Standards for public agencies

2020 Edition

Financial Management (PA-FIN) 4: Financial Management

Positive financial outcomes are achieved through a financial management system that advances the agency’s strategic priorities and receives, disburses, and accounts for funds in accordance with sound financial practices.
NA The agency does not have a finance department.
2020 Edition

Currently viewing: FINANCIAL MANAGEMENT (PA-FIN)

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Purpose

The agency's ability to achieve its mission is based on sound financial managment practices that ensure efficient, data-informed use of its resources in accord with applicable legal and regulatory requirements.
1
Full Implementation, Outstanding Performance
A rating of (1) indicates that the agency's practices fully meet the standard and reflect a high level of capacity.  
  • All elements or requirements outlined in the standard are evident in practice, with rare or no exceptions: exceptions do not impact service quality or agency performance. 
2
Substantial Implementation, Good Performance
A rating of (2) indicates that an agency's infrastructure and practices are basically sound but there is room for improvement.
  • The majority of the standards requirements have been met and the basic framework required by the standard has been implemented. 
  • Minor inconsistencies and not yet fully developed practices are noted; however, these do not significantly impact service quality or agency performance.
3

Partial Implementation, Concerning Performance
A rating of (3) indicates that the agency's observed infrastructure and/or practices require significant improvement.  

  • The agency has not implemented the basic framework of the standard but instead has in place only part of this framework.  
  • Omissions or exceptions to the practices outlined in the standard occur regularly, or practices are implemented in a cursory or haphazard manner.  
  • Service quality or agency functioning may be compromised.  
  • Capacity is at a basic level.
4
Unsatisfactory Implementation or Performance
A rating of (4) indicates that implementation of the standard is minimal or there is no evidence of implementation at all.  
  • The agency’s observed administration and management infrastructure and practices are weak or non-existent; or show signs of neglect, stagnation, or deterioration.
Self-Study EvidenceOn-Site EvidenceOn-Site Activities
County/Municipality Administered Agency, State Administered Agency (Central Office), or other Public Entity
  • Procedures for: 
    1. Purchasing
    2. Managing and disbursing client funds
    3. Payroll 
  • List of programs that draw down federal money 
  • Aggregate federal reimbursement review reports for the previous fiscal year 
State Administered Agency (Regional Office)
  • Regional federal reimbursement review reports for the previous fiscal year
County/Municipality Administered Agency, State Administered Agency (Central Office), or other Public Entity
  • Documentation of efforts to maximize federal funding
  • Financial statements/records to support federal claims for the previous fiscal year
  • Copies of financial reports or progress summaries related to court orders or mandates
  • Training curricula for personnel on the agency’s accounting system
  • Documentation tracking staff completion of required trainings
State Administered Agency (Regional Office)
  • Financial statements/records to support federal claims for the previous fiscal year
  • Training curricula for personnel on the agency’s accounting system
  • Documentation tracking staff completion of required trainings
County/Municipality Administered Agency, State Administered Agency (Central Office), or other Public Entity
  • Interviews may include:
    1. Fiscal authority
    2. CFO or equivalent
    3. Financial personnel
    4. Agency leadership
    5. Legal personnel
    6. Payroll staff
    7. Purchasing staff
  • Observe reporting and accounting system
State Administered Agency (Regional Office)
  • Interviews may include:
    1. Regional Director
    2. Financial personnel
  • Observe reporting and accounting system

PA-FIN 4.01

The agency maximizes federal funding opportunities. 

Interpretation

The agency’s ability to maximize federal funding may be limited by the state’s infrastructure. For example, county-administered agencies may have a limited ability to pursue funding avenues without the support of the state. The agency should be prepared to speak to the efforts they have made in this area within the context of the state-wide approach. 
 
NA State-administered agency regional office
Examples: Ways to maximize federal funding can include, but are not limited to:
  1. centralized, ongoing review of eligibility requirements to ensure policies are correctly applied across jurisdictions;
  2. tracking and responding in a timely manner to changes in federal ruling or regulations;
  3. exploring how federal funds can be used to reimburse purchased services;
  4. conducting time studies with staff and contracted providers so eligible activities are reimbursed at the appropriate rate;
  5. using training and supervision to educate staff on critical terminology and processes and continuing to monitor that they are consistently applied; 
  6. incorporating monitoring of federal reimbursements/claims into the agency’s overall performance and quality improvement program; and
  7. partnering with leaders across the jurisdiction to explore the availability of alternative federal dollars that may fall outside traditional funding sources. 

PA-FIN 4.02

The agency seeks to conserve its fiscal resources by:
  1. taking advantage of tax exemptions permitted for public agencies, where applicable;
  2. coordinating the purchase of goods or services among internal divisions; and
  3. involving staff and other stakeholders in identifying creative ways to use funds effectively and efficiently. 

PA-FIN 4.03

The agency’s finance department:
  1. maintains all financial records required to support federal claims; and
  2. complies with all applicable court orders or mandates.

Fundamental Practice

PA-FIN 4.04

An agency that assumes fiduciary responsibility for client funds or disburses client funds: 
  1. segregates client funds from other agency funds;
  2. complies with applicable legislative, regulatory, judicial, and governmental requirements; and
  3. plans for meeting the needs of clients in the event of unexpected resource disruptions impacting client funds.
Examples: Unexpected resource disruptions that could impact client funds include federal government shutdown or other events that termporarily suspend the agency’s receipt of client funds. 
 

PA-FIN 4.05

The agency’s finance department trains personnel to use the accounting system and adapt to changes in the system as they occur. 

PA-FIN 4.06

Payroll practices include:
  1. documentation of changes in time and overtime records; and
  2. separation of payroll funds.
NA State Administered Agency Regional Office