Spreadsheet: 0081c4ff-12f8-4e46-a763-93e84f382ce3
Sheet: 1. Introduction

INTRODUCTION
 | This manual presents a uniform financial accounting and reporting structure for public
elementary and secondary schools in the state of Nevada.  With this manual, the financial portions
of the Nevada Local Government Budgets and the Annual Financial Report are revised to be
consistent with the U.S. Department of Education publication, Financial Accounting for Local and
State School Systems, 2003 edition.  This publication is one of a series published by the National
Center for Education Statistics (NCES).
 | The Statutory Authority for The Deputy Superintendent for Administrative and Fiscal Services
to create and maintain the manual is found in [NAME]
PURPOSES OF THE MANUAL
 | The Nevada Common Elements for Accounting and Reporting K-12 Educational Finances
Including Standard Chart of Accounts is designed to serve three primary purposes:
1 | Provide a structure to permit Local Education Agencies (LEA's) to demonstrate prudent use
 | of funds.
2 | Supply the means for collecting the financial data necessary to examine comparability of
 | educational outcomes at the local level.
3 | Meet the many recent demands of the education community for accountability in terms of
 | educational programs.
 | Of primary consideration to any public agency is the demonstration of prudent expenditure
and control of public funds.  The use of certain classifications contained in this manual permits the
design of a local school district accounting system which will meet this consideration.
 | An additional consideration to both local and State legislative bodies, as well as the public,
is the desire for comparability of information about education.  The classifications contained in this
manual provide mutually exclusive, discrete dimensions and categories which may be used to
describe financial transactions.  The logic of the classification system improves the chances of
correct coding and as a result, improves comparability of reported data.  The adoption of the
handbook by school districts and charter schools in Nevada will put them in harmony with most of
the Local Education Agencies (LEA's) throughout the country because Financial Accounting for
Local and State School Systems, 2003 Edition is used for financial accounting throughout the nation.
The Nevada Common Elements for Accounting and Reporting K-12 Educational Finances is in
compliance with the 2003 Edition referenced above.
DEVELOPMENT OF THE MANUAL
 | Inasmuch as the Nevada Common Elements for Accounting and Reporting K-12 Educational
Finances is an adaptation of the Federal Public Financial Accounting for Local and State School
Systems, 2003 Edition, an understanding of the development effort that went into the 2003 Edition,
as well as this manual, is appropriate.
 | The Federal Public Financial Accounting for Local and State School Systems, 2003 Edition
was written through the efforts of education professionals from a range of backgrounds under the
leadership of the NCES National Forum on Education Statistics, Core Financial Data Task Force.
 | The Federal Public Financial Accounting for Local and State School Systems, 2003 Edition
replaces the prior revisions of the handbook, published as part of the State Educational Records
and Reports Series.  The revision was cooperatively developed, and is designed to serve the same
users more effectively as a vehicle for accumulating data for management decisions concerning
educational programs and students.
 | Nevada Common Elements for Accounting and Reporting K-12 Educational Finances was
written through the efforts of representatives of various school districts and charter schools (See
[NAME]). This Chart of Accounts Task Force met multiple times in 2008 and the final effort was
reviewed by the Deputy Superintendent of Administration and Fiscal Services and the Superintendent
of Education.  The Chart of Accounts contained in the Nevada Common Elements for Accounting
and Reporting K-12 Educational Finances was approved by the Nevada State Board of Education
in November 2008.  Additional inputs were provided by appropriate personnel in various departments
within the Nevada Department of Education.  This handbook replaces Nevada Financial Accounting
Handbook which was fully implemented on July 1, 1982.
 | Five basic criteria were used in determining items and classification for inclusion in this
handbook.  These criteria are:
1 | The items, accounts and categories of information must provide the basic framework
 | fundamental to a comprehensive system of educational program information.
2 | The revised guidelines must serve all sizes and types of school systems.
3 | The categories of accounts must be both contractile and expandable, enabling all school
 | districts and charter schools to adapt to and support various planning, programming,
 | budgeting and evaluation systems.
4 | Data elements must be additive into broad categories for purposes of reporting and comparing
 | at the local, State, and Federal levels.
5 | The classifications must conform to generally accepted governmental accounting principles
 | and be consistent with the requirements of the Nevada Revised Statutes.
USE OF THE MANUAL
Chapter II
 | The Chart of Accounts provided in the manual is fully implemented effective July 1, 2009.
All school districts and charter schools as well as related transactions within the Nevada Department
of Education will be using the same Chart of Accounts and reporting in the same format (Accounting
String).  The Chart of Account Elements are Balance Sheet Codes (2.1), Fund Codes (2.2), Revenue
Codes (2.3), Project / Grant Codes (2.4), Program Codes (2.5), Function Codes (2.6), Object Codes
(2.7), and Level of Instruction Codes (2.8).
Chapter III
 | Because many school districts and charter schools are not in a position to convert their
current accounting system and software to the Chart of Accounts outlined in Chapters 2.1 - 2.8,
a system to crosswalk information will need to be developed.
 | Adaptation of Record-keeping Systems
 | Redesign of records:
 | Conversion of master records
 | Training
 | Need to complete this section
Chapter IV
 | There are frequently asked questions about which items should be classified as supplies and
which should be classified as equipment.  Chapter IV addresses this issue with guidelines to make
these determinations.  This is particularly important with supplies of higher value which may be
coded as either 612 or 652 object code.
Chapter V
 | The cost allocation process determines the costs of various administrative and instructional
activities and how they are to be disbursed in the organization.  Chapter V focuses on considerations
for the development of sound indirect cost information as a means for establishing reliable program
cost data.
Chapter VI
 | Full Time Equivalency (FTE) determination for calculation of staff is an important issue.  The
figures are used for numerous calculations such as student/teacher ratios or support staffing ratios.
The range of criteria in calculating FTE among the various school districts and charter schools was
so diverse that a standardized method had to be developed so comparisons between organizations
would be consistant.