A group of parents in Parma, Ohio claimed to have discovered a nearly $9 million clerical error in Parma City School District’s five-year financial forecast. The expenditure line, marked county auditor/treasurer’s fees, amounted to $10,159,900. An active member of Parents for Parma Education wrote the amount should be roughly around $1.2 million in a statement regarding the error that was posted on group’s Facebook page (Cleveland.com, October 2016).
While Parma City School officials subsequently confirmed that the error did not influence the district’s finances, they did recommend that the board approve an independent audit for the district’s finances in order to strengthen the relationship between the district and its residents, parents and students.
The Parma situation was not an isolated case. Over the years, school districts in Colorado, Alabama, Maryland, California, New York and others have discovered budget errors that resulted in staff pay cuts, significant budget gaps requiring state loans, staff layoffs and an erosion of the public trust.
In each case, at least part of the blame was put on the district’s budget practices. Stated contributing factors included:
- Out-dated information systems
- Communication breakdowns between central-office departments
- Poor planning
- An inability to do multi-year projections accurately enough
Even under ideal circumstances, budgeting can be difficult, particularly for expansive school district budgets that require a large input amounts to support thousands of line items. A single line item can result in significant budget implications depending on the development of economic indicators, revenue sources, enrolment trends and staffing costs throughout the budget cycle. Conventional budgeting systems, including mistake-prone Excel spreadsheets, are usually not equipped to incorporate key factors into the budget development processes and adequate analysis can’t be achieved.
Questica Budget is a web-based budgeting tool that provides a controlled environment for budget input, review, approval and maintenance. It offers one point of data entry, seamless integration with a school district’s financial management system and the ability to leverage financial and statistical data from any number of sources. This information can be projected into future years for increased accuracy in forecasting capabilities.
Unlike other budgeting software providers, Questica is dedicated to serving the North American public sector and its budget solutions have been implemented by over 600 public sector customers ($60 billion in annual budgets).
At a time when it is paramount that stakeholders are confident about the accuracy of the information provided to them, find out how Questica can help your school district improve its budgeting practices by setting up a demo of Questica Budget today.