|
Policy Section 400- Fiscal Management
Board of Directors Policies
Section 400
FISCAL MANAGEMENT
410 General Financial Policy
420 Budget Preparation, Adoption, and Review
425 Budget Implementation Limits of Authorization
430 Revenues from Members Schedule of Annual Dues
450 Financial Reports and Statements
455 Audit
460 Depositories for Funds and Investments Depositories Investments Scope of Investment Policy Authority Objectives Standard of Care Permissible Investments Diversification Reporting
465 Authorized Signatures for Checks
470 Surety Bonds and Liability Insurance 480 Capitalization and Bid Requirements
410 General Financial Policy
The board determines how the associations funds shall be spent when it adopts the annual budget, as prepared and presented by the executive director and staff.
Once the budget is adopted, it authorizes the limits within which the executive director will operate.
Approved: 4/6/79 Amended: 5/14/99 1/18/02 5/16/03
420 Budget Preparation, Adoption, and Review
The executive director, in cooperation with the Finance Committee, shall prepare the annual budget for consideration by the board.
The preliminary budget shall be presented to the board for consideration by March 31. The board shall adopt the final budget by May 31 each fiscal year.
The Finance Committee, no later than February 28 each year, shall review the current years budget to determine if revisions are necessary.
Approved: 4/6/79 Amended: 6/19/81 5/2/86 5/10/96 5/14/99 1/21/00 Reviewed: 1/18/02
Reference: See MASB Bylaws Article XII, § 1
425 Budget Implementation
Limits of Authorization
Any anticipated net expenditure in a program budget exceeding both $5,000 and ten percent of that programs total budgeted amount or exceeding $15,000.00 shall require prior approval of the board.
In an emergency, the executive director may take action necessary and appropriate, and then inform the president and the Finance Committee.
Approved: 4/6/79 Amended: 5/2/86 1/21/94 7/9/99 1/18/02 7/27/05
430 Revenues from Members (Cf. 145)
Schedule of Annual Dues
The annual dues for membership shall be determined by district size and established by the board prior to March 31 for the next fiscal year.
Determination of district size for billing purposes shall be made from the fall pupil membership count of the preceding year's enrollment as published by the State Department of Education.
There shall be no refund of dues if a member board withdraws from MASB membership.
Approved: 4/6/79 Amended: 5/2/86 5/10/96 5/14/99 1/18/02
450 Financial Reports and Statements
The executive director shall supply each director with a quarterly financial statement.
The annual audited financial report shall be made available to the membership.
Approved: 4/6/79 Amended: 5/10/96 1/18/02
455 Audit Selection
The Finance Committee shall act as the boards Audit Committee.
The auditing firm selected to conduct the annual audit shall be recommended to the Audit Committee by the executive director and approved by the board at the January board meeting. No less often than every five years, bids to conduct the audit shall be solicited from at least three firms.
Representatives of the Audit Committee and the president shall annually conduct a pre-audit interview.
Approved: 1/21/94 Amended: 1/18/02 3/11/05 1/8/07
460 Depositories for Funds and Investments
Depositories
Depositories for MASB funds shall be recommended by the executive director to the Finance Committee and approved annually by the board.
Investments:
Scope of Investment Policy
This investment policy applies to all MASB operating and general funds.
Authority
The executive director is responsible for conducting investment transactions. The executive director shall establish a system of internal controls and investment practices.
Objectives
The objectives for investing the associations assets are: first, the safety and preservation of principal in the overall portfolio; second, maintaining the necessary liquidity to match expected liabilities; and third, obtaining a reasonable return.
Standard of Care
The executive director shall exercise reasonable skill, prudence, and diligence when investing MASB funds.
Permissible Investments
MASB assets or funds may be invested only in the following instruments:
(a) Interest bearing savings, money market, and savings accounts in a bank, savings and loan association, or credit union approved as a depository by the board. (b) Obligations of the U.S. government, its agencies, and instrumentalities and obligations of the State of Michigan. (c) Certificates of deposit issued by a federally insured national or state depository institution authorized to operate in Michigan. (d) Commercial paper that matures within 270 days of date of purchase and is rated within the two highest classifications established by at least one of the nationally recognized standard rating services. (e) Prime bankers acceptances issued by a bank that is a member of the Federal Deposit Insurance Corporation. (f) Mutual funds and/or managed funds that have a record of low to moderate risk. (g) Investment pools composed of instruments that are legal for investments by MASBs members.
Diversification
The executive director shall diversify MASBs investments to eliminate the risk of loss resulting from over-concentration of assets in a specific maturity, issuer, or class of securities.
Reporting
The executive director shall submit a semi-annual investment report to the Finance Committee no later than January 31 and July 31. The report shall summarize recent market conditions and investment strategies, describe MASBs current portfolio, summarize investment transactions during the reporting period, and compare investment results with budgetary expectations. The Finance Committee shall submit a similar annual report to the board.
Approved: 4/6/79 Amended: 1/21/94 5/10/96 5/15/98 1/18/02
465 Authorized Signatures for Checks (Cf. 350)
In accord with Policy 350, the signature of the executive director, or designee, is sufficient for any check not exceeding $5,000 drawn upon an MASB account. However, two authorized signatures are necessary for each check exceeding $5,000 drawn upon an MASB account.
The executive director and at least two staff members, designated by the executive director, are authorized to sign all checks.
In the absence of the executive director, a facsimile signature may be used when checks are prepared as authorized by the executive director.
Approved: 1/27/89 Amended: 11/12/93 5/10/96 5/14/99 1/18/02
470 Surety Bonds and Liability Insurance
The executive director shall assure the board that all appropriate personnel have adequate bonds and insurance protection.
MASB shall carry surety bonds in an adequate amount for all personnel designated to handle MASB funds and carry liability insurance in an adequate amount to cover the association and its employees.
The insurance shall cover personal injury, bodily injury, property damage and errors and omissions.
Approved: 4/6/79 Amended: 6/19/81 Reviewed: 1/18/02 Amended: 3/11/05
Reference: See MASB Bylaws Article XII, § 1
480 Capitalization and Bid Requirements
Any asset that has a useful life of more than one year and costs more than $1,000 will be capitalized rather than expensed in the year of purchase. In general, the straight-line method of depreciation should be followed, unless there is a documented business reason to use an accelerated method.
Assets will remain on the schedule of fixed assets until they are disposed of either by sale or salvage. All sales or disposals of assets must be approved by both the director of fiscal and business operations and the assistant director of fiscal and business operations. Sales will be arms length transactions with documentation to support market price.
An annual capital expenditures budget will be presented to the board for approval following general budgeting practice.
The executive director shall solicit bids or competitive price quotes for MASB expenditures over $15,000 for equipment, supplies, and services. For lesser expenditures, competitive price quotes are encouraged, and may be requested by the authorized approver.
The purchase of any fixed asset that serves the entire MELG group will be capitalized on MELGs books, and recorded on MASBs books as an addition to the investment in MELG . This will also apply to any cash contribution to a capital reserve fund for MELG.
All purchases and disposals of capital assets shall be reported annually to the auditors.
Approved: 4/6/79 Amended: 6/19/81 11/12/93 1/9/96 5/14/99 1/18/02 3/17/06
Masb-bod-hndbk-section 400
|
|
Return to: Governance | Top of Page
Michigan Association of School Boards, 1001 Centennial Way Suite 400, Lansing, Michigan 48917
Questions, problems to webmaster@masb.org |
