The people's voice., 1958-11-21
Budget and Audit Practices


School budget forms in Montana
are unnecessarily complicated be-
cause of the separate organization
of elementary schools and high schools
and because separate levies are re-
quired for certain aspects of the
school budget. There is a separate
budget for pupil transportation, for
retirement contributions for school
employe, for federal funds. and for
the school lunch program. To simplify
the budgeting procedure, elementary
schools and secondary schools should
be combined into one fiscal operation.
This would reduce some of the pro-
rating and unnecessarily complicated
bookkeeping involved in keeping sep
arate records.
1t is also recommended that there
be three separate funds in the school
budget: (1) the general fund, (2)
the school building fund, and (3) the
debt service fund. The budget for
pupil transportation should be in
cluded in the general fund. Similarly,
expenditures for the retirement of
school employees should be paid from
the general fund under the category
of "fixed charges.
In order to clarity the status of
cash reserves, the budget should con-
tain an exhibit which would explain
the amount of funds being held in
reserve for school bus depreciation.
This should be an exhibit on the budg-
ct form and not separate budget
for expenditure purposes.
Similarly, the school lunch budget
should be separate from the general
fund in order to distinguish funds re-
ceived from the sale of lunches and
from federal contributions from regu-
lar school operation funds.
Recently the United States Office
of Education has published financial
accounting guide for local and state
school systems. This guide contains
recommended accounts to be used in
school budgets and in annual reports
made by local school systems. The |
State Department of Public Instruc-
tion, in cooperation with the State
Examiners Office should revise the |
school budget forms in line with rec
concentrations contained in this re-
port, and should incorporate into pub
lie school records and reports the ac-
count classification recommended by
the United States Office of Educa-
tion.
The state law requires local school
4c fn hn W
audit may be made by the State EX-
aminer's office or by a private audit
ing firm. The law does not fix upon
any state office responsibility for en-
forcing the required annual audit.
The law should fix the responsibility
for enforcing the school audit law
upon the State Examiner.
At present there are large num-
Der of school districts in Montana and
each school district has several sepa-
rate funds. This makes the auditing
procedure more time consuming than
it should be. Consolidation of school
districts and school accounts should
reduce the time required to audit the
financial records of the schools in
Montana.
Although the State Examiner should
be charged with the responsibility for
the audits in the public {
schools, exceptions to local practices i
should be called to the attention of $
the State Superintendent of Public
instruction. Most difficulties found .
in the audit process will call for i'm {
in accounting practices. '
This, in turn, will call for leadership i
from the State Department of Public I
instruction and the State Examiners t
office.
RECOMMENDATIONS
l. Each school district should have
three basic funds-a general fund,
building fund, and a debt service fund.
The present multiplicity of funds and
local taxes is cumbersome
and unnecessary.
2. AS elementary and secondary I