(b) Eligible education expenses may only include expenses that are in the statement of activities, except for the cost of land. The amount that the school paid for land shall be included in the first year the land is used for educational programming using an allocation method under par. (d), if applicable.
(c) An expense may only be included as an eligible education expense one time.
(d) If an expense or government assistance revenue is partially related to educational programming, the school shall use an allocation method to determine the portion that is related to educational programming.
(e) The following may not be included in kindergarten through grade 12 eligible education expenses:
1. Contributed services, capital assets or goods.
2. Scholarship awards and financial support for pupils to attend the private school, including payments to parents or others on behalf of pupils.
3. Daycare expenses except expenses for before or after school care for kindergarten through grade 12 pupils that are enrolled in educational programming at the school.
4. Expenses for pupils who are enrolled in the public school district and attending the private school.
(2) Auditor review of eligible education expenses. An auditor shall ensure the eligible education expenses a school included in the supplemental schedulemply with the requirements under sub. (1).
(3) Supplemental schedule calculations. The supplemental schedule shall calculate all of the following:
(a) Net eligible education expenses exclusively for special needs scholarship program pupils as follows:
1. Determine the amount of eligible education expenses exclusively for special needs scholarship program pupils.
2. Subtract all government assistance revenues received for eligible education expenses exclusively for special needs scholarship program pupils.
3. Subtract fundraising revenue, up to the non-administrative fundraising expenses in subd. 1. In this subdivision, administrative expenses include expenses for school personnel, copying, mailing, or capital assets used for other school purposes.
4. Subtract all insurance proceeds received for eligible education expenses exclusively for special needs scholarship program pupils.
(b) Net eligible education expenses for all pupils as follows:
1. Determine the amount of eligible education expenses, excluding eligible education expenses in par. (a).
2. Subtract all government assistance revenues received for eligible education expenses, excluding eligible education expenses in par. (a).
3. Subtract fundraising revenue, up to the non-administrative fundraising expenses in subd. 1. In this subdivision, administrative expenses include expenses for school personnel, copying, mailing, or capital assets used for other school purposes.
4. Subtract all insurance proceeds received for eligible education expenses, excluding eligible education expenses in par. (a).
(c) The net eligible education expenses for special needs scholarship program pupils as follows:
1. Calculate the percentage of pupils at the school participating in the special needs scholarship program as the full-time equivalent for the special needs scholarship program pupils compared to the all pupil full-time equivalent. The full-time equivalents shall be based on the average of the full-time equivalents determined in the enrollment audits under s. PI 49.07. 2. Multiply the amount calculated under par. (b) by the percentage under subd. 1.
3. Add the net eligible education expenses under par. (a).
(d) The reserve balance as follows:
1. Determine the total scholarships received.
2. Add the prior year reserve balance, if any.
3. Subtract the amount determined under par. (c).
(e) The school’s cash and investment balance that must be maintained under sub. (4) as follows:
1. Determine the sum of any remaining depreciation on fixed assets used by the school and any land purchases that have not yet been included in eligible cost under sub. (1) (b).
2. Subtract the amount under subd. 1. from the amount under par. (d).
(4) Maintain reserve balance. The school shall maintain the reserve balance, if positive, for future eligible education expenses for special needs scholarship program pupils. The school’s cash and investment balance shall be at least as much as the amount calculated under sub. (3) (e), if positive. If the school is participating in a program under s. 118.60 or 119.23, Stats., the cash and investment balance shall be at least as much as the reserve calculated under this chapter, s. PI 35, and s. PI 48 less the sum of any remaining depreciation on fixed assets used by the school and any land purchases that have not yet been included in eligible cost under sub. (1) (b). (5) Final financial audit. If a school ceases to participate or is barred from participation in the special needs scholarship program under s. 115.7915, Stats., it shall submit to the department the financial audit for the final school year in which it participated. If a school fails to submit the financial audit, the school’s net eligible education expenses for the year shall be determined to be zero for purposes of determining the school’s reserve balance. (6) Refund of the reserve. If a school ceases to participate or is barred from participating in the special needs scholarship program under s. 115.7915, Stats., and the school’s reserve is positive, the school shall refund the reserve balance to the department. The school shall make the refund within 30 days of the date of the closure payment letter sent to the school by the department. PI 49.10 School financial requirements. (1) Engagement letter. A school shall have a written engagement letter with each auditor providing services required by this chapter. The school or auditor shall provide a copy of the engagement letter to the department upon request. The written engagement letter shall contain all of the following:
(a) A statement that the auditor shall comply with generally accepted auditing standards and the requirements of this chapter.
(b) A statement that the auditor shall comply with generally accepted governmental auditing standards if other governmental agencies providing funds to the school so require.
(c) .The responsibilities of the school and the auditor in meeting the requirements of this chapter. .(d) The services the auditor provides to the school that are in addition to those audit and attestation services required under this chapter. .(e) The auditor's acknowledgement that the department will rely on the auditor’s work to fulfill the department’s responsibilities under s. 115.7915, Stats., and this chapter. (f) The auditor's compensation for the services the auditor provides to the school.
(2) Financial accounting system. A school shall use a double entry financial accounting system organized in a manner that enables preparation of the financial audit and financial audit supplemental schedule. A school shall balance the financial accounting system and provide the auditor with a trial balance of the account balances. (3) Adjusting entries. Adjustments to the school’s trial balance recommended by a school’s auditor shall be approved by the school before the entries are recorded in the school's financial accounting system.
(4) Records retention. A school shall retain all financial and pupil records relating to the enrollment audits under s. PI 49.07 and the audit required under ss. PI 49.08 and PI 49.09 for at least 5 years from the due date of the financial audit for each school year, unless the department or a law enforcement agency requests that the school retain the records for more than 5 years. (5) PI 35.046(1)(g)Records availability. A school shall furnish all financial and pupil records the auditor considers necessary to provide the audit opinion or agreed upon procedure reports. Upon request by the department, a school shall provide the department access and copies to the records referenced in the auditor's working papers. (6) School responsibility. An auditor’s failure to completely or properly perform the responsibilities set forth in s. 115.7915, Stats., or this chapter is not a defense to any determination the department makes that there is an amount due from a school or to a school under s. PI 49.07 (4) or PI 49.09 (6). (7) Auditor bar. A school participating in the special needs scholarship program may not engage an auditor who the department bars under s. PI 35.12 (7), PI 48.12 (7), or PI 49.11 (7) until such time as the auditor provides evidence acceptable to the department that the auditor has made procedural changes and has successfully completed professional development training that enables the auditor to comply with the requirements of this chapter, ch. PI 35, ch. PI 48, and ss. 115.7915, 118.60, and 119.23, Stats. PI 49.11 Auditor requirements.(1) Independence requirements. An auditor engaged by a school to meet the requirements under this chapter and s. 115.7915, Stats., shall comply with the standards of the American Institute of Certified Public Accountants, including all of following: (a) An auditor shall comply with the requirements of s. Accy 1.101. (b) An auditor shall obtain the school’s trial balance if completing compilation or review services.
(c) Except as provided in par. (d), an auditor may not post or prepare for posting typical reoccurring financial transactions to the school's general ledger, including cash receipts and disbursements, invoices or billings for services, billings from vendors and suppliers, and payroll activity. (d) An auditor shall obtain written approval of the school's management prior to posting adjusting, correcting, and closing journal entries to the school's general ledger. An auditor's working papers shall document evidence of management approval for all such entries resulting from a financial statement compilation, review, or audit.
(e) If an auditor assists in the preparation of a school’s budget, the auditor shall do all of the following:
1. Comply with s. Accy 1.201 (1) (e), regarding forecasts. 2. Identify that such assistance was provided, if required by the department.
(2) Inquiries. An auditor shall promptly respond to inquiries or requests made by the department. The auditor shall notify the school of any inquiries or requests made by the department and the auditor's response.
(3) Working papers retention. An auditor shall retain working papers relating to the enrollment audits under s. PI 49.07 and the audit required under ss. PI 49.08 and PI 49.09 for at least 5 years from the due date of the financial audit for each school year, unless the department or a law enforcement agency requests that the auditor retain working papers for more than 5 years. (4) Working papers review. An auditor shall permit the department to review audit working papers prepared in support of the enrollment audits under s. PI 49.07 and the audit required under ss. PI 49.08 and PI 49.09. An auditor shall promptly provide copies of working papers the department requests. (5) Auditor peer review reports. An auditor completing any of the audits and agreed upon procedure reports under s. 115.7915, Stats., or this chapter shall submit the auditor’s peer review required under s. 442.087, Stats., to the department within 30 days of the report issuance. (6) License requirements.
(a) The auditing firm that is engaged by a school to complete the audits and agreed upon procedure reports under this chapter or s. 115.7915, Stats., shall be licensed as a certified public accounting firm by the accounting examining board under ch. 442, Stats. (b) The individual auditor who signs the engagement letter for the audits and agreed upon procedure reports under this chapter or s. 115.7915, Stats., shall be a licensed certified public accountant by the accounting examining board under ch. 442, Stats. (7) Auditor bar. (a) The department may bar PI 35.05(2)(c)PI 35.05(2)(d)an auditor who fails to timely and properly fulfill the auditing and reporting requirements of this chapter or s. 115.7915, Stats. (b) An auditor who is barred under par. (a) shall not complete accounting, auditing, or other reporting requirements for any schools participating in the special needs scholarship program or in a program under s. 118.60 or 119.23, Stats., until such time as the auditor submits to the department evidence acceptable to the department that the auditor has made procedural changes to the manner in which the auditor conducts an audit and has successfully completed professional development training that will enable the auditor to comply with the requirements of this chapter, ch. PI 35, ch. PI 48, and ss. 115.7915, 118.60, and 119.23, Stats. PI 49.12 Quarterly reporting to parent. A school shall report to the parent of a pupil participating in the special needs scholarship program at least quarterly using a form provided by the department. The report shall describe the implementation of the child’s individualized education program or services plan, as modified by agreement between the school and the child’s parent, and the pupil’s academic progress.
PI 49.13 State aid payment calculation.)The state superintendent shall make the payments under s. 115.7915 (4m), Stats., to schools participating in the special needs scholarship program. The state superintendent may withhold payment from a school under s. 115.7915 (4m), Stats., if the school violates this chapter or s. 115.7915, Stats. PI 35.05(3)(b)The state superintendent shall make the payments as follows: (1) September payment. The September payment shall be based on the number of special needs scholarship program pupils at the school reported under s. PI 49.06 (4). The state superintendent shall calculate the September payment as 25 % times the total of all of the following: (a) The full-time equivalent for full scholarship pupils multiplied by the per pupil payment amount determined under s. 115.7915 (4m) (a), Stats. (b) The full-time equivalent for partial scholarship pupils, as reported under s. PI 49.06 (4) (b), multiplied by the per pupil payment amount determined under s. 115.7915 (4m) (e), Stats. (2) November payment. a. The November payment shall be based on the number of special needs scholarship program pupils reported by October 1 in the school’s pupil count report required under s. PI 49.06 (5) (b), unless a pupil is determined ineligible by the department. The state superintendent shall calculate the November payment as 50 % times the amount owed for eligible pupils less the September payment received. The state superintendent shall calculate the amount owed for eligible pupils as the total of all of the following: (a) The full-time equivalent for full scholarship pupils multiplied by the per pupil payment amount determined under s. 115.7915 (4m) (a), Stats. (b) The full-time equivalent for partial scholarship pupils, as reported under s. PI 49.06 (4) (b), multiplied by the per pupil payment amount determined under s. 115.7915 (4m) (e), Stats. (3) February and may payments. The February payment and May payment shall each be based on the number of special needs scholarship program pupils reported by February 1 in the school’s pupil count report required under s. PI 49.06 (5) (b), unless a pupil is determined ineligible by the department. The state superintendent shall calculate the February and May payments as 25 % times the total of all of the following: (a) The full-time equivalent for full scholarship pupils multiplied by the per pupil payment amount determined under s. 115.7915 (4m) (a), Stats. (b) The full-time equivalent for partial scholarship pupils, as reported under s. PI 49.06 (4) (b), multiplied by the per pupil payment amount determined under s. 115.7915 (4m) (e), Stats. (4) Ceased instruction. The state superintendent may not make a September, November, or February payment to a school that has ceased instruction prior to the payment date.
(5) Ending a school term early. The state superintendent may not make a May payment to a school that has ceased instruction prior to the end of its scheduled school term unless the school obtained prior written approval from the department to end the school term early. (5) (
PI 49.14 Department authority.(1) Inquiries. The department may make inquiries to ascertain the accuracy and completeness of information contained in audits or reports required under s. 115.7915, Stats., or this chapter. Schools and auditors shall promptly respond to inquiries made by the department. (2) Training. The department may provide training to school staff and auditors. The department may charge a reasonable fee for providing training under this subsection.
(3) Pupil confidentiality. The department shall maintain pupil confidentiality at all times.
(4) Order to bar. The department may issue an order barring a private school from participating in the special needs scholarship program if the department determines that the school has done any of the following:
(a) Failed to provide the financial audit or financial audit supplemental schedule in two or more years by the date specified in s. PI 49.08. (b) Provided a financial audit or financial audit supplemental schedule that does not comply with the requirements under s. 49.08 or 49.09 in two or more instances in the same year or in different years.
