3100 – Business – General Fund – Reporting Unrestricted Fund Balance

Policy – x
Regulation –
Exhibit –

Adopted – 6-2-2011
Revised –


This Fund Balance Policy establishes the procedures for reporting unrestricted fund balance in the General Fund financial statements. Certain commitments and assignments of fund balance will help ensure that there will be adequate financial resources to protect the District against unforeseen circumstances and events such as revenue shortfalls and unanticipated expenditures. The policy also authorizes and directs the Chief Business Official to prepare financial reports which accurately categorize fund balance as per Government Accounting Standards Board (GASB) Statement No. 54, Fund Balance Reporting and Governmental Fund Type Definitions.


Fund balance is essentially the difference between the assets and liabilities reported in a governmental fund. There are five separate components of fund balance, each of which identifies the extent to which the District is bound to honor constraints on the specific purpose for which amounts can be spent.

” Nonspendable Fund Balance (inherently nonspendable)
” Restricted Fund Balance (externally enforceable limitations on use)
” Committed Fund Balance (self-imposed limitations on use)
” Assigned Fund Balance (limitation resulting from intended use)
” Unassigned Fund Balance (residual net resources)

The first two components listed above are not addressed in this policy due to the nature of their restrictions. An example of nonspendable fund balance is inventory. Restricted fund balance is either imposed by law or constrained by grantors, contributors, or laws or regulations of other governments. This policy is focused on the financial reporting of unrestricted fund balance, or the last three components listed above. These three components are further defined below.


Committed Fund Balance
The Governing Board, as the District’s highest level of decision-making authority, may commit fund balance for specific purposes pursuant to constraints imposed by formal actions taken during the interim report adoption. These committed amounts cannot be used for any other purpose unless the Governing Board removes or changes the specific use through the same type of formal action taken to establish the commitment. Governing Board action to commit fund balance needs to occur within the fiscal reporting period, no later than June 30th; however, the amount can be determined subsequent to June 30th but prior to the submission of the SACS Unaudited Actual Financial Reports.
This policy does hereby Commit all Unassigned Fund Balances in the following funds for the identified purposes:

Fund 12 Child Development Fund – Committed for the purpose of supporting the State Preschool and Before and After School Recreation Program.

Fund 13 Cafeteria Fund – Committed for the purpose of supporting the District’s Food Service Program.

Fund 20 Post Employment Benefits – Committed for the purpose of having available funds for post employment benefits.

Fund 21 Building Fund – Committed for the purpose of funding Measure D projects.

Assigned Fund Balance

Amounts that are constrained by the District’s intent to be used for specific purposes, but are neither restricted nor committed, should be reported as assigned fund balance. This policy hereby delegates the authority to assign amounts to be used for specific purposes to the Superintendent or the Chief Business Official for the purpose of reporting these amounts in the annual financial statements.

Unassigned Fund Balance

These are residual positive net resources of the general fund in excess of what can properly be classified in one of the other four categories. There are some reserves that do not meet the requirements of the fore mentioned components of fund balance. For financial statement reporting purposes these reserves are included in unassigned fund balance.

Fund Balance Classification

The District considers restricted fund balances to have been spent first when an expenditure is incurred for the purposes for which both restricted and unrestricted fund balance is available. Similarly, when an expenditure is incurred for purposes for which amounts in any of the unrestricted classifications of fund balance could be used, the District considers committed amounts to be reduced first, followed by assigned amounts and then unassigned amounts.

This policy is in place to provide a measure of protection for the District against unforeseen circumstances and to comply with GASB Statement No. 54. No other policy or procedure supersedes the authority and provisions of this policy.

Minimum Fund Balance

The Minimum Fund Balance is intended to address the minimum fund balance in the general fund by establishing an appropriate level of unrestricted fund balance that will be maintained in the general fund.

The Board reserves the authority to review and amend this policy as needed to reflect changing circumstances and district needs.

The District is committed to maintaining a prudent level of financial resources to protect against the need to reduce service levels because of temporary revenue shortfalls or unpredicted expenditures. The District’s Minimum Fund Balance requires a Reserve for Economic Uncertainties consisting of unassigned amounts and consistent with the Criteria and Standards for fiscal solvency adopted by the State Board of Education. The District maintains a Reserve for Economic Uncertainties to safeguard the District’s financial stability. The Board intends to maintain a minimum Unassigned Reserve for Economic Uncertainties of 3% of the District’s general fund annual operating expenditures.

CSBA Date –

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