1002 Record Keeping In accordance with the charter school regulations the charter school is Department’s required to maintain their financial system and records in accordance with accounting principles generally accepted in the United States of America. Financial books and records of the charter school must reflect the source of all assets, liabilities, net position, revenues, and expenses recorded during the fiscal year. For network schools, each school must maintain a separate financial system to record the financial activity of each school. Recommended Audit Procedures: Determine whether the charter school maintains a financial system of recording and documenting all financial transactions. Review supporting documentation for selected transactions during the audit to determine if they are properly supported. Determine that the financial system properly tracks and reports each school separately 1003 Related Party Disclosure In accordance with the Commonwealth of Massachusetts Charter School Recommended the charter school will follow M.G.L. Chapter Fiscal Policies and Procedures Guide 268A, the conflict of interest law and file financial disclosures pursuant to G.L. c. 71, s 90(u)." The charter school may not be operated for the benefit of an affiliated or unaffiliated organization or an individual in his or her own private capacity or individuals related to the charter school or members of its management. Thus, the charter school will be guided by the principle of arms-length standards with all affiliated or unaffiliated organizations or with a private or related individual(s). Recommended Audit Procedures: Review and become familiar with the requirements and recommendations as codified in the AICPA Statement of Auditing Standards, FASB Accounting Standards Codification 850 Related Party Disclosures, Government Auditing and the requirements of M.G.L. Chapter 268A. Standards Obtain a listing of the related party transaction that occurred during the year whether material or not. Determine if the building is leased from a related party. If so, determine if the rent paid is the market rate for the area. Obtain representation from management and the board of trustees as to whether they or any other related party engaged in any transactions with the charter school during the year and disclosed all the required transactions in the accompanying notes to the financial statements. Determine that all transactions, between the network schools and other component units are properly disclosed in the notes to the financial statements
1002 Record Keeping In accordance with the Department’s charter school regulations the charter school is required to maintain their financial system and records in accordance with accounting principles generally accepted in the United States of America. Financial books and records of the charter school must reflect the source of all assets, liabilities, net position, revenues, and expenses recorded during the fiscal year. For network schools, each school must maintain a separate financial system to record the financial activity of each school. Recommended Audit Procedures: Determine whether the charter school maintains a financial system of recording and documenting all financial transactions. Review supporting documentation for selected transactions during the audit to determine if they are properly supported. Determine that the financial system properly tracks and reports each school separately 1003 Related Party Disclosure In accordance with the Commonwealth of Massachusetts Charter School Recommended Fiscal Policies and Procedures Guide the charter school will follow M.G.L. Chapter 268A, the conflict of interest law and file financial disclosures pursuant to G.L. c. 71, s 90(u)." The charter school may not be operated for the benefit of an affiliated or unaffiliated organization or an individual in his or her own private capacity or individuals related to the charter school or members of its management. Thus, the charter school will be guided by the principle of arms-length standards with all affiliated or unaffiliated organizations or with a private or related individual(s). Recommended Audit Procedures: Review and become familiar with the requirements and recommendations as codified in the AICPA Statement of Auditing Standards, FASB Accounting Standards Codification 850 Related Party Disclosures, Government Auditing Standards and the requirements of M.G.L. Chapter 268A. Obtain a listing of the related party transaction that occurred during the year whether material or not. Determine if the building is leased from a related party. If so, determine if the rent paid is the market rate for the area. Obtain representation from management and the board of trustees as to whether they or any other related party engaged in any transactions with the charter school during the year and disclosed all the required transactions in the accompanying notes to the financial statements. Determine that all transactions, between the network schools and other component units are properly disclosed in the notes to the financial statements