Financial Expertise For Charter Schools
Questions, questions, questions…
You’re starting a charter school and you need to know if the accounting firms you are interviewing know what they’re talking about and can do what they say they can. Here are the three questions you absolutely must ask. Get the right answers to these and choosing the right one won’t be as daunting a task as you’d expect.
Question 1: How much do you charge?
That’s #1! Most firms base their rates on a per-pupil basis, so the number of students enrolled and the percentage of the overall financial workload you’d like them to assume determines their fee. Generally, you’re going to pay a rate comparable to the annual salary of one Certified Public Accountant in your area. Click Here for a list of Florida CPA salary rates.
Look for a firm that has demonstrated in-depth knowledge of the complexities of charter school accounting and reporting, and understands the financial constraints of charter schools. An exceptional firm has these qualities and will quote you a fair price that states clearly-defined services and deliverables. A reputable firm will have the capacity to fulfill all fiduciary obligations of the school, including payroll and purchases, and can develop processes and procedures that may be unique to your school’s operation. Remember, the cheapest may not always be the best.
Question 2: Do you work on site?
With today’s technology, it’s not necessary to have an on-site presence. Everything in the accounting processes can be done electronically and in secured environments, from transfers of information to accounts payable and receivable. It’s not only more efficient but also results in a “greener” operating environment. Plus, an offsite provider saves you money by not occupying valuable office space. That money can be invested in your students!
One thing that is important: The firm you hire has staff available to personally attend board and other meetings that concern the financial health of your school. If they can’t make themselves available for those, they aren’t willing to invest in you as their client.
Question 3: What makes your firm better than others?
Look for a firm that has the knowledge of complex financial reporting requirements and experience in meeting these requirements. This is especially true for charter schools which must follow the guidelines included in Florida Department of Education’s “Red Book,” a detailed publication that provides Florida school districts and charter schools with a uniform chart of accounts for financial, cost and budgetary reporting.
Also, ensure the firm that knows Generally Accepted Accounting Practices for government; these are the gold standards for accounting. You’ll need a firm that can put strong controls in place to monitor and report how you receive and disburse funds to avoid fiscal mismanagement. Because there are several streams of revenue from which charter schools operate, mismanagement and fraud in the financial realm is one of the key reasons that charter schools fail.
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