1. A. The board of education of each school district shall use the following system of initiating, recording and paying for all purchases, salaries, wages or contractual obligations due from any of the funds under the control of such board of education. However, a school district board of education may use the procedures outlined in Section 304.1 of Title 62 of the Oklahoma Statutes for the payment of salaries and wages only if the board so votes. The provisions contained herein shall not apply to the sinking fund and school activity fund.
2. B. The encumbrance clerk and treasurer of the school district shall each enter the authorized amounts in the various appropriation accounts of the funds to which this system is applied. The authorized amounts of appropriations shall be the general fund and building fund appropriations approved by the county excise board and such additional amounts as may be applied in the manner provided by law, the amount received for deposit in a special cash fund where such special cash fund is authorized by law or required by the person or agency providing such funds, or the amount of the net proceeds realized from the sale of bonds of the school district and any other income due such fund.
3. C. It shall be the duty and responsibility of the board of education of the school district to prescribe and administer adequate business procedures and controls governing the purchase or confirmation of purchase and delivery of goods or services. Such procedures shall include the designation of authorized persons to purchase goods or services for the district and the method of determining the school employee receiving delivery of each purchase.
4. D. Prior to the issuance of a purchase order, the encumbrance clerk must first determine that the encumbrance will not exceed the balance of the appropriation to be charged. The encumbrance clerk shall charge the appropriate appropriation accounts and credit the affected encumbrances outstanding accounts with the encumbrances. A copy of the encumbrance or purchase order may be used as the authority for the designated school personnel to complete the purchasing process. Encumbrances must be submitted to the board of education in the order of their issuance on a monthly basis, subject to a monthly business cycle cut-off date determined by the board of education. Approved encumbrances shall be listed in the minutes by the minute clerk.

5. E. After satisfactory receipt of the goods or services, the employee designated by the board of education to be responsible for the transaction shall certify the bill to the encumbrance clerk for payment. The encumbrance clerk, however, shall not pay any bill unless it is, or is properly supported by, an itemized invoice clearly describing each item purchased, the quantity of each item, its unit price, and its total cost. The bill and/or invoice shall be filed in the encumbrance clerk's official records. If a district has the ability to electronically utilize evaluated receipt settlement (ERS), the district may remit to vendors on that basis if the requirements of this subsection are fulfilled. In the event a district is establishing electronic data interchange, electronic entries will suffice in lieu of paper documents. In order for a district to be authorized to utilize an evaluated receipt settlement system:

   1. 1. The ERS must have received the prior approval of the State Auditor and Inspector as conforming to industry standards governing ERS systems;
   2. 2. The ERS must result in payment by the district from vendor receipts that have been matched to the purchase order date;
   3. 3. The ERS may only be used when there is an agreement between the district and the vendor for use of an ERS; and
   4. 4. The ERS must be included in the district's journal ledger/accounts payable/purchase order software.
6. F. The encumbrance clerk shall debit the encumbrances outstanding account and credit the accounts payable account for the amount of the approved bill. The board of education shall determine the extent such costs may fluctuate without additional board action. Minor adjustments not requiring additional board approval shall be referenced to the original encumbrance.
7. G. After ascertaining that proper accounting of the purchase has been made and that the files contain sufficient information to justify the expenditure of public funds, the encumbrance clerk shall pay the approved bill by issuing a warrant against the designated fund, except as otherwise provided in subsection I of this section. The warrants so issued shall be consecutively numbered in the order of their issuance. The encumbrance clerk shall charge the warrant against the accounts payable account and credit it to the warrants issued account. Provided, if payment is to be made immediately and the board of education deems it advisable, the postings to the accounts payable account may be omitted and the payment of the approved bill may be credited directly to the warrants issued account. The warrant shall show on its face the name of the school district, the date of issue, the payee, the amount, the expenditure classification code, and such other information as may be necessary or desirable. The president and clerk of the board of education shall each sign the warrant, thereby denoting to the public that the warrant is for the purpose and within the amount of the appropriation charged.
8. H. The warrant shall then be delivered to the treasurer of the school district who shall register the same in the warrant register, charging the appropriation account and crediting the warrants outstanding account of the designated fund. Provided, no warrant shall be registered in excess of the appropriation account's balance. All warrants shall be registered in the order of their issuance number. Voided warrants shall be registered and filed with the treasurer. The warrants against each fund shall be payable in the order of their issue. The treasurer shall sign each warrant showing its registration date and stating whether the warrant is payable or nonpayable. When funds become available, nonpayable warrants shall be called in the same manner as that now provided by law. When a properly payable warrant is presented to the treasurer, the treasurer shall issue a check in payment thereof. The payment shall be charged to the warrants payable account and credited to the cash account of the fund involved.
9. I. In lieu of issuing such warrant as provided for in subsection G of this section, the treasurer of any school district may, upon notification from the encumbrance clerk that the bill is approved for payment, enter the warrant on the warrant register and record payment of the warrant by check, wire transfer, direct payroll deposit, or other instrument or method of disbursement through the Federal Reserve System.
10. J. School districts complying with the provisions of this act shall use only those forms and accounting systems approved by the State Board of Education. Such forms and systems shall be considered in substantial compliance with this act if they are sufficient to convey the meaning and sequence of transactions contained herein. Provided, nothing contained herein shall be construed to limit or prevent the use of additional or subsidiary accounts, forms, or files which may be deemed necessary or advisable by the board of education of the district or the State Board of Education.
11. K. Any school district desiring to utilize the services of a data processing center to furnish any or all of the records herein required may do so if the center and its system complies with this act and the rules and regulations of the State Board of Education. Such center shall furnish an honesty bond in an amount to be set by the board of education but not less than Ten Thousand Dollars ($10,000.00).
12. L. The State Board of Education shall notify the board of education of the school district of the tentative amount said district is to receive from state and federal aid funds or allocations, and the board of education of the school district may include such tentative estimate as an item of probable income in the preparation of the school district's Estimate of Needs and Financial Statement; provided, no such federal aid estimate shall be used in any way to reduce the State Foundation Aid or Incentive Aid for such school district or sustain a protest for the reduction of a tax levy.

Laws 1985, HB 1252, c. 82, § 5, eff. November 1, 1985; Amended by Laws 1988, HB 1935, c. 90, § 20, emerg. eff. July 1, 1988; Amended by Laws 1990, HB 2167, c. 221, § 10, emerg. eff. July 1, 1990; Amended by Laws 1998, HB 2909, c. 365, § 10, emerg. eff. July 1, 1998 (superseded document available).