Adopted: MSBA/MASA Model Policy 702
Revised: 2025 Rev. 2022
702 ACCOUNTING & Electronic Payment Procedures
I. PURPOSE
The purpose of this policy is to adopt the Uniform Financial Accounting and Reporting Standards for Minnesota School Districts (UFARS) provided for in guidelines adopted by the Minnesota Department of Education.
II. GENERAL STATEMENT OF POLICY
It is the policy of this school district to comply with the Uniform Financial Accounting and Reporting Standards for Minnesota School Districts.
III. MAINTENANCE OF BOOKS AND ACCOUNTS
The school district shall maintain its books and records and do its accounting in compliance with the Uniform Accounting and Reporting Standards for Minnesota School Districts (UFARS) provided for in the guidelines adopted by the Minnesota Department of Education and in compliance with applicable state laws and rules relating to reporting of revenues and expenditures.
IV. PERMANENT FUND TRANSFERS
Unless otherwise authorized pursuant to Minnesota Statutes section 123B.80, as amended, or any other law, fund transfers shall be made in compliance with UFARS and permanent fund transfers shall only be made in compliance with Minnesota Statutes section 123B.79, as amended, or other applicable statute.
V. REPORTING
The school board shall provide for an annual audit of the books and records of the school district to assure compliance of its records with UFARS. Each year, the school district shall also provide for the publication of the financial information specified in Minnesota Statutes section 123B.10 in the manner specified therein.
Purpose
The purpose of this policy is to establish procedures to prevent fraudulent payments or transfers to employees, vendors, and contractors.
This policy applies to all ISD #599 departments and employees that have control over entity disbursement transactions and governs the actions of all Fertile-Beltrami employees.
Effective internal control policies and procedures need to be adopted to protect ISD #599 funds from fraudulently being disbursed.
Fraudsters are using techniques like social engineering tactics, such as impersonation and manipulation, to deceive employees with legitimate-looking correspondence or phone calls to obtain personal information such as bank accounts or address changes that will re-direct payments intended for an employee or vendor. Other forms of social engineering can include phishing, vishing, smishing, malware, pre-texting, baiting, and push notifications.
The following are processes to prevent the fraudulent electronic payments of ISD #599 funds:
1. Vendor/Contractor payment approvals
a. Require at two approvals within the District Business Office for disbursements of funds over staff procurement levels.
b. Require Board of Directors, CEO or designee approval on large payments exceeding amounts set in ISD #599 Policy & Procedures.
2. Update and review vendor/contractor files annually
a. Review and correct duplicate vendors/contractors in systems with minor differences, i.e., LLC or Inc.
b. Annually review list of vendors/contractors and close or inactivate vendors not currently used by ISD #599.
c. Review for unusual activity such as fluctuation in payment amounts, activity for closed vendors/contractors, etc.
d. Utilize Accounts Payable EFT Authorization Form when a change in banking/financial information is requested by the vendor/contractor and dual authenticate the change by using a trusted form of contact for the vendor/contractor, such as verbal authentication.
e. Always require a signed Form W-9 from every new payee in advance of making any payments or change in a mailing address.
3. Utilize the Direct Deposit Authorization Payroll Form when a change in banking/financial information is requested by the employee and dual authenticate the change by using a trusted form of contact for the employee, such as verbal authentication.
Legal References: Minn. Stat. § 123B.02 (General Powers of Independent School Districts)
Minn. Stat. § 123B.09 (Boards of Independent School Districts)
Minn. Stat. § 123B.10 (Publication of Financial Information)
Minn. Stat. § 123B.14, Subd. 7 (Officers of Independent School Districts)
Minn. Stat. § 123B.75 (Revenue; Reporting)
Minn. Stat. § 123B.76 (Expenditures; Reporting)
Minn. Stat. § 123B.77 (Accounting, Budgeting and Reporting Requirements)
Minn. Stat. § 123B.78 (Cash Flow; School District Revenues; Borrowing for Current Operating Costs; Capital Expenditure Deficits)
Minn. Stat. § 123B.79 (Permanent Fund Transfers)
Minn. Stat. § 123B.80 (Exceptions for Permanent Fund Transfers)
Cross References: MSBA/MASA Model Policy 703 (Annual Audit)