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School Nutrition Finance

School Nutrition Finance. Spring Financial Training School Nutrition Program and Local Finance May 2, 2012 Gatlinburg May 9, 2012 Murfreesboro May 9, 2012 Pickwick Landing. Office of Local Finance. LEA technical financial support BEP IDEA / Special Education No Child Left Behind

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School Nutrition Finance

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  1. School Nutrition Finance Spring Financial Training School Nutrition Program and Local Finance May 2, 2012 Gatlinburg May 9, 2012 Murfreesboro May 9, 2012 Pickwick Landing

  2. Office of Local Finance • LEA technical financial support • BEP • IDEA / Special Education • No Child Left Behind • Accounting, budgeting, reporting • Nashville office • Maryanne Durski 615.532.9510 • Andrew McClusky 615.532-1654

  3. Office of Local Finance • Field Service Centers – Fiscal Consultants • Southwest Ron Adelman 615.306.4062 • Northwest Brad Davis 615.308.3616 • Middle Malinda White 615.969.9352 • Upper Cumberland Bobby Palmer 615.308-1592 • Upper East Jackie Broyles 615.306.7429 • Southeast Carol Newton 615-306-7974

  4. Accounting Reference Material

  5. Chart of Accounts Food Service Chart of Accounts (Centralized)

  6. Revenue • 47000 Federal • 43000 Current Services Food Service Chart of Accounts (Centralized) • Federal • 47111 USDA School Lunch Program • 47112 Commodities • 47113 Breakfast • 47114 Other • Current Services • 43521 Lunch Payments Children • 43522 Lunch Payments Adults • 43523 Income from Breakfast • 43524 Special Milk Sales • 43525 Ala Carte Sales Centralized Fund 143 Non Centralized Fund 141 • Federal • 47111 USDA School Lunch Program • 47112 USDA Commodities • 47113 Breakfast • 47114 Other

  7. Food Service Chart of Accounts (Centralized) Centralized Fund 143 Non Centralized • Expenditures Acct 73100 • 100 Personal Services • 200 Benefits • 300 Contracted Services • 400 Supplies & Materials • 500 Other Charges • 700 Equip • 73100 105 Supervisor/Director • 73100 117 Career Ladder Program • 73100 119 Accountants/Bookkeepers • 73100 162 Clerical Personnel • 73100 165 Cafeteria Personnel • 73100 188 Bonus Payments • 73100 189 Other Salaries & Wages • 73100 196 In-Service Training • 73100 201 Social Security • 73100 204 State Retirement • 73100 206 Life Insurance • 73100 207 Medical Insurance • 73100 208 Dental Insurance • 73100 210 Unemployment Compensation • 73100 212 Employer Medicare • 73100 299 Other Fringe Benefits • 73100 307 Communication • 73100 329 Laundry Service • 73100 330 Operating Lease Payments • 73100 336 Maintenance & Repair Svs - Equipment • 73100 348 Postal Charges • 73100 354 Transportation - Other than Students • 73100 355 Travel • 73100 399 Other Contracted Services • 73100 421 Food Preparation Supplies • 73100 422 Food Supplies • 73100 435 Office Supplies • 73100 451 Uniforms • 73100 452 Utilities • 73100 469 Commodities • 73100 499 Other Supplies and Materials • 73100 524 In Service/Staff Development • 73100 599 Other Charges 0 • 73100 710 Food Service Equipment 0

  8. Food Service Chart of Accounts (Non-Centralized)

  9. Food Service Chart of Accounts (Non-centralized) Liabilities and Fund Balance 11 Cash on hand 12 Cash in Bank 13 Cash in savings account 21 Other investments 31 Accounts receivable 41 Inventory Assets • Balance sheet • 1-99 Balance sheet • 61 Income tax withheld • 62 Social security tax payable • 63 Retirement withheld and payable • 65 Insurance withheld and payable • 66 Other payroll deductions • 71 Accounts payable • 81 Accrued payroll • 94 School nutrition fund balance NOTE: Any account may be expanded to create a sub-level of reporting

  10. Revenue • 101-199 Revenue Food Service Chart of Accounts (Non-centralized) Lunch Breakfast 111 Students 112 Adults 113 Other 114 USDA • 121 Students • 122 Adults • 123 Other • 124 USDA Milk Other Programs 141 Students 142 Adults 143 Other 144 Interest income 145 USDA Commodities (in-kind) 146 Fresh Fruit and Vegetable Program 131 Students 132 Adults 133 Other 134 USDA (Special Milk) NOTE: Any account may be expanded to create a sub-level of reporting

  11. Food Service Chart of Accounts (Non-centralized) Lunch • 210 Labor • 220 Food • 240 Supplies • 250 Utilities • 260 Contracted services • 270 Equipment • 280 USDA Commodities (in-kind) • 290 Other • Expenditures • 201-299 Expenditures NOTE: Any account may be expanded to create a sub-level of reporting

  12. Budgeting • Best Practice • Involve cafeteria managers in preparing budget • Communicate with district finance officer for benefit rates, salary increases • Base budget on actual expenditures in current year plus any known increases/decreases • Budget must be approved by School Board and governing body

  13. Budget Amendments • Review budgeted amounts to actual expenditures at least quarterly • Finance office should provide monthly revenue and expenditure reports to School Nutrition • Submit a budget amendment • If salary expenditures expected to exceed budget • New grant revenue and expenditures • If total expenditures are projected to exceed budget amount for the category (i.e. 73100) • Amendments must be approved by: • Board of Education (all) • Governing body (everything except line item transfers)

  14. Commodity Reporting • Commodity Reporting – Centralized • Revenue – 47112 USDA - Commodities • Expenditures – 469 USDA – Commodities • Budget amendment and journal entries will be necessary to record commodities • No separate report in eReporting required

  15. Commodity Reporting • Commodity Reporting – Non-Centralized • Report as part of Non-centralized report in eReporting • New line item created for commodity revenue and expenditures - 84100 • No separate commodity report in eReporting required

  16. Reporting Timelines • Original budget – July 1 • Budget amendments • Approved by Board of Education and governing body by June 30 • Plan ahead – do not wait until the school year ends • Annual Financial Report – August 1 in eReporting • Non-centralized Cafeteria Report – August 1 in eReporting

  17. INDIRECT COST • What are Indirect Costs?—costs incurred for common or joint purposes. Indirect costs benefit more than one program and cannot be readily identified with a single program. • Examples of indirect costs— • Attendance Director • Finance Department • Cost of Audit • Worker’s Comp Insurance • Maintenance and Operations costs

  18. Indirect Cost • What are Direct costs?—costs that benefit a single program, costs that are identified with a single program. • Examples of direct costs— • Teacher’s salaries and benefits • Instructional materials and supplies • Professional development • Direct Administrative costs • Food Costs for School Nutrition

  19. Indirect cost • Calculation of Rate— Indirect Costs__________ Direct Costs-Excluded Expenditures Excluded expenditures (calculated at the system level) include equipment, food purchases, trustee commission, transfers out.

  20. Indirect cost • Restricted Rate • Lower than Non-restricted Rate • Limits the amount of general management costs that can be included in the indirect cost pool (numerator.) • Treats as direct costs • Director of Schools administrative costs • Maintenance • Operations • Used for other Federal Projects calculations

  21. Indirect Cost • Non-restricted Rate • Higher than Restricted Rate • Treats as direct costs • Director of Schools administrative costs • Maintenance • Operations • Used for School Nutrition calculations

  22. Indirect cost • Using your non-restricted Indirect Cost Rate, calculate the Indirect Cost to pay to your General Purpose fund: Total School Nutrition Expenditures -Food Expenditures -Equipment Expenditures = Expenditure Base X Non-restricted Rate = Calculated Indirect Cost

  23. Indirect cost • An example… • $1,000,000 School Nutrition Expenditures • - $300,000 Food Expenditures • - $100,000 Equipment Expenditures • = $600,000 Expenditure Base • X 12.0% Non-restricted Indirect Cost Rate • = $72,000 Calculated Indirect Cost

  24. Indirect Cost • May take indirect cost ONLY IF there is an excess operating balance (3 months operating expenditures) • May take indirect cost up to amount of year end excess operating balance only • In prior example, if excess balance was $70,000, then indirect cost on only $70,000 may be taken.

  25. Indirect cost • Which year’s rate do I use? • Use the appropriate rate for that fiscal year…. • Expenditures from July 1, 2011 to June 30, 2012—use the FY 12 rate. • Expenditures from July 1, 2012 to June 30, 2013—use the FY 13 rate. • When budgeting—use the rate for upcoming fiscal year. • If you do not pay indirect costs prior to June 30, setup a payable in Fund 143 and a receivable in General Purpose. • Check would be written after June 30 from the payable account. Deposit into GP receivable account.

  26. Indirect Cost • NOTE: • If you do take an indirect cost, you may have to recalculate the indirect cost rate IF some of the expenditures included are charged directly to the School Nutrition Program • Example – SNP pays full cost of 3 maintenance workers, parts, vehicles, gasoline, etc. – would have to be taken out of indirect cost calculation since this is a direct cost • Fiscal Consultant will recalculate if necessary

  27. Questions?

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