What is a Fund Balance? Why is maintaining a large Fund Balance so important?
Fund Balance is a measure of net financial assets, which is similar, but not identical to, equity or accumulated savings. In other words, it is like the balance in your checking account. Deposits are like assets, and the bills you need to pay are like your liabilities. What remains is generally considered your available balance, or a “rainy day fund.” Maintaining a healthy Fund Balance allows the District to get a high bond rating which affects our credit-worthiness. In addition, the State requires that we have a minimum of one month’s worth of operating expenses in our Fund Balance.
