Mosaica 6 Detail App 6

8/12/2019 Mosaica 6 Detail App 6

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MOSAICA EDUCATION,INC.

FINANCIAL POLICIES AND PROCEDURES

MANUAL

AUGUST 1,2014


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This Page Intentionally Left Blank


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MEI Accounting Procedures

TABLE OF CONTENTS

I. RESPONSIBILITIES OF THE ACCOUNTANT ......................................................... 1

II. VENDOR BIDS ................................................................................................................. 2

III. PURCHASE OF GOODS OR SERVICES..................................................................... 3

IV. ACCOUNTS PAYABLE / CASH DISBURSEMENTS .................................................5

V. PETTY CASH ................................................................................................................... 7

VI. PAYROLL ......................................................................................................................... 9

VII. MANAGING THE DUE TO MEI ACCOUNT(S) ....................................................... 13

VIII. MANAGEMENT FEES ................................................................................................. 14

IX. BANK RECONCILIATION .......................................................................................... 15

X. CASH RECEIPTS .......................................................................................................... 17

XI. MONTH END CLOSING SCHEDULE ....................................................................... 18

XII. FINANCIAL STATEMENT REPORTING................................................................. 19

XIII. BOARD MEETINGS...................................................................................................... 20

XIV. BUDGETING, BUDGET PREPARATION AND CONTROL .................................. 21

XV. DEPRECIATION ........................................................................................................... 25

XVI. INSURANCE ................................................................................................................... 26XVII. PERSONAL LEAVE ...................................................................................................... 27

XVIII.REAL ESTATE LEASE AGREEMENTS ................................................................... 28

XIX. FISCAL YEAR END ...................................................................................................... 29

XX. RECORD RETENTION ................................................................................................ 30

XXI. CHART OF ACCOUNTS .............................................................................................. 31


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MEI Procedures Manual

I. Responsibilities of the Accountant

A.

To help ensure the quality of its work, Mosaica sets high standards and providesguidance in meeting them. The quality of Mosaicas work depends on thecompetence, dedication, and enthusiasm of its multidisciplinary staff members. Someof the Accountants responsibilities are to:

1.

Post all income to the General Ledger

2. Manage Accounts Payable

3. Reconcile bank statement

4. Perform monthly account analysis

5. Complete month end closing

6.

Prepare Financial Statements and supporting schedules

7. Present Financial Statements to Mosaica and School Management three days priorto board meeting

8. Present Financial Statements to the Board

9. Perform End of Year Accruals

10.Assist with Audits

B. Fund Accounting- The accounts of the Schools are presented on the basis of fundsand account groups. A fund is an independent fiscal and accounting entity with a

self-balancing set of accounts comprised of assets, liabilities, funds equity, revenuesand expenditures. Fund accounting presentation segregate funds according to theirintended purpose in compliance with finance related license provisions, authorizerrequirements and governmental regulations.

C. Basis of Accounting- The School shall use the Cash Basis of accounting. Whennecessary, reports shall be completed using the Modified Accrual Basis ofaccounting.


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MEI Accounting Procedures Manual Page 2 of 31

II. Vendor BidsA. Any goods or services that require competitive bidding from contractors or vendors

should be initiated by forwarding a request thru the Regional Vice-President (RVP) tothe Manager of Purchasing.

B. The Manager of Purchasing will put together the necessary information for theadvertisement. This information will be sent back to the HoS for proofing.

C. Once the ad has been proofed, the Manager of Purchasing will have it posted in thenewspaper for the legally requisite number of times and/or publication period.

D. The bids that are received will be reviewed by the Purchasing Manager and thenforwarded to the HoS (copy to the RVP) with a recommendation as to whichrepresents the lowest responsive bid, and any form of contract that may be required.

E. The HoS forwards the bids to the Board of Directors for review and approval.

F.

Where required, bids requiring authorizer or other approvals or review will beforwarded by the HoS to the appropriate office or agency.

G. Following approvals pursuant to paragraphsE andF above,the vendor of choice willbe notified by the Purchasing Manager.

H. The name of the legal entity, address, and social security number of all contractorsmust be on file before work begins or services provided.


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III. Purchase of Goods or ServicesA. Purchase Orders

1. Purchase Orders are prepared at the School

a.

Teachers / Staff members must fill out a Purchase Order (Attachment E) witha complete description of the item or service.

b. Completed Purchase Orders will then be transmitted to the HoS, who willverify the availability of budgeted funds. This information may be ascertainedfrom the School Accountant or from online access to the schools accountingrecords.

c. Additional approvals, if any, which are prescribed in the following table shallthen be verified by a signature affixed to the Purchase Order either by hand orelectronically:

Amount of Purchase RVP Board< $1,000 No No

$1,000 - $9999.99 Yes No

> $10,000 Yes Yes

d. The School submits the approved purchase order to the Manager ofPurchasing and the School Accountant at the regional accounting office by e-mail or fax.

1) The Manager of Purchasing is responsible for:

a) Insuring compliance with bid laws (see SectionII above)

b) Identifying lowest price meeting specifications for goods requested.

2) The School Accountant is responsible for:

a) Verifying availability of budgeted funds;

b) Coding and entering the Purchase Order into the Accounting System;

c) Forwarding the approved and processed Purchase Order to the Vendor;

d) Returning a copy of the approved and processed Purchase Order to theschool;

e) Filing a copy of the Purchase Order in the Vendor Files in theAccounting Office

2. Receipt of goods or services by the school

a. The Building Administrative Assistant (or other designated school employee)is responsible for verifying conformity of delivery to the Purchase Order andto the invoice. Any discrepancies are to be reported directly to the vendorimmediately.

b. The Building Administrative (or other designated school employee) shall affix(or obtain) the signature of the employee verifying receipt and the date of such


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signature, and then forward the invoice to the HoS for a signature authorizingpayment.

1) If the purchase was made pursuant to a Purchase Order, it shall besufficient to attach a copy of the approved and processed Purchase Orderto the invoice bearing the signature of the receiving employee and theHoS.

2) If the purchase was not made pursuant to Purchase Order, the invoice shallbe circulated to obtain the appropriate approval signatures in accordancewith the signature table set forth in paragraphIII.A.1.c above.

3)

The verified copy of the invoice, request for payment and packing slip issent to the Regional Accounting office via fax or e-mail within 24 hours ofreceipt and verification of goods.

4) Verification of receipt of services from all independent contractors mustinclude an itemized invoice of services provided, which invoice must be

verified and approved by the HoS.3. The AP department at the Regional Accounting Office codes the Payment

Voucher and issues a check to the vendor in accordance with SectionIV below.


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IV. Accounts Payable / Cash DisbursementsA. The payment process is initiated by the school through transmittal of invoices to the

Regional Accounting Office for input into the Accounting System followingverification of the receipt of goods or services in accordance with SectionIII.A.2above.

B. The invoices must be signed by the employee who was responsible for verifyingreceipt, and by the HoS (and such other persons as may be required in accordancewith the table set forth in paragraphIII.A.1.c above)authorizing payment.

C. Twice monthly, the Building Administrative Assistant (or other designated schoolemployee) shall prepare a Transmittal of Unpaid Invoices which shall include allpreviously unsubmitted invoices received at the school to that date together with allsuch supporting information as may be required pursuant to paragraphIII.A.2 above.

1. To preclude duplication of payment, all payments should be made on the basis of

original invoices rather than statements2. The Transmittal of Unpaid Invoices shall be signed for by the AP (Accounts

Payable) Accountant, stamped received, and dated.

3. The AP Accountant determines the correct chart of account to be used whilereviewing the invoices. The account numbers used are documented on eachinvoice and purchase order.

4. The AP Accountant will record all invoices received in the AP module in theAccounting system.

5. All invoices received shall be entered into the accounting records so as to indicatethe anticipated payment date.

6. A report of this information is then printed to verify accuracy.

D. On the fifth business day following the dates established in paragraphIV.C above,theAP Accountant will run an Aged Payable report to be transmitted to the schools HoSand such other school or Board personnel as the Board may direct.

1. It is understood that the Regional Accounting Office shall generally beresponsible for entering all invoices into the Accounting system within threebusiness days of receipt, provided that the school has provided such documents tothe Accounting Office in accordance with the provisions of paragraphIII.A.2.b.3)or paragraphIV.C above.

2.

Invoices held at the school longer than the prescribed period and transmitted tothe Accounting Office after the specified dates may not be entered into theAccounting system in time to appear on the Aged Payables Report provided for inthis section.

E. The HoS (or other designated school employee or Board member) shall determinewhat bills are to be paid after conferring with the School Accountant to verifyavailability of funds in the schoolsbank account(s).


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1. Any deviation from a pattern of paying the oldest outstanding bills should bedocumented with a brief explanation by the HoS (or other designated schoolemployee) as to the reason for recommended delay in payment and thecontemplated date of payment.

2. The HoS shall then sign, date, and transmit to the AP Accountant the foregoinglist of bills to be paid.

F. The AP Accountant processes these bills in the Accounting System utilizingsequential check numbering.

1. The checks are printed and attached to a copy of the invoice or purchase order.

2. A Check Register Report is produced.

3. The Controller (or other authorized MEI personnel) reviews each payment andsigns the checks.

4. The Check Register is posted to the general ledger.

5.

Two copies of the checks are made, one is attached to the MEI file copy of theinvoice or purchase order and the other is sent back to the school for their records.

G. The original checks are then mailed to the school for second signature as prescribedin the following table, and thereafter mailed to the vendor.

Amount of Check HoS Treasurer

< $1,000 No No

$1,000 - $9999.99 Yes No

> $10,000 Yes Yes

H.

Voided checks shall be retained to ensure proper maintenance of checking accountrecords.

I. Whenever practical, invoices shall be paid in a timely fashion so as to take advantageof any discount available, but in any event within thirty (30) days of their issue unlessalternative arrangements are made with vendors or unless a dispute arises.

J. Accounts Payable records shall be retained alphabetically by vendor at the school andat the management company regional office so as to provide a backup for records thatmay be misplaced. Records of journal entries shall also be retained electronically,and on paper chronologically as an additional backup.


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V. Petty CashA. Each School is allotted a Petty Cash Account in an amount determined by the Board

of Directors. When the Petty Cash Account is opened, a check is issued from theschools concentrationaccount. There are two types of Petty Cash Accounts at theschools, a Petty Cash Checking Account and a Petty Cash fund.

1. Petty Cash Checking Account

a. The Petty Cash Checking Account should be used primarily for supplieswhere the vendor is not willing to provide credit, or for emergency expenses.Purchases from this account generally exceed $25, but may not exceed $100.

b. The Petty Cash Checking Account is to be managed by the HoS andmaintained at the school in a secure location.

c. Before Petty Cash is spent for appropriate expenses, a check request is filledout summarizing the expenses to be reimbursed. All Petty Cash checks shall

be written sequentially, and no checks should be removed from the Petty CashCheckbook except after being completed and the payment entered in theregister.

d. Requests for reimbursement should be submitted to the Board of Directors forapproval then sent to the Regional Accounting Office to replenish the schools

bank account. A check from the schools concentration account is issuedanddeposited into the Petty Cash Checking Account.

e. A copy of the Petty Cash Checking Account bank statement must be sent tothe Regional Accounting Office within two business days of receipt by theschool. In the event that bank statements are sent directly to the Regional

Accounting Office, the original shall be transmitted by the RegionalAccounting Office to the school within two business days of receipt.

f. The Accountant at the Regional Office makes a journal entry to record thePetty Cash Activity onto the books at the time of issuance of a replenishmentcheck or at the time of bank reconciliation, whichever occurs first.

g. Reimbursement of the Petty Cash Checking Account should be initiated bythe HoS (or other designated school employee) when the Petty Cash Accountis reduced to half of the allotment.

h. To obtain reimbursement of Petty Cash Checking Account expenditures, thefollowing steps must be followed:

1) The Petty Cash Tracking Log must be up-to-date

2) A Check Request summarizing expenditures reflected in the Tracking Logis submitted to the Board Treasurer for approval. Attached should be thePetty Cash Tracking Log and receipts.

3) Once the Board Treasurer approves the Check Request, the CheckRequest, Petty Cash Tracking Log and receipts are mailed, faxed, oremailed to the Regional Accounting Office.


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4) The School Accountant will enter any necessary information into theAccounting System and will prepare and transmit a replenishment checkto the school in accordance with the procedures established in paragraphIV.F above.

B. Petty Cash Fund

1.

The Petty Cash Fund is actual cash, managed by the HoS and maintained at theschool in a secure location.

2. The fund is to be used only for those purposes in accordance with the formallyadopted Board policy. The purchases should be less than $25.00.

3. The Board of Directors must approve all requests for increases in the Petty CashFund.

4. A Petty Cash Slip (Attachment A) and a receipt must accompany all petty cashtransactions. Both the HoS and the recipient of the petty cash must sign the pettycash slip. The Petty Cash slip must be stapled to the receipt and kept with the

petty cash fund.

5. All transactions from the Petty Cash Fund must be recorded on the Petty CashTracking Log (Attachment B).

6. Copies of all receipts for items purchased with petty cash must be provided to theRegional Accounting Office via fax or e-mail within 24 hours of the purchase.

7. Each month a Copy of the Petty Cash Tracking Log must be sent to the RegionalOffice in order for the School Accountant to record the monthly transaction fromthe Petty Cash Fund.

8. Any funds in excess of the agreed upon maximum balance must be deposited into

the schools general checking account. The Regional Accounting office must benotified of this deposit and a Cash Transmittal Form must be completed.

9.

The Petty Cash Fund must be reconciled each month with a copy of thereconciliation and Petty Cash Tracking Logs sent to the Regional AccountingOffice by third day of the new month.

10.To obtain reimbursement of petty cash expenditures, the following steps must befollowed:

1) The Petty Cash Tracking Log must be up-to-date

2) A Check Request summarizing expenditures reflected in the Tracking Logis submitted to the Board Treasurer for approval. Attached should be thePetty Cash Tracking Log and receipts.

3) Once the Board Treasurer approves the Check Request, the CheckRequest, Petty Cash Tracking Log and receipts are mailed, faxed, oremailed to the Regional Accounting Office.

4) The School Accountant will enter any necessary information into theAccounting System and will prepare and transmit a replenishment checkto the school in accordance with the procedures established in paragraphIV.F above.


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VI. PayrollA. Hiring ProcessHiring shall be undertaken in accordance with the procedures

established in the MEI Personnel Handbook, and all necessary payroll formsincluding signed and completed W-4s and I-9s shall be obtained prior to entry ofany employee into Payroll.

1. School personnel shall be responsible for verifying that all necessary items aslisted on the Personnel File Inventory Form (see Attachment E) have beenobtained or requested prior to submitting a PAF (Personnel Action Form) to theMEI Payroll Office. A copy of the Personnel Inventory Form, signed by theschool Administrative Assistant (or other designated personnel) and initialed bythe HoS, verifying compliance with this paragraph, shall accompany the PAF.

2. Most items listed on the Personnel File Inventory Form are required before apaycheck may issue to an employee. Some, however, necessarily require someperiod of time before the document may be obtained, and employers are permitted

to hire and commence payroll processing pending receipt. In all of the later cases,however, there is a finite period of time for documents to be obtained. The MEIPayroll Office shall establish a schedule for final receipt of all missing documentsand shall take appropriate steps to insure such schedule is met by schoolpersonnel.

B. Background for Hourly Employees - Overview

1. At the beginning of each fiscal year a payroll file (School Timesheet file) isprovided to the school by the Regional Accounting office. This file will reflect allactive employees account code, department, pay cycles, pay rates, positions andovertime pay policies with respect to hourly employees.

a.

Employees may be added or deleted from the School Timesheet file by the

school (with assistance of the Regional Accounting Office as necessary)throughout the year which must be submitted on a PCF signed by the HoS andRVP.

2. The designated school employee must maintain the School Timesheet file on apay period by pay period basis recording actual hours worked by each employee.

3. The file must be e-mailed to the Regional Accounting office within one businessday following the close of the pay cycle. This file should be e-mailed with thereturn receipt function activated. There must be an assigned backup to e-mail thisinformation in the event the primary person is out of the office.

C. Background for Salaried Employees - Overview

1. At the beginning of each fiscal year a payroll file (School Timesheet file) isprovided to the school by the Regional Accounting office. This file will reflect allactive employees account code, department, pay cycles, pay rates, positions. Inaddition, this file will record any vacation or leave utilized by the salariedemployee.

a. Employees may be added or deleted from the School Timesheet file by theschool (with assistance of the Regional Accounting Office as necessary)


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throughout the year which must be submitted on a PCF signed by the HoS andRVP.

2. Throughout the pay period, a designated school employee must maintain theSchool Timesheet file, recording any vacation or leave utilized by salariedemployees.

3.

The file must be e-mailed to the Regional Accounting office within one businessday following the close of the pay cycle. This file should be e-mailed the returnreceipt function activated. There must be an assigned backup to e-mail thisinformation in the event the primary person is out of the office.

D.

Processing Payroll

1. Employee hours, employee status changes, and vacation or leave utilized will beentered into the excel School Time Sheet file by the business manager or otherauthorized personnel of each school.

2. At the end of each pay period all schools are required to e-mail their Excel School

Time Sheet to the Regional Accounting Office by 5 pm on the day on which thepay period ends.

3. The Payroll Accountant is required to enter all the payroll details into the CeridianPayroll software.

4. The Payroll Accountant also records all manual checks, void checks, adjustments,and stop payments into the Ceridian Payroll software.

5. Using the Ceridian software the Payroll Accountant will transmit the current payinformation to Ceridian for processing.

6. On the next business day, Ceridian delivers the payroll checks and payroll reports

to the Regional Accounting office. This information is verified for accuracy.7. The checks are then sent by UPS next day morning delivery to each school. The

authorized person at the school is not permitted to issue the checks to theemployees until the actual payday.

8. Employees enrolled in the direct deposit program will receive a check stub ratherthan a payroll check.

9. Once the payroll has been processed, the Regional Accounting Office will make ajournal entry based on department totals in the Sage reporting system to recordthe payroll.

10.In cases where Mosaica is funding the schools payroll. The accountant createsan invoice in the amount of the gross payroll and sends it to the school forpayment.

11.The funding of the payroll is setup as a receivable on Mosaicas books and apayable on the schools books.

12.The Regional Accounting Office is required to e-mail to the Corporate Office thedetails of the payroll entry. This will prevent any discrepancies when Corporatebills the school for any payroll that was paid by Mosaica.


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13.The schools are required to send a check or a wire transfer in the total amount ofthe invoice to Mosaica within 30 days.

14.When the funds are received, the Mosaica receivable account and the schoolpayable account are cleared.

15.

Payments of employer taxes and employee tax withholdings are paid by thepayroll processing agency (currently Ceridian) directly to the appropriategovernmental authority. Payments of all other withholdings and benefits aretransmitted by the Regional Accounting Office in accordance with SectionIVabove.

E.

Manual Checks

1. Express checks are generated by either a request by the school or a correctionmade by the Regional Accounting Office.

2. In the case where the request is by the school, a request form must be submitteddetailing the reason for the check and approved by the HoS or the assigned

authorized party at the school. This form must then be e-mailed to the RegionalAccounting Office for processing.

3. In the case where the express check is generated for a correction, the regionaloffice will e-mail the HoS or authorized party at the school and carbon copy theVP of Administration of the Regional Office.

4. When requests or corrections are approved, an express check is drawn on theschool bank account. Generally if the documented and approved request isreceived in the Regional Accounting Office before 3 pm, the check can be drawnthat day and sent to the school for next day delivery.

5. The Express Check information is automatically reported on the next pay periodspayroll report.

F. Payments to Employees

1. All payments to employees for services rendered must be processed through thepayroll system.

a. It is a conflict of interest for any employee to contract with the school outsidethe employment relationship.

b. All bonuses, stipends, after-school wage payments, and other employmentcompensation arrangements are to be submitted on a Personnel Action Form(PAF) bearing the approval of the RVP to the Regional Accounting Office no

later that 5 pm at least two days (48 hours) prior to the Pay Period End (PPE)in order to be processed and paid with such pay period.

c. These payments are never to be paid from AP or from Petty Cash.

2. All spending for teacher appreciation and/or employee gifts should be approved inadvance by the Board and the RVP and should be only in accordance with thebudget and with laws, rules, and regulations relating to public school spending.

3. Employee Reimbursements


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a. No reimbursement for any employee payments shall be made except from areceipt.

b. Employees using personal or business credit cards must submit receipts tosupport all purchases. Any employee purchasing anything on the corporatecard without submitting a receipt shall reimburse the school for the fullamount of the charge.

c. No school employee may sign a check for their own reimbursement forexpenses.

d. All Employee Reimbursements shall be paid from Petty Cash in accordancewith the procedures set forth in SectionV above or through Accounts Payableas set forth in SectionIV above.


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VII.Managing the Due to MEI Account(s)A. The Due to MEI Account is used when a payment is made out of the Mosaica bank

account on behalf of a school.

B.

Mosaica should be reimbursed for these advances within 4 to 5 business days or suchother period as may be specified in the Management Agreement.

C. In most cases the advances relate to Payroll, Rent and Lease Payments.

D. The Due to MEI Account is made up of the following sub-accounts.

1. Due to MEIManagement Fee

2. Due to MEIRent

3. Due to MEIPayroll

4. Due to MEIEquipment Leases

5.

Due to MEIPrior Year Balance6. Due to MEIOther

E. Mosaica sends an invoice out to the schools for these charges. The Corporate Officecreates the invoice.

F. Before the invoice is sent to the school, the Corporate Office should e-mail a copy ofthe invoice to the Regional Accounting Office. The e-mail should provide a detaileddescription of the associated charges.

G. In the case of payroll, the Accountant at the Regional Accounting Office will provideCorporate with their payroll entry. The accountant is to be very clear about theamount related to Due MEI. They should inform by Corporate ASAP if there are anydiscrepancies between the amount to be billed to the school and the amount that wasposted to the G/L.

H.

Once the amount of the invoice has been verified, the Regional Accounting Officeshould immediately contact the Corporate Office with confirmation of such. TheCorporate Office can then send the invoice to the school for approval to pay.

I. Once payment has been made the Due to MEI account should be cleared.

J. This account must be reconciled on a monthly basis.

K. The Controller or VP of Administration should be notified of amounts outstanding formore than 60 days and what steps were taken to collect the debt.


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VIII. Management FeesA. For services provide to the schools, Mosaica charges a Management Fee.

1. Management Fees are charged in accordance with the management agreement.

2.

They are billed monthly from the corporate office upon receipt of revenue at theschools. The fees should be posted to the Management Fee account, and aregenerally divided 50/50 between Instructional Services and AdministrativeServices unless a different allocation is suggested by unique circumstancesrelating to a particular school.


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IX. Bank ReconciliationA. Bank Statements

1. Bank statements must be reconciled each month.

2.

A copy of the original Bank Statements should be sent to the RegionalAccounting Office and the corresponding School with the original maintained onfile at the school.

3. Bank Statements should be received from the bank within 5 days into the newmonth.

4. Online banking access should be available to the Regional Accounting Office

5. The bank statement must be reconciled by the 8thbusiness day of the new month.

6. All reconciling items must be clearly documented.

B. Deposits

1. When bank deposits are made, the HoS must complete a Transmittal ForFinancial Documents form, attaching all supporting information and forward it tothe Regional Accounting Office within 24hrs.

2. The accountant at the Regional Accounting Office must record the transaction andfile all supporting documentation in the current months cash activity file. Thisshould include a copy the journal entry.

3. If there is insufficient information, it is the accountants responsibility to contactthe HoS and have them provide the missing information.

4. The cash activity file must be kept in chronological order and clearly labeled. If

the school has multiple accounts, it should be filed individually.

C. Withdrawals

1.

The most common bank withdrawals are Wire Transfers, ACH Debit orAutomatic Account sweeps.

2. When these transactions occur, they are initiated by either an invoice fromMosaica Corporate or at the request of the HoS at the school.

3. These transactions should be recorded on a Transmittal For Financial Documentsform, attaching all supporting information.

D. Reconciling Bank Statement

1. The following documents are required to reconcile the bank account.

a. Bank Statement

b. Copies of cancelled checks where provided by the Bank.

c. All current month Transmittal For Financial Documents Forms

d. G/L Detail Report

e. Cash Management Bank Activity Report


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2. Beginning book balance is the prior month ending balance from the G/L cashaccount.

3. Reconcile the G/L Detail Report to the Cash Management Bank Activity Report.

4. Reconcile the Credits and Debits on the Bank Statement to the Deposit and

Withdrawals in the Cash Management Bank Activity Report.

5. Any transaction that appears on the Bank Statement and not the CashManagement Activity Report or vice versa should be researched to identify itssource.

6. Bank transactions that are not on the books that have been identified, an entrymust be made in the Cash Management module in SAGE to record it on thebooks.

7. * Please note that the Management Company should haveat a minimumread-only access to the bank accounts in order to expedite the BankReconciliation in real time. An accountant other than the AP Accountant or the

assigned School Accountant shall perform the bank reconciliation.


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XI. Month End Closing ScheduleA. The following reports and schedules must be completed and reconciled by the

indicated dates.

1.

1st

Qtr Financial Statements 10/312. Annual Audited Financials Statements 09/30

3. 2ndQtr Financial Statements 01/31

4. 3rdQtr Financial Statements 04/30

5. 4thQtr Financial Statements 07/31

6. General Ledger Detail Report 5thbusiness day of the new month

7. Expense analysis (Budget vs Actual) 5thbusiness day of the new month

8. Bank Reconciliation 8thbusiness day of the new month

9.

Treasurers Report 10thbusiness day of the new month

10.Accounts Payable Aging Schedule 10thbusiness day of the new month

11.Due to MEI Reconciliation 15thbusiness day of the new month


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XII.Financial Statement ReportingA. At the close of each month the Accountant is required to produce Monthly and Year

to Date Financial Statements. Each month the Accountant is to provide the HoS witha Monthly Financial Statement stating Actual vs. Budget for the previous month andActual Year to Date vs. Budget Year to Date. The Financial Statements lists sourcesof income and expense categories and includes budget projections in addition to theprevious months expenses for each category.

B. In preparing the Financial Statements, the Accountant must make sure that theFinancial Statements present fairly the financial position, the results of operations andcash flows are in conformity with generally accepted accounting principles (GAAP).

C. The financial information for these reports is obtained from data generated from theschools accounting system, monthly payroll entries and AP invoices (including pettycash entered into the accounting system) provided by the HoS.

D.

The statements are to be completed by 10

th

business day of the new monthE. The following schedules are required for presentation to the Board at the end of the

month:

1. Income StatementActual vs Budget for the Month and YTD

2. Comparative Balance SheetBeginning YTD and Month End

F. The following reports are presented to HoS End of Month Meeting

1. Current Month Variance Report

2. Current Month G/L Trial Balance

3.

General Ledger Detail ReportG. The Financial Statements will help the HoS evaluate how the school is doing

financially. Any questions regarding these financial statements must be answeredimmediately.


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XIII. Board MeetingsA. Purpose - Monthly Board meetings serve as a forum for discussing the school

and the monthly Financial Statements in detail.

B.

Attendees - The primary attendees from Mosaica are as follows:1. RVP Curriculum & Operation

2. Mosaica School Accountant or VP for Administration

3. Such other Mosaica personnel as may be necessary to address specific issueslisted in advance on the agenda for the meeting


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XIV. Budgeting, Budget Preparation and ControlA. Budgeting - The School budget is essentially a tool for planning and control as well

as, a yardstick for measuring performance. Revenue projections are based on theestimated total student enrollment and the estimated number of special educationsstudents. Revenue sources include: tuition per student, special education funds, start-up funds (if applicable) grants, bridge loans (if applicable), before/after schoolprograms and food programs. Expenditure projections include: teacher and staffpayroll and benefits, staff development, curriculum materials supplies, officesupplies, equipment leases, office equipment maintenance, testing materials,insurance, accounting & legal, field trips, nursing services, security, utilities, rentallowance, maintenance & repair, marketing, after school program, food/cafeteria,curriculum and services provided by Mosaica Education, Inc., and contingencies.

B. Budget Preparation

1. Strategic Planning

a. Before preparing a budget there needs to be Board input on school goals fornext fiscal year

b. The Board, upon the recommendation of the HoS, should identify a list ofpriorities for the school for the upcoming year. The budget should thenbecome the financial roadmap for achieving those goals -- or whatever portionof those goals that the school can afford.

c. At the end of the process, ideally by the end of February, there should be aBudget Objectives document identifying key strategic objectives for the

school for the upcoming fiscal year. The budget should then be developed asthe financial roadmap for achieving those goals.

1) In setting these goals/objectives, the Board should establish prioritiessothat in the development of the budget we are able to say, "Goal A is moreimportant that Goal B, so therefore we should put the money in line Xrather than line Y."

2) Goals / Objectives should be realistic.

a) The list of goals need not be all that much longer than one mightreasonably expect the school to be able to afford.

b) The list should overreach just enough to be sure that all the criticalissues are on the table.

2. Recommended Budget - Once the goals are done, the HoS, school accountant andRVP will develop a Recommended Budget a document that should providethe Boardat a minimumwith a comparison of the current year budget, thecurrent year projected actual, and the recommended budget for the upcomingyear.

a. Recommended Budget Ingredients The following should be assembledand available for reference throughout the Budget Development and Reviewprocess:


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1) Budget Scheduledeveloped based on the statutory or regulatoryrequirements and working backwards

2) A recent Payroll Register listing all current employees

3) The most recent monthly financial statements together with a projection of

total actual current year activity

4) Copy of the most recent Consolidated Grant Application, together withany preliminary work that has been done on the upcoming years grants

5) Lease Agreements and Amortization Schedules

6) Real Estate Agreements and Development plans

7) Mortgage/Bond Payment Schedules

8) Revenue Estimates

9) Textbook purchase / replacement plans

10)

Equipment purchase / replacement plans11)Staffing needs

12)Long term contracts / bids / proposals including:

a) Transportation

b) Custodial Services

c) Food Services

d) SPED Services

e) Copier Contracts

f)

Insurance

13)Budget forms / memos from

a) Governmental Authorities

b) Authorizers

b. The Recommended Budget should:

1) Include all Door Openers critical items that are essential to theschools continued operation;

2) Outline the financial steps necessary to move the school toward each of

the highest ranking goals;3) Be completed in time to submit to the Board for review and consideration

at the Regular April Board Meeting.

3. Budget RevisionFollowing preliminary Board Review, the HoS, the RVP, andthe School Accountant will applyto the extent possible within the limits of abalanced budgetany changes or modifications requested by the Board.


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4. Final Budget should be presented to the Board no later than the _______ Boardmeeting, in order to insure timely action by the Board before the applicabledeadline.

C. Budget submission / publicationSchool Accountant

1.

The approved budget is then sent back to the Regional Office to align the codingwith the chart of accounts.

2. A budget report is then developed to indicate the correct coding for all AR andAP transactions.

3. After the budget is reviewed and finalized it is sent to the appropriate state agencyor authorizer. No revenues or expenditures should be coded outside of theapproved budgeted line items without the approval of the VP of Administration.Correct coding ensures that the financial statement accurately reflects the status ofbudgeted expenditures and encumbrances.

D. Budget Control

1. The Board of Directors generally: adopts the annual budget, designatesdepositories for school fund, enters into contracts of any kind where the amountinvolved exceeds $200, fixes salaries or compensation of administrators, teachers,or other employees of the School, enters into contracts with and makesappropriations to an intermediate unit, school district or AreaVocational/Technical School for the charters proportionate share of the cost ofservices provided by those entities.

2. The HoS is provided with a board-approved budget with projected revenues andapproved expense amounts. It is essential for the sound financial management ofthe School that every effort is made to adhere to the approved budget. Deviations

from budget will be granted only through board approval. Budgets projectrevenues for the year as accurately as possible, however, actual school revenueperformance may vary. The HoS is responsible for reviewing the projectedrevenue as compared with the actual revenue on a monthly basis so thatadjustments to expenditures can be made accordingly. Using percentages ratherthan a dollar amount from the annual school budget allows for more accuratecontrol of expenses. For example, if the current school revenue (based onenrollment) is higher than budget, by using the budgeted percentage for each lineitem rather than the straight dollar amount, as reflected on the budget, the HoScan calculate the increase in dollars available for each line item to spend to meetthe needs of the increased enrollment. On the contrary if school revenue is less

than the budgeted dollar amount the HoS can calculate the adjustments needed inexpenditures to reflect the decrease in enrollment.

E. Expense Tracking

1. The accounting program used by MEI offers several reports capable of trackingexpenses for budget compliance. The reports that should be used for expensetracking are:

a. Maintain Budgets

b. Maintain GL Accounts


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c. Invoice History

d.

Check History

e. Accounts Payable Aging

f. Accounts Receivable Aging

2. These reports will help the School Accountant, the HoS and VP of Administrationwith the necessary tools to monitor budgeted expenses.


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XV.DepreciationA. All equipment purchases shall require the prior approvals specified in SectionII

above.

B.

The Schools Capitalization Policy is attached hereto as Attachment D, andincorporated herein by reference:

C. Capital Assets as defined under the Capitalization Policy shall be depreciated overtheir useful life.

D. All purchases of property not fitting the definition of a capital asset shall be expensedin the period of purchase.


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XVI. InsuranceA. The School shall maintain appropriate insurance coverage, which, at a minimum shall

include: a) commercial package; b) directors and officers liability; and c) workerscompensation.


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XVII. Personal LeaveA. The School shall carry accrued vacation and sick leave on financial statements as

liabilities as necessary in accordance with personnel policy.


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XVIII.Real Estate Lease AgreementsA. All schools that are renting or leasing space from Mosaica must enter into a Lease

agreement. The lease agreement provides mandatory terms and conditions requiredin any lease of real property by, or on behalf, of Mosaica. If any Special Provisions

are incorporated into the lease agreement, a copy of the Special Provision must be

attached.

B. Copies of all state Leases are kept at the Regional Accounting Offices and at theschools.

C. Annually the lease payments must be reconciled.


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XIX. Fiscal Year EndA. Fiscal calendar start on July 1 and ends on June 30 of the following year.

1. The books must be closed by July 31 of each year

2.

Tentative budget finalized by June 30

3. Posting of accruals by July 20th

4. Audit starts August 30

5. YTD account analysis10thbusiness day into the new month

6. Due to MEI Account reconciled

7. Lease amortization schedule reconciled to the lease payments


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XX.Record RetentionA. Record Management is designed to provide control over records from the time of

their creation or receipt to their ultimate disposition

1.

Original copies of all invoices, purchase orders, rental agreement and any otherfinancial documentation are kept at the schools.

2. Copies of these documents are kept in clearly labeled files at the RegionalAccounting Office.

3. All documents are stored and retained on site at the school until the mandatoryretention period has expired in accordance with applicable laws and regulations


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XXI. Chart of AccountsA. A Chart of Accounts prescribed by applicable local regulation, or Authorizer mandate

shall be utilized in the maintenance of all accounting records and budgets. In theabsence of a prescribed Chart of Accounts, the Management Company will utilize anappropriate Chart sufficient to accurately reflect budget categories and to record andreport all revenues and expenditures.


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Attachment A

PETTY CASH REQUEST SLIPRecord #

Date:

Employee Name:

Expenditure:

Amount:

Employee Signature:

Approval Signature:


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Attachment B

School

Petty Cash Tracking Log

Date Receipt # Vendor Name Description G/L Code Amount issued

Amount

Reimburse


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Attachment C

Fax Transmittal For Financial Documents

Bank Deposits:

_____ _____ Deposit Slip

_____ _____ Copy of Check(s) deposited

_____ _____ Check Stub(s) for checks deposited

_____ _____ Copy of Remittance Advice or other revenue documentation

Invoices / Petty Cash to be Paid / Reimbursed:

_____ _____ Invoice / Receipt

_____ _____ Signature verifying receipt of goods or services

_____ _____ Signature authorizing payment

Required Information:

Anything else we should know: _______________________________________________

__________________________________________________________________________

__________________________________________________________________________

__________________________________________________________________________

__________________________________________________________________________

__________________________________________________________________________

Attached Not Available Item

Purpose: Instruction Admin Support Facility

Object: Supplies Cntrct Svcs Travel Equipment

Grant Funding: ______________________________________________


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Attachment D

CAPITALIZATION POLICY

Capital expenditure:

Capital expenditure means the cost of the asset including the cost to put it in place. Capitalexpenditure for equipment means the net invoice price of the equipment, including cost of any

modifications, attachments, accessories as well as cost of sales tax, transportation incurred orshipment of external suppliers.

Equipment:

Equipment is non-expendable, tangible, personal property which stands alone, is complete by itself,does not lose its identity and has a useful life of more than one year.

Capital Equipment:The following shall be capitalized:

1. items of equipment which have a per unit acquisition cost of $500 or more;2. items of equipment which are furniture used by students, teachers, or staff;3. items of computer hardware accessories having a per unit price of $50 or more which are

connected to student, teacher, or staff computers;4.

computer software having a per license price of $500 or more; and5. textbooks or library books.

Minor Equipment:

All other items of equipment which do not meet the definition of Capital Equipment above shall beexpensed as supplies and materials.

Maintenance and Repair:Expenditures needed to maintain equipment in a proper operating condition or to restore equipmentto a proper operating condition are expensed.

Computer software:

If software is associated with the specified computer, the software will be depreciated over the sameperiod as that equipment. In addition, software costing over $500 per license will be capitalized anddepreciated. Except as provided in the preceding sentences, all computer software is expensed.

Depreciation:

Depreciation will be calculated on a straight line basis with the following service life:Office equipment: 5 yearsOffice furniture: 7 yearsSchool furniture: 7 yearsComputers: 3 yearsComputer software: 3 years


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Mosaica 6 Detail App 6

Documents

Transcript of Mosaica 6 Detail App 6