LCS Fund Accounting Principles

Fund Basis:

Lakeway Christian Schools (LCS) shall maintain its accounting system on a fund basis, where each fund represents a distinct fiscal and accounting entity with self-balancing accounts. Funds shall be established and operated in compliance with applicable laws and financial standards.

Minimum Number of Funds:

LCS acknowledges the importance of minimizing unnecessary complexity in its financial structure. Therefore, only the minimum number of funds consistent with legal and operational requirements shall be established.

Core Funds:

LCS shall begin with the implementation of the following core funds:

• General Fund: Used to account for and report all financial resources unless there is a legal or other compelling reason to use another fund type.
• Capital Projects Fund: Accounts for and reports financial resources restricted, committed, or assigned to expenditures for capital outlays.
• Debt Service Fund: Used to account for and report financial resources restricted, committed, or assigned to expenditures for principal and interest. It also accumulates resources for future debt service payments.
• Designated Activity Funds: Used to account for and report all financial resources designated for student clubs, family associations, and organizations that are not included in the annual appropriated budget.
• Other Potential Funds: If the need arises through circumstances, LCS may utilize other fund types, such as Special Revenue Funds for specific revenue sources or Enterprise Funds for fee-based activities.

Advantages of Fund Accounting:

The use of fund accounting at LCS provides several advantages:

• Clear Accountability: Fund accounting ensures clear and distinct tracking of financial resources for specific purposes or activities, enhancing accountability for funds and resources.
• Transparency: Fund accounting promotes financial transparency by segregating funds based on their intended use, enabling stakeholders to easily understand and assess the financial position of each fund.
• Compliance: By adhering to fund accounting principles, LCS can better comply with applicable laws, regulations, and financial standards governing educational institutions.
• Efficient Resource Allocation: Fund accounting allows for efficient allocation of resources to specific programs, projects, or capital needs, facilitating effective financial management.
• Improved Decision-Making: Separate fund reporting provides essential data for informed decision-making, ensuring that financial resources are allocated strategically to support the school's mission and goals.