Education, Administration

Rule R277-425

Budgeting, Accounting, and Auditing for Utah School Districts

Notice of Proposed Rule

(Amendment)

DAR File No.: 35535
Filed: 12/14/2011 02:40:20 PM

RULE ANALYSIS

Purpose of the rule or reason for the change:

This rule is amended to update reference materials and current guidance to local education agencies (LEAs) throughout the state.

Summary of the rule or change:

The amendments include adding new definitions, adding and updating reporting standards, and renumbering as necessary.

State statutory or constitutional authorization for this rule:

• Subsection 53A-1-401(3)
• Subsection 53A-1-402(1)(e)(iv)

Anticipated cost or savings to:

the state budget:

There are no anticipated costs or savings to the state budget. This amendment updates reference materials for use by LEAs but does not have any costs associated with it.

local governments:

There are no anticipated costs or savings to local government. The updated reference materials will assist LEAs in reporting but do not have any costs associated with them.

small businesses:

There are no anticipated costs or savings to small businesses. This rule and the amendments apply to public education and do not affect businesses.

persons other than small businesses, businesses, or local governmental entities:

There are no anticipated costs or savings to persons other than small businesses, businesses, or local government entities. The amendments to this rule apply to LEAs.

Compliance costs for affected persons:

There are no compliance costs for affected persons. The updated reference materials will assist LEAs in reporting.

Comments by the department head on the fiscal impact the rule may have on businesses:

I have reviewed this rule and I see no fiscal impact on businesses.

Larry K. Shumway, State Superintendent

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Education
Administration
250 E 500 S
SALT LAKE CITY, UT 84111-3272

Direct questions regarding this rule to:

• Carol Lear at the above address, by phone at 801-538-7835, by FAX at 801-538-7768, or by Internet E-mail at [email protected]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

01/31/2012

This rule may become effective on:

02/07/2012

Authorized by:

Carol Lear, Director, School Law and Legislation

R277. Education, Administration.

R277-425. Budgeting, Accounting, and Auditing for Utah [School Districts]Local Education Agencies (LEAs).

R277-425-1. Definitions.

A. "Board" means the Utah State Board of Education.

B. "Modified accrual basis of accounting" means a method under which expenditures other than accrued interest on general long-term debt are recorded at the time liabilities are incurred and revenues are recorded when they become measurable and available to finance expenditures of the current period.

C. "GAAP" means Generally Accepted Accounting Principles, as defined in the ["]Codification of Governmental Accounting and Financial Reporting Standards,["] as published by the Governmental Accounting Standards Board.

D. "GAAS" means auditing standards established by the American Institute of Certified Public Accountants, generally referred to as Generally Accepted Auditing Standards.

E. "LEA" means local education agency which includes school districts and charter schools.

F. "USOE" means the Utah State Office of Education.

 

R277-425-2. Authority and Purpose.

A. This rule is authorized by Utah Constitution Article X, Section 3 which vests general control and supervision over public education in the Board, Section 53A-1-402(1)[(f)](e)(iv) which allows the Board to adopt rules regarding financial, statistical, and student accounting requirements, Section 53A-1-404 which allows the Board to approve auditing standards for school boards, Section 53A-1-405 which requires the Board to verify accounting procedures of school boards for the purpose of determining the allocation of Uniform School Funds, and Section 53A-1-401(3) which allows the Board to adopt rules in accordance with its responsibilities.

B. The purpose of this rule is to specify uniform budgeting, accounting, and auditing procedures for [school districts]LEAs consistent with Generally Accepted Accounting Principles (GAAP) and Generally Accepted Auditing Standards (GAAS).

 

R277-425-3. [Procedures]Reporting Standards.

A. Each LEA's financial reporting shall be in accordance with GAAP which include GAAS.

B. Each LEA's financial reporting shall be provided in the modified accrual basis of accounting in accordance with GAAP.

C. [School districts]LEAs shall [act]provide data and information consistent with [the Annual] School Finance [and Statistics Workshop Book]budgeting, accounting and auditing standards for Utah [School Districts, published by]LEAs provided online by the Utah State [Board]Office of Education, [April, 1979]October, 2011 and reviewed annually. The [Workshop Book]USOE School Finance website contains applicable Utah statutes, applicable Board rules, and uniform rules for:

[A.](1) budgeting;

[B.](2) financial accounting;

[C.](3) student membership and attendance accounting;

[D.](4) indirect costs and proration;

[E.](5) financial audits;

[F.](6) statistical audits; and

[G.](7) compliance and performance audits.

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R277-425-4. Amendments.

The budgeting, accounting, and auditing standards for Utah school districts are amended as follows:

A. Each school district's financial reporting shall be in accordance with Generally Accepted Accounting Principles, (GAAP), which include Generally Accepted Governmental Auditing Standards.]

[B]D. Section 53A-19-103 allows [school districts]LEAs to have an undistributed reserve not to exceed five percent of the [district maintenance and operation]LEA general fund budgeted expenditures. The purpose of the reserve is to meet unexpected and unspecified contingencies.

 

KEY: education finance

Date of Enactment or Last Substantive Amendment: [April 15, 1996]2012

Notice of Continuation: February 13, 2009

Authorizing, and Implemented or Interpreted Law: Art X Sec 3; 53A-1-402(1)([f]e); 53A-1-404; 53A-1-405; 53A-1-401(3)