Board Meeting Analysis
Financial Report Analysis
The new Interim Superintendent, CFO and appointed board created and passed the FY ’14 budget. The fiscal year begins on July 1. On 09/09/2013, the CFO presented the July 2013 Monthly Financial Report. I didn’t see most of the presentation, so I’m going off the fiscal report. Please comment and let me know what was said.
Cash or Modified Accrual Basis of Accounting
Is DeKalb Schools on a cash or modified accrual basis of accounting? From the looks of this financial report, DeKalb Schools has reverted back to a cash basis of accounting. Generally Accepted Accounting Principles (GAAP) and the Ga DOE require that the modified accrual basis of accounting be used for governmental fund types.
Disbursements: Instructional (Page 1)
Page 1 of the financial report says we spent $752K for instructional costs compared to $4.3M last year. Every number on page 1, except for Charter Schools, is significantly lower than it was last year. We didn’t cut the budget by 50%. I hardly think we accrued only $752K in instructional expenses for July. It’s difficult to discern what is going on with this line item because SOME salaries paid out in July accrue back to the previous fiscal year. But, as Nancy reminds me, anytime you see a large difference in anything from year to year, budget vs. actual, month to month, it should be further investigated. It could just be a timing issue, an accrual issue or something else, but we need to keep a watch on this item.
Receipts : Taxes-Property (Page 4)
In July we only collected .5% of the anticipated taxes. This is not alarming given the school receives payments in various lump sums. It is, however, 50% less than was received last year and should be monitored as the year progresses.
Receipts: Other (Rent, Fingerprinting, Planetarium and Lost Books) (Page 4)
The school district received $272K for this line item in July of last year. The FY14 budget is $13.4M for this line item. Where in the budget does that number come from. Looking at the approved detailed budget, those line items add up to $2M.
- $900K – Rental of land or buildings (pg 185)
- $1.2M – Rent and other local revenues (pg 1719)
- $22K – Fingerprinting and background checks (pg 309)
- $50K – Planetarium proceeds (pg 131)
- $500.00 – Lost and damaged books. (pg 409)
Looking back to previous fiscal years this is the amount DeKalb Schools received in that “Other” line item:
- FY11: $2,414,218
- FY12: $1,313,031
- FY13: $5,429,241
- FY14 Budget $13,494,492
It is interesting to note the substantial increase in the actual revenue collected on this line for the fiscal year that just ended on June 30, 2013 (FY13). In the final month of the fiscal year, the year-to-date revenue in this line almost doubled. In June 2013 alone, DCSS reported that they received $2.45 million. This brought the total year-to-date “other” revenue to be $5.4 million. That’s a rather large collection of revenue for “rent, fingerprinting, background checks, planetarium proceeds and lost books” for ONE month. Moving forward DCSS is expecting to collect $13.5 million for this fiscal year. What is behind these large increases in revenue and anticipated revenue? Does any of this have to do with commandeering the money from each school’s After School Program?
Receipts: QBE Earnings (Page 4)
QBE earnings are $6M less than they were last year at this time. Once again, not alarming given the lumpy funding but something to keep an eye on. On a side note, I’d like to see the expected FTE counts for the various categories used to come up with the current anticipated QBE funds. Since over half of the general fund comes from QBE earnings, I was disappointed there wasn’t more discussion on this during the budgeting processes.
Disbursements: Legal Fees (Page 5)
I’m skeptical we accrued $0 legal fees in July. Were invoices turned in that weren’t paid that are not showing up here?
The bridges initiative mentions hiring Graduation Coaches. There is a line item in the budget for each high school for Graduation Coaches and each one says $0. Where in the budget are graduation coaches coming from?
Bridges Initiative (Superintendent Report)
Bridges initiative has a huge price tag. We need a much more detailed list of these expenses. Where does this come from in the budget? What are we losing in its place?
Parent and Family Centers (School Readiness Report)
In the budget, all Family Services/Parent Coordinators have a budget of $0. These initiatives need to be tracked separately in the financial report and not buried.
Receipts are low, revenue expectations are higher and disbursements don’t seem to be accrued. I’m concerned the Interim Superintendent initiatives are not fully budgeted for and are difficult to track in the monthly financial report. I remain skeptical regarding the DeKalb Schools’ financial situation.