TJ WALKER - THE HABIT INFLUENCER - Personal Development | LIVE STREAM

Welcome to Spotlight Chat, a conversation with leaders. Our special guest today is Hussein Gunai. He is the Director of Research and Compliance for Accord Education. Hussain, thanks for joining us. First of all, what is a Director of Research and compliance?

Thank you. Director of Research and Compliance collects data from schools, especially charter schools that we are working with and check them for their compliance, transparency and accountability in terms of their data, governance and finances.

And you are public schools. You work with public schools, public tax dollars, which means a much higher degree of transparency and accountability because you've got politicians looking at you, lawmakers, regulators, parents and students, of course. What are the metrics that people care about the most? Traditionally you hear in the mainstream media, Reading rates, graduation rates, what else do you measure?

Those are the education site. I am on a different site. My site is going to look at for transparency of the data and the finances. For example, if you have a decision, if you make a decision at the school in governance, board level or executive level, then you have to be transparent about those decisions. At the end of the day, the money that you are going to spend is tax dollars, right? And then you have to be compliant with the laws and regulations even though these are mandated by federal, state or your own policies and procedures. And then afterwards you have to be accountable what you are doing, you have to do what you are supposed to do. I don't want to take accountability as in a term that you have to be held accountable for the mistakes that you make, but actually for the things that you are doing.

And how do you help your client schools figure out the best way? Because proper spending is in the eye of the beholder. There are, for example, public schools in Texas that spend $90 million on a football stadium. And apparently people there think that's a wise use of spending. And maybe it's not all tax dollars. Maybe they raise some of it through parents and other things. Other people would look at that and say these people are crazy. That's the most wasteful form of spending ever. How do you help people figure out what's, what's a wise use of spending and what is something that's really going to raise red flags by regulators, lawmakers.

And others in all levels, governance and financials, whether the decision time or spending time. We are checking the school with pre audits, for example, we have audit preparation where we go and check the decision levels. Who has the authority, what is the level of authority and what was it.

Just the basics of figuring out whether this is legitimate or not.

It is legitimate. It is legitimate. If you do it In a way. For example, there are certain ratios in the industry. Suppose you are a public charter school. If you are spending only 30% of your fund for the teachers, that is not going good because at the end of the day your basic thing that you are doing is education in general. 55% is the benchmark for the industry to spend on your teachers salaries and benefits. If you're going below that, then you are not doing your job correctly maybe. Or if you are spending 30% of your funds to your building, this is really high cost, then people will start questioning you. But if you are in the like, you know, certain limits, for example, 15% of your funds is going to your facilities, then you are doing your job correctly. That's what we are checking with our pre audit. We have financial ratios analysis which checks all these things. Whether the money is spent correctly and they are meeting with the certain benchmarks and with governance and structure analysis, we are checking whether the policies and procedures are working correctly and the authorities like you know, giving their authorization at the time that they are supposed to. And with the financial operations side, we are checking whether the accounting is working in the school correctly.

How do you actually determine what is officially classroom spending? Some parents are listening to this and obviously people say well of course I want my tax dollars going for spending in the classroom and not for high paid administrators. But how do you actually define that? If you're buying a textbook, that's a teacher salary. If you're paying for a teacher's pension, which they deserve, that's not directly in the moment helping the student. Students need some playgrounds and that's not in the. What actually gets defined as classroom spending versus other administrative costs?

Administrative costs are the salaries and benefits paid to the administration and executives and office per staff. Other than that, everything is pretty much spent in the classroom, in the class, in the school. As I mentioned, facility, 15% that is like, you know, the need for the students to be taught. And 55% salary and benefits for the teachers that is also spent in the classroom. That makes up to 70%. Then 10% for the operations which can include the cost of books and other stuffs. That's adding up to 80% of the funds are going to the basically the need of the students in the school. Then There are like 10% for the administration, 5% for contingency, 5% for reserves which are mandated by the state. Then you're pretty much spending most of your money to classroom.

Actually you have charter schools around the country in many states come to you higher a Court education for help. What is your biggest challenge in helping them with their compliance? Where are the areas that are easiest to sort of get off the right track and how do you steer them back?

Oh, I see. There are certain areas where, for example, facility costs are higher, like California, that can put you into stress in terms of your budget. And in some areas, policies and procedures are not settled down. They are not like, you know, working in proper order. Those are the areas that we are having most of the challenges.

So.

For example, in accounting, if there's a missing check, there's a problem there, right? There are like, you know, certain ways of procedures that you can add into your policies and procedures and then you can avoid them. There are, there are always going to be mistakes. I'm not saying that like it's not going to happen, but there are always going to be mistakes. But you are trying to make minimize the mistakes and errors that you can make in a school environment. That's how we help them review their policies and procedures and check whether they are working properly in the school system. Do they have checks and balances in school system? A couple of people are checking it or not. The ratios are satisfied, ratio percentages are satisfied. That's how we check the schools.

A lot of spending. There are gray areas. It's a balancing act because. Because with, for example, facilities, yeah, you could spend too much and it's. Next thing you know, it's 50% of your revenues if you're in the fanciest part of town. But if you just focus on saving money, you could rent an office building or a facility in the poorest, most dangerous part of town. Yeah, you're saving money. But if students are afraid of getting beaten up on the way to school, that's not really helping either. How do you find the right balancing part of the spectrum when it comes to money on facilities?

It is difficult. In most of the areas it is difficult and well, you do your due diligence, you do your homework and then hope for the best. And also we encourage charter schools to save some money from their reserves and try to have a fund because if you have 60 days of cash, it will ease your bond financing for the future facility projects. And if you are sound school working in the field for 10 years and having a good waiting list, having a good number of students, it might ease you to have facilities projects in the future where you can bond finance. That is how we are helping them as well. We are checking whether they have the proper reserves, more than that, whether those reserves are enough for them to have their dream facility in the future where it can be chosen at nice place. If you do your due diligence and your search perfect building, you can construct from ground up or you do the renovation in already existing building according to the codes and stuff. That's why we help them as well.

The organization is Accord Education. For information go to the website and we've linked to it in the show notes. That's accord education.org Hussein Gunai thank you so much for being our guest today. Thank you for listening to Spotlight Chat, a conversation with leaders.