Arkansas Code
Subchapter 22 - Arkansas Educational Financial Accounting and Reporting Act of 2004
§ 6-20-2207. Rulemaking authority

(a)
(1)
(A) The State Board of Education shall promulgate rules governing a uniform budget and accounting system that shall be known as the “Arkansas Educational Financial Accounting and Reporting System”.
(B) This system shall include a uniform chart of accounts known as the “Arkansas Financial Accounting Handbook” that shall be exempt from the rulemaking process pursuant to the Arkansas Administrative Procedure Act, § 25-15-201 et seq.

(2) These rules shall be applied to all school districts, open-enrollment public charter schools, and education service cooperatives for purposes of reporting and accounting for revenues and expenditures.
(3) As necessary to comply with federal law, the Arkansas Financial Accounting Handbook initially shall comply with the Financial Accounting for Local and State School Systems, 2003 Edition (NCES 2004-318). The Arkansas Financial Accounting Handbook shall be exempt from the rulemaking process and procedures required pursuant to the Arkansas Administrative Procedure Act, § 25-15-201 et seq.

(b)
(1)
(A) The state board shall amend the rules, and the Division of Elementary and Secondary Education shall amend the Arkansas Financial Accounting Handbook provided in subsection (a) of this section as necessary.
(B) The amendments, annual revisions, and financial accounting updates to the Arkansas Financial Accounting Handbook shall be developed with representatives from the Arkansas Association of School Business Officials, the education service cooperatives, and other school district officials as designated by the division.

(2) Before making an amendment to the Arkansas Financial Accounting Handbook, the division shall provide written notice via a Commissioner of Elementary and Secondary Education memo to the school districts, open-enrollment public charter schools, and education service cooperatives.
(3) Amendments, annual revisions, and financial accounting updates shall be effective on July 1 of the next fiscal year or ninety (90) days from the date of the commissioner's memo, whichever is later, unless:
(A) The commissioner declares that there is an emergency, at which time the change shall be effective immediately upon the date specified in the commissioner's memo;
(B) A new program or revenue source requires new accounting codes, at which time the change shall be effective immediately upon the date specified in the commissioner's memo; or
(C)
(i) The change affects only a few school districts and the school districts have mutually agreed to make the change.
(ii) The changes shall be effective immediately upon the date specified in the commissioner's memo.

(c) Any school district, open-enrollment public charter school, or education service cooperative that fails to comply with state law or rules governing and providing a uniform chart of accounts for budgeting of revenues, expenditures, and financial reporting shall be deemed to be in fiscal distress and subject to the applicable enforcement provisions as provided by law.
(d) Any school district, open-enrollment public charter school, or education service cooperative that fails to comply with the expenditure requirements of any public school, public school district, or education service cooperative funding law shall be deemed to be in fiscal distress and subject to the applicable enforcement provisions as provided by law.