Business Practices

School Business

School finance is not the reason educators become educators, but they should still have a basic understanding of school finance. The district’s school business official (SBO) and the school leader should meet, preferably one on one, to get to know each other and to talk about processes, procedures and expectations.

SBOs should acknowledge that school finance is not the most important issue for principals. However, they should share that a principal’s understanding of key concepts and adherence to processes and procedures can ensure financial stability, facilitate resources for instruction, ensure safety and security for students and staff, and keep everyone’s name out of the newspapers.

Most of what principals should know can be grouped into four categories: budgeting and finance, operations, facilities, and health and welfare. Here are just a few of the basics in each category.

Budgeting and finance

Although principals likely have taken a school finance course at some point, they may not remember important details. Spend time reviewing the general ledger account structure, including any state-mandated parameters and any local district variations. Such a review will tie directly into the purchasing process and is important for accurate spending analysis and reporting.

Whether you use paper or electronic requisitions, clarify the approval process, timing, and expectations. If principals rely on secretaries to stamp their signature on documents or log in and approve requests on their behalf, the principals should know that they are still responsible for such expenditures.

Providing a written summary of the purchasing process can help ensure that principals and school secretaries have the same information. In particular, the summary should include information about the cutoff date in the spring for purchases to ensure that they hit the current year’s budget.


The operations category includes such areas as food service, the free and reduced-priced meal program, fee waivers and bus transportation. Principals should have a list of the main business office or service provider contacts with their contact information. Clear expectations regarding the lines of communications are important — both to and from the business office — including reporting late busses, bus accidents, expired milk, insufficient meal quantities and so on.

Federal guidelines on privacy for students with free and reduced-price meal status should be described for districts that participate in the National School Lunch Program. Depending on your state law or local policies, the confidentiality guidelines can complicate seemingly simple activities, such as collecting money for field trips.


Supply principals with written facility maintenance procedures. Review emergency protocols, including documentation, controls and supplies. If the district provides a backup cell phone for each building, the number should be shared, and the phone should be checked to confirm that it is operable. If a VoIP (Voice over Internet Protocol) system is being used, a single POTS (plain old telephone service) line may still be in place at the school in case of emergency, and principals should be shown that line and how to use the handset if the line is normally connected to a fax machine.

Review staff access to buildings during off hours and weekends, as well as special procedures for access, such as issuing keys or adjusting badge reader permissions.

Health and welfare

Although principals aren’t typically asked insurance benefit questions, they should know the basics of the policies and where to direct specific questions. Review workers’ compensation forms and procedures for reporting accidents.

Principals need to know how to request certificates of insurance for outside performances, and that they also need to request certificates of insurance from third parties. If principals sign the contracts for third-party services, they should be briefed on the key contract provisions, including those covering insurance and liability.

Focus on responsibility

By investing time up front with building administrators, SBOs can ensure that important responsibilities in the areas of budgeting and finance, operations, facilities, and health and welfare are addressed. At the same time, principals will know what they need to do and when it should be done, freeing them to focus most of their time and energy on student achievement and instructional leadership.

—This article is excerpted from the June 2014 issue of School Business Affairs, published by the Association of School Business Officials International (

This article originally appeared in the issue of .

About the Author

David Bein, SFO, is assistant superintendent of Business Services and chief school business official at East Maine School District 63, Des Plaines, Ill.