Transform Your Charter School’s Financial Health With a Department Assessment
Many charter schools are grappling with issues like inadequate cash flow, incomplete or untimely financial reporting, cumbersome processes, and concerns about the accuracy and consistency of financial data.
Administrative leaders and board members often know they have a problem with their school’s finance processes, but the causes aren’t always obvious, so they may persist and get worse when they aren’t addressed. Eventually, financial deficiencies can compromise the quality of a charter school’s educational mission and even threaten the school’s very existence.
If your school is in a similar situation, there are things you can do to turn the problem around, coax high-quality and useful financial information out your data, and make informed decisions that help advance your organization’s mission and objectives. Start by acknowledging the symptoms of a less-than-stellar finance function, then identify their root problems with a department assessment. From there, you can address the issues with targeted, strategic solutions.
Recognizing the symptoms of a faltering finance function
Do any of these telltale signs of a faltering finance function sound familiar?
- Financials are often late or incomplete
- You don’t trust your financial statements to be accurate
- You don’t have reliable numbers to confirm the financial health of your school
- You have to tap your credit line to pay the bills, or you don’t know if you’re positioned to finance your growth
- Turnover is high in the finance and accounting department
- The finance team doesn’t act like a team and can’t seem to keep pace with organizational growth
Identifying problems in your school’s finance and accounting department
Addressing just one of these concerns, like a lack of teamwork and cooperation, can be a challenge. But in many situations there isn’t going to be a single answer that will right the ship. It may make more sense to take a top-to-bottom look at the finance function.
By unpacking these pains, asking questions, and assessing systems, school finance leaders can learn:
- Whether your school has the right staff capacity and mix of skills
- Ways to produce more consistent, accurate, and timely financial reports
- Strengths and weaknesses of technology tools and which ones are right for you
- What it would take to develop infrastructure to support organizational growth and strength
- Best practices for improving transparency and accountability
- Ways to better align with various funding and regulatory requirements
A thorough review of your school network’s many moving parts can help you identify a number of underlying issues and work with leadership to develop a plan of action. Interviews, document reviews, and analyses of processes and systems can give you a good assessment of your opportunities for improvement.
Understanding how a finance department assessment can drive improvement
This illustration of a thorough finance department assessment shows how a well-intended review can drive real change.
A school with cash-flow challenges learned they were largely caused by revenue claim submissions (or lack thereof). Student data systems weren’t appropriately linked to compliance and financial reporting, revenue was not being collected accurately or in a timely manner, and the school’s line of credit was being tapped for routine expenses. Going deeper, it was discovered that the delays resulted from a lack of clarity in the roles and responsibilities within the department.
To help fix the problem, the team identified ways to reorganize the roles and responsibilities and suggested changes to streamline processes. In addition, new schedules and reporting were developed, leading to greater transparency in the short term. As a longer-term solution, the assessment team recommended ways to better integrate student information systems with the accounting application.
Within months, the organization’s cash flows started to stabilize, accountability increased, and the pains began to fade.
How we can help
Our charter school professionals can conduct a finance department assessment to help you expose issues and offer actionable ways improve the long-term financial and operational health of your school. We can work with you to identify the issues, make recommendations, train staff, and help you get your finances back on track.