets versus actual statements
should clearly indicate monthly debt repayment. The charter school
should also provide a detailed schedule of all loans and associated
interest.
(b) any surplus funds remaining at the close of one fiscal year will be used
to enhance the charter school's academic program the following year?
The charter school/corporation will be responsible for disclosing all
uses of surplus funds to the District at the end of the fiscal year.
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Section H: Financial Plan
(c) any deficit occurring during or at the end of a fiscal year will be
eliminated within the next fiscal year? A detailed, realistic plan and
budget for the next fiscal year must be provided to and approved by
CCSD. No CCSD funds will be allocated to the charter school for the
next fiscal year until the Superintendent or designee approves such
plan and budget.
(d) the charter school will be solely responsible for all debts it incurs and
will acknowledge that it shall not contractually bind the CCSD with
any third party contracts it makes?
(e) the board of the charter school will notify the CCSD immediately if the
charter school is contemplating the cessation of operations, and will
cooperate with the CCSD to the extent necessary to provide an orderly
return of the students to their local school?
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Section H: Financial Plan
(f) if the charter school/corporation ceases operations for any reason, the
charter school/corporation personnel and its governing board will
cooperate fully and be responsible for appropriately safeguarding and
distributing the school’s assets and winding up the school’s business
and affairs? Articles of Incorporation should reflect returning the assets
to CCSD upon dissolution.
(g) if the charter school does not have sufficient funds to pay its entire bill
at the time it ceases operation, the CCSD will not be responsible for the
charter school’s unpaid bills?
(h) the charter school will be audited annually by the state auditor or, if
specified in the charter, by an independent certified public accounting
firm, licensed in the State, according to the same guidelines (O.C.G.A.
20-2-2065(b)(7) applicable to public school systems in Georgia and that
copies of the audit will be submitted to the Cobb County Board of
Education within 90 days of the end of the charter school’s fiscal year,
with the cost of the independent audit borne by the charter school? The
District requires all charter school audits to express an unqualified
opinion.
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Section H: Financial Plan
(i) the CCSD's Internal Audit Department will be permitted to audit the
charter school as the CCSD deems appropriate?
Be specific in your statements.
Does the petition state that the nonprofit corporation will:
(a) Operate and support the charter school as the sole function of the
corporation;
(b) Not raise funds for any other purpose;
(c) Submit a copy of the IRS application for tax exempt status or the letter
of determination confirming the nonprofit’s tax-exempt status;
(d) Obtain tax exempt status with the first 18 months of incorporation to
retain the nonprofit corporation’s charter.
(e) Submit copies of the IRS Form 990, Return of Organization Exempt
from Income Tax for each year of operation?
Be specific in your statements.
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Section H: Financial Plan
Does the petition list the nonprofit corporation’s current board members
by name, address and occupation? The petition must list all members
and all requested information.
Are copies of the corporation’s Articles of Incorporation, all amendments
to the Articles of Incorporation, the By-laws and all amendments to the Bylaws attached to the petition? Do these documents support the petition,
State law, and CCSD requirements? These need to be complete, fullyexecuted versions.
Does the petition state the charter school understands that the charter
may be revoked or not renewed by the Cobb County Board of Education if
the Board determines that the Charter School failed to meet generally
accepted standards of fiscal management as described by the CCSD
Financial Services Division? Be specific in your statement.
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Section H: Financial Plan
Does the petition state that all equipment with an original acquisition cost
of $1,000 or more (as well as all computers, printers, LCD projectors, and
interactive whiteboards, regardless of cost) will be identified and reported
to CCSD each year? Be specific in your statement.
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Section H: Financial Plan
Budget
Does the petition provide a realistic and balanced budget that includes
realistic revenue projections based on the Georgia Department of
Education Quality Basic Education formula and the District’s local revenue
projections? The question is asking if the petitioner’s budget is
thorough and their assumptions sound and reasonable, including a
balanced budget. The assumptions must be disclosed.
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Forecasted budget must be provided for each year of proposed charter
Budgeted expenditures cannot exceed budgeted revenues in any year
Each significant revenue source should be shown as a separate line item
Each significant expenditure (e.g. salaries, taxes, benefits, retirement,
rent, textbooks, management fees, utilities, etc.) should be shown as a
separate line item
• The budget should be provided in an Excel spreadsheet file, in
addition to the paper reports.
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Section H: Financial Plan
Supporting assumptions used to estimate revenues should be disclosed.
• Projected enrollment by year, by grade
• Explain how per student funding calculated
• Provide supporting calculations for any other revenues (grants,
fundraising, etc.)
Supporting assumptions used to estimate expenditures should be disclosed.
• For example, explain how teacher salaries were calculated based on
enrollment, class size, average salary, etc.
• For example, explain how rent expense was calculated (e.g. square
footage times average rental price for commercial buildings in
projected locality)
• Provide supporting calculation for any other significant expenditure
Ancillary services such as food services and after-school-programs (ASP)
need to be fully documented and integrated into the budget.
Financial Services
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Section H: Financial Plan
Does the petition list a balanced budget for the term of the charter, including:
1. Projections from the Georgia Department of Education FTE earnings.
2. Detailed budget and cash-flow projections, with supporting documentation
showing the basis for all revenue and expenditure projections, to be
available per FTE and the basis for the estimates as well as approximate
dates of availability of funds.
3. Evidence that the proposed budget is financially sound for the charter
school and the District and that the petitioner is creditworthy.
4. A financial statement to the CCSD that discloses the projected cost of
administration, instruction, and all other spending categories for the charter
school that is understandable to the general public and that will allow
comparison of such cost to other schools or other comparable organizations
in a format acceptable to the District.
5. A description of how the charter school facility will be funded, and
maintained (including all current and/or potential leases, debt services,
construction costs, and leasehold improvements).
Financial Services
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Section H: Financial Plan
QBE & Local Revenue Estimate
Actual QBE revenue is based on several variables, including FTE count
count, grade level, courses offered, special needs, etc. However, based on
our two existing charter schools, an average revenue-per-student could be
$5,658 as calculated below:
Fiscal Year 2014 Estimate
Kennesaw
Charter School
(K-6)
Smyrna
Charter School
(K-8)
State Revenue Estimate
$
$
Local Revenue Estimate
Subtotal
1,656,742
$
Less: 3% Fee
Revenue Allocation to Charter School
Financial Services
4,948,063
$
(148,442)
$
FTE Student Enrollment
Revenue per Student
3,291,321
4,799,621
5,783
3,719,415
$ 7,010,736
1,872,231
3,528,973
5,591,646
$ 10,539,709
(167,749)
$
830
$
Total
5,423,897
(316,191)
$ 10,223,518
977
$
5,552
1,807
$
5,658
14
Thank You
Financial Services
Financial Services
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