NC Education Code · Regulation
Title 16 — root / Chapter 06 — 16 NCAC 06G .0505
Plain English summary
This regulation establishes a three-tiered financial noncompliance framework for charter schools in North Carolina, consisting of Cautionary, Probationary, and Disciplinary statuses triggered by specific financial conditions such as late reporting, audit findings, insolvency signs, or failure to attend required training. Schools progress through stages with minimum 30-day correction windows at each level, with state funds potentially restricted to monthly allotments and ultimate referral to the Charter School Advisory Board or State Board of Education for unresolved violations. The State Board of Education retains authority to take independent action regardless of a school's noncompliance status.
Key requirements
- if the charter school fails to report financial, personnel or student data within 10 days of the required or agreed-upon reporting date or does not submit accurate data
- if the charter school fails to respond to a specific financial, personnel, or student information request for information or data from the Department of Public Instruction by the required reporting date
- if the charter school fails to submit the required audited financial statements to the North Carolina Department of State Treasurer's Local Government Commission, as prescribed by G.S. 115C-218.30 and G.S. 115C-447
- if the charter school shows signs of financial insolvency or weakness, including a decline in student membership based on evaluation of financial statements by an accountant
- if the Office of State Treasurer receives a 'non-sufficient funds (NSF)' notification during the course of cash certification processing
- if the charter school receives a material audit finding in its annual independent financial statement audit which indicates a violation of State law, a violation of any of the conditions or procedures set forth in its Charter, a failure to meet generally accepted accounting practices and principles, including sound fiscal management in accordance with G.S. 115C-218.95 and remains unresolved
- if the charter school's staff fails to attend required financial training
- The school shall remain in cautionary status for a minimum of 30 calendar days from the date of notification, and during that time must correct the exception(s) that caused the financial warning(s) if applicable
- The school remains in probationary status for a minimum of 30 calendar days from the date of notification, and during that time must correct the exceptions that caused the financial warnings if applicable
- While in probationary status, state funds for the school may be allotted on a monthly basis until the exceptions that caused the financial warnings are corrected
- When in Disciplinary status, the school shall address all of the exceptions that caused the financial noncompliance within 10 business days from the date of notification or otherwise stated
- State funds for the school may be allotted on a monthly basis until the exceptions causing the noncompliance are corrected
- the school's access to the cash management system may be revoked if necessary to prevent the expenditure of funds in violation of the standards in Subparagraph (b)(6) of this Rule until the exception is corrected
Affected parties
- Charter schools
- Charter school staff
- NC Department of Public Instruction
- NC Department of State Treasurer / Local Government Commission
- Charter School Advisory Board
- State Board of Education