Financial Management:
A Course for School Nutrition Managers
Pre - Assessment
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Place an identifier at the top of the page.
You will use the same identifier when you complete
the Post Assessment.
You do not need to place your name on the
Assessment.
Financial Management for Managers
Activity: Managers Need To Know
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What are things school nutrition managers need to
know regarding financial management?
Financial Management for Managers
Objectives
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Assess competencies, knowledge, and skills of
financial management
Examine the advantages of cycle menus
Recognize the importance of standardized recipes
and the financial benefit of USDA Foods
Recognize key information when forecasting menu
item usage
Calculate the cost of menu items
Identify purchasing controls
Identify inventory controls
Financial Management for Managers
Objectives, Continued
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Identify ways to control labor costs
Calculate Full-Time Equivalent (FTE)
Calculate Meals Per Labor Hour (MPLH)
Implement processes and procedures that minimize
financial risk
Develop and use tools to facilitate the
communication of financial data and information
Recall the benefits of financial information as it
relates to your school nutrition program
Financial Management for Managers
Terms and Definitions
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Terms and Definitions Handout
Financial Management for Managers
Importance of Financial Management
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Changing federal regulations
Increasing program cost
Growing demands
Financial Management for Managers
Nonprofit School Nutrition Program Fund
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Flow of school nutrition program funds
Requirements for establishing a nonprofit school
nutrition program account
Program revenue requirements
Financial Management for Managers
Office of Management and Budget (OMB)
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Terms and conditions
Fundamental guidelines
Financial integrity of SNP
Financial Management for Managers
School Nutrition Program Fund
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The OMB cost circulars outline cost principles which
ensure that taxpayer’s resources are appropriately
used to carry out the Federal programs as the
Federal agencies are responsible for the stewardship
of these resources.
Financial Management for Managers
School Nutrition Fund Flow
United States Department
of Agriculture
State Agency
(SA)
School Food Authority
(SFA)
Financial Management for Managers
Budget-Manager’s Role
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Participate in preparation and review process
Keep budget on file
Evaluate income and expenditures
Amend as necessary
Financial Management for Managers
Financial Management Practices
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Indicators are analyzed regularly
Prices based on established criteria
Financial records are cross-checked
Compare expenditures to revenues
Participation is analyzed monthly
Financial Management for Managers
Internal Controls
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Written policies
Authorized individuals
Monitored by an independent review
Trained employees
Financial Management for Managers
Financial Management Skills
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Competencies, Knowledge, and Skill Statements for
District-Level School Nutrition Professionals in the
21st Century
Financial Management for Managers
Activity: Self-Assessment
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Self-Assessment Handout
Evaluate your current skills level
Financial Management for Managers
Activity:
Financially Sound School Nutrition Program
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What purchasing tools and processes contribute to a
financially sound nutrition program?
Financial Management for Managers
Menus
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Driving force of school nutrition operation
Definition of cycle menus
Financial Management for Managers
Activity: Cycle Menu Advantages
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Cycle Menu Activities Handout
Advantages of Cycle Menus
Financial Management for Managers
Stock-Keeping Units (SKUs)
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Multiple uses for the same product
Example: each flavor of juice has a different SKU
Best practice - reduce SKUs
Financial Management for Managers
Standardized Recipes
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Tried, adapted, and retried several times
Recipe produces the same good results and yield
every time
Specific quantity for each ingredient and portion size
Financial Management for Managers
Activity: Importance of Standardized Recipes
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Take about 10 minutes to work together at your
tables and list the advantages of using standardized
recipes.
Financial Management for Managers
USDA Foods
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Meet meal pattern requirements
Coincide with the principles in the Dietary Guidelines
for Americans
Add variety to the school menu
Provide cost savings to the SNP
Financial Management for Managers
USDA Foods Value
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Financial Benefits of Using USDA Foods: BBQ Pulled
Pork Example Handout
Financial Management for Managers
Food Production Records
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Required
Demonstrates required food components
Lists menu items offered and served
Used to document reimbursable meals
Evaluate how menu items contributed to meeting
nutrition standards
Keep for three years plus the current year
Financial Management for Managers
Production Record—Value
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Used to forecast product estimates
Provides historical data (forecasting)
Identifies excessive labor
Identifies potential waste
Identifies unfavorable items
Financial Management for Managers
Forecasting
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Past
Present
Future
Financial Management for Managers
Activity: Forecasting Number of Servings
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Sample Forecasting Number of a Servings Handout
Financial Management for Managers
Activity: Extra Servings Scenario
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Extra Servings Handout
Financial Management for Managers
Activity: Financial Control in Food Preparation
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Work together at your tables and make a list of ways
to enhance financial control during food preparation.
Financial Management for Managers
Batch Cooking
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Batch cooking and “just-in-time” (JIT) cooking used
interchangeably
Small quantities maintain higher quality
Amount prepared not to exceed servings needed in
established time (15–30 minutes)
Takes place continuously throughout the meal
service
Financial Management for Managers
Activity: Batch Cooking
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Batch Cooking Handout
Financial Management for Managers
Portion Control
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Production records
Standardized recipes
Nutritional analysis
Age-appropriate portion sizes
Financial Management for Managers
Activity: Portion Control
Tilapia Garnished with Citrus Sauce
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Tilapia Garnished with Citrus Sauce Handout
Financial Management for Managers
Controlling Cost and Waste
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Procedures to minimize waste
Controlling waste – operational factors and customer
acceptability
Financial Management for Managers
Activity: Controlling Waste
 Work together at your tables and list ways to control
waste.
Financial Management for Managers
Food Buying Guide
http://fbg.nfsmi.org
Financial Management for Managers
Food Buying Guide Information
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Contains both specific food product information and
general operational information
Provides the yields, or the amount of servings
obtained in a purchased unit of different products
such as fruits, vegetables, grains, meats/meat
alternates, and dairy products
Financial Management for Managers
Food Guide Buying Calculator
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A tool to help calculate quantity of food to purchase
Individual calculators for each of the 6 food groups
http://fbg.nfsmi.org/
Financial Management for Managers
As Purchased (AP) and Edible Portion (EP)
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AP refers to the weight of the product as it exists
when purchased.
EP refers to the part of the product that can be
consumed.
AP weight is greater than EP weight.
Financial Management for Managers
Calculate the Cost of Menu Item
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Meet the needs of the recipe
Reduce waste
Determine product loss
Determine preparation
Financial Management for Managers
Activity: Purchasing Decision, Broccoli
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Purchasing Decision Handout
Financial Management for Managers
Product Screening
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Not required
Establish procedures
Financial Management for Managers
Screening
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Paper Screening
Appearance Screening
Taste Screening
Financial Management for Managers
Paper Screening
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Product label
Description of the product
Nutritional analysis
Financial Management for Managers
Appearance Screening
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Examines appearance of product
Determines if product appearance is wanted or
expected
Financial Management for Managers
Appearance Screening - Package
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Individually wrapped
Integrity of the product
Financial Management for Managers
Taste Screening
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Determine criteria in advance
Document customer satisfaction
Screen adults and students
Financial Management for Managers
Activity: Financial Advantages of Product
Screening
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What are the financial advantages of product
screening?
Financial Management for Managers
Inventory Control
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Receiving
Storage
USDA Foods value
Financial Management for Managers
Receiving Strategies
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Procedures
Financial Management for Managers
Activity: Best Practice Receiving
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Work as a team and identify several best practices
receiving strategies.
Financial Management for Managers
Storage
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Proper conditions
Financial Management for Managers
Activity: Storage Area Organization
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What are typical storage areas?
Financial Management for Managers
Activity: Dry Storage
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List categories you might use to group foods in dry
storage.
Storage Area Handout
Financial Management for Managers
Inventory
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Control
Financial Management for Managers
Inventory Methods
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Perpetual inventory
Physical inventory
Financial Management for Managers
USDA Foods and Commercial Inventory
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Value of USDA Foods
Single inventory concept
Inventory Handout
Perpetual Inventory Control Example Form
Physical Inventory Example Handout
Financial Management for Managers
Value of Inventory
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Purchase price = invoice price
Replacement cost = most recent price paid for the
product
Weighted average price = average price paid for each
product in inventory
Financial Management for Managers
Inventory Turnover
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Greater the turnover the more efficient the
operation
Items are available
Reducing risk of theft
Reducing risk of waste
Financial Management for Managers
Food Cost
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Follow standard operating procedures.
Maintain the correct inventory levels.
Have needed product on hand.
Prevent the need for more expensive substitution.
Ensure food is used in a timely manner.
Financial Management for Managers
Activity: Calculate Cost of Food Used and
Inventory Turnover
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Calculate Cost of Food Used and Inventory Turnover
Handout
Financial Management for Managers
Par Stock Levels
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Predetermined inventory quantity for food item
Serves as in indicator to reorder the product
Financial Management for Managers
Expenditures
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Food costs
Labor costs
Supply Costs
Purchased services
Transportation
Indirect
Financial Management for Managers
Food Costs
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Within guidelines
Ascertain sufficient funds to pay expenditures
Establish the cost for each meal
Prevent waste and food theft
Financial Management for Managers
Ways to Reduce Food Cost
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Ways to Lower Food Costs in School Nutrition
Programs Handout
Financial Management for Managers
Meal Equivalents
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USDA does not prescribe one method to calculate
meal equivalents.
School meals must be converted to a standard.
Nonprogram food sales are converted to lunch
standard.
Calculate meal equivalents based on full cost of
reimbursable lunch.
Financial Management for Managers
Equates Meals to a Standard
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A student reimbursable lunch is the standard unit of
measurement most often used.
Counting meal and food sales other than lunch is not
clear-cut.
Meal equivalents are used for determining per meal
cost, productivity ratios, and Meals Per labor Hours
(MPLH).
Financial Management for Managers
Meal Cost Meal Equivalents Calculations
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Convert different types of meals and nonprogram
revenues to numbers of meals equivalents served.
Breakfast, lunch, snacks, and nonprogram food sales
such as a la carte must be converted.
Check with state agency for guidance.
Financial Management for Managers
Activity: Meal Equivalents
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Breakfast Meal Equivalents Handout, Afterschool
Snacks Meal Equivalents Handout
Nonprogram School Nutrition Sales Handout
Financial Management for Managers
Per Meal Costs
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Meal cost as a benchmark
Essential to good financial analysis of SNP
Determine on a regular basis
Per Meal Cost Calculation Handout
Financial Management for Managers
Labor Costs
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What are ways to control labor costs in school
nutrition programs?
Financial Management for Managers
Staffing
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Determination of appropriate number of workers
needed for work to be accomplished
Established guidelines essential
Impacts financial management
Financial Management for Managers
Scheduling
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What are implications of poor scheduling?
Financial Management for Managers
Activity: Production Task Schedule
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Production task Schedule Example Handout
Financial Management for Managers
Full-Time Equivalent (FTE)
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1.0 = one full-time employee
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Holiday, sick leave, vacation, or other time off not
considered FTE
Financial Management for Managers
Activity: FTE Calculations
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Number of employees x hours worked per day
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Total hours per week x number of days
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Hours per week ÷ 40 hours per week
Financial Management for Managers
Meals Per Labor Hours
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Meals Per labor Hours (MPLH) productivity index
Actual hours assigned
Financial Management for Managers
Activity: Meals Per Labor Hours
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Meals Per Labor Hours Handout
Financial Management for Managers
Fraud Prevention
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Accounting
Internal Organization
External Organization
Financial Management for Managers
Internal Controls
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Compliance
Cash handling
Deposits
Funds for allowable cost
Appropriate accounting methods
Monitoring, authorizing, and recording
Financial Management for Managers
Activity: Cash Handling Practices
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What are some procedures to prevent fraud or theft?
Cash Handling Procedures-Good Practices Handout
Financial Management for Managers
Activity: Customer and Employee Theft
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Work in small teams and discuss ways to prevent
customer and employee theft.
Theft Prevention Measures Handout
Financial Management for Managers
Communicating Financial Information
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Checklist
Financial Management for Managers
Activity: Communicating with the School
Nutrition Director
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What operational concerns directly related to the
financial impact of your program should be
communicated to your director?
Financial Management for Managers
Thank You!
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Post - Assessment
Evaluations
Financial Management for Managers
National Food Service Management Institute
www.nfsmi.org
800-321-3054
Financial Management for
Managers