Wis. Admin. Code Department of Public Instruction § PI 35.047 - Sound fiscal practices

Current through November 29, 2021

(1) A private school under this chapter shall use a double entry financial accounting system that is organized in such a manner that it will enable preparation of the report required under s. PI 35.045(1) and provide such other information to fiscally manage the private school. The accounting system shall identify all the sources of funding used in the private school's operation specifically identifying all of the following:
(a) Revenue for pupils participating in the choice program.
(b) Revenue for parent or other private-paid tuition pupils.
(c) Revenue from payments made to or due the private school from the school district for instruction provided pupils enrolled in the private school.
(d) Revenue from payments made to or due the private school from the school district for transportation of the private school's pupils.
(e) Revenue from federal, state and local governments for instructional programs, food service and facility acquisition.
(2)
(a) Except as specified under par. (b), annually, prior to the start of the private school's fiscal period, the administrator of the private school shall prepare a budget for the ensuing fiscal period showing anticipated enrollments for all pupils enrolled in the school and for choice program pupils, estimated revenues and costs, and a schedule of anticipated beginning and ending net choice program assets. The budget shall identify contingent funding sources the private school will use should actual enrollments be less than expected.
(b) A private school filing an initial notice of intent to participate in the choice program under s. PI 35.03(1) shall, by the following May 1, submit to the department the information required in par. (a) along with a schedule of monthly cash flow requirements on a form provided by the department.
(c) A private school that participated in the program under this chapter in the immediately preceding school year shall revise the information required in par. (a) to reflect revenues resulting from the school's actual third Friday in September enrollment and related required budget changes if the actual third Friday in September enrollment for all pupils or for choice program pupils varies by 20% or 20 pupils, whichever is less, from the anticipated enrollments used in the budget required under par. (a).
(d) A private school filing an initial notice of intent to participate in the choice program under s. PI 35.03(1), shall submit to the department by the following November 1, on a form provided by the department, a budget as required in par. (a) reflecting the school's actual third Friday in September enrollments and any related changes in revenues, costs and monthly cash flow requirements.
(3) A private school shall make payment of all the following within 90 days of receipt of invoice or payment request or as per written agreement:
(a) Payments to vendors for services provided.
(b) Reimbursements to employees and other individuals for expenses incurred on behalf of the private school. The employee or related party shall request reimbursement within the time period specified by the private school's written policy for such reimbursement. All reimbursements shall be made on the basis of original receipts that shall be retained by the private school in support of the paid reimbursement.
(4) A private school shall make payments to employees based on written documents specifying compensation and dates for payment. The private school shall provide this information to any employee requesting it.
(5) A private school shall have an adequate system of financial internal controls that includes all of the following:
(a) Depositing all receipts and paying all disbursements from a depository account or accounts maintained solely for the private school's purposes unless the operating organization's financial accounting system provides for separate identification of the private school's revenue and expenditure transactions. The depository account or accounts used by the private school or those used by its operating organization for school purposes shall be located within the state of Wisconsin.
(b) Maintaining documentation as to the nature and source of all cash receipts.
(c) Depositing intact and separate from all other receipts of the school, payments received for choice program pupils. The private school shall maintain a record of the deposit date for all individual payments received for the choice program pupils.
(d) Using pre-numbered checks for all school disbursements, except those from a petty cash fund.
(e) Maintaining on file original invoices and payment requests supporting disbursements.
(f) Using internal control practices recommended in previous fiscal practices reports required under sub. (13).
(6) A private school or its operating organization shall be current with all of the following:
(a) Filing and with holdings payment requirements of the federal internal revenue service. If the private school or its operating organization is required to file annual information return form 990 or form 990-EZ, a copy of the information in the filed return identified as available for public inspection by the federal internal revenue service shall be provided to the department by the private school within 30 days after filing.
(b) Filing and with holdings payment requirements of the Wisconsin department of revenue.
(c) Filing requirements of the Wisconsin department of workforce development.
(d) Filing requirements of the Wisconsin department of financial institutions.
(e) Filing requirements of the Wisconsin department of safety and professional services.
(f) Auditing requirements of federal, state and local government agencies. The private school shall provide the department with a copy of audit reports issued or revisions within 30 days of submission to the requiring government agency.
(7) A private school shall have worker's compensation coverage and shall have liability and errors and omissions insurance coverage for incidents resulting from omissions or actions of the private school's owners, directors or employees. Coverage shall be provided by an insurance company licensed to do business in the State of Wisconsin or by a non-profit, tax exempt mutual protective organization covering risks of schools of, and controlled by, a religious denomination. All coverage shall be on an occurrence form or a claims made basis. Minimum coverage shall be as follows:
(a) Worker's compensation as specified under ch. 102, Stats.
(b) Commercial general liability in the following amounts unless the coverage amounts are based on a written or documented verbal recommendation of a risk or insurance consultant.
1. For each occurrence, minimum coverage in the amount of $1,000,000.
2. Personal injury, minimum coverage in the amount of $1,000,000.
(c) Umbrella excess liability, an aggregate limit minimum coverage of $5,000,000, unless the coverage amounts are based on a written or documented verbal recommendation of a risk or insurance consultant.
(d) Auto liability, a combined single limit minimum coverage of $1,000,000 for each accident unless the coverage amount is based on a written or documented verbal recommendation of a risk or insurance consultant.
(e) Errors and omissions for school leaders, an aggregate limit minimum coverage of $1,000,000 unless the coverage amount is based on a written or documented verbal recommendation of a risk or insurance consultant.
(f) Sexual misconduct liability, an aggregate limit minimum coverage of $1,000,000 unless the coverage amount is based on a written or documented verbal recommendation of a risk or insurance consultant.
(8) If a private school operates or contracts for the operation of school buses with an organization other than a Wisconsin school district, the private school or the contracted operator shall have school bus insurance as required by s. 121.53, Stats. The private school may not contract for the school bus operation with an organization other than a Wisconsin school district unless the operator has provided the private school with a certificate of insurance meeting the requirements of s. 121.53, Stats.
(9) If a private school is providing or contracting for pupil transportation in vehicles other than school buses as permitted by s. 121.555, Stats., the private school shall determine that any motor vehicle so used complies with the conditions specified under s. 121.555, Stats.
(10) A private school shall, at least once every 3 years, have a written risk management and insurance evaluation by a risk or insurance consultant.
(11) A private school shall have a fidelity bond indemnifying the private school against loss resulting from dishonesty, malfeasance, or neglect by owners, officers or employees.
(11m) A private school shall ensure all teachers employed by the private school have a bachelor's degree from an accredited institution of higher education or a temporary, nonrenewable waiver under s. PI 35.07(2), all administrators have at least a bachelor's degree from an accredited institution of higher education and all teacher aides have graduated from high school, been granted a declaration of equivalency of high school graduation or been issued a general educational development certificate of high school equivalency. If a waiver has been granted to a teacher under s. PI 35.07(2), the private school shall ensure the teacher has made progress with the plan and, if applicable, the teacher has submitted an updated waiver form to reflect any changes made to the five-year plan submitted to the department under s. PI 35.07(2) (b).
(12) The administrator of a private school filing an initial notice of intent to participate in the choice program under s. PI 35.03(1) shall, by the following May 1, participate in a fiscal management training program approved by the department and shall provide the following on a notarized statement on a form provided by the department:
(a) Identification of the operating nature of the private school as one of the following:
1. Non-profit corporation.
2. Affiliation with religious organization with non-profit status.
3. For profit corporation.
4. For profit limited partnership
5. For profit partnership.
6. Sole ownership.
7. Specified other.
(b) Identification of how the private school will implement an accounting system that complies with the requirements of sub. (1).
(c) A statement that the private school shall have a written policy as required by sub. (3) (b) for expenses incurred on behalf of the private school.
(d) Identification of the written documents on which employee compensation will be based as required by sub. (4).
(e) A statement that the private school will have a system of financial internal controls as required by sub. (5).
(f) A statement that the administrator of the private school and the operating organization of the private school are current with filings and with holdings payments under sub. (6).
(g) A statement that the private school will have the minimum insurance coverage as specified under sub. (7) unless a different amount is recommended based on the written recommendation of a risk or insurance consultant. The private school shall provide the department with a certificate of insurance or other evidence of having obtained the required insurance by August 1 or prior to May 1 if the private school begins initial participation in the program with operating a summer school.
(h) A statement that the private school shall comply with the requirements of subs. (8) and (9) prior to providing or contracting for pupil transportation.
(i) A statement that the private school shall obtain the risk management and insurance evaluation as required by sub. (10).
(j) A statement that the private school shall have a fidelity bond as required by sub. (11) by August 1 or prior to May 1 if the private school begins initial participation in the program with operating a summer school.
(13) A private school shall engage an auditor to provide a report to the department by December 15 attesting to the private school's compliance or non-compliance with the fiscal and internal control practices required by this section. The internal audit staff of an organization affiliated with the private school may, with prior approval of the department, provide the report required by this subsection if the internal audit staff meets independence standards identified in generally accepted government auditing standards. The report under this subsection shall meet all of the following requirements:
(a) The report shall be prepared in accordance with professional standards and identify the procedures agreed upon by the auditor and the department that were used in determining compliance or non-compliance. In making such a determination, the auditor may not rely on oral or written representations of the school's administration or staff.
(b) The report shall contain the private school's response as to its reasons for non-compliance with the requirements of this section and corrective action the school is taking.

Notes

Wis. Admin. Code Department of Public Instruction § PI 35.047
CR 04-076: cr. Register October 2005 No. 598, eff. 11-1-05; EmR1021: emerg. cr. (11m), eff. 6-16-10; CR 09-084: cr. (11m) Register September 2010 No. 657, eff. 10-1-10; correction in (6) (e) made under s. 13.92(4) (b) 6, Stats., Register February 2012 No. 674.

The Milwaukee parental choice program budget and anticipated cash flow form may be obtained from the Wisconsin Department of Public Instruction's website at www.dpi.state.wi.us/dpi/dfm/sms/finrpt.htmlor is available at no charge by writing to the Wisconsin Department of Public Instruction, School Management Services, P.O. Box 7841, Madison, WI 53707-7841.

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