Board Policy

Policy Type: Ends

EF-1 – Fiscal Health

Initial Date of Approval: 08/20/2000

Revision Date: 04/13/2004, 05/14/2013, 05/14/2019 (without revisions), 06/09/2020, 11/09/2021, 10/13/2026

AUTHORITY

The Skagit Valley College Board of Trustees assures fiscal health by approving annual budgets and requiring regular budget and expense reports.

The Board delegates authority to the President for preparing and administering College budgets as required by law in accordance with the following limitations. Accordingly, the President:

  1. May not expend more funds than are received in the fiscal year, with the exception of fund balance expenditures.
  2. May not expend the Board of Trustees designated minimum fund balance level of $5.5 million.
  3. May not conduct inter-fund transfers that result in negative fund balances at fiscal year-end.
  4. May not acquire, encumber, or dispose of real property without board approval.

BUDGET DEVELOPMENT & APPROVAL

The President will prepare College budgets and review them with the Board of Trustees at least one month prior to recommendations for adoption.

Budgets shall be submitted for adoption prior to June 30.

Board of Trustee’s budget approval will be based upon:

  1. The budget’s reflection of the College’s Mission, Vision, Core Themes, and Strategic Priorities.
  2. Commonly accepted financial practices and procedures.

BUDGET REPORTING

The President shall provide a financial report to the Board in December, February, and June, that includes:

  • Budget to-actual results;
  • Expenditure trends; and
  • Reserves

The President shall provide an annual financial report to the board in November that includes:

  • Budget to-actual results;
  • Revenue and expenditure trends;
  • Reserves;
  • Debt obligations; and
  • Fiscal Health Indicators.

AUDIT AND INTERNAL CONTROL REPORT

The President shall provide a report to the Board in December, March, and June that includes:

  • Status of external audits;
  • Internal audit activity, if applicable;
  • Open audit findings;
  • Status of remediation efforts;
  • Internal control concerns;
  • Financial reporting risks; and
  • Compliance with financial reporting deadlines.

ESCALATION EVENTS REQUIRING IMMEDIATE BOARD CHAIR NOTIFICATION

The President shall promptly notify the Board Chair upon becoming aware of any of the following:

  • Audit delays;
  • Financial reporting delays;
  • Material weakness in internal controls over financial reporting;
  • Significant deficiencies in internal controls;
  • Other material financial events, including:
    • Fraud involving College funds or assets.
    • Misappropriation of public resources.
    • Significant accounting errors requiring correction or restatement.
    • Findings that may adversely affect federal, state, and grant funding.
    • Any financial condition creating risk to the institutional solvency, liquidity, or fiscal stability.

CORRECTIVE ACTION PLANS

Whenever a material weakness or significant deficiency is identified, the President shall provide a written remediation plan that includes:

  • Description of the issue;
  • Root cause analysis;
  • Financial and operational impact;
  • Corrective actions;
  • Responsible administration;
  • Target completion date; and
  • Status updates until resolved.