Financial Responsibility Guide


School board members have many responsibilities, but none is more important than financial oversight. This is often a challenge for individuals who are elected to serve, yet have little training or expertise in organizational finance. The Financial Responsibility Guide has been designed to assist board members who find themselves in exactly that situation. The guide begins with a  discussion of the state public school finance system, gradually moves to areas of local district concern, and ends with specific financial legal issues that apply directly to board members as office holders. We hope you find this information useful as you serve in this most important capacity.

Table of Contents

Overview of the Texas School Finance System (pdf), by Catherine Clark, former TASB Associate Executive Director for Governance Services

The Texas school finance system is based on a combination of local property tax and state funding.  This section describes the breadth of the system, its limitations, and the challenges that must be addressed in future years.

The Board’s Role in Financial Responsibility (pdf), by TASB Leadership Team Services

School board members have a fiduciary duty to provide oversight regarding expenditures of taxpayer dollars.  This section focuses on the processes board members use to effectively carry out that duty.

The Basics of Understanding School District Financial Statements, by TASB Governmental Relations

Although school board members are not required to be experts in financial management, they do need a general understanding of the financial statements used in district management.  This section provides a basic description of the standard financial statements used in the school district context.

Adoption of the School Budget and Tax Rate (pdf), by TASB Legal Services

Annual adoption of the budget and tax rate is essential to the operation of a school district. This section describes how the adoption process works and the board’s role in that process.

School FIRST: Understanding the Financial Integrity Rating System of Texas (pdf), by TASB Legal Services

This section explains the Financial Integrity Rating System of Texas (FIRST) and the associated reporting and disclosure requirements.

School District Audits (pdf), by TASB Legal Services

Financial audits are key indicators of the district’s financial health.  This section reviews the requirements of conducting an audit and offers valuable information regarding the selection of an auditor.

The Role of the Internal Auditor in Texas School Districts (pdf), by TASB Legal Services

This section discusses the role of the internal auditor in school districts and answers frequently asked legal questions.

Fraud Prevention, by TASB Legal Services

This section covers what board members can do to protect the district’s financial systems from fraud or financial abuse.