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Sound financial reporting is an essential element of public-sector accountability to the citizens they serve. This policy defines basic accounting and cash control policies. It is designed to protect and enhance the security of Meridian Library District’s financial functions, promote the maintenance of accurate records of financial activities, and facilitate compliance with governmental and private funding source reporting requirements. The Library Board of Trustees formulates policies and supervises the Library Director who is responsible for the daily operations and activities of the library.
LIBRARY BOARD OF TRUSTEES: The financial resources of Meridian Library District (Library) are the responsibility of the Meridian Library District Board of Trustees (Board). The Board are elected officials and serve without compensation. The Board is responsible to:
- Provide guidelines for management and allocation of financial resources which seek to produce optimum benefit for those we serve.
- Monitor and evaluate the financial plans of the Library and to maintain the financial integrity of the Library.
LIBRARY DIRECTOR: An annual operating budget will be prepared by the Director and presented to the Board for approval pursuant to Idaho Code Section 33-2725 and the corresponding requirements of public notice and public hearing. The budget will reflect the estimated cost of carrying out the programs and services of the Library for the next fiscal year and the anticipated revenues of the Library. The Library Director is the primary purchasing agent for the library and is responsible for all library contracts, orders, and purchases. The Director shall select products, services and vendors that best meet the needs and goals of the library. In making decisions regarding selection of products and services for the library, the Director will comply with Idaho Code and should consider relevant factors with include, but are not limited to: Suitability, Availability, Quality, Workmanship, Price, and Delivery. The Director may delegate the responsibility for ordering selected products and services to other employees as the Director deemed appropriate or necessary to accomplish the goals of the library. Please see the Meridian Library Purchasing Guidelines and Procedures for information regarding library purchasing procedures. To help reduce the risk of financial loss to the library, the Director will implement procedures to:
- Prevent embezzlement
- Ensure against liability losses (to Board members, the Library or to Library funds)
- Properly maintain facilities and equipment. Limit exposure of the Library, the Board and the staff to claims of liability
- Ensure funds are disbursed only in compliance with Board authorization and applicable state laws
LIBRARY FINANCE MANAGER: The Finance Manager records library transactions to accurately reflect library operations. Monthly financial statements will be presented to the Board that include individual payments made from library accounts. Monthly reviews (or more frequently as may be requested) of all accounts will be provided by the library Finance Manager to the Director and the Board. The Finance Manager coordinates the annual audit with an independent auditor.
LIBRARY STAFF: Managers prepare budgetary requests annually during the development process. All library staff will be familiar with this policy and the Purchasing Guidelines and Procedures and as public servants will exercise fiscal responsibility in regards to their use of library funds. Employees are to follow the District’s Purchasing Guidelines and Procedures when making purchases on behalf of the District. Employees who make unauthorized purchases will be subject to disciplinary action including possible dismissal.
BASIS OF ACCOUNTING
The accounts of the Library are maintained on the modified accrual basis of accounting. All Library monies are considered part of the General Fund, Capital Replacement and Repair Fund or Restricted Funds. Restricted Funds include fund balance amounts that are constrained for specific purposes which are externally imposed. Restricted Funds include revenue connected with gifts and memorials donated to the Library and/or otherwise restricted funds. The Library’s fiscal year is October 1 through September 30. The financial statements of the Library shall be independently audited annually in accordance with generally accepted auditing standards and the standards applicable to financial audits contained in Government Auditing Standards and applicable law. Annual audits are submitted to the online central registry and reporting portal on the legislative services office website.
The Director is responsible for preparing an annual detailed budget estimate for submission to the Board of Trustees in compliance with Idaho Code Section 33-2725. The budget is prepared on the modified accrual basis of accounting consistent with the basis used for financial reporting. The Library Board is responsible for revising and adopting the budget estimate for publication, holding the necessary public hearings, and for adopting the appropriate budget resolutions. After the action of the Library Board, the budget is submitted to Ada County Clerk’s Office who submits it for approval to the Idaho State Tax Commission and is made available on the library’s website. The budget development process typically begins in February, the Ada County clerk is notified of public hearing date by April 30th, the preliminary budget is presented to the Board for review in July, and is put forward for formal consideration at a public hearing in August (per Idaho Code Section 33-2725). The L-2 is submitted to the county by the first week in September. In January of each year, the most recent adopted budget and a comparison of the budget to actual revenues and expenditures for the most recently completed fiscal year is submitted to the online central registry and reporting portal on the legislative services office website. After the library budget has been duly approved and funds have been appropriated, the Director is authorized to expend funds within the confines of the budget's categories. The Director will also be responsible for notifying the Board of anticipated insufficiencies in any fund category that may require a budget amendment and/or the future transfer of funds between accounts.
APPROVAL OF LIBRARY EXPENDITURES
The Director will submit for approval a list of checks issued for the prior month to the Board at each regular Library Board meeting. The Board Treasurer selects checks from the check listing and reviews supporting documentation each month. The Director is authorized to make payment for budgeted expenses in advance of such approval in order to take advantage of discounts or to meet due dates. Such payments are ratified by the Board after review of the monthly check listing. No draft on a checking account of the Meridian Library is valid without the signature of the Library Director or a member of the Library Board. All payments are reviewed and approved by the Library Director.
The Library Director and Finance Manager report monthly to the Library Board on the year-to-date status of revenues and expenditures in the Library’s General Fund as compared to the budget. The Library Director and Finance Manager also present monthly the balance in each fund of the Library.
CASH RECEIPTS POLICY
Deposits for fines and fees are recorded daily. Before the start of the day, the monies from the registers are dual counted and reconciled to cash register receipts. The Daily Reconciliation Form is completed. The money is put into a bag and locked in a secure place. Payments made by credit card are recorded as part of the daily cash reconciliation process. A library assistant manager deposits the monies to the bank either daily or periodically depending on the amount of cash received.
Self-pay machines and APM/Copy machines are emptied and filled periodically during the month. The money is recorded on a Checks Received Through the Mail and Miscellaneous Receipts form. The money is dual counted, put into a bag and locked in a secure place. Cash payments received through self-pay machines and APM/Copy machines are deposited by a library assistant manager periodically during the month.
Self-pay credit card payments are downloaded and recorded by the Finance Manager.
Property tax payments are electronically deposited into the Library checking account. Notification is sent by Ada County as the tax funds are remitted.
All other cash and checks (grants, donation, etc.) are logged through a Checks Received and Miscellaneous Receipts form by the Administrative Assistant. The checks are stored in a locked secure location. The library assistant manager will prepare the deposit and complete a Deposits to Bank form. The deposits are taken to the bank by a library assistant manager.
Monthly the Finance Manager verifies that the daily cash register receipts, the self- pay receipts, APM/Copy Machine receipts and the checks received through the mail were deposited to the bank.
BANK STATEMENTS AND RECONCILIATION REPORTS
Bank statements are downloaded directly from the bank website by the Library Director, reviewed by the Library Director and forwarded to the Finance Manager. As part of the bank statement review, the Library Director confirms payroll transfers, payroll tax transfers and PERSI transfers as well as confirming transfers to and from Library bank accounts. The Library bank accounts are reconciled monthly by the Finance Manager.
Idaho Code provides authorization for the investment of funds as well as specific direction regarding allowable investments. The District's policy is consistent with this direction. The District currently invests in interest bearing bank accounts and the State of Idaho local government investment pool.
FINANCIAL RESERVE AND CARRY OVER POLICY
Annually, after the annual audit, the fund balances will be reviewed. Reserve balances will be reviewed to insure adequate reserves in the General Fund sufficient to maintain district operations. A proposed transfer may be presented for board approval to transfer carry over funds from the General Fund to the Capital Replacement and Repair Fund. The District follows Idaho Code Section 33-2724 (3) and 33-2724 (4) that pertains to carry over balances and capital asset replacement and repair funds.
Staff members who frequently make purchases for Library events, have frequent travel expenditures or who order library supplies have been issued a credit card with a credit limit established by the Library Director. The staff member assigned a card will attend required training and sign an Agreement Regarding Obligations of Holders of Meridian Library District Credit Card.
Each month credit card statements are downloaded by the Finance Manager and forwarded to the staff member responsible for the credit card and charge receipts. The Library Director’s credit card statement is received through the mail.
Staff members responsible for credit cards are to reconcile receipts to the credit card statement and submit the receipts and statements to their supervisor. Supervisors review and approve the credit card statement, receipts, budget codes and support codes, if applicable. Both the receipts and statements are forwarded to the Finance Manager.
Charges on Library-issued credit cards are reviewed each month by the Library Director.
The Library Director’s credit card statement is reviewed monthly by the Treasurer of the Board or Board Chair.
FIXED ASSET CAPITALIZATION POLICY
Fixed assets are property, plant, furniture and equipment costing $1,000 or more with a useful life of three years or more. An inventory of fixed assets will be maintained.
All fixed assets are valued at historical cost or estimated historical cost if actual is unavailable, except for donated fixed assets which are recorded at their estimated fair value at the date of donation.
Depreciation is provided over the assets’ estimated useful lives using the straight-line method of depreciation.
Fixed assets do not include ordinary repairs that do not increase the value or extend the life of the asset.
A retirement record will be maintained as items are withdrawn or retired.
The fixed asset inventory should be reviewed on an annual basis.
CONFLICT OF INTEREST
A conflict of interest occurs when a person has a private pecuniary interest in any library decision or action. It is also important to avoid the appearance of a conflict of interest where a person's private interests compete with his or her professional obligations to the Board-governed entity to such a degree that an independent observer might reasonably question whether the person's professional actions or decisions are materially affected by personal considerations, including but not limited to, personal gain, financial or other benefit. Public officials and employees are prohibited from having a direct or indirect interest in transactions with the units of government that they serve without appropriate disclosure. Library legal counsel will be consulted when a conflict of interest may exist and/or the legality of a transaction is in question. Library Trustees and Library Staff will be familiar with and comply with Idaho Statutes Title 74, Chapter 4 Ethics in Government as well as Meridian Library District’s Conflict of Interest Policy.
If an employee or volunteer has a reasonable belief that an employee, volunteer or Trustee of Meridian Library District has engaged in any action that violates any applicable law, or regulation, including those concerning accounting and auditing, or constitutes a fraudulent practice, or a conflict-of- interest, the employee is expected to immediately report such information to the Library Director. If the employee does not feel comfortable reporting the information to the Director, he or she is expected to report the information to Human Resources. See the Meridian Library District –Whistleblower Policy for additional information. Other policies governing travel, expenses, mileage, supplies, equipment and telephone use are contained in the Library Employee Handbook.
Approved by the Meridian Library District Board of Trustees on June 15, 2016
Revised February 20, 2019