PRIOR PRINTER'S NO. 1859 PRINTER'S NO. 3133
No. 1496 Session of 2007
INTRODUCED BY PETRONE, CALTAGIRONE, FREEMAN, GEIST, GRUCELA,
HARKINS, KORTZ, KOTIK, MOUL, MYERS, NAILOR, REICHLEY, STERN,
THOMAS, STAIRS, SIPTROTH AND WAGNER, JUNE 7, 2007
AS REPORTED FROM COMMITTEE ON EDUCATION, HOUSE OF
REPRESENTATIVES, AS AMENDED, JANUARY 28, 2008
AN ACT
1 Amending the act of March 10, 1949 (P.L.30, No.14), entitled "An
2 act relating to the public school system, including certain
3 provisions applicable as well to private and parochial
4 schools; amending, revising, consolidating and changing the
5 laws relating thereto," further providing for contracts with <--
6 private residential rehabilitative institutions and certain
7 criteria in department audits. REPORTS TO DEPARTMENT OF <--
8 EDUCATION, FOR CONTRACTS WITH PRIVATE RESIDENTIAL
9 REHABILITATIVE INSTITUTIONS AND CERTAIN CRITERIA IN
10 DEPARTMENT AUDITS AND FOR FINANCIAL REPORTS.
11 The General Assembly of the Commonwealth of Pennsylvania
12 hereby enacts as follows:
13 Section 1. Section 914.1-A of the act of March 10, 1949 <--
14 (P.L.30, No.14), known as the Public School Code of 1949, is
15 amended by adding a subsection to read:
16 SECTION 1. SECTION 218 OF THE ACT OF MARCH 10, 1949 (P.L.30, <--
17 NO.14), KNOWN AS THE PUBLIC SCHOOL CODE OF 1949, ADDED MAY 10,
18 2000 (P.L.44, NO.16), IS AMENDED TO READ:
19 SECTION 218. REPORTS TO DEPARTMENT OF EDUCATION.--ALL
20 FINANCIAL ACCOUNTING AND REPORTING BY SCHOOL DISTRICTS TO THE
21 DEPARTMENT OF EDUCATION SHALL BE IN ACCORDANCE WITH GENERALLY
1 ACCEPTED ACCOUNTING AND REPORTING STANDARDS[.], EXCEPT FOR THE
2 ANNUAL FINANCIAL REPORT. THE DEPARTMENT OF EDUCATION SHALL
3 ESTABLISH A REPORTING STANDARD FOR THE ANNUAL FINANCIAL REPORT.
4 THE STANDARD SHALL CONFORM TO FUND LEVEL REPORTING CRITERIA
5 ONLY. ENTITYWIDE STATEMENTS, MANAGEMENT DISCUSSION AND ANALYSIS
6 AND NOTES TO THE FINANCIAL STATEMENTS ARE NOT A REQUIRED
7 COMPONENT OF THE ANNUAL FINANCIAL REPORT.
8 SECTION 2. SECTION 914.1-A OF THE ACT IS AMENDED BY ADDING A
9 SUBSECTION TO READ:
10 Section 914.1-A. Contracts with Private Residential
11 Rehabilitative Institutions; Certain Criteria in Department
12 Audits.--* * *
13 (g) (1) Beginning with the 2005-2006 2007-2008 school year <--
14 and each school year thereafter, each private rehabilitative <--
15 residential institute RESIDENTIAL REHABILITATIVE INSTITUTION <--
16 shall maintain an accounting and bookkeeping system and be
17 subject to audit as provided in 22 Pa.Code, Ch. 171, Subch. C
18 (relating to interim audit standards), PROVIDED, HOWEVER, THAT <--
19 WHEN STATE REIMBURSEMENT FOR ALLOWABLE COSTS INCURRED PURSUANT
20 TO SECTION 914.1-A FOR THE EDUCATION PROGRAM OF THE INSTITUTION
21 IS NOT RECEIVED WITHIN THREE MONTHS FOLLOWING THE INCURRENCE OF
22 THOSE ALLOWABLE COSTS, INTEREST EXPENSES ON BORROWING INCURRED
23 WHERE THE BORROWING IS REQUIRED TO PROVIDE FOR THE DIRECT
24 OPERATION OF THE EDUCATION PROGRAM OF THE INSTITUTION DUE TO THE
25 DELAY IN STATE REIMBURSEMENT SHALL BE TREATED AS OPERATIONAL
26 EXPENSES AND NOT AS ADMINISTRATIVE EXPENSES. The audit shall be
27 conducted in accordance with generally accepted accounting
28 standards by an independent certified public accountant.
29 (2) Notwithstanding the provisions of 22 Pa.Code § <--
30 171.206(b) (relating to administrative costs), for purposes of
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1 an audit conducted under this subsection, administrative
2 expenses shall not include interest expenses on borrowing
3 incurred by a private rehabilitative residential institute where
4 the borrowing is required to provide for the direct operation of
5 the education program due to any delay in State reimbursement.
6 SECTION 3. SECTION 921-A OF THE ACT, AMENDED JULY 11, 2006 <--
7 (P.L.1092, NO.114), IS AMENDED TO READ:
8 SECTION 921-A. FINANCIAL REPORTS.--AN ANNUAL FINANCIAL
9 REPORT SHALL BE SUBMITTED TO THE SECRETARY OF EDUCATION BY EACH
10 INTERMEDIATE UNIT NOT LATER THAN THE 31ST DAY OF OCTOBER,
11 TOGETHER WITH AN AUDITOR'S REPORT PREPARED BY AN INDEPENDENT
12 AUDITOR WHO SHALL BE A CERTIFIED PUBLIC ACCOUNTANT OR OTHER
13 COMPETENT PUBLIC ACCOUNTANT. ALL FINANCIAL ACCOUNTING AND
14 REPORTING BY INTERMEDIATE UNITS TO THE DEPARTMENT OF EDUCATION
15 SHALL BE IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING AND
16 REPORTING STANDARDS[.], EXCEPT FOR THE ANNUAL FINANCIAL REPORT.
17 THE DEPARTMENT OF EDUCATION SHALL ESTABLISH A REPORTING STANDARD
18 FOR THE ANNUAL FINANCIAL REPORT. THE STANDARD SHALL CONFORM TO
19 FUND LEVEL REPORTING CRITERIA ONLY. ENTITYWIDE STATEMENTS,
20 MANAGEMENT DISCUSSION AND ANALYSIS AND NOTES TO THE FINANCIAL
21 STATEMENTS ARE NOT A REQUIRED COMPONENT OF THE ANNUAL FINANCIAL
22 REPORT.
23 Section 2 4. This act shall take effect in 60 days. <--
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