SLLA School Finance and Resource Management 3

Question 1

Which grant type gives school administrators the greatest flexibility in how allocated funds may be spent?

Accepted Answer

Block grants

Answer

Block grants provide funds for broad purposes with fewer programmatic restrictions, giving administrators significantly more discretion in resource allocation.

Question 2

What does the 'supplement, not supplant' provision in federal education law require?

Accepted Answer

Federal funds must add to, not replace, existing state and local funding

Answer

The 'supplement, not supplant' rule requires that federal funds add to existing services rather than being used to replace state or local funding obligations.

Question 3

What is the primary purpose of a school's reserve fund (fund balance)?

Accepted Answer

To provide financial stability and cover unexpected costs

Answer

Reserve funds provide a financial cushion for emergencies, unanticipated expenses, and revenue shortfalls, ensuring operational continuity.

Question 4

When a principal moves funds from one budget line item to another within the same program without changing total program funding, this is called a:

Accepted Answer

Budget transfer

Answer

A budget transfer moves funds between line items within the same program or fund, not changing the total, and typically requires less formal approval than an amendment.

Question 5

Which measure best indicates a school district's short-term financial health and ability to meet near-term obligations?

Accepted Answer

Fund balance as a percentage of annual expenditures

Answer

Fund balance as a percentage of expenditures is a key liquidity indicator showing whether adequate reserves exist to cover short-term financial obligations.

SLLA Test Practice Test

SLLA Test Practice Test

SLLA School Finance and Resource Management 3