SFO® Certification Exam Prep Manual - WASBO · (Lunch 11:15 a.m. – 12:15 p.m.) (12:15 p.m. – 1:15 p.m.) Marvin Dereef, Ellen Skoviera Conduct Budgeting and Reporting Activities

Copyright 2012 ASBO International

SFO® Certification Exam

Prep Manual



SFO® Certification Exam Prep Manual

ASBO International’s (ASBO) professional development team is pleased to present the SFO® Certification Exam Prep Manual as a service to the school business management profession.

Each year since ASBO launched its Certified Administrator of School Finance and Operations® (SFO) program, a panel of experts, completely independent from the Certification Commission and staff, has conducted a full-day workshop at our Annual Meeting & Expo to help eligible practitioners prepare for the certification exam. The panel’s workshop curriculum is presented here in the form of PowerPoint slide handouts for easy note taking. It covers all the areas of knowledge and skill tested by the two-part exam.

At the back of this manual, you will find the Certification Commission’s official Guide to Studying for the Examinations, which is also available on ASBO’s website. The guide features study tips, practice questions with answers, and a reference list. It also provides tips on how to form and run effective study groups.

If you are considering earning your SFO credential, we hope you will take full advantage of all the study materials available to you on ASBO’s website, in this manual, and at our Annual Meeting & Expo.

Sincerely,

Arlene H. Olkin, Ph.D. Director of Professional Development


Disclaimer

ASBO International’s certification program is governed by the Certification Commission, a semi-independent certifying body of the Association of School Business Officials International. In adherence to best practices for certifying bodies, Certification Commission volunteers and certification staff are not involved in the development of any preparatory program, and no preparatory program is endorsed by the Certification Commission nor is a prerequisite to earn the certification. The Certification Commission and its staff are solely responsible for the policies and administration of the certification program, including application procedures and qualification requirements.


Agenda (8:00 a.m. – 8:10 a.m.) Jay Snyder

Jay will talk about education credits and ASBO’s Certification Program while thumb drives and the exam prep manual are being distributed.

(8:10 a.m. – 8:55 a.m.) Ellen Skoviera, Marvin Dereef, Ann Williams Manage Accounting Systems (28% to 33%) Slides 4 - 26 Maintain Accounting Software Maintain Chart of Accounts Reconcile General Ledger Accounts Track Fixed Assets Internal Service Funds Fraud

(8:55 a.m. – 10:00 a.m.) Brenda Burkett, Ann Williams

Manage Accounting Functions (67% to 72%) Slides 27 - 76 Manage Payroll Functions Manage Accounts Receivable Process Manage Accounts Payable Process Manage Purchasing Procedures Manage Annual Budgets Prepare Financial Reports Manage Cash Flow GASB Student Activity Funds

(Break 10:00 a.m. – 10:15 a.m.)

(10:15 a.m. – 11:15 a.m.) Ellen Skoviera, Ann Williams Conduct Financial Planning and Analysis (27% to 32%) Slides 77 - 109 Serve as a School Leader Review Financial Impact of Strategic Planning Goals Develop Financial Goals Evaluate Funding Options for Debt Management Develop Outside Funding Sources Analyze Economic Data


Analyze Demographic Data Develop Multi-Year Forecast Estimate Real Estate Property Tax Revenues

(Lunch 11:15 a.m. – 12:15 p.m.)

(12:15 p.m. – 1:15 p.m.) Marvin Dereef, Ellen Skoviera

Conduct Budgeting and Reporting Activities (15% to 20%) Slides 110 - 116 Project Student Enrollment Evaluate Instructional Program(s) Costs Develop Annual Budgets Manage Grant Activities Prepare for Annual Audit

(1:15 p.m. – 2:00 p.m.) Brian Moore, Jim Westrum

Conduct Risk Management Activities (10% to 15%) Slides 117 - 124 Evaluate Existing Risks Address Results of Risk Audit Conduct Annual Evaluation of Insurance Plans Manage Insurance Plans “Right to Know”

(2:00 p.m. – 2:35 p.m.) Brian Moore, Ellen Skoviera

Manage School Facilities (7% to 12%) Slides 125 - 136 Update Facility Master Plan Oversee the Operation and Maintenance of School Campuses Oversee New Construction and Renovations Asbestos

(Break 2:35 p.m. – 2:50 p.m.)

(2:50 p.m. – 3:10 p.m.) Ellen Skoviera

Manage Information Systems (4% to 6%) Slides 137 - 152 Assist in Developing a Technology Plan Maintain Technology Systems/Oversee Telecommunication Systems


(3:10 p.m. – 4:00 p.m.) Matthew Malinowski

Manage Human Resource Functions (15% to 20%) Slides 153 - 169 Manage Hiring of New Employees Develop Compensation Structure Manage Staff Development and Training Programs Manage Evaluation Process Manage Personnel Administration Manage Employee Benefit Programs

(4:00 p.m. – 4:45 p.m.) Ellen Skoviera, Brian Moore

Manage Ancillary Services (7% to 12%) Slides 170 - 224 Manage Transportation Services Manage Food Service Programs Manage Purchasing Process Manage Other Service Programs Public Relations Governance & Policy

(4:45 p.m. – 5:00 p.m.) All presenters to field questions

Q&A


SFO® Prep Panelists

Panel Chair Ellen R. Skoviera, RTSBA, SFO Assistant Superintendent for Business and Operations Leander ISD Leander, TX [email protected]

Ellen Skoviera is a 30+ year school business administrator whose experience has ranged from rural to fast-growing suburban schools. Ellen has significant experience in quality/continuous improvement. She is a member of the charter SFO cohort as well as a Registered Texas School Business Administrator. She has been active in ASBO International, serving as past committee chair for the Management Techniques Committee and currently serving as Editorial Advisory Committee chair. She also has been active in the Texas ASBO, serving at various times on the Accounting committee, the Management Information Systems committee, and the Governmental Relations committee. She is a former chapter president of NYSABO’s southern tier chapter, and co-chaired the BOCES ad-hoc civil service committee in the late 1980s. She also served on the BOCES statewide software selection committee. Ellen’s passion for education began at an early age with a family that placed a high value on education. She has served as a student mentor throughout her career. She is a graduate of State University of New York at Binghamton’s School of Management program, and holds her master’s in public administration from Texas State University. She is the proudest Texas A&M Aggie Mom of the classes of 2005 and 2009! Panelists Ann C. Williams, SFO Business Manager Bloom Township HSD 206 Chicago Heights, IL [email protected]

Ann Williams is the business manager for Bloom Township High School District #206 in Illinois. She serves on the board of directors for Illinois ASBO and is an active member of ASBO International. With more than 10 years of experience in finance, Ann is also an adjunct professor for several universities throughout Chicagoland. Prior to working in education, Ann worked in the private sector as a corporate finance manager. She has a bachelor’s degree from Northern Illinois University and an MBA from DePaul University. Ann is currently completing her doctoral degree in educational leadership at Roosevelt University. Her dissertation topic is maintaining financial solvency in school districts during challenging economic times. Ann’s personal interests include mountain climbing, consulting religious organizations, mentoring youth, and real estate.

mailto:[email protected]



Marvin Dereef, SFO Executive Director of Budget Services Fulton County Schools Atlanta, GA [email protected] Marvin Dereef, Jr., is executive director of budget services at Fulton County Schools (FCS) in Atlanta, Georgia, which has 93,000 students and an $800 million general fund budget. In three years at FCS, he has earned several awards from ASBO and GFOA for budget presentations. He has helped his school district maintain a strong financial condition in this tough economic climate. Prior to joining Fulton County Schools, Marvin worked as a finance officer for Scotland County Schools. As grants and capital asset manager at Clayton County Schools, he received a Certificate of Excellence for developing their first comprehensive annual financial report. He holds a master’s in accounting and financial management and a bachelor’s in business administration with a concentration in accounting. Marvin continues to contribute to the school business profession by writing articles and conducting workshops for ASBO. Brenda R. Burkett, CPA, SFO ASBO International Board of Directors 2011-2013 Chief Financial Officer Norman Public Schools, Norman OK [email protected]

Brenda Burkett, the chief financial officer for Norman Public Schools in Norman, Oklahoma, has been in education for over 20 years, and has been very active in her state association. Brenda served as the president of Oklahoma ASBO in 2008-2009, is one of Oklahoma ASBO’s Certified School Business Administrators, and currently serves the OASBO Board of Directors as the liaison to ASBO International. She also serves on the advisory board for the Oklahoma Center for School Business Management, and is a frequent presenter at workshops and conferences held by both of these organizations. Brenda has been a member of ASBO International since 1992, serving the association in various capacities—currently as a member of the ASBO Board of Directors. She was a participant in the ASBO Economic Crisis Summit and received the Pinnacle of Achievement Award in 2008. Brenda also served on the educational panel for the Town Hall meeting with the U.S. Deputy Secretary of Education at the 2009 ASBO Annual Meeting.

Brian N. Moore Supervisor, Public Safety Red Clay Consolidated School District Wilmington, DE [email protected] Brian Moore is supervisor of public safety for Red Clay School District in Wilmington, Delaware. After serving as a police officer for 15 years and logging countless hours as a volunteer





firefighter, Brian looked for another way to use his acquired skills. He found the answer in a Red Clay School District position opening for someone with experience in emergency services who could run an energy efficiency program. The district had spent $6.5 million annually on electricity. In each of the next two years, he helped save half a million dollars in utility costs while offering his expertise in school security issues. Brian served four years as facilities manager, laying the groundwork for Red Clay to become the first district in Delaware to get a contractor’s license for its maintenance department, saving substantial amounts on construction project outsourcing costs. He currently serves as vice chair of ASBO’s School Facilities Committee and as a member of ASBO’s Editorial Advisory Committee.

Jim Westrum Executive Director of Finance and Business Wayzata Public Schools Wayzata, MN [email protected] Jim Westrum, the executive director of finance and business for the Wayzata Public Schools in Minnesota, has more than two decades of experience in school business. During that time, he has developed a deep appreciation for the important work and the significant impact school business officials can have on the students, staff, and families in a community. Jim is committed to professional development; he recently received the Certified School Risk Manager (CSRM) designation in addition to the SFO, CPA, and RSBA designations. He served as president of Minnesota ASBO at the time that Minnesota rolled out their voluntary state certification program. He currently serves as chair of the ASBO Risk Management Committee. Matthew J. Malinowski Director of Business Affairs School District of Cheltenham Township Elkins Park, PA [email protected]

Matthew Malinowski, director of business affairs for the School District of Cheltenham Township in Pennsylvania, has worked in local and state governments in addition to school districts, which accounts for the past eight years of experience. Matt spent nearly four years executing an improvement project focusing on financial and operational reforms with one of Pennsylvania’s most impoverished school districts. Following the completion of this initiative, he spent four years with the Susquehanna Township School District in Harrisburg, Pennsylvania, as the assistant superintendent of business services. In his current position, he oversees transportation, operations, maintenance and construction, food service, budgeting, financial reporting, and taxes. He has published articles in state and national publications focusing on pragmatic and current school business issues and is a frequent speaker at state and national workshops for both ASBO/PASBO and other associations.



Slide 1

Skills Refresher for

ASBO International’s

SFO® Certification Exam


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Slide 2

Disclaimer

ASBO International’s certification program is governed by

the Certification Commission, a semi-independent certifying body of the Association of School Business Officials International. In adherence to best practices for certifying bodies, Certification Commission volunteers and certification staff are not involved in the development of any preparatory program, and no preparatory program is endorsed by the Certification Commission nor is a prerequisite to earn the certification. The Certification Commission and its staff are solely responsible for the policies and administration of the certification program, including application procedures and qualification requirements.


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Slide 3 SFO® Exam Content

Part 1

• Manage Accounting Systems (28%-33%)

• Manage Accounting Functions (67%-72%)

Part 2

• Conduct Financial Planning and Analysis (27%-32%)

• Conduct Budget and Reporting Activities (15%-20%)

• Conduct Risk Management Activities (10%-15%)

• Manage School Facilities (7%-12%)

• Manage Information Systems (4%-6%)

• Manage Human Resource Functions (15%-20%)

• Manage Ancillary Services (7%-12%)


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Slide 4

Manage Accounting Systems

Marvin DeReefEllen R. SkovieraAnn Williams


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Slide 5

What is an Accounting System?

• A series of steps, either manual or automated, that records the transactions of a business, and provides the information for financial reports

Expense Revenue

Debit Credit Debit Credit


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Slide 6

Typical Accounting Flow

• Journalize the business event (accounting transaction) in a book of original entry (a special or general journal)

• Post the business event from the journal to a subsidiary ledger

• Post the total from the journal to the General Ledger

• Summarize the business events by preparing a trial balance


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Slide 7

Automated Systems

• 3 steps:

• Record Transaction

• Update Master Data

• Generate reports (and support queries)

• Password control is essential


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Slide 8

Online Communications Technology

• Communication networks range from those designed to link a few computers, to the internet which links most of the world’s computers together

• Client/server: the physical and logical division between user-oriented allocation programs that are run at the client (user) level and the shared data that must be available through the server (the central server that handles centrally shared activities)


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Slide 9


• LAN (Local-area network): links several different local user machines with printers, databases, and shared devices

• WAN (Wide-area network): links distributed users and local networks into an integrated communications network

• Web browsers: software designed to allow users to easily view various documents and data sources available on the Internet


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Slide 10


• Intranet: mini internal equivalent to the Internet, links an organization’s internal documents and databases that are accessible via Web browsers or internally developed software

• Extranet: expanding access to a company’s intranet to external, trusted partners


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Slide 11 Internet-based Systems

(Cloud Computing)

• Cloud computing is a paradigm shift following the shift from mainframe to client–server in the early 1980s. Details are abstracted from the users, who no longer have need for expertise in, or control over, the technology infrastructure "in the cloud" that supports them.


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Continued…

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Slide 12

Internet-based Systems

(Cloud Computing)

• Cloud computing describes a new delivery model for IT services based on the Internet, and it typically involves over-the-Internet provision of dynamically scalable and often virtualized resources. Cloud services provide ease of access to remote computing sites provided by the Internet, web-based tools or applications that users can access and use through a web browser, as if it were a program installed locally on their own computer.


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Slide 13

Important Things to Remember• Security: are your records housed either manually

or on-line in a location that is protected from intrusion? In fire-proof cabinets, if hard to replace

• Back-up: are your electronic records backed-up at least each night?

• If there were an emergency, have you assigned records responsibility to anyone?

• Do you have Business Interruption Insurance?• Is your data encrypted when attached to an email?• Do you have “secure” thumb drives?


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Slide 14

Documentation

• Sarbanes-Oxley Act of 2002 Section 404 requires that organizations document internal controls over their financial reporting processes

• This documentation helps the organization know the flow of transactions through the accounting system, helps identify which areas have implemented internal controls, and can identify areas of control gaps that need to be addressed


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Slide 15

Documentation

• Written procedures• Flowcharts: • Data flow diagrams, which portray business

process activities , storage of data, and flows of data

• Systems flowcharts present a comprehensive picture of the management operations, information systems, and process controls present in the business processes


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Slide 16 Copyright 2012 ASBO

International

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International

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Slide 18 Fraud Prevention• Especially in periods of tight money, it is

important to maintain absolute integrity

• Ethical culture

• Dual control

• Sign offs and cross checks

• Audit trails

• Secure passwords, encrypted mailings


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Slide 19

Fraud Prevention

• External audit not designed to disclose

• Internal audit function

• Metrics to indicate anomalies

• Exception reports

• Override authority/ sharing passwords

• Multiple employees with same deposit account


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Slide 20 Fraud

Three factors are generally necessary for fraud to occur:

Pressure

Opportunity

Rationalization

(often referred to as the fraud triangle)


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Slide 21 Fraud• Develop and promote a district-wide culture of

honesty (tone at the top)

• Separation of duties and responsibilities among employees

• Dual controls-minimum of two people involved in all aspects of monetary responsibilities

• Monitoring controls review- spot check staff and management override controls on a periodic basis to ensure controls are working and effective

• Fraud reporting process in place-internal employee, external customer tips, fraud hot line, etc.


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Slide 22

Fraud

• Understand what can happen –common fraud schemes

• Identify red flags to look for

• Test for the red- flag type activities


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Slide 23 Fraud Resources

• Association of Certified Fraud Examiners (AFCE): www.acfe.com

• Institute of Internal Auditors (IIA): www.theiia.org

• Information Systems and Control Association (ISACA): www.isaca.org

• American Institute of Certified Public Accounts (AICPA): www.aicpa.org

• Open Web Application Security Project (OWASP): www.owasp.org

• Payment Card Industry – Data Security Standards(PCI DSS): www.pcisecuritystandards.org/security_standards

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Slide 24

Internal Service Funds

• Used when providing goods or services to other funds, departments, or agencies of the primary government on a cost-reimbursement basis. An internal service fund should be used only when the reporting government is the predominant participant in the activity. Otherwise, the activity should be reported as an enterprise fund.


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Slide 25

Due to/Due from

• Balance monthly

• Examples:

• Internal services funds

• Field trip costs

• Other interfund transfers

• State aid “settle up”


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Slide 26

Surprise Quiz!

• If a district purchases inventory in Year 1 but charges it to expense, which of the following is the result?

• -The first year shows less fund balance than it should

• -Both the first and second year are misstated


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Slide 27

Manage Accounting Functions

Brenda R. Burkett, CPA, SFOASBO Int’l Board of Directors 2011-2013Chief Financial OfficerNorman Public Schools, Norman [email protected]


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Slide 28

Manage Payroll Functions

• The greatest portion of the price of education is concentrated in the form of personnel

• Education is labor intensive

• Personnel costs make up 80-90% of most school budgets


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Slide 29

Personnel Costs

• Personnel costs are the single most expensive (and most important) item in school budgets

• After estimating enrollment and envisioning programs, costing out salaries is the next most important task in successfully balancing revenues and expenditures

• A demographer may be needed to assist with studying the population and student growth of your district


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Slide 30

Determining Staffing Needs

• Enrollment drives staffing

• Ability to properly determine staffing needs is a function of organizing and using information about the district and its current and prospective staff

• Projections indicating a need for new staff require budget input


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Slide 31

Determining Staffing Needs

• Hiring decisions must be coordinated with the budget office, which must find money for salaries

• Must determine if budget constraints will allow for additional staff to be hired

• If so, consider whether the district should hire beginning teachers or whether it can afford more experienced staff


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Slide 32

Data Input

• As the hiring decisions are made, and the staff member’s payroll information is processed, it is critical that data be correctly entered into the payroll system

• There are many items pertaining to compensation that must be accurately keyed into the system, for a person’s pay and benefits to be correct


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Slide 33

Compensation

• Employee compensation includes negotiated benefits such as teacher’s retirement, defined contribution plans and various kinds of insurance

• Compensation also includes employer costs for workers’ compensation coverage, unemployment insurance, and social security


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Slide 34

Pay Tables And Deduction Codes

• One of the most critical functions of the payroll office is to ensure that pay tables and deduction codes are set up and entered correctly into the software

• It doesn’t matter if you’ve entered the staff person’s correct pay step into the computer. If the pay step amount is not correct in the computer, underpays or overpays will occur.


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Slide 35

Pay Tables And Deduction Codes

• Deduction codes and the correct percentages should be entered and double checked for accuracy

• Retirement payments into the Teachers Retirement System, and taxes paid to the IRS, are dependent on accurate percentages being set up in the payroll software


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Slide 36

Benefits/Other Compensation

• Leave Benefits: There is often time away from the job not deducted from pay, including sick leave, bereavement leave, and personal leave

• Other Comp: Direct and indirect compensation such as overtime pay, supplemental salaries, and performance pay may also occur


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Slide 37

Benefits/Other Compensation

• Leave balances available to employees are handled either by regular accruals, or by days given on an annual basis or some other benchmark in the employment process

• A system must be in place for all leave requests so proper reduction of leave balances occurs, or pay docks are processed, if no leave is available


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Slide 38

Checks and Balances

• Payroll oversight entails making sure that the amounts paid are correct, and that the benefit calculations are accurately figured

• Deduction registers should be scrutinized for reasonableness

• Random sampling should be performed to check % calculations


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Slide 39

Salary Payment Options

• There are many different categories of employees that work in a school system, and often their start dates and contract days vary

• Many districts require 10 month employees receive their annualized pay over 12 months, to handle monthly insurance premiums or annuity deductions that continue on a year-round basis


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Slide 40

Salary Payment Options

• Summer checks run in June (July and August checks that are for salaries to be charged in current fiscal year) will have taxes, retirement payments and other deductions withheld

• Payment of these deductions require close supervision to ensure paid in the right month and paid by certain deadlines


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Slide 41

Manage Accounts Receivable

• The purpose of Accounts Receivable is to track revenues that are not yet received by the District

• Procedures should be set in place to accumulate, categorize, report and control revenues due the district


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Slide 42


• Procedures and practices should remain the same across time and reports. If differences occur, they should be due to substantive differences in the events and conditions reported rather than because of arbitrary accruals


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Slide 43


• The Accounts Receivable function can provide a method for accruing revenues earned for a certain period, for consistency and comparative analysis to that same period the year before.


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Slide 44

Revenue Applications

• Revenue and Accounts Receivable applications should be designed with superior and flexible functionality to generate, maintain, inquire, collect and report on revenues earned


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Slide 45

Manage Purchasing Process

• Accountability for public money is backbone of purchasing

• Procedures must be in place that focus on getting the best bang for the buck with taxpayer funds

• As long as procedures are outlined and followed, then substantiation for purchasing decisions will be in place


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Slide 46

How Districts Procure Goods and

Services

• The District obtains quotes, at the appropriate dollar threshold, on items to be purchased and then creates purchase orders to award the contracts based on Board of Education approval

• Requisition system-used to acquire goods/services by purchase order and verify budget authority

• Purchase order – legal authority to spend• Contracts - to delineate specific terms• Districts should purchase from responsible business

entities.


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Slide 47

Purchasing Process

• Bidding▫ Public notice normally 10 to 20 days before▫ All bids must be sealed▫ All bids must be opened during a public bid

opening where the contents are announced▫ Bids should be awarded to the lowest

responsible bidder who conforms in all material aspects to the requirements and criteria set in the invitation to bid

• Request for Proposals - often used for services


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Slide 48

Options for Purchasing

• Quotes from vendors

• State Contract pricing

• National Purchasing cooperative

▫ US Communities

▫ NJPA (National Joint Powers Alliance)

• allow participating governmental and municipal agencies to reduce the cost of purchased goods by leveraging their combined purchasing power.


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Slide 49

Manage Accounting Functions -

continued


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Ann C. Williams, SFOBusiness ManagerBloom Township HSD 206Chicago Heights, IL

ACW1

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Slide 50

Agenda


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• Manage Annual Budgets

• Prepare Financial Reports

• Manage Cash Flow

• Managing Activity Accounts

• GASB

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Slide 51

Know your funds

• General Funds

• Restricted Funds

▫ enterprise

• Proprietary funds


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Slide 52

Manage Budgets

• What is a budget?▫ An educational plan that….

Satisfies requirements of state, local and federal governments

Provides both expending and taxing authority

Estimate of revenues and expenditures Provides a tool to measure fiscal performance

Attempts to accomplish the financial goals of the Board of Education and its stakeholders

It’s an estimate.


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Slide 53

Manage Budgets cont’d

• Philosophies

▫ Business as usual

▫ Zero Based

▫ Site Based

▫ Program Based

▫ Combination of the above


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Slide 54


• Begin with assumptions

▫ State and federal government budget projections▫ Tax cap, if applicable▫ Contractual obligations (collective bargaining

agreements, vendor contracts, etc.)▫ Programmatic changes▫ Staffing changes▫ Non-routine expenditures (e.g., textbooks,

uniforms)▫ Technology needs▫ Capital projects/expenditures


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Slide 55

Manage Budgets, cont’d

Budget revenue

▫ Local

▫ State

▫ Federal

Difficult to forecast and budget

Review historical trends

Know the program or population being served

Federal Grants are potentially difficult to budget because of the timing of approvals


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Slide 56


Budget expenses• Review assumptions on key budget drivers, make

additional assumptions and collect other expense related information, including:▫ Current and projected enrollment Trend analysis

Cohort survival

▫ Current and projected number of employees▫ Status of negotiations▫ Current fiscal year – year to date results▫ Limitations imposed by revenue projections


56

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Slide 57


Budget expenses

• Salaries

• Benefits

• Purchased Services

• Supplies & Materials

• Capital Outlay

• Other Objects

• Out of district tuition (e.g., special ed)


57

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Slide 58


• Estimating expenditures

▫ Identify programs and functions

▫ Determine types and quantities of resources needed

▫ Estimate costs of each program or function

▫ Consider the teacher contract

How much schedule movement can you anticipate?

Is there a new Master’s program in town?


58

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Slide 59


• Estimating expenditures

▫ Identify programs and functions

▫ Determine types and quantities of resources needed

▫ Estimate costs of each program or function

▫ Consider the teacher contract

How much schedule movement can you anticipate?

Is there a new Master’s program in town?


59

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Slide 60

• Continuum for budget reduction Obtain reduced prices for services

Increase productivity

Defer spending

Make across the board cuts

Eliminate “non-essential” services

Reduce instructional positions and programs


60

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Slide 61


• Reductions through improved efficiencies▫ Energy conservation▫ Risk management▫ Purchasing▫ Privatization▫ Training for operations/support staff▫ Deferral of expenditures▫ Use of more efficient equipment▫ Early retirement plans▫ Lower salary increases▫ Lower cash carryover (working cash)


61

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Slide 62

Budgeting Adjustments

• Budget reductions due to program reductions

▫ Reduce instruction staff

▫ Reduce course offerings

▫ Reduce support staff

▫ Reduce non essential services


62

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Slide 63


• Reductions are inevitable, but how can we increase revenues to avoid cuts?

▫ Charge for services provided

Facility use by others (pool, auditorium, etc.)

Parking

▫ Charge for non academic services

Transportation (if not mandated)

Private sector support

Volunteers


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Slide 64


• The budget is “done”, the year is almost over, what now?▫ Compare budget to actuals Are actual expenditures within the budgeted

amount? How much is left to spend?

▫ Look at encumbrances Defined-obligations in the form of purchase orders,

contracts or salary commitments chargeable to an appropriation and for which part of the appropriation is reserved


64

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Slide 65

Preparing Financial Reports

• Accountability

• Transparency

• Environment of trust

• Reporting is dependant on the needs of the stakeholders

• How do you present your budget? PowerPoint presentation?

Executive Summary?

Detailed spreadsheet?


65

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Slide 66

Preparing Financial Reports

• Consider the Budget at a Glance reporting

• Consider Dashboard reports

▫ IL provides a financial profile


66

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Slide 67

Budget at a Glance Sample

• http://www.orland135.org/about/Administration.asp

• http://www.orland135.org/departments/business_office/FinancialReports.asp


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Slide 68

Dashboard sample

• http://www.d13.dupage.k12.il.us/dashboard/index.htm

• http://www.d62.org/schoolboard/dashboardreports.html

• http://schooldashboard.org/d205/default.aspx?DashboardID=64&ParentID=39&SchoolID=11110723

• http://www.byron226.org/education/components/scrapbook/default.php?sectiondetailid=4577


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Slide 69

Managing Cash Flow

• Determine cash on hand requirements• Cash on Hand = projected estimate of the

number of days a district could meet operating expenditures provided no additional revenues were received.

• Review historical cash flow patterns• Evaluate anticipated changes in patterns

(recession)• Establish Board Policy• Create plan to build fund balances over time


69

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Slide 70 Managing Cash Flow

• Cash vs. Accrual

▫ Cash

Recognizes revenue when received

Recognizes expenses when paid

▫ Accrual

Recognizes revenue before it is received

Recognizes expenses when they are incurred

▫ Modified accrual

Recognizes revenue revenue when it becomes available and measurable and, with a few exceptions, recognizes expenditures when liabilities are incurred.

Which method is better for your district? Why?


70

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Slide 71

Student Activity Accounts

• Activity account▫ ONLY benefit students▫ Owned, operated, and managed by organizations

within the student body under the guidance of a faculty member

▫ Examples?

• Convenience account▫ For faculty, staff, parent organizations, or similar

non-student groups▫ Maintained by the district


71

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Slide 72

Student Activity Accounts cont’d

• School Board responsibilities Approve the establishment and purpose of each

activity fund

Set policy for student participation and adult supervision of funds

Appoint a treasurer to oversee funds

Ensure appropriate recordkeeping

• Treasurer responsibilities Consistent with district funds


72

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Slide 73


• Quiz!!!

▫ Which expense is not an allowable activity account expense?a) Meals for students participating in an away

football gameb) Magazines used for the benefit of the student

organizationc) Meals for football coaches meetingd) Athletic tournaments outside of regular scheduled

games


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Slide 74


• Quiz!!!▫ Which expense is an allowable activity

account expense?a) Meals for football coaches meetingb) Polo shirts with team name and sport for

football coachesc) Sales tax for football supplies for football

studentsd) Gifts for football coaches or adult volunteers


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Slide 75

GASB 54

• Governmental Accounting Standards Board▫ GASB 54 Fund Balance Reporting and

Governmental Fund Type Definitions Clarifies fund types (general, special revenue, debt

service, capital projects) and their use Revises how balances are reported Nonspendable fund balance Restricted fund balance

Committed fund balance Assigned fund balance

Unassigned fund balance


75

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Slide 76

Find out more about GASB at….

http://www.gasb.org/st/summary/gstsm54.html


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Slide 77

Conduct Financial

Planning and Analysis

Ellen R. SkovieraLeander ISD, Leander , TXSeptember 24, 2010


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Slide 78

Serve as School Leader

• Represent the district on financial matters

• Community

• Budget

• “Data-driven” analytical resource

• Legislature

• Bond ratings


78

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Slide 79

Some Questions to ponder

• What does it cost us to reduce by one child per elementary/middle/high school? What is your overall teacher-pupil ratio? How does it compare to similar districts?

• How do your function costs compare to other similar/state/provincial districts?

• How do your budget expenditures tie to the organization’s stated mission?


79

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Slide 80

Leadership

• “You are a fund balance manager”• Ready access to various data services• Awareness of financial trends in your state,

province, or region• Long term planning- multi-year projections• What are the demographic trends being seen

in your district, and what are the cost implications?


80

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Slide 81

Legislation

• How often does the governing legislature meet?

• Is your state/ province financial system stable or constantly being changed? What data resources are available to you?

• (Good chance for a brainstorm: what are your best sources to know what to expect? Share with the group)


81

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Slide 82

Impact of Legislation/Other

National Events


82

How will the downgrading of municipal debt in general impact your school district’s debt ratings? What are the most important factors affecting your debt rating?

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Slide 83 Presenting Your District


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Slide 84

Presenting Your District


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Slide 85

Presenting Your District


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Slide 86

Telling Your Story

• Be ready with talking points at all times: necessary for community and elected representatives

• Be ready to provide cost data, as legislators may call on you for immediate answers when they are deliberating new laws/requirements

• Demographic trends


86

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Slide 87

Financial Impact of Strategic

Planning Goals

• Know ahead of time what a program is likely to cost: have metrics to know what

• Involves working closely with program developers, particularly Curriculum

• An example:

• Science scores need to improve

• Pilot run, funded at $120,000 to provide regular rotation of science kits by grade level


87

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Slide 88

Example of Budget Costs for Strategic

Objective: Improve Science Scores

• Added Science materials Center Manager• Purchased building• Purchased initial start up supplies for kits,

expanded each year • Courier cost was absorbed in current mail

delivery model• Science scores show great improvement at all

levels


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Slide 89 Sample Goal: Want latest

technology for students

• Operational definition: “Latest” (Best? Newest?)

• TCO: Total cost of ownership (CoSN model)

• What are the direct costs of the goal?(Teacher training? Other staff to support the equipment? R and D to identify the proper technologies, space (small classrooms?), computer(s) and peripherals, supplies-more printing, for example (paper, toner), training, energy, opportunity cost—what else are we giving up?

• Capital refreshment cycle

• Bring Your Own Technology (BYOT)


89

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Slide 90

Develop Financial Goals

• Operating cost per student• Cost of instruction as a percent of dollar• Cost of teacher starting salaries to be highest in

region• Fund balance policy, if not prescribed by law• Cost of support (metrics:cost per square foot to

maintain, clean, landscape)• Long-term strategies: 10 year facilities plan


90

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Slide 91

Other Financial Goals

• Does the Board wish to control its tax rate against any given benchmark?

• Long-term replacement plans (buses, copiers, technology refreshment, musical instruments)

• Construction of facilities: cost to construct, life cycle costs, green initiatives (LEED)

• For each area or program, what are the costs?• For example, do you pay more for staff

development, but have lower turnover as a result? It is more than just the metric

• Can you point to resources in the budget that demonstrate commitment to strategic goals?


91

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Slide 92

Evaluate Funding Options for

Debt Management

• Typically, highly regulated…you need an attorney and a financial advisor

• Bond programs require a long-term strategy• Including community involvement, education,

identification of essential projects, recognition of failing existing building systems (roofs, HVAC, e.g.), Informational materials for the general community, tax election

• Lease vs. Buy (consider state aid funding mechanisms)


92

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Slide 93

Funding Options for Debt Management

• The following are various forms of securities, which may not be legal in your state or province

• General Obligation Bonds• CIBs (Current Interest Bonds

• CABs (Capital Appreciation bonds)

• RANs and TANs (Revenue and Tax Anticipation Notes-not for raising capital, only for cash management)

• Leasing (may or may not be legal in your state/province)

• Budget Notes, Public Property Finance Contractual Obligations (PPFCOs), Lease Revenue Obligations (public facility corporation is created which issues)

• Time Warrants• Maintenance Notes, Delinquent Tax Notes, Stadium Revenue Notes,

Refunding Bonds


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Slide 94

Lease vs. Buy• Calculate the total cost of ownership• Calculate the cost of leasing• Which is a better economic value?• Which poses more risk? (for example, if you

lease, what happens if your budget cannot sustain?)

• NON-APPROPRIATIONS clauses-include in all contracts


94

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Slide 95

Contract Management as Financial Tool

• Central review of all documents which bind the district

• Does state/province have a caveat emptor or caveat vendor philosophy? Include venue, hold-harmless restrictions, restrictive covenants

• Be sure that someone does not “lease” what is actually a lease-purchase capital acquisition if your state does not permit such acquisitions


95

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Slide 96

Develop Outside Funding Sources

• Financial Advisor

• Grants- cost/benefit analysis (monitor cash request submissions)

• Donors

• Foundations (MOUs)

• Fund Raising (internal controls)

• Wise investments


96

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Slide 97

Analyze Economic Data

• Annual schedule of economic announcements• What is your region’s primary industry?• What is housing doing in your region?• Are there any tax-credit housing developments

being started?• Consumer confidence• Interest rate projections• Unemployment rate


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Slide 98

Economic Factors

• Slower housing may lead to slower growth in enrollment (or not! More nuclear families in one domicile)

• Tax-credit developments may lead to higher school nutrition program eligibility (U.S.)

• Unemployment may key slower tax collections (what are you using for collection rate?)


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Slide 99

Analyze Demographic Data

• What is your cohort survival at each grade level?

• Are your lower grades more populous than your higher grades?

• What is your free/reduced percentage over time?

• Are you enrolling more harder-to-educate youngsters? What impact will that have on your costs? On your general programs?


99

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Slide 100

Analyze Your Demographic Data

• Housing: any new starts? Foreclosures?

• From city planning departments: Plat approvals

• Inventory of homes: size in square feet, number of bedrooms, starter vs. move-up,

• Apartments

• “Recycling” of neighborhoods (children grow up, house sells, new family with new children)


100

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Slide 101

Develop Multi-year Forecast

• Use Excel as an easy tool for this• Identify major budget drivers: enrollment,

property value, income (if part of the state aid equation)

• Identify major budget costs:• Personnel (staffing ratios) , Operating metrics

(cost per square foot or student or ‘x’)• Other: energy, support costs, equipment

refreshment


101

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Slide 102

Multi-year Forecasting

• Important to understand how various components affect your state aid calculations

• Look at least three years ahead on your debt rate, do you need to smooth it out?

• If operating rate is concern, look at combination of both tax rates (debt and operating), consider timed application of fund balance, if available


102

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Slide 103

Multi-year forecasting

• Develop and share replacement schedules with Board (action, where applicable)

• Develop and share staffing ratios with Board• (action, where applicable)• Examples: 1:22 k-4, 1: 27 at 5th, 6 teachers to

150/team at middle school, 30 per class at high school (watch core class enrollments)

• Examples: Buses, 200,000 miles or 15 years, Band Uniforms, every 8 years


103

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Slide 104 Multi-year Forecast

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Slide 105 105

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International

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Slide 107

Estimate Real Property Tax Revenues

• Maintain long term collection data, and couple it with economic health indicators in your area

• Are there any changes to the formula that will affect your collections?

• If you have disabled, senior, or portability exemptions, is there any new development that might cause an increase in exemptions?

• Is the Board considering any economic development strategies that will impact your collections (P.I.L.O.T agreements, for example)


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Slide 108

Tax Collections

• Know the local tax office officials

• Have there been any property value appraisal studies?

• Based on longitudinal data, estimate tax collections. Consider last three years, last five, last ten. If the economy is changing, shorten the comparison years.


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Slide 109

End of Financial Planning

and Analysis Module

Questions?


109

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Slide 110

Conduct Budgeting and Reporting

Activities Conduct Budgeting and Reporting Activities


110

Marvin Dereef, SFO Executive Director of Budget Services Fulton County SchoolsAtlanta, GA


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Slide 111

Project Student Enrollment

Evaluate Instructional Program(s) Costs

Develop Annual Budgets

Manage Grant Activities

Prepare for Annual Audit


111

Conduct Budgeting and Reporting

Activities

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Slide 112

Project Student Enrollment


112

Purpose

Trend line analysis

Cohort survival

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Slide 113


Salary and Benefits

Cost vs. Results

One time vs. Continuous


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Slide 114


Policy

Budget Process

Approaches to Budgeting

Revenue forecast

State differences


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Slide 115


Grant Sources

Major Federal Grants

Key terms

Reporting


115

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Slide 116


Checklist

Inventory

Year End Closing


116

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Slide 117

Conduct Risk Management

Activities: Plan, Prepare, Protect

Brian N. Moore

Supervisor, Public Safety

Red Clay Consolidated School District

Wilmington, DE


117

Jim Westrum

Exec. Dir. of Finance and Business

Wayzata Public Schools

Wayzata, MN

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Slide 118

What will we cover?

• What is School Risk Management?

• How do you perform a Risk Audit?

• How to follow up a risk audit?

• How to analyze available insurance options.

• Some help!


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Slide 119

School Risk Management for Dummies!

The process of analyzing the risks to the health and welfare of our students and staff then finding ways to effectively mitigate that risk!

The process of analyzing the risks to the stability and well being of our physical assets, our schools and finding ways to mitigate them.

Making intelligent financial decisions regarding how to best manage that risk.


119

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Slide 120 What is a risk audit?

It is an exercise in history and predicting the future.

A risk audit begins with a historical analysis of incidents that have occurred in your schools, including Workers Compensation Claims and Incident Reports.

What happened and when?


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Slide 121

Predicting the future?

Perform a trend analysis! Flood Data From NOAA

• Look at weather or flood predictions.

• Review long term community growth trends.

• Review crime statistics and discuss possible future trends.

121


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Slide 122 What’s Next?

Mitigation Planning

• Review ways to reduce risks associated with historical or possible future threats.

• Purchase products or create policies to reduce risks associated with operating a school.

• NEVER STOP! The cycle continues!!!

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Slide 123

Insurance Management

Outside Insurance Firms Self Insurance

• Review available options from commercial business insurers.

• Allow them to help provide you with a risk assessment!

• Don’t trust the agent who tries to sell you flood insurance for your school on TOP of the Mountain!

• What are the risks?

• What is your current Situation?

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Slide 124

Other Options?• Insurance Pool?

• State Office of Insurance?

• Combination planning.

• Legal insurance.


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Slide 125

Manage School FacilitiesIf you build it..

They will come!


125

Brian N. Moore

Supervisor, Public Safety

Red Clay Consolidated School District,

Wilmington, DE

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Slide 126 What would school look like

without walls?


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Slide 127

So we know we need walls!

• We will review how we plan our schools.

• How do we maintain our schools?

• How do we build new schools?


127

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Slide 128 You need a plan!

• How many schools do you need?

• How many schools WILL you need?

• How many schools do you have?

• How long will the schools that you have last?


128

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Slide 129 Did you know?

• The average age of a school in the US is 42 years old!

• 1927 new schools were opened in 2008.

• 2120 schools were closed!• Public school enrollment

is expected to increase by 12% before 2017.


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Slide 130

How do we maintain them?

• A strong maintenance team is necessary to extend the service life of schools.

• Focus on preventive maintenance, use electronic work orders.

• Perform life cost analysis rather than the early savings!


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Slide 131

Train your team

• They must focus on good work skills.

• They should have a strong sense of ownership in the facilities.

• They can be a key resource for any energy saving initiatives!


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Slide 132

Build your next school!

• Once you know that you need a new school.

• Where can you build it?

• How much money will it cost too build?

• How will you pay for it?


132

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Slide 133

Marketing for school facilities

• Use your parents as key stakeholders

• Sell your School Board

• Sell your elected officials

• Sell your voters or the public!


133

Caution: Most states do not allow schools to advocate , only to inform with facts regarding school district bonds

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Slide 134

Once you pass a bond or budget

funding • Find the right architect.

• Decide what construction model you would like to use: Managing Architect versus Construction Manager.

• Begin planning!


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Slide 135

What else?

• Outside groups using school facilities.

• Recreational and sports facility management.

• Green cleaning initiatives.

• Fixed assets.

• IPM programs.

• Energy purchasing and conservation programs.

• Life safety management programs.


135

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Slide 136

Where can I learn more?

• ASBO School Facilities Committee

• National Clearinghouse for Educational Facilities.

• Facility Masters Program.

• Just ask me!


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Slide 137

Manage Information

Systems

Ellen R. Skoviera, RTSBA, SFOLeander ISD Leander, TX


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Slide 138

Assist in Developing Technology Plan

• What is the district’s Technology Vision?

• What is desired for children to use and to know?

• Roles include automational, transformational, communications, efficiency

• “Mission critical”

• What is mandated?

• What does it take to get there?


138

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Slide 139


Consider:• Infrastructure, telecommunications (e-rate)

• Training of staff (critical!)

• Equipment standards and refreshment

• Accessibility of printers to classrooms (cost factor)

• Standardization of software

• Disaster and recovery (share with other schools?)

• Business interruption insurance


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Slide 140


• High degree of attention needs to be placed on security

• Secure versus non-secure sites

• Many textbook companies are offering online textbook enhancements, but the sites are not secure: FERPA and privacy concerns

• National Education Technology Plan3d2know.cosn.org/presentations/DDDottawa.ppt

www.classroomtco.org


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Slide 141


• Open source computing vs. proprietary software

• Cloud computing

• Scope agreement (scope creep)


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Slide 142

CoSN Checklist for Efficient Operations

• IT Asset Management

• Manage software licenses repurpose minimally used computers: Some computers are used more than others. Certain software applications are no longer used, or they’re not installed on all of the systems for which they are licensed. It is prudent to make sure that computers (including servers) are located where they are needed most and licensed only for the software actually in use. An IT asset management application can monitor this use over the network, evaluating usage results over time.


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Slide 143


• Help Desk and Centralized Support Tools

• Technical support consumes time and money when technology professionals must travel from building to building to maintain equipment, troubleshoot problems and support end users. With already stretched staffs and more staff reductions in the offing, it’s a good idea to find a way to support users more efficiently.

• Automated, remote support from a centralized help desk is an answer. Centralized user support requires tools to view and control computers remotely. This approach to problem management does have some up-front costs, but it provides the opportunity for efficiencies over the longer term, while maintaining user satisfaction by effectively managing responses to support requests. A vendor-provided centralized support ROI calculator can be found on KACE's website.


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Slide 144


• Computer Refresh Cycle

• During times of economic stress, one of the budget areas that receives scrutiny is the IT capital budget and the computers scheduled for replacement. Leasing…

• Direct and Indirect Labor

While looking into reducing time computer support techs spend traveling through centralized support techniques, it is also important to ask, "Who is providing direct labor services?" Direct labor includes all personnel who have as at least part of their responsibility to provide computer support or other computer services. This may include external providers, teachers, aids, school-based techs who don't report to the IT organization, as well as the computer services organization. Is your current support structure as effective as it can be? In many cases it doesn't make sense to pay teachers, who are not trained as techs and are more expensive, to provide user support services.


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Slide 145


• Computer, Server and Network Consolidation• Server Consolidation and server virtualization reduce complexity, OS

and other software licenses, and power usage. This process involves up-front planning and some initial investment, but can result in significant savings. This topic is covered under "Other Resources" and in CoSN's Green Computing Leadership Initiative.

•• Networks: A district telecom system typically consists of data lines

from campuses to the central office and connection to the Internet, plus internal and external voice communications and often security and clock synching networks. The external voice connections through the local telephone company can add up to a significant cost, as do Internet access lines and Internet service provider (ISP) charges. A study of VoIP costs and savings should be considered, as well as consolidation of the data networks.


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Slide 146

CoSN Checklist for Efficient Operations• Number of Supported Operating Systems and Applications• A broad mix of desktop, laptop and server operating systems requires a broad

mix of support talent and complicates system integration and network management. This is not to say there should be only one operating system. More than one client and one server operating system however, that supporting multiple OS versions also could be more costly in terms of support talent and system/network integration issues.

• Printing• Printing and copying can be major expense that include hardware, ink or toner

cartridges, energy and paper costs. It’s important to evaluate your current printer inventory: How many and what type of printers and copiers are connected to computers and on the network? Operational costs can be drastically reduced by replacing individual other inkjet printers in favor of strategically located print/copy centers. Implementing electronic forms for staff and school board use can also reduce the cost of printing. Some of these issues are covered in CoSN's Green Computing Leadership Initiative.

•http://www.cosn.org/Initiatives/ClassroomTotalCostofOwnership/Checklist/tabid/5126/Default.aspx


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Slide 147 147

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Slide 148

Maintain Technology and

Telecommunications Systems

• Platform decisions-cost and complexity

• Staffing ratios for support - fixing and teaching

• R&D: emerging trends and technologies

• Cloud computing, in-house programming, open-source

• VoIP, POTS

• Refreshment cycles, and how funded

• E-rate decisions

• Security policies, spam filtering, content blocking


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Slide 149 Maintain Technology Systems/Oversee

Telecommunications Systems

• Capacity should always be measured: when will you need more (ports? shelves? band width?) Conduct predictive exercises

• Planning for capacity is multi-year effort (budget and bonds)

• License compliance

• Acceptable use policies, employment consequences

• Policies on social media-risks and benefits


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Slide 150 Manage Technology and

Telecommunications Systems• Staffing: expertise and staying competitive with market

• Preventive Maintenance schedules

• Service Level Agreements

• ITIL:

• Responding to growing dependence on IT, the UK Government's Central Computer and Telecommunications Agency (CCTA) in the 1980s developed a set of recommendations. It recognized that without standard practices, government agencies and private sector contracts were independently creating their own IT management practices.The IT Infrastructure Library originated as a collection of books, each covering a specific practice within IT Service Management. ITIL was built around a process-model based view of controlling and managing operations often credited to W. Edwards Deming and his plan-do-check-act (PDCA) cycle.

• http://en.wikipedia.org/wiki/Information_Technology_Infrastructure_Library


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Slide 151 151

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Slide 152

Manage Information Systems

Questions?


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Slide 153

Manage Human Resource

Functions


153

Matthew J. MalinowskiDirector of Business AffairsSchool District of Cheltenham TownshipElkins Park, PA

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Slide 154

Manage Hiring of Good Employees

• Recruitment

▫ Review the necessary qualifications by appropriate personnel: HR, principals, supervisors

▫ Utilize exit interview paperwork


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Slide 155


• Vacancy Notice

▫ Include job description or summary job description

▫ Work Schedule

▫ Hourly rate

▫ Salary


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Slide 156


• Application• Qualifications• Reference Check• Interviews

▫ Use at least teams of two Ensure at least one individual on the team is knowledgeable

of job functions

▫ Document questions and answers▫ Ensure questions are appropriate

▫ Prohibit comments that are personal and subjective


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Slide 157


• Orientation Goals

▫ To Promote the new employee’s identification with the school entity

▫ To facilitate the new employee’s successful adjustment to the entity and to the position to which he/she has been assigned


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Slide 158


• Probationary Period

▫ 30 days to 1 year

▫ Formal evaluation


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Slide 159 Manage Hiring of Good

Employees

• Tour of facility• Introduction to staff• On-site organization structure• Reporting time/procedures• Inclement weather procedures• Attendance/punctuality• Absence notification• Special equipment/supplies (tools, etc.)• Dress• Security/ID badges• Emergency procedures• School calendar• Break times• Lunch area procedures

• Parking• Telephone calls/rules• Overtime/comp. time/extra duty• Staff/faculty meetings• Sick leave/other leaves• Jury duty• Safety/accident reporting• Handbook or contract distribution• Review of position description• Evaluation form• Review and receipt of particular policies• (harassment, smoke/tobacco/drug-free

workplace, workers’• compensation, evaluation, discipline,

child/student abuse)• Explanation of applicable employee benefit

programs• (Retirement, health and life benefits,

flexible spending accounts)• Tax-sheltered annuities• Payroll dates and procedures• Probationary period


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ORIENTATION TOPICS

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Slide 160

Develop Compensation Structure

• Compensation Management

▫ Goal: Have a system of determining compensation for employees that is:

Fair

Understandable

Rational


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Slide 161


• Compensation Management▫ Internal Equity Range of pay for positions in organization and the relative

value/rate of pay assigned

▫ External Equity Rate of pay for a position as compared to the “market”

“Market” for school districts is surrounding districts

For some trades and technology other external data may be relevant

Critical to attracting and retaining qualified candidates


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Slide 162

Manage Staff Development and

Training Programs

• Link Training with ASBO/ Local ASBO

• Look for appropriate college opportunities for staff development

• Bring effective Personnel through internal and external development programs


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Slide 163

Manage Evaluation ProcessPurpose of Evaluation

• First, it acts as the tool to evaluate administrator performance

• Secondly, it provides the documentation necessary to award merit increases as a result of demonstrated performance


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Slide 164

Manage Personnel Administration• Pertinent Regulations

▫ Family and Medical Leave Act of 1993 (FMLA) The U.S. Department of Labor’s Employment Standards Administration, Wage and Hour Division,

administers and enforces the Family and Medical Leave Act (FMLA) for all private, state and local government employees, including school entities. FMLA became effective on August 5, 1993 and entitles eligible employees to take up to 12 weeks of unpaid, job-protected leave in a 12-month period for specified family and medical reasons. The employer may elect to use the calendar year, a fiscal year or a 12-month period prior to or after the commencement of leave as the 12-month period.

The law contains provisions on employer coverage, employee eligibility for the law’s benefits, entitlement to leave, maintenance of health benefits during leave, job restoration after leave, notice and certification of the need for FMLA leave and protection for employees who request or take FMLA leave. The law also requires employers to keep certain records.

School entities should adopt policies to clarify specific aspects of the law.

▫ Consolidated Omnibus Budget Reconciliation Act (COBRA) Federal law requires that employers offer eligible employees and their dependents the opportunity for

a temporary extension of health coverage called continuation coverage at group rates in certain instances, or Qualifying Events, where coverage under the plan would otherwise end.

▫ The Health Insurance Portability and Accountability Act of 1996 (HIPPA) HIPAA protects health insurance coverage for workers and their families when they change or lose

their jobs.

http://www.hhs.gov/ocr/privacy/

▫ Drug-Free Workplace Act of 1988 Required of any organization who receives federal funding


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Slide 165

Manage Personnel Administration▫ Omnibus Transportation Employee Testing Act of 1991

requires all school entities to establish programs and practices designed to help prevent accidents and injuries resulting from the misuse of alcohol or controlled substances by drivers of commercial vehicles subject to the commercial driver’s license (CDL) requirements

▫ Harassment Policy Equal Employment Opportunity Commission guidelines on discrimination because of sex define

sexual harassment as any unwelcome sexual conduct that “has the purpose or effect of unreasonably interfering with an individual’s work performance or creating an intimidating, hostile or offensive work environment.”

▫ Americans with Disabilities Act (ADA) Activities covered under the ADA include but are not limited to walking, talking, seeing and

hearing. People with a record of such impairment and those regarded as having an impairment are protected under the ADA.

▫ Age Discrimination in Employment Act (ADEA) prohibits employment discrimination against any individual forty years of age or older.

▫ Pregnancy Discrimination Act (PDA) Employees who are pregnant must be treated the same as other employees with similar disabilities

or limitations. An employer cannot refuse to hire a woman because she is pregnant nor may an employer terminate a woman simply because she becomes pregnant.

If an employee is temporarily unable to perform the requirements of a job due to pregnancy, the employer must treat her like any other temporarily disabled employee

▫ State Regulations Veterans Preference

State Certification Guidelines


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Slide 166

Manage Employee Benefit Programs

• The most important and overlooked aspect of employee benefits administration is communicating the value of these benefits to staff

• Benefits can average 25-30% of total compensation for most entities


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Slide 167

How to Communicate Benefit

Information

• Personalized statements sent periodically to each employee showing the employee’s salary and an itemized list of the benefits available to that employee and the entity’s cost to provide those benefits

• Benefit booklets written so that they can be easily read and understood by the employee

• Periodic meetings to review changes in coverage utilizing insurance company representatives to explain coverage, answer questions, etc.

• Orientation programs for new employees


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Slide 168



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Slide 169


• All school administrators should have a basic understanding of the value and coverage offered through their entity’s benefit package. They should be able to direct employee inquiries to the appropriate staff person who can answer specific questions. Areas in which staff members must be knowledgeable include:

• Eligibility requirements for all insurance coverage• Rates for all insurance coverage• Co-payment amounts, if applicable• COBRA regulations• Eligibility requirements for PSERS• Basic understanding of all coverage provided• Amounts and procedures for calculating vacation days, sick

days, personal days, etc.


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Slide 170

Manage Ancillary Services

Ellen R. Skoviera, RTSBA, SFOAssistant Superintendent for Business and OperationsLeander ISDLeander, TX [email protected]


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Slide 171

Manage Ancillary Services

• There is a tendency in society to see the mission of schools as exclusively instructional

• The unfortunate outcome is other areas are ignored when they should also be valued for their role in providing equal opportunity and meaning to the social and educational mission of schools


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Slide 172

Transportation and Food Service

Programs

• Schools would be negatively impacted without these operations

• Every child has a right to a good education without regard for socioeconomic status

• Every child should be able to get to school without hardship and attend classes free from hunger


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Slide 173

Transportation and Food Service

Programs• There is no equal opportunity when educational

programs are physically inaccessible or when children are underfed

• All stakeholders in education should be concerned with organizing and operating efficient systems for transporting and feeding children.


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Slide 174

Transportation

• These operations are large and complex regardless of school district size

• Urban districts use many buses to transport thousands of students over short distances

• Rural districts also need many buses, despite low pupil population, to travel over countless open miles


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Slide 175

Transportation

• Actual costs may be similar, and large and small systems alike face issues of safety, insurance, and so on

• Billions are spent annually, making it a major industry

• Complex issues of liability, safety, and equal access

• State and federal regulations


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Slide 176

Transportation Function

• No doubt one of the most visible services in schools

• Bright yellow school buses arrive in front of homes of more than half of all school children each morning

• And the bus is often the last school contact of the day


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Slide 177

Transportation Function

• Also involves taking students on field trips and to athletic and academic events

• Also assist with other services such as special education


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Slide 178

“When floors shine, the schools seem

good”

• When buses are late or when problems arise, everything about schools seems suspect

• As a result, transportation is one of the most important and visible non-instructional activities of schools


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Slide 179

Transportation Origins and Purpose

• Transportation and state financial support have been in existence since 1869

• Pupil transportation has had no choice but to grow as compulsory attendance, district consolidation, and the advent of motor vehicles have drastically affected society.


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Slide 180

Transportation Origins and Purpose

• A major role for transportation has also arisen from court-ordered desegregation plans revolving around forced busing

• More recently, magnet schools and year-round schools have added to the complexity of pupil transportation


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Slide 181

Complexity of Transportation

• Variables such as population density, number of pupils to be transported, topography, road conditions, and length of routes affecting the size of buses on routes

• Movement of population within a community may create new transportation demands

• Racial integration may require new school attendance boundaries


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Slide 182

Director of Transportation Services

Requires a variety of talents and skills:

• Ability to efficiently organize a large transportation fleet and to consistently demonstrate human relations skills in working with personnel problems

• Skilled in decision-making to manage effectively

• Knowledge of diverse topics, including computer routing, budgeting, labor relations, inventory, drug testing, underground storage tanks, and hazardous materials


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Slide 183

Comprehensive Transportation Manual

• Document should be open to public, and in-service should be held with transportation staff to clarify the policies of the district

• Special emphasis must be given to driver training, pupil discipline, energy conservation, disability issues, public relations, bus routes, and bus schedules


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Slide 184

Transportation Funding

• Like other forms of state aid, transportation aid varies in amount and distribution method from state to state

• Formulas include a variety of factors, such as expenditures per pupil, population density, bus capacities, matching grants, or some combination as common denominators


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Slide 185

Transportation Funding

• Some states provide a transportation allowance based on hazardous walking conditions

• In some states, transportation aid is tied to the general fund formula

• One basic similarity: in most states, transportation aid almost NEVER covers the entire cost


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Slide 186

What other Transportation issues are

relevant?

• Owning or Contracting

• Computerizing Transportation Services

• Purchasing Buses

• Maintenance and Safety


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Slide 187

Owning or Contracting

• Contracting avoids the cost of buying buses

• Contracting avoids the high maintenance cost of older buses

• It’s argued that contracting lowers capitalization costs, reduces personnel and administration costs, and provides greater efficiency through contractors whose sole business is transportation


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Slide 188

Contracting Transportation

Counterarguments, however, include:

• how to ensure quality performance by a contractor when the district no longer controls the public relations aspect of the contractor’s behavior

• the need for insuring against liability for acts of contractors.


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Slide 189

District Ownership of Transportation

Arguments for district ownership:

• Provides more flexibility, provides selection, training, and supervision of transportation employees, and ensures control over changes in operational costs


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Slide 190

Owning or Contracting

• It may be that there is no one best option for transportation, as the right choice may depend on a district’s financial position and the community’s attitude about this vital service


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Slide 191

Computerizing Transportation Services

• Every year more districts are using computerized routing systems

• These plans are cost-effective in that they can apply mathematical formulas for routing efficiency

• Aid in mapping routes, including census data, highway time delay studies, and other manual data supplied


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Slide 192

Computerizing Transportation Services

• Software is even available to preplan routes in undeveloped areas in advance of actual population movement

• Computerized fleet maintenance is also common. Total costs and item costs can be accounted for instantly and used to make decisions about maintenance and disposal

• Geocoding, privacy issues


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Slide 193

Purchasing Buses

• Large outlays (over $50,000 per bus, plus additional thousands for a bus with a wheelchair lift)

• Local districts use written specifications, usually based on state guidelines

• Especially complicated because they are purchased on separate chassis and body bids, but this provides both economy and specialization that can be used by manufacturers


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Slide 194

Purchasing Buses

• Larger buses are more versatile, which in turn reduces the number of buses and staff.

• Smaller buses are used in sparsely inhabited areas or inner cities on crowded streets


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Slide 195

Maintenance and Safety

• Maintenance, safety, and staff are inseparable in any discussion of transportation

• Good drivers cannot offset bad buses, nor can new equipment offset bad drivers.

• Transportation utmost duty: To ensure student safety


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Slide 196

Surprise Quiz!

• Let’s say you are a bus driver. You make your first stop, and ten children get on. At the second stop, two get off (for some permissible reason), and eight get on. At the third stop, seven students board the bus. When you get to the school, all the children disembark.


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Slide 197

Surprise Quiz! (Cont’d)

•How old is the bus driver?


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Slide 198

Food Service Programs

• Like transportation, the food service function is a key to effective and efficient operation of schools

• Less visibly related to the primary mission of schools, but provides vital support to the instructional process


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Slide 199

Food Service Function

Need to understand the following:

• How it operates

• How meal prices are set under federal, state, and local participation

• How revenues and expenditures in food service budgets are allocated

• Much more regulation on meal content


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Slide 200 Linking School Performance

to Nutrition

• Undernourishment due to poverty and ignorance is still sizable in today’s era of economic progress

• Data exists that links poor school performance to nutrition

• The role of food service in schools has increased with time, as seen in the fact that most U.S. schools now have both breakfast and lunch programs


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Slide 201

Food Service Funding

• Long history of federal (U.S.), state, and local subsidies to supplement meal prices paid by children

• These sources make up the revenue side of food service operations and are highly interdependent


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Slide 202

Federal Support

• Surplus commodities began to be used in school lunch programs in 1936

• Not long afterward, The United States Congress enacted the National School Lunch Act authorizing grants to states to help provide food and facilities for school lunch programs


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Slide 203

State Support

• Individual state participation is harder to summarize because each state has been free to determine the extent of its involvement in the National School Lunch Act

• State funding is relatively small compared to federal spending


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Slide 204

Local Support

• The local contribution is defined as dealing with the leftover costs after fed/state revenues are expended

• The local role is thus one of determining how much, if any, the district wishes to further subsidize meals by shifting additional local tax revenue to food service


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Slide 205

Local Support

• Leaving the unfunded part of meal costs to the local district creates a heavy burden for schools, in that such decisions have moral and financial implications.

• If the district channels all unfunded costs to families, then some children may not receive the intended benefits of food service programs.


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Slide 206

Local Support

• If the district subsidizes meals from tax revenues, a choice to reduce other program expenditures is often made.

• Costs, efficiencies, and all other aspects of operations are a function of district size and skill in directing food service operations. The number of meals and dollars becomes large very quickly.


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Slide 207

Relevant Issues

• Often the biggest problem is rising costs associated with purchasing and preparing foods such as supply price increases, labor costs, and equipment and facilities – all of which must factor into what the district ultimately charges for meals.


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Slide 208

Compliance Requirements

• Compliance is a common concern whenever outside aid is provided. Assurances are directed to the federal government in return for dollars and commodities

• Districts must assure states of compliance so the state can provide its own assurances to the fed govt.


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Slide 209

Federal Rules and Regs

• Operate a nonprofit program

▫ Only a 3 month operating balance may be kept on hand and still be nonprofit

• Serve meals that meet nutrition requirements

- Programs can offer single menu, fast food choice menu, or a’ la carte menu


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Slide 210


• Price meals as a unit

▫ To count as reimbursable, meals must be priced as a unit. This does not prohibit single item sales

• Supply free and reduced meals

▫ To eligible needy children

• Agree to avoid discrimination

▫ No child may be refused because of inability to pay, race, gender, or national origin


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Slide 211


• Keep accurate records of income and expenditures

▫ Records are subject to intensive state and federal audits

• Complete a formal reimbursement claim

▫ Claims must be sent on a timely basis each month to the state


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Slide 212


• Distribute applications for free and reduced meals

▫ Districts must actively inform each student of the program

• Review and act on F&R applications

▫ Parents or guardians must be notified regarding decisions

• Develop and implement verification procedures

▫ A method of verifying accuracy of applications must be followed

212


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Slide 213


• Maintain accurate participation records

▫ The district must establish procedures for obtaining accurate meal counts

• Establish and implement purchasing procedures

▫ Purchasing procedures must comply with state and federal regulations


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Slide 214


• Use federally donated foods or commodities

▫ This includes the ability to store commodities properly without spoilage

• Approved programs provide meals based on daily nutritional requirements

▫ Must provide approx 1/3 of the recommended dietary allowance (RDA)


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Slide 215

Meal Reimbursements

• To receive reimbursement, a lunch must contain a set of specified components and menu items, where components are:

▫ Meat or meat alternate

▫ Vegetable and/or fruit

▫ Bread or bread alternate

▫ Milk

• The Goal is a balanced diet


215

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Slide 216

Food Service Management

• Options on types of mgmt systems best suited to a district’s needs:

▫ Management companies

▫ Centralized in-house operations

▫ Decentralized in-house food service

• Careful cost analysis necessary since each has its benefits and problems


216

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Slide 217

Management Companies

• Use of outside management companies centers around debate of whether it is more cost-effective

• The main reason many districts have decided to contract for food service has been a benefit stemming from fiscal and managerial efficiency


217

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Slide 218

Benefits to Contracting

• Administrators have more time for curriculum

• Wage and benefit costs, disputes, and grievances have been reduced because the district no longer handles personnel

• Menu planning is improved by use of food professionals


218

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Slide 219

Benefits to Contracting

• In-house record-keeping requirements are reduced

• There is strong incentive for food service to become a profit center with high client satisfaction


219

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Slide 220

Contracting Services

• Districts should take care to choose from a list of reputable and experienced firms

• Should act from a set of bid specs to assist bidders in deciding whether to bid, as well as establishing the criteria for evaluating proposals


220

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Slide 221

In-House Operations

• Centralize or de-centralize services

• On-site food preparation vs. satelliting from central kitchens

• ‘Satelliting’ means delivering cooked food with finishing kitchens on-site, in contrast to on-site food prep

• Major benefit is mass preparation and non-duplication of full facilities

• Concern could be loss of site control and responsiveness, and over standardization


221

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Slide 222 In-House Food Services Director

• Full time director highly trained to assure the efficient and cost-effective operation.

• Needs skills to work closely with principals and central office, as well as supervising service workers

• Must work with district budget director, and provide leadership in setting meal prices


222

In-House Operations

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Slide 223

Wrap up

• Ancillary services are a vital contribution to educational outcomes

• Although often lacking in glamour, they represent vast expenditure outlays and significant liability

• They are interrelated parts of a complete educational system. Each piece makes a vital contribution and can’t be slighted without significant harm to children


223

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Slide 224

All One Team

• Involving support staff in the instructional program, such as voluntary mentoring, has tremendous benefit to the campus, and generally provides more fulfillment to the workers. Job satisfaction is a tremendous asset of any school.


224

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Slide 225

Thank you!

• Thank you for being here today and for your personal investment in bettering the lives of those we educate and care for

• Thank you for your personal commitment to enriching your skills

• HAVE A GREAT CONFERENCE!


225

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SFO® Certification The Mark of a Professional

ASBO International Certified Administrator of School Finance and Operations® (SFO®)

Guide to Studying for the Examinations

Written by Janice DeMeuse, SFO, and Debbie Fry, SFO, for ASBO International

Copyright ASBO International 2012

ASBO International SFO Certification

Guide to Studying

2

Table of Contents

ASBO International Certified Administrator of School Finance and Operations® (SFO®) ................ 1

Table of Contents .......................................................................................................................................... 2

Overview of the SFO Credential Program ..................................................................................................... 4

How to Prepare for the SFO Certification Exam ........................................................................................... 4

Learn what will be covered in the test. ..................................................................................................... 4

Assess how well you know the content. ................................................................................................... 4

Collect the materials you need to study. .................................................................................................. 5

Plan and organize your time. .................................................................................................................... 5

Take additional courses. ........................................................................................................................... 5

Form or join a study group........................................................................................................................ 5

How to Start a Study Group .......................................................................................................................... 5

How to Run an Effective Study Group .......................................................................................................... 6

Using the Available Study Materials ............................................................................................................. 6

Exam Day Preparation................................................................................................................................... 7

Test Day Procedures for Pearson VUE Testing Centers ............................................................................ 8

Identification (ID) .................................................................................................................................. 8

Acceptable forms of photo with signature identification ..................................................................... 8

Acceptable forms of signature identification ....................................................................................... 8

Unacceptable forms of identification ................................................................................................... 8

Appendix A - Exam Content Areas ................................................................................................................ 9

Context of the SFO Exam Part 1: Accounting ............................................................................................ 9

Content Areas and Tasks Part 1 ............................................................................................................ 9

Context of SFO Exam Part 2: School Business Management .................................................................... 9

Content Areas and Tasks Part 2 ............................................................................................................ 9

Appendix B - Test Question Format ............................................................................................................ 11

Sample question for the SFO Exam Part 1: Accounting .......................................................................... 11

Sample question for the SFO Exam Part 2: School Business Management ............................................ 11

Appendix C - SFO® Certification Authoritative References List ................................................................... 11

Appendix D - Practice Questions ................................................................................................................. 12


Guide to Studying

3

Practice Questions for Preparation for the SFO Certification Exam Part 1: Accounting ........................ 12

Answers to the SFO Exam Part 1: Accounting Practice Questions: ........................................................ 18

Practice Questions for Preparation of the SFO Certification Exam Part 2: School Business

Management ........................................................................................................................................... 19

Answers to the SFO Exam Part 2: School Business Management Practice Questions: .......................... 26

ASBO International's certification program is governed by the Certification Commission, a semi-independent

certifying body of the Association of School Business Officials International. In adherence to best practices

for certifying bodies, Certification Commission volunteers and certification staff are not involved in the

development of any preparatory program, and no preparatory program is endorsed by the Certification

Commission nor is a prerequisite to earn the certification. The Certification Commission and its staff are solely

responsible for the policies and administration of the certification program, including application procedures

and qualification requirements.

About the Authors:

Janice DeMeuse, SFO, has worked in school business management in Wisconsin for 34 years and is the

business manager for Luxemburg Casco School District. She currently serves as the president of Wisconsin

ASBO and has been active with ASBO International as a member of several volunteer committees. She has a

bachelor’s degree in business administration, a master’s degree in school business administration, and is a

licensed school business official in Wisconsin.

Debbie Fry, SFO, has over 20 years of school district business experience in California, and has a bachelor’s

degree in business administration and a master’s degree in economics. She is also a Certified Chief Business

Official in California by CASBO, an ASBO affiliate.


Guide to Studying

4

Overview of the SFO Credential Program

Economic challenges continue to have a huge impact on our schools and force difficult choices that erode trust

in the communities we serve. In these complex financial times, it is important to demonstrate to the

community that your school’s finances are managed by knowledgeable and ethical administrators.

As ASBO International examined the certification requirements for school business officials across the United

States and Canada, it discovered a great diversity. Some states/provinces have no minimum requirements

and some states/provinces require a master’s degree and state/province licensure. The discovery of this

discrepancy led to the development of the Certified Administrator of School Finance and Operations (SFO)

program.

SFO certification is the professional credential that addresses these concerns. Developed by school business

management professionals, SFO certification adheres to the ASBO International Certification Code of Conduct

and validates the essential skills and knowledge all qualified school business management professionals

should have to meet their responsibilities.

Obtaining SFO certification is a straight-forward process. A candidate must first meet the eligibility

requirements, take and pass a two-part exam that covers Accounting and School Business Management, and

adhere to the ASBO International Certification Code of Conduct.

The following materials were developed to help candidates prepare for the SFO examination. The documents

address self-study versus study groups and how to start and run an effective study group. Exam content areas

and format are presented. There is a discussion of existing resources to help candidates study for the exam,

including some practice questions and answers. Exam day preparation tips are also offered.

The test was designed to be a comprehensive exam that demonstrates preparedness and professional

commitment. Congratulations on your decision to pursue the SFO certification. Good luck.

Visit www.asbointl.org/certification for detailed information addressing the eligibility criteria and application

process for the program.

How to Prepare for the SFO Certification Exam

Learn what will be covered in the test. ASBO has identified the competencies and major content areas covered by the exam along with the

percentage of questions relating to each area. Review the listing to hone in on the areas with which you feel

comfortable and those areas about which you believe you know the least. Use this review to prioritize your

study time. The exam content areas are listed on pages 9-10 of this document.

Assess how well you know the content. It is easy to think you are more prepared for the exam than you really are. Think carefully about how well you

know each of the areas. After becoming familiar with the competencies and content areas, review the sample

questions. Review the correct responses to the sample questions to help identify areas that need further

study. Use the review to focus the majority of your study time on the areas with which you feel least familiar.

However, all areas tested demand serious review; leave time to review all content areas.

http://www.asbointl.org/certification


Guide to Studying

5

Collect the materials you need to study. This document discusses existing resources available to support you as you as you study. For example, did you

take a course in which the area was covered and do you still have the textbook or your notes? Does a local

library--public or college--have materials you might borrow? Do you know a teacher or professor who can help

organize the study? Is there someone in your state/province who previously earned the certification that you

could approach for assistance? Would a study group work best with your learning style and help maintain your

momentum?

Plan and organize your time. Be honest with yourself about when you will actually devote time to study. It’s probably not feasible to plan to

study at night after working all day. Set a realistic schedule that will help you be successful. A variety of testing

dates are available, so when selecting your test date(s) be sure to allow sufficient time to study before the

exam.

Take additional courses. Talk with a local professor, your state/province ASBO affiliate organization, or other school business officials to

help you determine if there are specific courses you can take that cover the content areas you have not yet

studied.

Form or join a study group. A study group can be an effective way to review content. Group study may be most effective after you have

identified the areas in which you need the most review. A group that focuses on that particular area may be

most beneficial. See below for guidance in starting a study group.

How to Start a Study Group

Candidates who pool their resources and study together may be more confident in their knowledge and more

likely to be successful in passing the exam. The group might even consider scheduling their tests at the same

time and perhaps traveling together to the exam site.

A convenient way to form a study group is to work through your state/province ASBO affiliate organization. The

affiliates usually have a communication mechanism in place through which you can quickly contact others who

are preparing for the exam. If you have identified content areas that need more attention, include that

information in your study group request. Your state/province ASBO affiliate organization may also be able to

recommend someone within your state who has expertise in your area of need and who might serve as an

advisor or mentor to your study group.

If you are comfortable with utilizing technology to study with individuals beyond your immediate geographical

area, consider using ASBO ConnectEd, a social networking website, to locate exam candidates who want to

study a specific content area. Consider communicating via technology to study together virtually.


Guide to Studying

6

How to Run an Effective Study Group

Keep your group small. Roughly three to six members is a good size to allow for good interaction but

not so large that it adds confusion to discussions.

Establish regular meeting times and places that work for everybody.

Agree that everyone comes to the meetings prepared to participate.

Bring a written test question to each meeting to quiz other group members.

Take turns acting as a group moderator to keep the conversation on topic.

Hold a discussion about the prepared quiz questions.

Predict test questions and quiz each other.

Create a code word to recognize good ideas and use it to congratulate group members.

Share a friendly word with members who are slacking off to encourage them to get back on track.

Reconvene and celebrate after the exam(s) is completed.

Using the Available Study Materials

Several resources are available to help you prepare for the examination. These resources provide an overview

of all areas covered on the examination.

The suggested materials cover a wide range of processes in school operations, human resources, maintenance

and operations, purchasing, and financial and managerial accounting to name a few. Allow yourself plenty of

time to read the materials.

Consider the application of the processes in your experience, and develop an approach to understanding a

written version of the processes. For example, you may be to a point in your career where you just naturally

record capital assets, but now you may be tested on the process, so make sure you can fully interpret it in

question form.

Develop flash cards of certain processes to help promote recall and memorization.

Work within a study group of other aspiring SFO professionals.

Contact current SFO professionals for tips and assistance in preparation.

Answer the sample questions, more than once – up to a point of getting 100% correct responses.


Guide to Studying

7

The following study resources are available on ASBO International’s website, www.asbointl.org/certification.

Exam Content Areas (appendix A)

Test Question Format (appendix B)

Authoritative References List (appendix C)

Practice Questions (appendix D)

Current listing of test preparation courses offered by ASBO International and ASBO affiliate

organizations

Exam Day Preparation

If you scheduled your test under a nickname or variation of your legal name, and your identification doesn’t

match exactly (i.e., Debbie instead of Debra) check ahead of time for acceptability.

If you scheduled an early morning test time, plan to wake up at least an hour and a half before you have to

leave for the test site.

Eat a good breakfast so hunger doesn’t distract you during the examination. If you have later test times or

issues with blood sugar fluctuations, plan accordingly. If taken together, both sections of the test can require

up to four hours to complete.

Make sure you have your identification and your test schedule confirmation with you when you leave to go to

the test site. Do not take unnecessary personal items as you will not be able to take anything with you into the

testing room.

Take about an hour to review sample questions and subject areas. Reading the questions and correct answers

in to a recording device and playing it back is sometimes helpful.

As you are driving and/or travelling to the test site, play back your recording or ask yourself the questions aloud

so that you can hear your answers.

When you arrive, present your identification and test confirmation to the testing center representative. You will

be asked to leave any other personal belongings (purse, cell phone, etc.) in a lockable locker during the test.

You will be given online instructions for the examination.

Take a deep breath!

Read each question carefully, there is plenty of time to answer the questions.

Good luck!

http://www.asbointl.org/certification


Guide to Studying

8

Test Day Procedures for Pearson VUE Testing Centers You are encouraged to report to the test center one-half hour before your scheduled exam time. Two forms of

ID are required. You must present a valid government-issued photo ID with a signature and a second form of ID

with a signature (see information below on acceptable forms of ID). The name on the IDs must match the name

on the exam confirmation email.

Identification (ID)

Bear the candidate’s name exactly as provided during the exam registration process (as it appears on

the exam appointment confirmation letter).

Have a permanently affixed photo of the candidate’s face.

Be current — expired IDs will not be accepted.

Be an original document — no photocopies will be accepted.

Acceptable forms of photo with signature identification

Government-issued driver’s license.

Passport.

Military ID (except those with chips).

Permanent resident visa.

Other government-issued ID.

Acceptable forms of signature identification

Any on the above photo ID list.

Social Security cards.

Credit/bank ATM card (signature required).

Unacceptable forms of identification

Employee identification or work badge.

University/college identification.

If you do not have a valid photo ID or signature ID, or arrive more than 15 minutes after the scheduled exam

time, you will NOT be permitted to enter the test center and your examination fees will be forfeited.

The total computer-based testing time is two hours for Part 1: Accounting, and two and one-half hours for Part

2: School Business Management. Included in these testing times is five minutes for review and agreement of

the non-disclosure statement, five minutes for a tutorial, and five minutes for a follow-up survey.


Guide to Studying

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Appendix A - Exam Content Areas

Context of the SFO Exam Part 1: Accounting The Part 1: Accounting exam of the SFO Certification is written from the perspective of the professional who

may or may not have any years of experience in school business management. The knowledge and skills

covered in this exam represent what this professional should know at the time he or she is first hired for a

position in school business management.

The domains and content areas covered on this exam are as follows (percentage of the exam is provided in

parentheses):

Content Areas and Tasks Part 1 70 items total

Manage Accounting Systems (28% to 33%)

Maintain Accounting Software

Maintain Chart of Accounts

Reconcile General Ledger Accounts

Track Fixed Assets

Manage Accounting Functions (67% to 72%)

Manage Payroll Functions


Manage Accounts Payable Process

Manage Purchasing Procedures

Manage Annual Budgets

Prepare Financial Reports

Manage Cash Flow

Context of SFO Exam Part 2: School Business Management The Part 2: School Business Management exam of the SFO Certification is written from the perspective of the

professional who has at least three years of experience in school business management. The knowledge and

skills covered in this exam represent what this professional would learn over the course of at least three years

on the job.

The domains and content areas covered on this exam are as follows (percentage of the exam is provided in

parentheses):

Content Areas and Tasks Part 2 100 items total

Conduct Financial Planning and Analysis (27% to 32%) Serve as a School Leader

Review Financial Impact of Strategic Planning Goals

Develop Financial Goals

Evaluate Funding Options for Debt Management

Develop Outside Funding Sources

Analyze Economic Data

Analyze Demographic Data


Guide to Studying

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Develop Multi-Year Forecast

Estimate Real Estate Property Tax Revenues

Conduct Budgeting and Reporting Activities (15% to 20%) Project Student Enrollment





Conduct Risk Management Activities (10% to 15%) Evaluate Existing Risks

Address Results of Risk Audit

Conduct Annual Evaluation of Insurance Plans

Manage Insurance Plans

Manage School Facilities (7% to 12%) Update Facility Master Plan

Oversee the Operation and Maintenance of School Campuses

Oversee New Construction and Renovations

Manage Information Systems (4% to 6%) Assist in Developing a Technology Plan

Maintain Technology Systems/Oversee Telecommunication Systems

Manage Human Resource Functions (15% to 20%) Manage Hiring of New Employees


Manage Staff Development and Training Programs

Manage Evaluation Process

Manage Personnel Administration


Manage Ancillary Services (7% to 12%) Manage Transportation Services

Manage Food Service Programs

Manage Purchasing Process

Manage Other Service Programs


Guide to Studying

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Appendix B - Test Question Format

Sample question for the SFO Exam Part 1: Accounting

Q: What does the "Function" describe in the Chart of Accounts?

A. The item for which an expenditure is made

B. The activity being performed for which a service or material object is acquired

C. A way of classifying expenditures by physical location, budget, or cost center

D. A plan of activities and procedures designed to accomplish a predetermined objective

A: The answer is B.

Rationale: Hartman, William T., School District Budgeting, 2nd ed., Lanham, MD: ScarecrowEd, 2003.

Sample question for the SFO Exam Part 2: School Business Management

Q: What is the primary purpose of a physical risk inspection?

A. To identify potential maintenance issues

B. To identify potential future building needs

C. To identify potential entry points for intruders

D. To identify potential threats to the safety of students, staff, and the public

A: The answer is D.

Rationale: As a part of the risk management process, school business officials conduct physical inspections.

These inspections attempt to identify any physical deficiency or procedural issue that might affect the safety of

all persons using the building.

Appendix C - SFO® Certification Authoritative References List

ASBO International’s Certification Commission provides a general guide for the references and publications to

use as a study aid in preparation for the Certified Administrator of School Finance and Operations (SFO) exam.

The list is not an endorsement of the specific references, nor are the test questions necessarily taken from the

sources listed. The Certification Commission will review and update the list on an on-going basis.

Association of School Business Officials International, Standards of Excellence in Budget Presentation, Reston,

VA: Association of School Business Officials International, 2000.

Everett, Ph.D., Ronald E.; Lows, Dr. Raymond L.; and Johnson, Ed.D., Donald. Financial and Managerial

Accounting for School Administrators: Superintendents, School Business Administrators, and Principals, 4th

ed., Reston, VA: Association of School Business Officials International, 2003.

Earthman, Glen I. Planning Educational Facilities: What Educators Need to Know, 3rd ed., Lanham, MD:

Rowman and Littlefield, 2009.

Hartman, William T. School District Budgeting, 2nd ed., Lanham, MD: ScarecrowEd, 2003.


Guide to Studying

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Hartman, William T. and Stefkovich, Jacqueline A. Ethics for School Business Officials, Lanham, MD: Rowman

and Littlefield, 2005.

U.S. Department of Education, National Center for Education Statistics, National Forum on Education Statistics.

Planning Guide for Maintaining School Facilities, NCES 2003-347, prepared by T. Szuba, R. Young, and the

School Facilities Maintenance Task Force, Washington, DC: 2003.

Appendix D - Practice Questions

Practice Questions for Preparation for the SFO Certification Exam Part 1: Accounting The questions presented are practice questions for the Part 1: Accounting exam of the Certified Administrator

of School Finance and Operations (SFO) certification program. They do not represent the exam content to its

exact percentages of the domains presented in the exam content outline. These were created as a more

extensive set of questions to help candidates prepare for the exam. Answers to these practice questions can

be found on page 18.

1. What information is required to process an accounts payable invoice for payment?

A. Verified budget authority for item, accuracy of price, items received, and correct account code

B. Accuracy with purchase order price, amount ordered, and correct account code

C. Verified receipt of goods, price charged, and correct account code

D. Authorization to pay, goods received, accurate pricing, and correct account code

2. What strong internal control assures that only authorized employees are paid on a payroll?

A. Review of the payroll register by the supervisor of the payroll processing clerk

B. Written documentation from an authorized person other than the person processing the payroll

C. Approval of the payroll register after comparing it to the established staff list

D. Review of the payroll register by the school board chair

3. What is the purpose of a requisition system?

A. To acquire goods and services by purchase order and verify budget authority

B. To purchase goods and services through a formal bid [tendering] process and follow legal compliance

regulations


Guide to Studying

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C. To manage the compliance of purchasing goods and services for the different departments within the school

district

D. To verify all purchases are completed within the parameters of the budget and meet the bid [tender]

process laws

4. What primary factor should be considered when disposing of fixed assets?

A. The item is of no further use in its current location

B. There is an updated version of the item from the current vendor

C. The item has exceeded its useful life and is of no further use to the school district

D. A similar version of the item is available from another vendor

5. What factors should be considered in managing the budget for the year?

A. Compare current year's revenues and expenditures to a 10-year average for consistency

B. Compare estimated revenues and expenditures to projected actual revenue and expenditures for the year

C. Compare current year's revenues and expenditures to last year’s to determine if the budget is on track

D. Compare current year's budget to other school district budgets in the state [province] to check for

consistency

6. What is an example of a "proprietary fund"?

A. A trust fund

B. A general fund

C. A capital projects fund

D. An enterprise fund


Guide to Studying

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7. What information should be provided in a financial report so the governing body can determine the local

education agency's [authority’s] financial position?

A. A comparison of budget to actual revenues and expenditures and fund balance

B. A comparison of current year budget to prior year budget

C. A comparison of expenditures that have been approved by the school board

D. A comprehensive comparison of revenues and expenditures for the current year

8. What procedure should be in place for collection of unpaid accounts?

A. Prepare an aging list by customer and send letters, email, or call regarding collection on past due accounts

B. Immediately refuse any future services until the bill is paid

C. Prepare an aging list by customer and publish it in the local newspaper

D. Keep the invoices on the books and wait for payment

9. What represents the strongest control for processing payments?

A. An accounting employee pays from original invoices only, not from copies of invoices

B. Transactions are handled by the same employee from initiation to authorization

C. An accounting employee maintains a list of sequential check numbers to ensure all checks are accounted

for

D. The employee who authorizes the transaction is not the same employee who initiated the transaction

10. What is an important consideration when developing a data recovery backup plan?

A. The backup information will be securely stored on a separate server in the same location with the capability

to run the software

B. The backup information will be securely stored in an offsite location with the capability to run the software at

an alternate location

C. The backup information will be securely stored and accessible only to individuals who have the technical

knowledge to run the software

D. The backup information will be securely stored and accessible to a third-party vendor who has the technical

knowledge to run the software


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11. What activities affect cash flow?

A. Investing and timing of receipts

B. Budgeting and timing of receipts

C. Depreciation of assets and investing

D. Financing and depreciation of assets

12. To assure proper internal controls when processing timesheets for payment, what information is needed in

addition to time worked and rate of pay?

A. Budget authority, amount approved, and employee signature

B. Account code, description of work completed, and employee signature

C. Supervisor approval, employee signature, and account code

D. Budget authority, source of funds, and account code

13. Request for Proposals (RFP) must include which of the following items?

A. Payment terms

B. Project budget

C. Proposal due date

D. Manufacturer and brand

14. What is necessary to ensure that a public bid [tendering] process is successful and provides the desired

goods or services?

A. Ensure that appropriate vendors receive notice of the bid [tender] request

B. Require an independent legal review of the bid specification documents prior to the bid [tender] release

C. Ensure that the bid [tender] opening is performed in public with all bidders present during the opening

D. Develop a comprehensive bid [tender] specification and establish a fair rating system to evaluate bids

received


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15. How should a budget be monitored throughout the fiscal year?

A. By ensuring that the balance sheet accounts are in balance

B. By reviewing for variances in the revenue and expenditure accounts

C. By comparing current year activity to prior year activity

D. By accumulating the necessary data to prepare a trial balance

16. In an organization with no central purchasing function, who should be responsible for general ledger

coding of purchase requisitions?

A. The individual who is responsible for paying the invoice

B. The individual who is responsible for receiving the merchandise

C. The individual responsible for managing the specific budget being accessed

D. The individual consuming the merchandise

17. What accounts appear on a balance sheet?

A. Income, assets, and liabilities

B. Assets, liabilities, and equity

C. Income, expenses, and equity

D. Assets, expenses, and equity

18. What information does the Management's Discussion and Analysis (MD&A) provide?

A. A statement that compares current-year revenues received with expenditures for the same time period on a

fund-by-fund basis

B. A management report including all financial transactions on an accrual basis accounting

C. A narrative introduction and overview to the annual financial statements prepared by school district

personnel

D. An opinion of the auditor as to the viability of the school district


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19. What is an example of an accounts receivable for a school district using modified accrual basis

accounting?

A. Student activity receipts

B. School fees for the next school year

C. An unpaid invoice

D. School fees for the current school year


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Answers to the SFO Exam Part 1: Accounting Practice Questions:

1. D

2. B

3. A

4. C

5. B

6. D

7. A

8. A

9. D

10. B

11. A

12. C

13. C

14. D

15. B

16. C

17. B

18. C

19. D


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Practice Questions for Preparation of the SFO Certification Exam

Part 2: School Business Management The questions presented are practice questions for the Part 2: School Business Management exam of the

Certified Administrator of School Finance and Operations (SFO) certification program. They do not represent

the exam content to its exact percentages of the domains presented in the exam content outline. These were

created as a more extensive set of questions to use in assisting candidates in the preparation of the exam.

Answers to these practice questions can be found on page 26.

1. New construction, personal income, and retail sales are indicators in which kind of forecast?

A. Economic

B. Enrollment

C. Educational programming

D. Environmental impact

2. Preventive maintenance planning refers to which service area?

A. Facilities

B. Food services

C. School administration

D. Transportation system

3. How would a school business official know if a job description for the elementary building secretary needs to

be revised?

A. When the job description no longer resembles a neighboring school district's job description

B. When it is different from the high school secretary job description

C. When the secretary's annual evaluation is always reported as excellent

D. When the job description is no longer relevant to the evaluation process


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4. Which is a best practice for personnel management?

A. Praise and discipline in public

B. Praise in public and discipline in private

C. Reward and reprimand in a private setting

D. Praise and reprimand in writing

5. Which of the following should be covered by the personnel department during a new employee orientation?

A. Instructional methods to be used

B. History of the school district

C. Enrollment trends of the school district

D. Explanation of insurance benefits

6. Which element is a cornerstone in the development of a performance improvement plan?

A. The narrative of the plan

B. The timeline

C. The method of monitoring

D. The format of the plan

7. When managing a program, what information should be on the report that allows you to determine whether

the program is within budget?

A. Budget, expenditures, and encumbrances

B. Prior year budget, current year budget, expenditures, and encumbrances

C. Revenues, expenditures and encumbrances

D. Current month revenues and expenditures and encumbrances


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8. Which should be included in the building construction estimates for a replacement school building?

A. The increased cost of building insurance

B. The cost associated with the transportation of students to the interim building

C. A contingency for the cost of unexpected site conditions

D. The cost of moving furniture from the existing building

9. Which grant activity should be performed on at least a quarterly basis?

A. Calculation of expenditures of budgeted funds

B. The submittal of an application for additional funds

C. A budget revision for all grants

D. The preparation and submittal of reimbursement claims to date

10. How does the level of a deductible relate to managing risk for a local education agency [authority]?

A. When the deductible is lower then the risk is lower

B. When the deductible is higher then the risk is higher

C. When the deductible is higher then the risk is lower

D. When the deductible is lower then the risk is higher

11. At a minimum, how often should the fixed asset inventory for the local education agency [authority] be

updated?

A. On an annual basis

B. On a semi-annual basis

C. Once a month

D. Every two years


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12. What is the first thing a school business official should do when notified by the police of a significant

school bus accident?

A. Call the students' parents

B. Call the insurance carrier

C. Call the school board president

D. Call the superintendent

13. Which item may be asked for in a job application process?

A. Gender

B. Year of birth

C. Education

D. Age of dependents

14. A maintenance director discusses not interviewing an applicant for a custodial position because "everyone

on the interview team agrees this person is too old for this job." How should a school business official react to

this statement?

A. Explain to the team that ability is what is important, not age

B. Suggest that the committee interview the person and discuss the impact of his or her age on the job

C. Remind the maintenance director that people are working longer these days

D. Establish a maximum age limit for future custodial hiring

15. When is it allowable to ask if a person needs accommodation to perform the essential functions of the job?

A. In the job advertisement

B. In the letter of hire

C. On the application

D. During the interview


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16. Which is the leading indicator of the financial health of a school district?

A. Property tax levy

B. Property tax valuations within the local district

C. Undesignated fund balance

D. Total assets

17. What conditions would trigger the liquidated damages clause in a contract?

A. The vendor files for bankruptcy

B. The vendor does not perform in the time required

C. A bonding company takes over the project from the vendor

D. The vendor files suit against the school district

18. Who is the most important person(s) to be involved in developing an employee safety program?

A. Facility manager

B. School board members

C. Superintendent

D. Employee group representatives

19. A computer technician who does repair and services to computers and reports to the director of technology

is a non-exempt employee. What does this mean?

A. This position must be paid based on an hourly rate and paid the overtime rate for over 40 hours in a week

B. This position may be paid on a salary basis, avoiding the need to pay overtime

C. Vacation and sick leave are required as part of federal law

D. If the employee works on Sunday, double the hourly rate must be paid


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20. What is the best way to find an advisor for financing a capital improvement program?

A. Through a Request for Proposal (RFP) process

B. Request that the architect recommend a financial advisor

C. Through referrals from the school board

D. Request that the local bank recommend a financial advisor

21. In addition to acquisition, maintenance, and operation costs, what is the most significant cost of a

technology purchase?

A. Software upgrades

B. Replacement costs

C. Insurance costs

D. Shipping costs

22. How is per-student instructional program cost determined?

A. Add specific program costs, including staff salary, books, and materials, and divide by the number of

participants in the individual program

B. Add all direct costs of the instructional program and divide by the number of participants in the individual

program

C. Add all direct and indirect costs of the instructional program and divide by the number of participants in the

individual program

D. Add specific program costs and fixed costs and divide by the number of participants in the individual

program


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23. A popular five-year business office clerical employee is consistently behind in work assignments and

provides incorrect or incomplete results. This individual has been verbally warned and encouraged to improve.

What should the school business official do?

A. Prepare a written analysis of the problem and recommendations for improvement, then meet with the

employee and discuss the necessary steps

B. Do nothing because further action may result in staff morale problems

C. Give the employee a written warning of the consequences that will ensue if his or her performance does not

improve

D. Allow the employee additional time in which to perform his or her work or divert some of the duties to

someone else

24. Why are long-term forecasts generally less accurate than short-term forecasts?

A. Because the assumptions used in the long-term projections do not average out over time

B. Because long-term forecasts are less dependent on variables

C. Because there are fewer assumptions in long-term forecasts

D. Because there are more assumptions in long-term projections

25. How soon should work-related injuries be reported to the insurance entity?

A. As soon as the school district officials are aware of the accident

B. When it is determined to be severe enough

C. As soon as it is determined that the employee needs medical attention

D. After the medical service provider has examined the employee


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Answers to the SFO Exam Part 2: School Business Management Practice Questions:

1. A

2. A

3. D

4. B

5. D

6. B

7. A

8. C

9. D

10. B

11. A

12. D

13. C

14. A

15. B

16. C

17. B

18. D

19. A

20. A

21. B

22. C

23. A

24. D

25. A

Documents

SFO® Certification Exam Prep Manual - WASBO · (Lunch 11:15 a.m. – 12:15 p.m.) (12:15 p.m. – 1:15 p.m.) Marvin Dereef, Ellen Skoviera Conduct Budgeting and Reporting Activities