• Accounting Overview PDF Accounting Overview (PDF)


    Topic: Accounting Overview

    Reference or Contact:          Chief Financial Officer


    Section 44.007 of the Texas Education Code requires a standard school district fiscal accounting system be adopted by each school district. The system must meet at least the minimum requirements prescribed by the State Board of Education and also be subject to review and comment by the state auditor. Additionally, the accounting system must conform to Generally Accepted Accounting Principles (GAAP). This section further requires that a report be provided at the time that the school district budget is filed, showing financial information sufficient to enable the state board of education to monitor the funding process and to determine educational system costs by school district, campus and program.

    The Texas Education Code, Section 44.008, requires each school district to have an annual independent audit conducted that meets the minimum requirements of the state board of education, subject to review and comment by the state auditor. The annual audit must include the performance of certain audit procedures for the purpose of reviewing the accuracy of the fiscal information provided by the district through Public Education Information Management System (PEIMS). The audit procedures are to be adequate to detect material errors in the school district's fiscal data to be reported through the PEIMS system for the fiscal period under audit review. A major purpose of the following accounting code structure is to establish the standard school district fiscal accounting system required by law. Although certain codes within the overview may be used at local option, the sequence of the codes within the structure, and the funds and chart of accounts, are to be uniformly used by all school districts in accordance with generally accepted accounting principles. Board Policy CFA, CFC


    Code Structure Example:






    Fiscal Year

    Program Intent

    Local Option










    Fund Code:

    A mandatory 3-digit code is to be used for all financial transactions to identify the fund group and specific fund. The first digit refers to the fund group and the second and third digit specifies the fund.


    Governmental Funds


    (199- General Fund)


    Special Revenue Funds


    Proceeds of specific revenue sources that is legally restricted to expenditures for a specific purpose

    (Federal: 200-379, State: 380-459, Local 460-499)


    Capital Project Funds


    Must be used to account on a project basis for proceeds from bond issues

    (699 Capital Project Funds)


    Trust and Agency Funds


    Funds used to account for assets held by a school district in a trustee capacity, or as an agent

    (865-student activity fund)


    Function Code:

    A mandatory 2-digit code applied to expenditures/expenses that identify the purpose of the transaction. The first digit identifies the major class and the second digit refers to the specific function within the area.



    13-Staff Development for staff classified in functions 11, 12 & 13

    21-Instructional Leadership (District Offices)

    23-School Leadership (Campus Offices)

    31-Guidance, Counseling and Evaluation Services

    33-Health Services

    34-Student Transportation (to and from school)

    35-Food Services

    36-Cocurricular Activities

    41-General Administration

    51-Plant Maintenance and Operations (Custodial)

    52-Security and Monitoring Services

    53-Data Processing Services

    61-Community Services

    81-Facilities Acquisitions and Construction


    Object Code:

    A mandatory 4-digit code identifying the nature and object of an account, a transaction or a source. The first of the four digits identifies the type of account or transaction, the second digit identifies the major area, and the third and fourth digits provide further sub-classifications.


    Revenue Object Codes

    57XX-Local Revenue

    58XX-State Revenue

    59XX-Federal Revenue


    Expenditure Object Codes

    61XX-Payroll Codes

    62XX-Professional and Contracted Services

    63XX-Supplies and Material

    64XX-Other Operating Costs

    66XX-Capital Outlay


    Sub-Object Code:

    A 2-digit code that denotes the group, club or activity particular funds are associated with, allowing more detailed accountability at the local level.


    Organization Code:

    A mandatory 3-digit code identifying the organization, i.e., High School, Middle School, Elementary School, Superintendent's office, etc. An organization code does not necessarily correspond with a physical location. The activity, not the location, defines the organization. Campuses are examples of organization codes and are specified for each school district in the Texas School Directory.


    Program Intent Code:

    A 2-digit code used to designate the intent of a program provided to students. These codes are used to account for the cost of instruction and other services that are directed toward a particular need of a specific set of students. The intent (the student group toward which the instructional or other service is directed) determines the program intent code, not the demographic makeup of the students served.


    Example: An entire class of physics is taught at the basic level. Program intent code 11 would designate Basic Educational Services.

    11-Basic Educational Services

    21-Gifted and Talented

    22-Career and Technology

    23-Students with Disabilities

    24-Accelerated Education (“At Risk Students”)

    25-Bilingual Education and Special Language Programs

    26-Non-Disciplinary Alternative Education Program (Non-Supplemental)

    27-Non-Disciplinary Alternative Education Program

    (Supplemental State Compensatory)

    28-Disciplinary Alternative Education Program (non-supplemental)

    29-Disciplinary Alternative Education Program (Supplemental State Compensatory) 30-State Compensatory

    31-High School Allotment

    91-Athletics and Related Activities




    All principals and directors should check their expenditure transaction monthly to keep up with their current balances and to analyze for any unusual items or inaccurate coding. Please contact the Budgets Coordinator with any potential errors.