FINANCES AND REPORTING

1. Start-up Funds
The following is the School’s projections for funding needs during the planning year:

Planning Year Revenues
• Federal Start-up Grant: $150,000
• State Start-up Grant: To be determined if available

Planning Year Expenses
• Principal start: $50,000 from Dec 2005 – August 2006
• Teachers start (partial): $15,000 from Jun 2006 – August 2006
• PR and student recruiting: $15,000
• Books ordered: $25,000
• Class supplies: $50,000
• Educational Technology – labs, teaching aids, computers, etc: $45,000
• IT/MIS: $30,000
• Furniture ordered: $50,000

SLSPA will utilize short term financing from local banks to cover any temporary cash shortfalls between the time expenditures occur and the time revenues come in from state and federal sources. [Comment 1]

2. Revenue and Expenditures - See attached budget.

3. Accounting Policies and Procedures
SLSPA will adopt fiscal policies and procedures to safeguard assets; provide compliance with state and federal laws and regulations; and produce timely and accurate financial information. Generally these policies will be as follows:
• SLSPA will follow all the relevant laws and regulations that govern Utah charter schools. Additionally, any state or federal government laws and/or regulations from private sources that relate to grant funding will be adopted as the grant funding is received
• To provide accurate and auditable records of all financial transactions, SLSPA will maintain all books, records, and accounts in conformity with Generally Accepted Accounting Principles (GAAP), which include Generally Accepted Governmental Auditing Standards.
• The State Office of Education guidelines for budgeting, accounting, and auditing for Utah schools will be applied in administering and reporting school revenue and expenditures.

• The director/principalPrincipal, with the help of the Board, shall be responsible for preparing and submitting all financial and school reports to the state. This will include, but is not limited to, the State Accountability Report, Financial Audit Report and the financial and Enrollment Report as required by the State Office of Education.
• SLSPA will retain an accounting firm to provide monthly accounting needs. This will include, but is not limited to payroll, monthly reports, quarterly taxes, and tax returns.
• The director/principal Principal and treasurer of the Board will prepare an annual operating budget of revenues and expenses, a cash flow projection, and a capital budget. These budgets and projections are reviewed by and approved by the Board of Directors, and may be modified, as necessary.[Comment 2]

• The Board of Directors shall have the authority to approve and will record in its minutes:
a. approval of the annual operating budgets,
b. incurrence of debt, mortgages,
c. investments and/or purchase or sale of property,
d. opening up or closing checking or savings accounts,
e. selection of a certified public accountant, and
f. other activities associated with the operations of the School.

• Financial statements displaying budget vs. actual results will be prepared by the School’s accountant and reviewed by the director/principal and treasurer of the Board each month. The treasurer of the Board will present a budget update to the Board at each monthly/quarterly meeting. [Comment 2]

I. The Board of Directors will arrange for an independent certified public accounting firm to conduct an audit of the charter School’s financial statements annually.

Fiscal Procedures
The following procedures will govern the appropriation of funds approved in the annual budget.

• The President and/or the Chief financial Officer/Treasurer of the Board of Directors and the director/principal are the only individuals with signatory authority and are responsible for authorizing all cash transactions. Individual checks greater than $5,000 will require dual signatures prior to check issuance. [Comment 2]

• Petty cash payments are made from a fund not to exceed $150, and should be for cash advances, local expense reimbursement, and small-dollar vendor purchases provided proper documentation is furnished with each request. No individual payment shall be greater than $75.

The director/principal [Comment 2] will manage these funds and will provide a monthly statement to the accountant to replenish these monies as needed.

• Employees will be reimbursed at the standard mileage rate per mile as determined by the Internal Revenue Service for use of their own vehicle for business related travel. In addition, parking fees and tolls paid are reimbursable if supported by invoices. All employees requesting such mileage reimbursement are required to furnish a Travel Report containing the destination of each trip, its purpose and the miles driven, parking fees and tolls, within one month after the travel date, supported by invoices, if applicable. [Comment 3]
• All short-term and long-term debt must be approved by the Board of Directors and may not exceed the duration of the charter, without consent of the Board of Education. When applicable, short-term debt consists of financing expected to be paid within one year of the date of the annual audited financial statements. Long-term debt consists of financing that is not expected to be repaid within one year. All debt incurred must be repayable by a realistic repayment plan that is consistent with the approved budget. The Board of Trustee’s reserves the right to pay off debt sooner if budget allows.
• All lease agreements will be evidenced by a lease or sublease agreement approved by the Board of Directors and signed by the President of the Board of Directors. The agreement will identify all the terms and conditions of the lease.
• The School reserves the right to reallocate funds from one line item to another [Comment 4] if purchasing practices or conservation result in an expenditure different than the budgeted amount, to the extent allowed by law and the guidelines of the funding source.
• All capital expenditures must be approved in advance by the Board. [Comment 5]

Budget Policies and Procedures
The following policies relate to the development and implementation of the yearly annual budget.
• The School’s fiscal year will run concurrently from July 1 to June 30.
• Revenue

1. Start–up Funds
The School will request federal start-up funds set aside to assist new charter schools in the first three years of operations. We also will request from the state any state funds that may be earmarked to assist with the establishment of new charter schools. In addition to these funds, SLSPA will pursue additional funding opportunities through public and private grants, corporate sponsors, and fundraising. Should any of these grants, gifts, donations, etc exceed $500 the Board will disclose them in its annual financial report. SLSPA reserves the right to financing of certain expenditures within our start-up budget and/or the right to make budget modifications, should these funds not be available. [Comment 6]

2. Operating Funds
SLSPA’s operating funds will be generated from state WPU programs, on-going state programs (as determined by the legislature), federal funds and grants, private grants, and donations. Fundraising may be done, but will not be part of the annual budget for SLSPA.
• The School retains the right to purchase goods and services through the contracts in effect with the state and its vendors.
• In order that the School shall function on a balanced budget, the charter granting agency agrees to pay all funding to the School in an appropriate and timely manner. If the charter-granting agency fails to make proper payments to the School and the School incurs any fees as a result of said late payments, the charter-granting agency will be held liable for all late fees and/or costs incurred due to the breech of payment.
• Any undistributed reserves at the end of a fiscal year shall be added to the next year’s budget.
• The School will include in its budget, reserves to meet any unexpected or emergency expenditures.

3. Responsibility
• The School agrees to maintain applicable appropriate financial records as required by federal, state, and local laws, rules and regulations, and make such records available to the state and district as requested.
• The School agrees to engage and participate in an independent audit by a certified public accountant of all its financial and administrative operations on an annual basis. The results of the audit will be provided submitted to the Board of Directors and the state in written form within the statutory time limits required by the state and shall be published and posted as required by law. Any cost associated with the audit of the School shall be borne by the School. The School will maintain a comparison of actual expenditures to budgeted expenses.

4. Insurance
Insurance coverage for SLSPA will include General Liability Insurance, Property/Lease Insurance, Workers Compensation Insurance, and Health Insurance [Comment 7] for teachers and selected staff.
• General Liability Insurance: The SLSPA will obtain General Liability Insurance provided by the State of Utah Risk Management Division or contract with a private vendor.
• Property/Lease Insurance: Property Insurance will be obtained when the actual facility site is finalized.
• Workers Compensation Insurance: Workers Compensation Insurance will be provided by the Workers Compensation Fund of Utah as required by State Law.
• Health Insurance for staff: Public employees Health Plan PEHP will be offered to teachers and staff, along with a choice to use services from the private sector.

5. Fees
It is anticipated that SLSPA will charge approximately $60 per student per year in fees. This revenue will be used to fund various activities throughout the year. [Comment 8] Fee waivers are available to ensure that no student is denied the opportunity to participate because of an inability to pay the required fee. The School will provide a variety of alternatives for satisfying the fee requirement to those who qualify for fee waivers, in addition to the outright waiver of the fee. Fees and fee waivers associated with classes and/or activities of SLSPA students and HHS will be administered according to SLCSD policies.

6. Responsibility

SLSPA has engaged the Excel Education Group to assist in the day-to-day operations of the School, including the preparation of financial and educational reports. Excel will make these reports available to the Principal, who will file them with the appropriate agencies. All reports will also be summarized and distributed to the Board. Financial and educational audits will be performed annually to ensure proper reporting. [Comment 2]