Finance Analysis Model by Coopers & Lybrand

B5032J02 Date: March 23, 1995 To: Fred Smith From: Bill Mooney Subject: Finance Analysis Model We both know that the financial situation of the district makes sound decision-making critical to the future. As resources become increasingly strained, decision-makers operate with less margin for error. The chance of making a good decision is increased by having useful information readily available. The main purpose of the Program Budget Document is to link program accomplishments with program expenditures so we would have better information to guide the district. We must always seek better ways of collecting data and analyzing it into useful information. One of the better ways might be the Finance Analysis Model. I want to share the attached pamphlet with you, and get your thoughts into further investigation of this model. Since the model is PC-based, it could probably run in our existing environment. Such a tool might assist the administration. Board, and community in making better decisions. The model has something of a history around Little Rock. Last year, Ann Brown and I encouraged Gene Wilhoit to look into using the models forerunner, the Micro-Finance Model, statewide. Additionally, one of the authors of the model, Sheree Speakman, was the lead person on the Coopers & Lybrand study conducted for the district. I would bet she used some of her experience from that project as material for the model. Please read the pamphlet, then let me know what you think. I will be glad to help you in any way I can. Copy to: Ann Brown Hank WilliamsLRSD a6MIN. BULDING Fax:1-501-324-2032 Aug 31 95 15:17 P.02/02 W-' '5' 2^ 53 Little Rock School District Media Advisory August 31, 1995 For more information: Suellen Vann, 324-2020 The Board of Directors of the Little Rock School District (LRSD) will hold two special meetings beginning at 6:00 p.m. tonight. August 31, 1995. The purpose of the first meeting is to complete LRSD business which was not finished at the regular monthly meeting on August 24. The second meeting, which will immediately follow the first meeting, will be held to discuss a proposal from Service Master to manage custodial operations of the LRSD. The meetings will be held in the Board Room of the LRSD Administration Building at 810 West Markham, ### iiAiAiiiiAiialRsd admin, bulding Fax:1-501-324-2032 Dec 6 95 9:43 P.02/02 Little Rock School District 1 s Media Advisory December 6,1995 For more information: Suellen Vann, 3242020 Little Rock School Board member Judy Magness is participating in Leadership Greater Little Rock. As part of her leadership project, she will be interviewing Shorter College president Dr. Katherine Mitchell, who also serves on the Little Rock School Board. The interview will take place at 8:30 a.m. today at Shorter College. This advisory is being sent since a special meeting situation exists. 810 West Markham street Little Rock, Arkansas 72201 (501)824-200012/06/95 } 10:21 501 324 2023 LRSD COMMUNICATI ODM 002/002 I 1 y ( Little Rock School District Media Advisory I I Technology Donation for School December 6,1995 For more information: Dina Emfinger, 324-2020 , LITTLE ROCK The Association of Black Engineers in Arkansas will present computer software worth more than $550.00 to their Partner in Education, Romine Computer Science & Basic Skills Interdistrict Elementary School, today at 12:00 noon in the Ubrary of the school. I ABEA hopes their gift will promote development of math, science, and technology skills in female and minority students and will encourage them to pursue related careers. ### I I r j I I < i I IThe Finance Analysis Model is a cooperative effort of Coopers &Lybrand Coopers & Lybrand L.L.P. a professional services firm and the CENTER FOR WORKFORCE PREPARATION Letter from Coopers & Lybrand L.L.P. and the Center for Workforce Preparation Coopers & Lybrand L.L.P. and the U.S. Chamber of Commerce's Center for Workforce Preparation are pleased to announce a cooperative effort to enhance the public's understanding of the school operating framework that supports education. Our goal is simple: to enhance the information communicated on school finance. To this end, Coopers & Lybrand and the Center are combining their considerable resources and know-how to support the nation's schools in effective reporting to the public on the budgets and costs that make education and education reform possible. Each of our respective organizations already makes a substantial annual commitment to support local community efforts to improve teaching and learning. Since 1985, Coopers & Lybrand has encouraged employees to participate in a unique volunteer outreach program. Supporting Youth Education. In the 1993-94 school year alone, 3,000 participating partners and staff contributed 55,000 hours of teaching and tutoring to secondary schools nationwide. Committed to serious involvement in local education programs. Coopers & Lvbrand offices nationwide provide school districts across the country with technical and financial assistance. The Center for Workforce Preparation assists 3,000 state and local chambers of commerce nationwide with education reform efforts by supporting the U.S. Department of Education s satellite town meetings, distributing information on effective practices in school-to-work transition, parent involvement in education and other critical education issues. Our effort is directed toward disclosing information on education today so that community members can know udth certainty how much it costs to run schools, how dollars are directed to the teaching and learning of children V and the results of these efforts. We believe the sharing of information help
IS communities implement a shared vision of the best way to support the needs of local students and helps ensure that all who sit at the table of education reform equally informed. are The result of our coUaboration is the Finance Analysis Model , an information tool for schools that works at both the district level and at individual school sites. Our model provides a new reporting system for districts that are committed to site-based management. Our shared vision starting with this model is to bring best practices to American education, integrating processes developed by the business, education and financial communities into solutions that are delivered locally. We would like you to join us in bringing this new approach for sharing information to your local schools. Nicholas G. Moore Chairman Coopers & Lybrand Edwin Lupberger Chairman Entergy Corporation and the Center for Workforce Preparation Executive Summary Coopers & Lybrand L. L.P. and the U.S. Chamber ofCommerce's Center for Workforce Prepara tionhave joined efforts to createamodelforschool finance and management reporting based on each organization's school finance research. "The Finance AnaIy-7 sis Model is a technology-based information tool that operates on a standard } personal computer. As a technology, school districts can use it from one year to the next to determine Ion?- o grange patterns in e.xpenditures. The product is designed to analyze 100 percent of a school district's general i ledger. In addition to collecting information expenditures, it analyzes information at individual school on the districf s budget or actual sites. School-bv- school data allow community leaders to view how schools within the same district compare on spending patterns, and whether some schools investi resources in teaching and learning more efficiently than others.' The Finance Analysis Model consists of a series of multi-dimensional, spreadsheets that compile information on district and school expend!- tures. The three basic dimensions include: ? ,4 1 a functional dimension showing expenditures and budgets that comprises / 100 percent of the district's funds into one of five categories Instruction,^ Instructional Support, Operations, Other Commitments and Leadership,-:/ 3 a program dimension that provides community leaders with accurate infor- / mation on the costs of educational programs such as special education,/ gifted and talented, bilingual, chapter 1 & 2, summer school, general / education and other programs
I 1 a grade level dimension that allows school districts to determine the costs of / functions and programs in the district's elementary, middle and higb} schools, alternate schools and all other schoolsj The model is organized to present expenditures in five functions so that communities can search for the proper balance between instructional spending and other costs. Working with community leaders, school districts can use management information to identify where resources can be directed to enhance student perfor- mance.Introduction Generations of Americans have believed that the American dream of prosperity could be achieved with a sound, basic education. As the year 2000 approaches, however, parents, business and community leaders, educators and children alike are openly debating if today's education system continues to improve young minds, and whether or not the system still provides students with the skills needed to remain competitive in the work place. In the last decade of this centurv, the debate to reform the nation s education system has been influenced by both positive and negative pressures: Goals 2000 and state reform initiatives, irate taxpayers, critical reviewers, the accountability movement, funding shortfalls, "seed grants," government, individuals and philanthropy. As federal and state programs continue to recognize individual schools and teachers of excellence, critics wonder why three decades of constant attempts to improve education have only resulted in higher costs, burdensome regulations and increases in student achievement. more controls without realizing significant Continuous increases in funding for education have led to one conclusion funding does not guarantee enhanced student performance. In fact, as more federal, state and local funding o agencies have run out of options for P' providing new resources to schools, school decision-makers are having^ to do much more with the same or fewer dollarslToday it is more critical than ever to find and apply comprehensivesolutionstotheproblems facing schools allocating scarce education dollars efficiently. A new technol- ogy, the Finance Analysis Model, being developed by Coopers & / Lybrand L.L.P. and the U.S. Chamber of Commerce's Center for Workforce Preparation supports community efforts to redefine education. ' ' The product organizes a school s financial records into one report that can be easily understood by teachers, parents, business leaders and students alike. The model in and of itself will not solve a school districts problems, but in the hands of citizens, school and business leaders, teachers and parents, the process assures that all members of the community can make mformed decisions to improve education for the community's children. Why is the time right for the Finance Analysis Model? First, pressure has mounted since the groundbreaking 1983 report A Nation at Risk alerted the country to declining education standards. A Nation at Risk made the most convincing argument, U.S. children must learn more math and science, embrace technology and learn how to communicate more effectively if this nation is to remain competitive in the global marketplace. The President and the nation's governors responded to this national education crisis in 1989 with a bipartisan "Education Summit," resulting in the introduction of the National Education Goals. Today, the groundwork established at the summit continues to support community efforts to improve local education through Goals 2000. Second, schools continue to face problems that directly impact learning: helping S children who live in extreme poverty and deprivation: providing services to students who face physical or mental challenges
counseling students who have substance abuse problems
coping with crime in the schools and a steady increase in children having children. Many students arrive at the schoolhouse hungry and tired. They sometimes sleep through class, cut school, miss their lessons and fall further behind their peers. Mustering all conceivable resources to support the bodies and minds of children is an everyday reality for many schools. To further complicate matters, the pupil population is growing again for the first time in 12 years, particularly in major urban areas that are already under financial pressure. Third, school finance issues continue to demand the attention of many state legislatures. Traditionally, state and local governments direct funds to each school district. The district then has the responsibility to report to the state on the results of budgeting of funds and subsequent financial activity. Even with the volumes of data i these reports entail, few legislators understand how funds are actually spent in, individual schools and on students themselves. The lack of data obstructs states' efforts to manage shortfalls in tax revenue and cutbacks in public funding. There-? fore, not only has it been difficult for states to adjust allocation patterns across? districts, but in periods of austerity, school decision-makers find it difficult to predict just how cuts would affect the student-teacher ratio, course offerings and the ? teaching and learning of students. ? In essence, educators are expected today to work miracles: to do more, for more students, under more pressure within the same budget. Yet this pressure serves catalyst to bring about important break-throughs and visible signs of progress education reform. The time is now. Since 1983, the conditions for meaningful school improvement have all emerged. Models have been tried and refined. States and school districts have shown a real interest in reform, and key stakeholders have all come to agree that unless schools adopt better financial management and accounting techniques, school leaders will face challenges in making informed decisions. 4A Perfect Team Systemic Reform and Management Reporting Nationwide, a concerted movement toward real education improvement often called systemic reform is taking shape. "Systemic reform" is a critical concept. It rests on the belief that all levels and groups with a stake in education must be involved. The Educational Resources Information Center (ERIC) reviewed the growing efforts for systemic reform and concluded: Systemic education reform is an ambitious movement to improve education from the "top down" and "bottom up" through state policies that support change at the local level. It involves coordinated change in the whole education system, particularly in four areas: standards, curricu- ' lum, performance assessment, and teacher development. . . Sys- temic reform is unique in emphasizing that change tn one aspect of education requires change in all the other aspects. (ERIC Review, 1994, p. 2). S Despite the importance of systemic reform, few address the economic consequences of reform. How can a national effort of systemic reform for 50 million students in 15,025 school districts, and more than 111,000 schools occur without information on activities, costs, practices and outcomes? The nation^s schools need a new standard of information that is supportive of systemic reforms, a standard related to current accounting, budgeting, auditing and testing. Clear, accessible information is a key to empowering all facets of the community. Data are numbers and words
but information is organized data organized to solve a problem or spotlight a concern. For example, data show test results
information indicates which students took the test, and how well they did this term. Data should be the starting point, not the stumbling block, of all good education decisions. To accomplish this, information must be accurate, accessible and provide a common basis for action. Systemic reform can not survive with data that divides community leaders. The Need for School Finance Management Reporting Educators and business leaders share much in common. Both want and need the best opportunities for children to learn. Both benefit from students with access to quality learning environments that lead to results. When it comes to finance and informa- j tion, however, schools can learn from long-standing business practices, jBusinesses are customer driven
companies either respond to the wants and demands of consumers, or face financial ruin. Businesses also make a concerted effort to run their operations efficiently in order to maximize profits. Companies r~ -. etficiently with management reporting tools that show their leaders how funds spent, which portions of the organization perform better than others run more are and areas in which thecompanycanreduceexpenditureswithoutaffectingoveraU performance. Similarly, companies communicate when clear-cut information exits. more effectively with employees and investors In today's tight financial environment, schools have responsive to the taxpayer. While school districts a new customer they must be information on demographics and expenditures must report detailed to state education agencies, few are required to provide its shareholders, the local citizens, with financial information that clearly defines the cost of education. School budgets are so large and complex that the community can not understand calls for mcreased spending. This lack of community trust undermines the school district's attempt to provide sufficient resources for instruction and every facet of education, j The Move Toward Information It was not until the 1980s that educators and legislators focused on a system-wide concept of school-site management and decision-making. With this move came a need forschool-based infonnation, on-going assessments of school-by-school achievement and the patterns of spending in those same schools. Despite this need, researchers continued to focus on district-level revenue and expense analysis, which duplicated data already available. Consequently, those districts involved inschool- based management programs have been forced into unchartered territory as they attempt to organize around the development and implementation of information useful to school-based leaders and educators. Any school district, regardless of its position on school-based management, caro benefit from tools that analyze expenditures school-by-school^ The aUocahons records of school systems - including both their yearly budgets and their actual expenditures are the financial expression of the education priorities of the commumty, its board of education and senior administrative staff. As such, one of the objectives of financial accounting for a school system is to provide reports to the public as a basis for judging past, present and future decision-making. When taxpayers are demanding better information about how fiscally-tight spent, it is important that the school district provide clear. resources are concise and timelyinformation to all interested in local education. The public simply wants to know
^ t How much money is spent to run a school districts E How much money is distributed to each school site? } E How much money is directed to classroom instruction and pupils? I E How much money is used for pupil, teacher and program support? E How much money is allocated for operating schools and the central office? j E How much money is used on school leadership and administration at each # school and at the central office? E To what extent do tax payers get value for their tax dollars? ) When answers to these basic questions are available, then school boards and community residents can better determine how best to use or modify resources to meet district and state education goals. The need, therefore, is not to make the financial reporting system more complex but rather to construct a simplified, common sense financial reporting procedure. Early Efforts 'o' a*. In 1989, Drs. Bruce Cooper and Bob Sarrel began a study that sparked interest in school-site analysis. Cooper and Sarrel developed the so-called "cascade" model to analyze funding directed to New York City's 123 high schools. The cascade model traced funding at the central office, ^^39 to the high school and finally to classrooms. The Center for Workforce iSW Preparation (the Center) engaged Cooper and Sarrel in a two-year project, to expand their research. With a grant from the Lilly Endowment, Inc, th^ Center, Cooper and Sarrel developed a school-site financial analysis model. The resultant work was known as the Micro-Finance Model, The model allocated all costs to one of five functions, including Administration (Aa)J Operations and Facilities (Bb), Staff Development (Cc), Pupil Support (Dd) anc, Classroom Instruction (Ee). Second, the Micro-Finance Model separated costs, incurred at the central officeA,B,C,D,E from those incurred at the school level, a,b,c,d,e and distributed expenditures school-by-school by grade level,(elementary, middle and high schools). The model also permits cost comparisons^ across functions, such as A+a (Central and School Administration), and B+b
(Central and School Operations). To date, 54school districts in 14 states have applied i the Micro-Finance Model to over 2,200 individual schools. 1 While work was underway on the Micro-Finance Model, Coopers & Lybrand directed a senior partner, Sheree T. Speakman? to investigate how school districts manage information using the volumes of data produced. Speakman created a small team of individuals from business, education and academia to create a new management reporting model for education. The team began work in New York Citv in 1994 to construct a technology that would provide the public with concise information. The result of their work was the School District Budget Model, a new technology that reorganizes data found in a school district's general ledger into managements information readily understood by all. The software product defined 100 percent? of the school districts expenditures by function, program and grade level (eiemen- tary, middle and high schools). As a technology, the School District Budget ModeC provided the school district with a tool that can be used from year to year to create-> a long-term analysis of the district's expenditures. ? Coopers & Lybrand's process and tools translated bodies of current data into a document easily understood by the individuals who participate in education parents, taxpayers, elected officials, educators and administrators providing them access to an evenhanded portrayal of the resources that support the teaching and learning of children. The New Model -The Cento Md Coopers & Lybrand have joined efforts to integrate the
A best qualities and features of the Micro-Finance Model and the School^ District Budget Model into one comprehensive management reporting f tool, the Finance Analysis ModeBIt is now being tested at the district and state levels with the full cooperation of local political, education and business leadership. The Finance Analysis Model is a technology-based management infor- ? mation tool that operates on a standard personal computed Since it is technologybased, districts can use the model yearly to develop a long-range portrait of district spending. It presents information in a format that answers the finance questions most commonly asked of superintendents, school boards, administrators and members of the community. Whether presented at board meetings, community forums or in written communications, the model can provide a common and ongoing financial language for school and community conversations. 3I What does the Finance Analysis Model do? It is designed to analyze 100 percent of a school district's general ledger. The district can choose to analyze budget figures* or actual spending, depending on the districf s accounting cycle. Since the product ' can analyze either budget or actual expenditures, school leaders can use it for both ' to determine if the district is meeting budget targets. In addition to collecting, information on the district s budget or actual expenditures, it also analyzes informa- t tion at individual school sites. School-by-school data allows community leaders to ? view how schools within the same district compare on spending patterns, and t whether some schools are more efficient than others, i iSf' The model consists of a series of multi-dimensional spreadsheets that compile 5 information on district and school expenditures. The three basic dimensions in- * dude
lie c a functional dimension of expenditures and budgets that categorizes* 100 percent of the districts funds into one of five categories Instruction, Instructional Support, Operations, Other Commitments and Leadership
I S a program dimension that provides community leaders with accurate information on the costs of educational programs such as special education^ gifted and talented, bilingual, chapter 1 & 2, summer school, general education and other programs
o & a grade level dimension that allows school districts to determine the costs of? functions and programs in the district's elementary, middle and high / schools, alternate schools and all other schools. The product provides a detailed record of the data included in each of the categories of information presented in the new model. School-by-school comparisons are made easier as the model provides percentage breakdowns for each schools expenditures. By cross-referencing these three dimensions, communities can begin to explore and explain school costs. 1 The Five Functions The five functions: Instruction, Instructional Support, Operations, Other Commitments and Leadership represent a vital process in education, starting with the core principle of schoolingteaching and learning (see Appendices I, II, & III for an illustration). Without all five functions, the district would fail to achieve its mission. Obviously, a school district can not operate without buildings, buses, materials, management and high quality leadership. To date, however, education has not developed a system for determining the best ratio of instructional expenses to other costs that support instruction. In the absence of real data, the argument often comes down to "the more in the classroom and less in overhead, support, and other costs, the better." However, the "perfect" system is NOT one in which zero dollars are used for administration and supervision and 100 percent in the classroom. Yet, in the absence of real information on the need for and cost of administration in education, the arguments about spending will grow louder. The Finance Analysis Model is not anti-administration or anti-leadership. It acknowledges that each level supports, sustains and leverages the level above as part of the education process. The model is organized to BaBSV' present expenditures for all five functions so that communities can search for the proper balance between instructional spending and other * costs. Identifying and addressing this balance will not be the same for all children, for all communities, for all geographic locales or for all types of schools. What is common is that all five functions alwavs exist in every school and in every school district. Any attempt to make schools better will definitely involve manipulating the functions and costs of Instruction, Instructional Support, Operations, Other Commitments and Leadership in a svstemic way. As information from the model becomes available, trends in allocations will begin to emerge. It is hoped that lessons will be drawn, developing "benchmarks" on effective ratios of spending between Instruction and Instructional Support. Rural, urban and suburban districts may have different benchmarks for the value and efficiency of non-instructional resources as measured against the value of instructional spending. Taking demographics into account may demonstrate that certain children use more "pupil support services" than others to compensate for poor home nutrition, health and other conditions. Some districts have more costs associated with operations than others: distances from schools, heating and cooling costs, security and control needs. To act on the model's information, a thorough understanding of its five functions is critical. The five functions are as followsri Instruction^ the very foundation of education capturing a student's interest inf learning, understanding and applying new knowledge. The model interprets in^ struction as face-to-face teaching, irrespective of whether the setting is a science labf or a field trip. Most costs of classroom instruction pertain to teachers (their salaries,^ benefits, pension), their helpers (instructional paraprofessionals, substitutes) andj materials (textbooks, tests, technology, software, workbooks, lab books, telescopes^ microscopes, paper and pencils).! Instructional Support covers all aspects of student and teacher services unrelated^ to teaching. Guidance counseling, mental and physical health, media, curriculum development, program development and library services are considered Instructional Support. Extracurricular activities, such as sports and clubs, fall within this function also. Expenditures for teacher staff development appear in this category as well. AU short- and long-term programs that support general instruction faU into this category. Instructional Support does not include the senior district administrators who are not involved in the daUy deUvery of programs to students
they are categorized under the Leadership function. Together, the Instructional Support function is best understood as making possible improved instruction through a better prepared and trained staff and students who are physicaUy and psychologi- cally well and are ready to learn. Hence, the support function is critical to enhancing the instructionai function., o Operations includes the infrastructure needs of schools. These needs include non- instructional pupil services (transportation, food services and safety), school facilities, non-school fadhties and business services such as payroll, human resources, finance and accounting. School and non-school facilities include maintenance costs, utilities, custodial services and groundskeeping. The senior district staff who are not involved in the daily delivery of these services are included in the Leadership hmction. I Other Commitments covers items that are not considered part of a school's day-to-day operations. Other Commitments can fluctuate significantly from one school district to the next, even within the same-
^^|^B^^H^ state. School administrators could not make accurate comparisons with districts of similar size if Other Commitments were accounted for throughout every program and function. By allocating these obliga-, / tions to a separate category, the model makes it possible to compare* expenditures from district to district across the country. School districts and states, like other businesses, have expenses related to borrowing money (debt obligations) that must be retired, costs of pensions, other fringe benefits and incentives for early retirement. Under federal and state programs, some funds "flow through" the district books, such as school district children who attend school. outside the district or for eligible students in private and parochial schools who receive Chapter 1 services paid for through the district. Often, these costs are excluded from cost analyses. The goal of the model, however, is to capture all relevant costs by state, district and school to permit a full analysis of real costs. Leadership is the primary driving force in any organization: those people and functions that make plans, direct goals and oversee that the mission of the district and its schools is implemented. T^e foundation of the Finance Analysis Model is the direction given by creative, active leadership, who give shape to the use of facilities i and operations, who see that students and staff receive adequate support and that the classroom is the center of the system. Thus, the model identifies all the costs! related to managing the school system. Costs here will often include the superinten- i dent, assistants and deputies, senior administrators, legal affairs and the schoof board. Leadership also includes principals and assistant principals.. Using the Model for District and Statewide Reform The model is a first step, not a solution, to strengthening education in local communities. It provides critical information on expenditures within the school system that can guide the school board and district management in improving the flow of resources to the schools. However, education leaders and the community must work together to determine if the Finance Analysis Model report reflects the community^s education priorities. Why should the community be involved in this
process? Each representative group within the community brings a different per- 41 spective to the table on how best to affect change in education. This rich texture of experience and advice can strengthen efforts to implement changes based on the report. A parent representative should be invited to review the report so that parents can understand what measures have been taken to support their children in school. A business leader should offer input on what future generations of workers need to meet employer standards, and whether those standards are reflected in the report. A school principal and a teacher need access to the report to assure that recommendations for change take into consideration the individual schools. Open participation in the Finance .Analysis Model review process can help the district avoid confrontations once decisions are made. Cotninunity leaders can take positive steps toward changing local education with the process as it provides information on central and school-site expenditures by function, program and grade level. It also can help districts: J Calculate costs by type of school
elementary, middle, high school and other schools
J Establish costs accross functions, such as Instruction costs at aU schools and at the central office
1 Set the efficiency of each school by building a ratio of direct student services to the cost of getting those resources to students (Operations, Leadership and Support at both the central office and at the schools)
C Separate costs by program (bilingual, special and categorical education versus regular education)
r Begin to build productivity functions to help see if more resources, applied directly to students for learning and growth, would indeed make schools work better and help students learn. Just as the model can help communities determine new directions in education, it can assist states in determining whether there is a link between funding and student performance. Statewide implementation of the process can provide state leaders with concise information on 1 every school and school district in the state, which can lead to better decisions on education funding priorities. Ultimately, information is power: it gives those using the Finance Analysis Model the chance to inform themselves and others of school x- district allocations and through comparisons suggests ways to improve the use of school resources. Comparisons made through the model can affect every school in the district, every district in the state and every state in the nation. Conciusion Coopers and Lybrand L.L.P. and the Center for Workforce Preparation have developed the Finance Analysis Model to enhance education for all children. It provides community leaders and concerned citizens with clear and accurate information on a local school districts spending by location, by program and by grade level. With this information, business leaders, parents and educators can determine if the district's spending reflects the community's education priorities. Through the model, the community can decide if funding levels are appropriate for instruction, support services and operations, as well as school and district leadership. With detailed information, decisions can be made to change the balance of resources to maximize student performance, staff development, educational facihties or any educational need. Community representatives with access to better information have the power to make better decisions. That power is available today through the Finance Analysis Model. Use the model to make bettter decisions for today's students our future.Coopers a Lybrand L.L.P. / Center for Workforce Preparation Finance Analysis Model for Education INSTRUCTIONAL Kaaricdon: AU nghcs st jse ind reproduction reserved. Keoroductions of this publiciton, or exploicdcion of its concents. prohibited. m dtfhoie ar n pm. wichouc the prior wnccen permission of Coopers Lybrsnd is strictly Copyngnc Coopers Lybrand. LLP. Coopers A Lybrand L.L.P. / Center for Workforce Preoaritton FINANCE ANALYSIS MODEL FOR. EDUCATION 'TQ'Tfi,}. SPENDING: BUDGET OR EXPENDITURES rUNCTiOTJS SUB-FUNCTIOtlS DETAIL FUNCTIONS INSTRUCTION instructional SUPPORT operations OTHER COMMITMENTS LEADERSHIP FACE-TO-FACE teaching CLASSROOM materials PUPIL SUPPORT TEACHER SUPPORT program SUPPORT non-instructional PUPIL SERVICES SCHOOL FACILITIES non-school facilities BUSINESS SERVICES RETAINED EARNINGS DEBT SERVICE CASH CAPITAL OUTLAYS OUT-OF-OISTRICT OBLIGATIONS 4 CONTRACTS legal OBLIGATIONS SCHOOL LEADERSHIP PROGRAM management LEADERSHIP SERVICES 1994 4 Lybrand L.L.P instructional TEAC-ERS SUSSTTUTES instructional ?4RAPROF=SSIONALS PUPIL-USE TEC-^NClOGY & SOFTWARE INST RUCTION AL .MATERIALS. TESTS SUPPUES I guidance a COUNSEJNG LIBRAR'^a mCqia EXTP AC -RRICU LAP STl DEN- he alt- CURRICL.J*' DEVElOR'^ENT IN-SERVICE a S~ASg DsvElD*-NT SABBA-^iCALS RROGRa'** ZEVELOR^EnT PERSONAL ATTENDANTS. SOCIAL WORKERS. therapists. PSYC'^C.OGISTS a EVALUATORS "RanSpORTaT^qn B - Hx- NON-SCHOOL SUILD'NGS UTIL'^'IES a M AINTEN ANCE DA- A PR QC ESSIN G BUSINESS OPERATIONS I RESERVE" SPEClFiC UNRESERVED i PRINCIPALS assistant PRINCIPALS DEPUTIES. SENIOR ADMINISTRATORS. RESEARCH PROGRAM EVAtUATORS SUPERINTENDENT 4 SC-OOL 8OARC legal DEPARTMENTAcknowledgements Publishers: Coopers & Lybrand L.L.P. 203 North La Salle Street Chicago, Illinois 60601-1296 Center for lA'orkforce Preparation 1615 H Street. NW Washington. D.C. 20062-2000 Telephone (312) 701-5500 Facsimile (312) 701-5714 Telephone (202 ' 46S-55 Facsimile (202' 46' 730 Finance Analysis Model Team
Bruce Cooper Brian Glass Hunt Holsomback Jay May Bob Sampieri Sheree T. Speakman Mike Zuntag Jeff Joseph Larry .Malones Rae .Nelson Authors
Bruce Cooper Bob Sampieri Sheree T. Speakman Editors
Larry Maloney Jay May Sheree T. Speakman Design and Layout: Black Cat Design G Illustration
Special Thanks to: David Chen Herman Badillo, Fischbein, Badillo, Wagner, Itzler Mary Fulton, Education Commission of the States Bruce Hunter, American Association of School .Administrators John T. MacDonald, Council of Chief State School Officers Martin Orland, The Finance Project Nancy Prothero, Educational Research Service Glen Robinson, Educational Research Service Tom Shannon, National School Boards Association 1995 Coopers & Lybrand L.L.P. and the Center for Workforce Preparation. All rights resets cd 1 QH|nn*&tj|landLXJ?Z Canterfar Workfotca Preparation and I Fih^ce Analy^ Model .j fdr^Educatioii I L state District School Instruction / I I - . 4 Instructional Support I Operations I I I / I i I / I / \ Site-Based Reporting / for
Sito-Based Management i Copyright ^934^ Coopers & Lybrand LLP. I Coopers & Lybrand L.L.P. I Canter for Workforce Preparation and Quality Education Finance Analysis Model for Education *1 ill r INSraOCnOMAL OPBlATiaNS I COMMITMENTS Restriction: All rights of use and reproduction reserved. Reproductions of this publication, or exploitation of its contents, in whole or in part, without the pnor written permission of Coopers & Lybrand is strictly prohibited. Copyright 1994 Coopers & Lybrand, L.L.P. I Coopers & Lybrand L.L.P. / Canter for Workforce Preparation and Quality Education FINANCE ANALYSIS MODEL FOR EDUCATION TOTAL^^aiNGt BUOGErOREXPENOnURES I INSTRUCTION INSTRUCTIONAL SUPPORT OPERATIONS OTHER COMMITMENTS LEADERSHIP SU&RJNCnONS EnMLHJNCnONS 1 FAC-TO-FACE TEACHING CLASSROOM MATERIALS PUPIL SUPPORT TEACHER SUPPORT PROGRAM SUPPORT NON-INSTRUCTIONAL PUPIL SERVICES SCHOOL FACILITIES NON-SCHOOL FACILITIES BUSINESS SERVICES RESERVES DEBT SERVICE CASH CAPITAL OUTLAYS OUT-OF-OISTRICT INSTRUCTIONAL TEACHERS SUBSTITUTES INSTRUCTIONAL FARAPROFESSIONALS PUPIL-USE TECHNOLOGY i SOFTWARE instructional MATERIALS. TESTS & SUPPLIES GUIDANCE i COUNSELING LIBRARY S MEDIA extracurricular STUDENT HEALTH CURRICULUM DEVELOPMENT IN-SERVICE i STAFF DE/ELCPMENT SABBATICALS PROGRAM DEVELOPMENT personal attendants, social workers. THERAPISTS, PSYCHOLOGISTS 4 EVALUATORS I TRANSPORTATION FOOD SERVICE SAFETY SCHOOL SUILDINGEJT^E^^AINTENANC^^^^^^H NON-SCHCOL3UILOING^iTTUTTE^^AINraANC^^^^^B DATA PapCESSING BUSINESS OPERATIONS^^^^^^^^^^H OBLIGATIONS 4 CONTRACTS LEGAL OBLIGATIONS SCHOOL LEADERSHIP PROGRAM management LEADERSHIP SERVICES RESERVES - DESIGNATED RESERVES - UNDESIGNATED principal 4 INTEREST CURRENT CAPITAL PURCHASES parochialarivate^harte^^^^^^^^^H SCHCOL PASS-THROUGHS__________ RETIREE BENEFITS 4 OTHER SCHOOL MANAGEMENT CONTRACTS^^^^^^^^J LITIGADON AND SETTLEMENTS^^^^^^^^J PRINCIPALS ASSISTANT PRINCIPALS DEPUTIES. SENIOR ADMINISTRATORS^^^^^^^^f RESEARCH i PROGRAM EVALUATORS superintendent^^^^^^^^^^^^B i SCHCOL BOARD_______________ legal department Copyright 1994 Coopers 4 Lybrand L.L.Pi
Keporruaro ............ Stater Ave rages-.' National test results from 1993-94. to 1994-95 iHr Stanfonl * xoroawi 25aioerc8noJe 2O. 22.0% atxM TStiriiercentilBf Sdts(a ACT cwnoosite score Of 19(xaoove 59.K SLM SOURCE: Artan Owamwir Arkansas Democrat^(gazette [ _ , , SATURDAY? DECEMBER 2,1995 scoring ucuc, i<naitmcuab*ean>>.n, education officials have marveled at this statistic because usually Continueo from Page 1A when the pool of students fairing a- 312 school districts. It covers 16 test widens, scores drop- .,i . j In 1989-90,585 percent of those i categories, including dropout and attendance rates, teacher salaries faking the ACT scored above 19. and scores on the nationally ad- Last year, 813 oercenLaLtheJest-l ministered Stanford .Achievement .. ' .. - Test and .American College Test Each school district receives a icopy of the document, which also takers scoi^'aboTe la Ute top score is 361 is available from the Education jansas0eniocraM:aBzL2i!0BBns
Department ! Since 1991-92, Stanford Pupil scores disappoint agency chief 6th repon card shows state faces lot of work 3Y SUSAN ROTH Oemocrat-GazBilB Education Writar -Achievement Test scores have improved. School districts administer the tests co fourth-, seventh- and tenth-graders. Over time, fewer students are scoring at the low end of the scale. But since last year. Stanford scores declined. More students scored below the 25th percentile this year chan last year. The 50th percentile is considered the national average. More than half of .Arkansas pupils continue to score below the 50th percentile. Officials d they also were pleased, with the inereasing popularity of- Advanced Placement courses and., exams. Usually offered to top secondary students, .. the courses allow high achievers to tackle college-level work in high school and receive credit for it when they go on to college. This means more and more youngsters are going into college at higher levels, Wilhoit said. Its a very, very positive message for our parents," -Also troubling on the report Arkansas public school stu- card is an increase in the dropout dents are- still not peri'onning rate. In 1989-90. the statewide well enough to satisty the head of dropout rate was 4 percent. The the state Department of Educa- tion. The departments sucth annual school district repon card, released Friday, showed that students have improved in some ar- teeas this year, such as on American College Test scores. But pupils failed to show consistent gains in several other areas, such RQNMi card statistics. 1 Pago 12A. as on standardized achievement tests. Gene Wilhoit director of the de- ---------------partments General Education Division, refused to give the state's schools an overall grade, but he is not pleased. There is still a lot of work to do, Wilhoit said at a Friday news conference at the department offices in Little Rock, He said he is particularly concerned about student mastery of mathematics, which has been a department focus since 199L We know right now from talking to employers that they need people with math competence and not just basic competence Wilhoit said, They need to have a mastery of algebra, of geometrical concepts, of probability concepts. They have to know how to think mathematically on the job and solve problems. The 643-page report card compares educational achievement and demographics in the states See SCHOOLS, Page 13A rate dropped to 3 percent in 1991- 92. But in 1993-94. it was bac.k up to 3.9 percent. For individual districts, higher dropout rates correlated with higher numbers of students scoring below the 25th percentile on the Stanford .Achievement Tests, department officials said. One area showing continuous improvement was teacher salaries, which will jump again this year because of a new state law setting a minimum salary of S20,000. Other optimistic categories involved college-bound students. More students are taking the : .ACT. which is required for college ' admission. They are also steadily tArkansas Democrat ^^azctte f SATURDAY, DECEMBER '"*-*"** I ll. 2, 1995 T ^0809rs. Inc. LK summer programs given mediocre grade Report calls effort poorly organized and staffed BY CYNTHIA HOWELL Dernocrat-Gazette Education Writer Summer programs desi?noH Pogrom. Teachers were unable ..i.i. resigned use computers at the schools to provide remediation and 7 Aciiieuiduon and en- to children ex- in Little Rock s five incentive elementary schools were inadequately staffed and poorly organized according to a report re- leased Friday. The incentive schools in central and east Little Rock get extra funding for programs to raise the achievement levels of black thn ahroct whites to the schools. The districts deseg- ''*ros the district to offer a summer program at one or more of the schools no charge to the pupils. The remediation program was 5"^Rockefelllr Incen- Uye Elementary last The enrichment music, writing and held in five dis- summer. programs, in- trict schools. *** Ninety-five incentive school e Drown, who heads the amended enrichment ac- federal Office of Desegregation vities at five sites. ^omtoring, said Friday that n, additional 10.9 percent of while there were bright spots in ^e incentive school pupils me summer program, it nvpra 11 muaed a state-mandated summer program. The state program is for pupils who are performing below grade level and would other- Desegregation that were bright spots in J program, it overall rifv mediocrity that has been typical in the scho5s" incentive Ju-T? federal monitors said chiIdren in the remediation pro- Inn* Rockefeller did not have access to the school library or the science laboratory. There were no counselors, social work 6rs, librarians or computer < ''**080913. Inc. aides hired to assist with the to . -------- v V**V OVllUUlb i gain access to pupil records, f Teachers also reported prob- lems with pupil attendance and failure by the parents to take summer school grades seriously. Still another weakness cited by the monitors was the districts apparent failure to determine whether the pupils made any academic progress as the result ot the program. In the four years that ODM has monitored the incentive schools, evidence has been con- sistent that the schools have not lived 1 up to their promise, the in- monitors said in the report. Of 1,629 pupils who attend ir. ?no tive schools, 6.6 percent, or 108 pupils, attended the voluntary remediation program at Rockefeller. at- yis^ promoted to the next f grade. The monitoring office did I not report on the quality of the state program. jJ j J^N^ENTlVS. uhOOL noTLINt 1 <' 'S Gcci'^i^ >'}CiiCc>f.5 J i ' ) Sr/iKi f : JJ/r : f / WU i 2 H t f : r f SrDDics ifiT mi r~ J f! W I'll { 'G t^- Hfl I / Ifl '\ 'j Hll f//( { Uir ff IHi // //// J /7 /I If 1 i f /) }l Uli U! f C---' /o 1! Jifr/ 0 ^'1 XU r II w kz>_ /^ utr u 1/0 H' i Ip I 2d- IQ^ISa ,t * JU )|t )K !|t )(! 11 DATE START SENDER FEB- 6 11:58 501 374 7609 TRANSACTION REPORT RX TINE PAGES TYPE P.Ol FEB- 6-91 WED 11:59 NOTE r 37" 2 RECEIVE OK 1! K JU X j(( iK X
This project was supported in part by a Digitizing Hidden Special Collections and Archives project grant from The Andrew W. Mellon Foundation and Council on Library and Information Resoources.