SAC Budget & Financial Management 2 — Questions and Answers
Question 1: Which of the following is a key requirement for using Title I funds under a schoolwide program?
- Only students identified as low-income may benefit from services
- The school must use a comprehensive needs assessment and serve all students, though funds must supplement, not supplant (Correct answer)
- Title I funds replace all state and local funding for eligible schools
- Only reading and math programs may be funded
Correct answer: The school must use a comprehensive needs assessment and serve all students, though funds must supplement, not supplant
In a Title I schoolwide program, funds can serve all students in the school, but the school must conduct a comprehensive needs assessment and ensure Title I supplements rather than replaces core funding.
Question 2: What does 'supplement, not supplant' mean in the context of federal education funding?
- Federal funds must increase total education spending, not replace state and local funds (Correct answer)
- Federal funds can only be used for supplemental staff, not core instruction
- State funds must equal federal funds before supplemental money is released
- Supplemental programs must be run after school hours
Correct answer: Federal funds must increase total education spending, not replace state and local funds
Supplement, not supplant means federal funds must be used in addition to — not instead of — state and local funds that would otherwise be spent on those students or programs.
Question 3: Which financial practice is most important for school administrators to follow when spending public school funds?
- Moving funds between restricted accounts freely
- Maintaining a clear audit trail, ensuring all expenditures have proper authorization and documentation (Correct answer)
- Approving all purchases personally without board oversight
- Keeping financial records for a minimum of one year
Correct answer: Maintaining a clear audit trail, ensuring all expenditures have proper authorization and documentation
Public funds require transparent, documented, authorized expenditures to withstand audits and ensure accountability to taxpayers and regulatory bodies.
Question 4: A school administrator wants to purchase technology using grant funds. Which step must be completed first?
- Order the equipment through an informal vendor
- Verify the expenditure is allowable under the grant's scope and follow required procurement procedures (Correct answer)
- Have teachers vote on the preferred technology
- Wait until the end of the fiscal year to minimize paperwork
Correct answer: Verify the expenditure is allowable under the grant's scope and follow required procurement procedures
Before spending grant funds, administrators must confirm the purchase is allowable under the grant terms and comply with required procurement rules, including competitive bidding thresholds.
Question 5: What is zero-based budgeting?
- Starting with last year's budget and adjusting for inflation
- Building the budget from zero each year, requiring justification for every expenditure regardless of prior allocations (Correct answer)
- Eliminating all non-instructional spending
- Creating a budget with zero deficit
Correct answer: Building the budget from zero each year, requiring justification for every expenditure regardless of prior allocations
Zero-based budgeting requires every budget item to be justified anew each cycle, forcing alignment between expenditures and current priorities rather than perpetuating historical spending.
Question 6: Which of the following is an example of a capital expenditure in school finance?
- Monthly utility bills
- Teacher salaries
- Purchasing a school bus or constructing a new gymnasium (Correct answer)
- Office supply purchases
Correct answer: Purchasing a school bus or constructing a new gymnasium
Capital expenditures are large, long-term investments in physical assets such as buildings, vehicles, or major equipment, typically funded through bonds or capital budgets.
SAC Budget & Financial Management 2
Which of the following is a key requirement for using Title I funds under a schoolwide program?