Lawriter - OAC - 3358:11-1-12 Financial standards policy.

3358:11-1-12 Financial standards policy.

(A) Policy statement. The purpose of this rule is to institute financial standards so for any fiscal year, whole or part, the financial condition of the college maintains a generally acceptable level of prudent professional financial management and foresight.

(B) Strategic standards.

(1) The board of trustees finance committee shall meet bi-monthly, unless the committee chair deems a monthly meeting schedule necessary for a certain fiscal period.

(2) Reserve/net asset requirements. The college shall maintain a financial reserve or net asset requirements, as follows:

(a) Unrestricted educational and general current operating fund. The undesignated reserve within this fund balance should be greater than or equal to ten per cent of this fund's total annual expenditures and transfers.

(b) Unrestricted auxiliary fund. The undesignated reserve within this fund balance should be greater than or equal to five per cent of this fund's self-operated annual revenues.

(c) Unrestricted plant fund. The undesignated reserve within this fund balance should be greater than or equal to two per cent of investment in plant. Investment in plant means the original book value (prior to any depreciation) of land improvements, buildings, and building improvements.

(3) Long-range forecast. A long-range five-year forecast shall be prepared and presented as a component of the annual budget presentation to the board of trustees, which includes the institution's expected financial trends under clearly stated assumptions:

(a) The institution's expected financial performance as compared to the institution's maintenance of a financial reserve or net asset requirements.

(b) A reporting of financial dashboard metrics.

(C) Reporting. For the board of trustees to take a required action, it is essential that data, information, reports and recommendations flow regularly from the president or administrative designee to the board, which shall be accomplished through separate, or any combination of, finance, personnel, planning, committee reports or the president's recommendation to the board.

(1) Regular meetings of the board. The regular meeting agendas shall include reports from:

(a) Finance. Included in these reports are a financial analysis narrative and the presentation of the interim (monthly) financial statements, a report of purchase orders, bids and expenditures (where board approval is required if the cost is fifty thousand dollars or more). For informational purposes, a report of purchase orders, bids and expenditures will also include a listing of purchase orders issued where the amount is ten thousand dollars or more but less than fifty thousand dollars.

(b) Personnel. Included in these reports are position vacancies and other personnel changes.

(c) Planning. Included in these reports will be annual plans, goals and budgets and any interim progress reports on such matters; however, such may be incorporated into a finance report.

(2) Finance committee meetings of the board. The finance committee meeting agendas shall include a financial narrative report, which may include a financial analysis, interim (monthly) financial statements, quarterly reports, financial dashboard metrics, annual budget, year-end financial statements (prior to the board receiving the annual budget and year-end audited financial statements).

(3) Balance sheets. The interim (monthly) and year-end financial statements shall include the presentation of balance sheets.

(4) Treasurer. The treasurer/chief financial officer shall identify, document, and communicate the magnitude of positive or negative financial trends and the subsequent impact of operational or financial changes in the presentation of interim (monthly) financial statements, quarterly or year-end reporting and the annual budget.

(a) Attest. The treasurer/chief financial officer shall attest to the board the institution's maintenance, or lack thereof, of minimum or projected minimum, financial reserve or net asset positions with the adoption of the annual budget and at each occurrence a financial report is presented to the board.

Effective: 2/20/2015
Promulgated Under: 111.15
Statutory Authority: 3358.08
Rule Amplifies: 3358.08