1.1 	A bill for an act
1.2 	relating to education finance; creating a school district consolidated financial 
1.3 	statement; requiring the conversion of Uniform Financial Accounting and 
1.4 	Reporting Standards data into a new consolidated financial statement format; 
1.5 	requiring the new consolidated financial statement to be published on the 
1.6 	Department of Education Web site; creating a task force; amending Minnesota 
1.7 	Statutes 2004, section 123B.77, subdivisions 2, 3,  by adding a subdivision.
1.8 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.9 	Section 1. Minnesota Statutes 2004, section 123B.77, is amended by adding a 
1.10 	subdivision to read:
1.11 		Subd. 1a.School district consolidated financial statement. The commissioner, 
1.12 	in consultation with the consolidated financial statement task force, shall develop and 
1.13 	maintain a school district consolidated financial statement format that converts uniform 
1.14 	financial accounting and reporting standards data under subdivision 1 into a more 
1.15 	understandable format.

1.16 	EFFECTIVE DATE. This section is effective the day following final enactment.

1.17 	Sec. 2. Minnesota Statutes 2004, section 123B.77, subdivision 2, is amended to read:
1.18 		Subd. 2.Audited financial statement. (a) Each district must submit to the 
1.19 	commissioner by September 15 of each year unaudited financial data for the preceding 
1.20 	fiscal year. These financial data must be submitted in the format prescribed by the 
1.21 	commissioner.
1.22 	(b) By September 30 of each year the commissioner shall convert the unaudited 
1.23 	financial data required by this subdivision into the consolidated financial statement format 
1.24 	required under subdivision 1a and publish the information on the department's Web site.

2.1 	EFFECTIVE DATE. This section is effective for financial statements prepared in 
2.2 	2006 and later.

2.3 	Sec. 3. Minnesota Statutes 2004, section 123B.77, subdivision 3, is amended to read:
2.4 		Subd. 3.Statement for comparison and correction. (a) By November 30 of the 
2.5 	calendar year of the submission of the unaudited financial data, the district must provide to 
2.6 	the commissioner audited financial data for the preceding fiscal year. The audit must be 
2.7 	conducted in compliance with generally accepted governmental auditing standards, the 
2.8 	federal Single Audit Act, and the Minnesota legal compliance guide issued by the Office 
2.9 	of the State Auditor. An audited financial statement prepared in a form which will allow 
2.10 	comparison with and correction of material differences in the unaudited financial data 
2.11 	shall be submitted to the commissioner and the state auditor by December 31. The audited 
2.12 	financial statement must also provide a statement of assurance pertaining to uniform 
2.13 	financial accounting and reporting standards compliance and a copy of the management 
2.14 	letter submitted to the district by the school district's auditor.
2.15 	(b) By December 15 of the calendar year of the submission of the unaudited financial 
2.16 	data, the commissioner shall convert the audited financial data required by this subdivision 
2.17 	into the consolidated financial statement format required under subdivision 1a and publish 
2.18 	the information on the department's Web site.

2.19 	EFFECTIVE DATE. This section is effective for financial statements prepared in 
2.20 	2006 and later.

2.21 	Sec. 4. CONSOLIDATED FINANCIAL STATEMENT TASK FORCE.
 2.22 	The commissioner of education must convene a task force to develop a consolidated 
2.23 	financial statement that converts school district revenues and expenditures from the 
2.24 	uniform financial accounting and reporting standards, under Minnesota Statutes, section 
2.25 	123B.77, subdivision 1, to a consolidated financial statement recommended on November 
2.26 	11, 2005, by the Describing School Finances Committee. The task force shall consist of 11 
2.27 	members. The commissioner of education or the commissioner's designee shall chair the 
2.28 	task force. The commissioner shall appoint two members from the Minnesota Department 
2.29 	of Education. One task force member each shall be appointed from the Association of 
2.30 	Metropolitan School Districts, the Schools for Equity in Education, the Minnesota Rural 
2.31 	Education Association, and the Minnesota Association of School Business Officials. The 
2.32 	chairs of the house Education Finance Budget Division and the senate K-12 Education 
2.33 	Budget Division must each appoint two members, one representing the Minnesota 
3.1 	business community and one public school parent. The task force shall complete its 
3.2 	work by August 15, 2006.

3.3 	EFFECTIVE DATE. This section is effective the day following final enactment.