Auxiliary Operations

The following information is pertinent only to Arizona school districts.

Level of detail in the general ledger:

Q: What level of detail are districts required to report Auxiliary Operations activity on the AFR?

A: Starting in fiscal year 2010, districts were required to report expenditure activity relating to Auxiliary Operations based on the function and object code within their GL. Additionally, Extracurricular Activities Fees Tax Credit expenditures are to be reported at the same level; function and object. This information should also be included in the electronic AUDIT FILE that is submitted to the Arizona Auditor General's Office after the Governing Board has signed the AFR.

Meals and lodging for student athletes - a gift of public?

Q: If a school district purchases meals and lodging for students participating in athletic events, would this be considered a gift of public?

A: No. Attorney General's Opinion I81-045 concludes that school districts may expend funds for student meals and lodging when such expenditures are determined to be necessary to support student participation and to fulfill an educational function of the district, such as athletic events.

Accounting for monies collected during a book fair:

Q: Where should a district account for monies collected from students during a book fair, and the related payments to the book company (e.g. Scholastic Book Club)?

A: The most acceptable fund to account for this financial activity is the Auxiliary Operations Fund. The Student Activities Fund is not appropriate since this generally is not a 'fund-raising' activity. The Gifts and Donations Fund is not appropriate since the collection of money from the students does not constitute a donation to the district. Since most elementary schools do not have the Auxiliary Operations Fund bank account, our suggestion would be to set up an Auxiliary Operations Fund (525) with the County Treasurer and account for the financial activity in this fund.

Use of district's tax identification number for a bank account:

Q: Can a school district's parent organization, booster club, or other outside organization open a bank account using the district's tax identification number?

A: No. A school district's tax identification number should only be used in association with the bank accounts that are legally authorized for school districts. See also FAQ Cash and Bank Accounts #5 on the Arizona Office of the Auditor General Website: https://www.azauditor.gov/reports-publications/school-districts/faqs/cash-and-bank-accounts

Rebates

Q.If a district receives a rebate, where should the funds be deposited?

A.If the monies are received in the same year as the original expenditures, the district can either post the revenue against the original expenditure or record it as miscellaneous revenue in the Auxiliary Operations Fund (Fund 525).If the monies are received in a subsequent fiscal year, then the monies should be recorded as miscellaneous revenue in either the fund of the original expenditure or deposited in the Auxiliary Operations Fund.


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