by Guest Author
Finalizing Your 2019-2020 Charter School Budget
The end of the school year is upon us, and many charter schools are scrambling to put the finishing touches on their budgets for the 2019-2020 school year. This can be overwhelming given all the moving parts 鈥攆inalizing staff compensation, collecting final proposals for next year鈥檚 contracts, deciding which software and curriculum to use, tracking down charter school budget plans from all the department leads, awaiting initial QBE estimates, and preparing for public budget hearings 鈥� all while trying to finish out the school year!
Here鈥檚 my advice:聽Don鈥檛 sweat it! There is聽no way聽you are going to have all these items finalized by the time you need to send your budget to the board for approval. Plus, there are many aspects of the budget that are completely out of your control. Instead of worrying, try this approach:
- Pick two or three areas of the charter school budget you鈥檙e going to focus on in the 11th hour.聽These should be areas of the charter school budget that are either your most significant sources of revenue or expense or have caused problems in the past. And don鈥檛 pick 鈥渟taff鈥�! (See my next suggestion below for wrapping up your compensation budget.) Once you have picked your areas of focus, set aside a designated time (~30 minutes for each area) to dig in and try to firm up the assumptions鈥娾�斺赌妕hen put a bow on it! Once the new school year starts and you have access to new and/or updated information, you can work with your Finance Director or adviser to adjust the annual forecast.
- For staffing, again鈥�鈥斺赌�do your best!听Finalize the charter school budget with the information you know now and include reasonable and conservative assumptions for the things you don鈥檛 know.At some point, you must stop trying to get everything locked up and just go with what you have. But being conservative will help you to avoid the frustration of going over budget down the road.
- Make a list of the areas where you feel assumptions aren鈥檛 solid,听and over the summer, push to solidify them.聽Also, be upfront with your board about the areas of uncertainty (note: no need to share every uncertainty, just the ones you feel are the biggest opportunities/risks.) I find that outlining the missing information at a high level strengthens the board鈥檚 comfort with the financial plan. Board members will appreciate the transparency and feel reassured knowing you are aware of the uncertainties and on top of all the moving parts.
- For most charter schools, budgeting is an art, not a science.聽There are countless details, many of them unknown or unknowable, so we just do our best with what we have and keep pushing for improved clarity as the year goes on!
EdTec supports startup charter schools with their charter application budgets by working closely with the school鈥檚 founding team to project revenue and expenses, build a sound, multi-year budget in the authorizer鈥檚 required format, develop cash flow projections, and prepare a corresponding budget narrative. We also work with operating charter schools to develop annual and multi-year budgets as well as updated monthly cash flow and budget forecasts as part of our back office services. To learn more about EdTec and discuss how we can support your school, please email us at askus@edtec.com.
About EdTec: EdTec is a social enterprise committed to improving public education聽by supporting聽charter schools with business, operations, and performance services. Through our core service 鈥� back-office 鈥� we provide a CFO-level resource and a team of specialists to perform payroll, accounts payable, and accounting functions. EdTec has worked with hundreds of charter schools since our founding in 2001. We are excited to be working with both operating and startup charter schools in Georgia.
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