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Introduction
What's
New?
GASB 45 – OPEB
Announcing ACOPEB, the Alternative Calculation for OPEB, an approach for meeting the requirements of GASB 43 and 45 for small (less than 100 plan participants) OPEB plans. ACOPEB is on-line, user-friendly software for calculating other postemployment benefit obligations and accounting information. GASB 45 provides for an alternative calculation that does not require an actuary. If you have an OPEB plan with less than 100 plan participants then this software may be your solution. Take the test. See if your plan qualifies for the Alternate Calculation. For more information, click on http://www.acopeb.com/
CAFR-ONLINE
Announcing CAFR-ONLINE, on-line, user-friendly software for compiling GASB 34 compliant statements or a Comprehensive Annual Financial Report (CAFR). If you want to prepare your own financial statements, then this software is for you. For more information, click on http://www.cafr-online.com/
Upcoming Classes
- The GASB Statement No 34 Basic Statements and MD&A Overview workshop scheduled for Friday, December 11, 2009, at the Assabet Valley Regional School District in Marlborough. Due to the importance of understanding your financial statements under SAS 112, I am opening the Uniform Massachusetts Accounting System (UMAS) class to others to provide a timely and informative session on the Basic Statements and the MD&A. This workshop will provide an overview of the two government wide statements, the eight fund perspective statements, and the Management Discussion and Analysis. If you want an overview of the new reporting model, this workshop is for you. For more information, please click on http://www.theabrahamsgroup.com/Courses_GASB34.htm
- The ESE/DOR Roundtable scheduled for Friday afternoon, December 11, 2009, at the Assabet Valley Regional School District in Marlborough. This roundtable features Jay Sullivan from the Department of Elementary and Secondary Education and Ellis Fitzpatrick from the Department of Revenue to discuss and answer your accounting and reporting questions. Find out when the new 2:00 bus leaves or if the mileage varies on the 2:00 bus. Learn about the latest DOR IGRs, stimulus rules, maintenance of effort, Circuit Breaker accounting regulations, E&D rules and regulations, and other accounting treatments. This roundtable is offered free of charge. For more information, visit http://www.theabrahamsgroup.com/Courses_DOE_DOR.htm
- The Fall 2009 Uniform Massachusetts Accounting System (UMAS) course is scheduled to start on Friday, September 25, 2009 at the Needham School Administration Building. UMAS is offered to municipal and school officials and private sector individuals and related staff, who desire a basic course in current Massachusetts' governmental accounting. The course will focus on UMAS system as promulgated by the Bureau of Accounts in their updated UMAS Manual, including 2007 revisions to the capital projects and enterprise fund chapters. UMAS is the "preferred" accounting system for municipalities; regional school districts; water, sewer, fire and other districts; and municipal school departments. The course integrates Department of Elementary and Secondary Education budgeting, accounting and reporting requirements, the Statement No. 34 reporting model of the Governmental Accounting Standards Board and water, sewer, fire, regional school and other district requirements. For more information about this class, please click on http://www.theabrahamsgroup.com/Courses_UMAS.htm
- The 2009 Boot Camp class that meets on Thursday, February 5 and 26, and March 5, 2009 at the Avon Town Hall is now closed with 22 municipal and school officials attending. This course is a detailed general ledger journal entry course designed to train accountants to learn the Uniform Massachusetts Accounting System (UMAS). This class is called Boot Camp because the journal entries are repeated over and over. This class helps prepare town accountants and city auditors for the Uniform Municipal Accounting System (UMAS) certification exam. If you need a class to teach you the day-to-day UMAS journal entries or if you are having difficulty preparing for or passing the UMAS certification exam, then this class is for you. Topics covered include tax recap sheet budget journal entries, reconciliation of treasurer's cash, capital project accounting, debt accounting, common journal entries, closing journal entries and free cash calculation. Please check this web site for the 2010 class announcement. For more information, visit http://www.theabrahamsgroup.com/Courses_BootCamp.htm
- The 2009 Municipal Law Workshop conducted on February 12, 2009 is now closed with 24 municipal and school officials attending. This one day course focuses on provisions in the Massachusetts General Laws pertaining to Municipal Finance. If you need a class to teach you the day-to-day basic legal requirements or if you are having difficulty preparing for or passing the Municipal Law portion of the UMAS certification exam, then this class is for you. Please check this web site for the 2010 class announcement. For more information, visit http://www.theabrahamsgroup.com/Courses_MunicipalLaw.htm
CHAPTER 70 AND NET SCHOOL SPENDING
The preliminary estimates of Chapter 70 school aid and net school spending requirements for FY10 along with FY09 9C cuts have been published. The FY10 estimates are based on House 1, Governor Patrick's proposed state budget for the coming fiscal year. House 1 level-funds each district’s Chapter 70 aid at the FY09 level.
FY09
- Chapter 70 was not cut
- Additional Assistance and Lottery aid were reduced by $128 million or 9.7%
- FY09 required net school spending is fully in effect
- The majority of districts spend well in excess of required net school spending and thus are vulnerable to cuts, Chapter 70 aid not withstanding
FY10 Chapter 70 and Net School Spending highlights follow:
- The foundation budget calculation is based on the same model used in FY07. All foundation budget factors have been increased by 4.5% consistent with legal language that caps inflation, despite a 6.75% true inflation growth, and despite the fact the statutory cap was lifted over the past few years.
- The required local contributions are based on the aggregate wealth model first used in FY07. For the 185 (53%) municipalities with required contributions above their target, the requirement is reduced by 25% of the excess (compared to 33% reduction last year). Each municipality's target contribution has been updated using 2008 property values and 2006 personal income data. This continues the progress, albeit at a slightly slower pace, toward the taxpayer equity goals that were established in FY07. Communities may spend above their requirement; that is a local decision, not to be required by the State.
- The average municipal revenue growth factor (MRGF) statewide is 1.88%, the lowest ever.
- For the 166 communities whose preliminary contribution is less than the target (representing $390 million), an additional increment may augment the preliminary contribution.
- If the resulting contribution is still below the target, then a one-time adjustment is made for FY10 to get closer to their effort target. This adjustment brings the local contribution to the target or 95% of FY08 local spending, whichever is lower.
- Chapter 70 is level funded. Additional Assistance and Lottery aid were reduced by $240 million statewide
- 153 operating districts have FY10 net school spending requirements that are less than their FY10 foundation budgets, representing $168 million statewide. There is insufficient funding to pay for the difference between the foundation budget and the local contribution. With level funded state aid, there is no foundation aid for FY10. Remember spending must meet the net school spending requirement, not the foundation budget target. Federal stimulus money is planned to finance the foundation budget deficiencies.
- The final FY10 Chapter 70 and net school spending numbers will be published when the FY10 state budget is finalized. We will be discussing the final FY10 numbers on September 21, 2009 as follows:
- The next Basic Chapter 70 and Net School Spending Workshop (for Dummies) for FY10 final numbers will be held Monday morning, September 21, 2009, at the Assabet Valley Regional Vocational School in Marlborough. This workshop is an introductory session on Chapter 70 and net school spending and will explain the terminology and how your district's Chapter 70 distribution and the net school spending requirement are computed. This workshop will also review net school spending regulations, Chapter 70 district profiles, foundation enrollment, NSS compliance, the compliance supplement, NSS worksheet, and municipal costs paid on behalf of the school district. This workshop is recommended for new school and town officials or individuals who would like a net school spending overview or refresher. 37 municipal and school officials attended the last basic workshop. For a direct link, please visit http://www.theabrahamsgroup.com/Courses_FY10_Basic_NS_Spending.htm
- The next Advanced Chapter 70 and Net School Spending Workshop will be held Monday afternoon, September 21, 2009, for the FY10 final numbers at the Assabet Valley Regional Vocational School in Marlborough. This workshop is a hands-on, Excel based session allowing you to compute your FY10 Chapter 70 and net school spending numbers. This workshop also will cover net school spending for regions and how the municipal numbers fit into a region, and a review of regional E&D rules and computations. Bring your laptops and follow along to compute your numbers. This workshop is recommended for individuals who have a basic understanding of the foundation budget, local contributions, Chapter 70 distributions, required and actual net school spending and the like. 27 municipal and school officials attended the last workshop. For a direct link, please visit http://www.theabrahamsgroup.com/Courses_FY10_Final_Spending.htm
- The next How to Prepare Massachusetts' Fund Financial Statements class will be conducted on Friday, June 12, September 11 and October 16 at the Needham School Administration Building. This class is offered to municipal and school officials and private sector individuals and related staff that desire a hands-on course in preparing the fund financial statements. If your auditors are stating that you have a financial reporting deficiency under SAS 112, this class may be for you. The first day will develop the knowledge and a template to produce the Combined Balance Sheet for Free Cash or E&D Certification. The second day (September) will finalize the Combined Balance Sheet and started to develop the template for the GASBS No. 34 eight Fund Perspective Statements. The third day (October) is to complete the Fund Statements. This is not an overview class; this is a how to do it class using Excel combining and combined spreadsheets to prepare the combined and fund perspective statements. For more information, please visit http://www.theabrahamsgroup.com/Courses_Prepare_Massachusetts_Fund_Financial.htm
- The next How to Prepare Massachusetts' Government Wide Financial Statements class will be conducted in two classes: Yarmouth Police Station (Thursdays, June 24, September 10 and October 15, 2009) and the Dudley Municipal Complex (Wednesdays June 10, September 9, and October 14, 2009). This class is offered to municipal and school officials and private sector individuals and related staff that desire a hands-on course in preparing the Statement of Net Assets, Statement of Activities, and the Management's Discussion and Analysis (MD&A). The first day will review the eight fund statements and develop the knowledge and a template to produce the Statement of Net Assets and the reconciliation of the governmental funds balance sheet to the Statement of Net Assets. The second day (September) will review the Statement of Net Assets and develop the template for the Statement of Activities. The third day (October) is to review the government wide statements and learn how to write the Management's Discussion and Analysis (MD&A). This is not an overview class; this is a how to do it class using Excel spreadsheets to prepare the government wide statements. Knowledge of the fund statements is a pre requisite for this class. For more information, please visit http://www.theabrahamsgroup.com/Courses_Prepare_Massachusetts_GovWide_Financial.htm
- The next School Fund Accounting course will be conducted on Friday, December 4, 2009 at the Needham School Administration Building. SAVE THE DATE. Last year 38 municipal and school officials attended this session. This session will focus on fund accounting requirements based on the provisions in the Massachusetts General Laws pertaining to School Finance. The focus of this class is on Chapter 71 of the MGL, school special revenue, student activity accounts, regional excess and deficiency calculations and rules, and other funds. If you need a class to teach you the day-to-day basic school fund accounting requirements, then this class is for you. This class will focus on the school finance laws and accounting requirements for municipal and regional school districts. For more information, including on-line registration, please visit http://www.theabrahamsgroup.com/Courses_School_Fund_Accounting_Workshop.htm
- The next Performance Based Measurement and Budgeting class is scheduled for Thursday, June 11, and Thursday, June 25 (new dates) at the Needham School Administration Building. The first day will focus on performance measurement including the definition and development of performance measures, developing goals, linking goals to performance measures, the use of logic models, and activity mapping. The second day is to use performance measures and data to inform your budget and change your budget from a line item to a program budget populated with performance information. If you are interested in more transparency, moving your organization to a results-based management focus, and/or relating your budget to results, this class is for you. For more information, please visit http://www.theabrahamsgroup.com/Courses_Peformance_Based_Management.htm
- The next Martha's Vineyard Net School Spending Workshop will be held from 1 - 5 PM on Friday afternoon, August 7, 2009 at the Martha's Vineyard Regional High School. This class will provide you with an informal setting to learn about the Chapter 70 formula and how your final FY10 net school spending numbers are calculated. If you want to get away or if you want to learn your numbers, come to the Island of Martha's Vineyard. For more information,
http://www.TheAbrahamsGroup.com/Courses_MV_Final_Spending.htm
Look for new, upcoming classes on Enterprise Fund Accounting, Capital Projects Fund Accounting, and other classes starting after March 1, 2009.
OTHER EVENTS
The
CitiStat phenomenon hits Massachusetts.
The City of Somerville with the assistance of Mark Abrahams in conjunction
with the Kennedy School of Government and the Rappaport Institute
is implementing SomerStat, performance measurement and performance
budgeting as a way to Manage for Results. For more information,
visit http://www.theabrahamsgroup.com/SomerStat.htm.
The
Government Accounting Standards Board has issued a new Research Report
entitled "Reporting Performance Information: Suggested Criteria
for Effective Communication". The purpose of this special report
is to provide guidelines to state and local governments to enhance
the production of external accountability reports through use of sixteen
suggested criteria. These criteria were developed by studying state
and local governments currently using performance measures and studying
the work of other national and international organizations. Each criterion
includes the purpose, a description, the rationale for such a criterion,
and several examples from existing performance and accountability
reports. The report highlights performance measurement within a performance
management or Managing for Results context. Mark Abrahams is a contributor
to this Report. For a direct link, visit http://www.seagov.org/sea_gasb_project/suggested_criteria_report.pdf.
The
Government Finance Officers Association has recently emphasized performance
management by issuing two recent recommended practices. The first
is Using Performance Measurement in a Performance Management or
Managing for Results capacity. For a direct link, visit http://www.gfoa.org/services/rp/budget/budget-performance-management.pdf.
The second is Costing Government Services; that GFOA recommends
that governments calculate the full cost of the different services
they provide. For a direct link, visit http://www.gfoa.org/services/rp/budget/budget-measuring.pdf.
With
support from the Alfred P. Sloan Foundation, the Association for Government
Accountants is launching the Certificate of Excellence in Service
Efforts and Accomplishments Program that evaluates performance
reports at the state and local level. The purpose of the reviews will
be to evaluate how well the government or other organization informs
the public about its performance, consistent with the suggested criteria
issued by the GASB. The review is not intended to evaluate the quality
of the government or its performance. Rather, the focus is entirely
on the report's usefulness to the public and other decision-makers
who have a stake in the effectiveness of the government's services.
Mark Abrahams is an SEA Program Reviewer. For a direct link, visit
http://www.agacgfm.org/performance/sea/.
Managing for Results -- performance
based management, including strategic and program planning, performance
measurement and management, service efforts and accomplishments reporting
and activity based costing and management.
Budgeting
for Results -- activity based, program based and
performance based budget projects in Massachusetts and nationally along
with rate setting studies.
Accounting
for Results -- accounting implementations in Massachusetts
and nationally.
Auditing for Results
-- audits of performance information, the Compliance
Supplement, Student Activity Accounts and the like.
Courses
-- Announcing
the course and workshop schedule for the spring of 2008.
Click here for further details.
GASB 34 Implementation -- the
first GASB Statement No. 34 implementation in the country and the first
Massachusetts municipal early implementation. |
